<PAGE> 1
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 Section 240.14a-11(c) or Section 240.14a-12
THE BISYS 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)(4) 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> 2
[BYSYS LOGO]
THE BISYS GROUP, INC.
150 CLOVE ROAD
LITTLE FALLS, NEW JERSEY 07424
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
NOVEMBER 16, 2000
The Annual Meeting of Stockholders of The BISYS Group, Inc. ("BISYS" or
the "Company") will be held at the executive offices of the Company at 150 Clove
Road, Little Falls, New Jersey 07424, on November 16, 2000, at 9:00 a.m., for
the following purposes:
1. to re-elect seven directors to hold office until the next
Annual Meeting of Stockholders and until their respective
successors shall have been duly elected and qualified;
2. to consider and vote upon a proposal to amend the Company's
Amended and Restated Certificate of Incorporation;
3. to consider and vote upon a proposal to approve the Company's
2001Employee Stock Purchase Plan;
4. to consider and vote upon a proposal to ratify the appointment
of PricewaterhouseCoopers LLP, independent public accountants,
as the auditors of the Company for the fiscal year ending June
30, 2001; and
5. to transact such other business as may properly come before
the meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on September 29,
2000 as the record date for the determination of the stockholders of the Company
entitled to notice of and to vote at the Annual Meeting of Stockholders. Each
share of the Company's Common Stock outstanding on the record date is entitled
to one vote on all matters presented at the Annual Meeting.
ALL HOLDERS OF THE COMPANY'S COMMON STOCK (WHETHER THEY EXPECT TO
ATTEND THE ANNUAL MEETING OR NOT) ARE REQUESTED TO COMPLETE, SIGN, DATE AND
RETURN PROMPTLY THE PROXY CARD ENCLOSED WITH THIS NOTICE.
By Order of the Board of Directors
Kevin J. Dell
Secretary
October 11, 2000
<PAGE> 3
THE BISYS GROUP, INC.
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
NOVEMBER 16, 2000
This Proxy Statement is being furnished to stockholders of record of The
BISYS Group, Inc. ("BISYS" or the "Company") as of September 29, 2000 (the
"Record Date") in connection with the solicitation by the Board of Directors of
BISYS of proxies for the 2000 Annual Meeting of Stockholders (the "Annual
Meeting") to be held at the Company's corporate headquarters at 150 Clove Road,
Little Falls, New Jersey 07424, on November 16, 2000 at 9:00 a.m., and at any
adjournments thereof, for the purposes stated in the Notice of Annual Meeting.
The approximate date of mailing of this Proxy Statement and enclosed form of
proxy to stockholders is October 9, 2000.
As of the Record Date, the Company had outstanding 27,8xx,xxx shares of
Common Stock, $.02 par value ("Common Stock"). Each share of Common Stock
outstanding on the Record Date is entitled to one vote on all matters presented
at the Annual Meeting. A majority of the outstanding shares entitled to vote at
the Annual Meeting will constitute a quorum. Abstentions and broker non-votes
are counted as present for purposes of determining whether a quorum is present.
Directors are elected by a plurality of votes cast. All other matters to
properly come before the Annual Meeting require the approval of a majority of
shares of Common Stock present and entitled to vote with respect to such
matters, except that Proposal 2 (amendment to the Amended and Restated
Certificate of Incorporation) requires the affirmative vote of a majority of the
issued and outstanding shares of Common Stock. Abstentions and broker non-votes
have no impact on the election of directors except to reduce the number of votes
for the nominee(s). With respect to all other proposals, abstentions as to
particular proposals will have the same effect as votes against such proposals,
whereas broker non-votes are not counted as votes and are not included in
calculating the number of votes necessary for approval, except for Proposal 2
(amendment to the Amended and Restated Certificate of Incorporation) where
broker non-votes will have the effect of a vote against that proposal.
If the enclosed proxy is signed and returned, it may, nevertheless, be
revoked at any time prior to the voting thereof at the pleasure of the
stockholder signing it, either by a written notice of revocation received by the
person or persons named therein or by voting the shares covered thereby in
person or by another proxy dated subsequent to the date thereof.
Shares represented by duly executed proxies in the accompanying form
will be voted in accordance with the instructions indicated on such proxies,
and, if no such instructions are indicated thereon, will be voted in favor of
the nominees for election as directors named below and for the other proposals
referred to below. If any other matters properly come before the Annual Meeting,
it is intended that the persons named as proxies will vote such shares in
accordance with their own judgment.
1. ELECTION OF DIRECTORS
Seven directors are standing for re-election to the Board at the Annual
Meeting for terms expiring at the 2001 Annual Meeting. Accordingly, there are
seven nominees for election as directors, and proxies may not be voted for a
greater number of persons than the seven nominees named herein. The directors
will continue to serve until their respective successors are duly elected and
qualified.
Shares represented by proxies returned duly executed will be voted,
unless otherwise specified, in favor of the seven nominees for the Board of
Directors named below. If any (or all) such persons should be unable to serve,
the persons named in the enclosed proxy will vote the shares of Common Stock
covered thereby for such substitute nominee (or nominees) as the Board of
Directors may select. Stockholders may withhold authority to vote for any
nominee by entering the name of such nominee in the space provided for such
purpose on the proxy card.
<PAGE> 4
NOMINEES FOR ELECTION AS DIRECTOR
<TABLE>
<CAPTION>
Name Principal Occupation Served as Director Since
---- -------------------- ------------------------
<S> <C> <C>
LYNN J. MANGUM Chairman of the Board, President and 1989
Chief Executive Officer of BISYS.
ROBERT J. CASALE Until retirement, Group President, Brokerage Information 1997
Services, Automatic Data Processing, Inc.
THOMAS A. COOPER Chairman, TAC Associates, a financial advisory and 1997
investment firm.
JAY W. DEDAPPER Until retirement, Executive Vice President (Operations) 1989
NL Industries, Inc., a metal, chemical and petroleum company.
JOHN J. LYONS President and Chief Operating Officer, Keefe Managers, Inc., 1992
a New York City-based asset management firm and
registered investment company.
THOMAS E. MCINERNEY General Partner of Welsh, Carson, Anderson & Stowe, a 1989
New York investment firm.
JOSEPH J. MELONE Until retirement, President and Chief Executive Officer, 1999
The Equitable Cos., Inc.
</TABLE>
DIRECTORS AND EXECUTIVE OFFICERS
Set forth below is certain information with respect to each of the
nominees for the office of director and each other executive officer of BISYS:
NOMINEES
MR. MANGUM, 58, has served as a Director and as Chairman of the Board
and Chief Executive Officer of the Company since its founding in August 1989. He
was elected President of the Company in May 1998. Prior to August 1989, he
served as a Corporate Vice President of Automatic Data Processing, Inc. ("ADP")
and as Division President of ADP's Employer Services National Accounts Division
since December 1988. Prior thereto, he served for 22 years in various capacities
in ADP's Financial Services Group including, among other positions, Division
President of the predecessor company of the Company since 1983.
MR. CASALE, 61, has served as a Director of the Company since 1997. Mr.
Casale is the former Group President, ADP, Brokerage Information Services, a
position in which he served from 1988 to 1997. His experience also includes
serving as Managing Director, Mergers & Acquisitions/Corporate Finance of the
High Technology Group of Kidder, Peabody & Co. and more than 10 years in various
executive positions with AT&T, including President-elect of AT&T's Special
Markets Group, responsible for major joint ventures and partnerships. He is a
member of the Board of Directors of The Provident Mutual Life Insurance Company
and the Quantum Corporation, a publicly held disk drive manufacturer.
MR. COOPER, 64, has served as a Director of the Company since 1997. Mr.
Cooper is and has been Chairman of TAC Associates, a financial advisory and
investment firm, since 1996, and Chairman of Flatiron Credit Company, a finance
company, since 1997. He previously served since its formation and until 1996 as
Chairman of TAC Bancshares, Inc., a holding company formed in 1991 to acquire
and operate financial service
2
<PAGE> 5
institutions. From August 1993 to August 1996, he served as Chairman, President
and Chief Executive Officer of Chase Federal Bank, Florida, following the
acquisition and merger of Chase Federal Bank and Financial Federal Bank by TAC
Bancshares in August 1993. Mr. Cooper has over 30 years of broad experience in
financial services which include serving as Chief Executive Officer of Goldome,
one of the nation's largest thrift institutions, from 1988 to 1991; as Chairman
and Chief Executive Officer of INVEST/ISFA Corporation, a provider of brokerage,
investment, insurance, and related services from 1987 to 1988; and as President
and Chief Operating Officer of Bank of America, and President of BankAmerica
Corporation from 1985 to 1987. He is a member of the Board of Directors of
Renaissance Reinsurance, a publicly held reinsurance company.
MR. DEDAPPER, 76, has served as a Director of the Company since 1989.
Prior to his retirement in 1981, he served for more than five years as Executive
Vice President (Operations) of NL Industries, Inc., a metal, chemical and
petroleum company and served on its Board of Directors.
MR. LYONS, 60, has served as a Director of the Company since 1992.
Since February 1999, Mr. Lyons has served as President and Chief Operating
Officer of Keefe Managers, Inc., a New York City-based asset management firm and
registered investment company. From September 1997 to February 1999 he served as
President and Chief Executive Officer of Gateway American Bank of Florida, a
community bank headquartered in Ft. Lauderdale, Florida. From August 1996 to
April 1997, Mr. Lyons served as President and Chief Executive Officer of Regent
National Bank, Philadelphia, Pennsylvania. From April 1995 to August 1996, he
served as President and Chief Executive Officer and a Director of Monarch
Savings Bank, FSB, Clark, New Jersey. From December 1993 until April 1995, he
was President and Chief Executive Officer of Jupiter Tequesta National Bank, a
national bank headquartered in Tequesta, Florida. From 1980 until December 1993,
he was President and Chief Executive Officer of Lyons, Zomback & Ostrowski,
Inc., a New York-based bank and thrift consulting firm. That firm became a
subsidiary of Advest Group, Inc., a holding company with a brokerage firm as its
principal subsidiary. Mr. Lyons was Vice Chairman of Advest, Inc. during 1993
and from 1989 through 1993 was a member of its Board of Directors. He is a
director of Gateway American Bank of Florida, a publicly held banking company.
MR. MCINERNEY, 59, has served as a Director of the Company since 1989.
Mr. McInerney is, and has been since 1987, a general partner of Welsh, Carson,
Anderson & Stowe, a private equity investor specializing in the information
processing and healthcare industries, and is a general partner of the respective
sole general partners of its associated limited partnerships. He is a director
of the following publicly held companies: SpectraSite Holdings Inc., a provider
of wireless communication transmitting and receiving facilities; Centennial
Communications Corporation, a provider of voice and data communications
services; and Savvis Communications Corp., an international network services
provider. He is also a director of several private companies.
MR. MELONE, 69, has served as a Director of the Company since August
1999. He retired as President and Chief Executive Officer of The Equitable Cos.,
Inc. in 1998, a position in which he served since 1996. He previously served
from 1992 through 1995 as President and Chief Operating Officer of the company
upon its formation in 1992 after serving two years in the same position for its
principal insurance subsidiary, The Equitable Life Assurance Society of the
United States. Prior to joining Equitable, Mr. Melone served as President of The
Prudential Insurance Company of America. He is a member of the Board of
Directors of Foster Wheeler Corporation, a publicly held engineering and
construction company.
All directors are elected annually and hold office until the next
annual meeting of stockholders and until their successors are duly elected and
qualified. Each of the non-employee directors (i.e., other than Mr. Mangum)
receive a $15,000 annual retainer and a $1,000 fee for their personal attendance
at each meeting, including committee meetings held other than the day of a Board
meeting. Mr. Mangum does not receive any compensation for his services as a
director, but is reimbursed for expenses. Pursuant to the Company's Non-
Employee Directors' Stock Option Plan, as amended (the "Non-Employee Directors'
Stock Option Plan"), which became effective, as amended, at the 1997 Annual
Meeting of Stockholders, each person who was a non-employee
3
<PAGE> 6
director of the Company at that time (i.e., nominees other than Messrs. Mangum
and Melone) was granted an option to purchase 25,000 shares of Common Stock at
an exercise price of $34.00 per share, the fair market value of a share of
Common Stock on the date of grant. Pursuant to the Non-Employee Directors' Stock
Option Plan, each non-employee director of the Company elected thereafter by
stockholders will be granted an option to purchase 25,000 shares of Common Stock
upon his initial election by stockholders as a director. Accordingly, Mr. Melone
was granted an option to purchase 25,000 shares of Common Stock upon his initial
election by stockholders as a director at the November 12, 1999 Annual Meeting
of Stockholders at an exercise price of $54.50 per share, the fair market value
on the date of grant. Each such option vests 20% on the date of grant and 20%
upon such director's re-election by stockholders at subsequent annual meetings
until such option is fully vested. Each such option is exercisable to the extent
vested. A new stock option for an additional 25,000 shares of Common Stock will
be granted to a non-employee director upon re-election at the next annual
meeting after the annual meeting at which any prior option becomes fully vested.
All stock options under the Non- Employee Directors' Plan are granted at an
exercise price equal to the fair market value of a share of Common Stock on the
date of grant. There are 275,000 shares of Common Stock reserved for options
under the Non- Employee Directors' Stock Option Plan, of which 85,600 shares are
currently available for future options which may be granted thereunder.
During fiscal 2000, the Board of Directors of the Company held five
meetings. The standing committees of the Board of Directors are the Audit
Committee, whose current members are Messrs. Cooper and DeDapper, and the
Compensation Committee, whose current members are Messrs. Casale and Lyons. The
Audit Committee periodically consults with the Company's management and
independent public accountants on financial matters, including the Company's
internal financial controls and procedures. The Audit Committee held four
meetings in fiscal 2000. The Compensation Committee reviews and makes
recommendations with respect to the salary and incentive compensation of the
Chief Executive Officer and his direct reports, and certain other employees of
the Company and its subsidiaries whose salaries are in excess of specified
levels; administers the Company's stock option plans, including the granting of
stock options and rights to purchase Common Stock; and administers the Company's
annual Employee Stock Purchase Plan, as approved by the stockholders. During
fiscal 2000, the Compensation Committee held four meetings. The Board of
Directors of the Company does not have a standing Nomination Committee. During
fiscal 2000, all of the Company's directors, other than Mr. McInerney, attended
at least 75% of the meetings of the Board of Directors, and all committees on
which they served. Mr. McInerney attended three out of five, or 60%, of the
meetings of the Board of Directors.
OTHER EXECUTIVE OFFICERS
KEVIN J. DELL, 44, serves as Executive Vice President, General Counsel
and Secretary. He previously served since 1998 as Senior Vice President, having
joined the Company as Vice President, General Counsel and Secretary in 1996.
From 1993 until he joined the Company, he served as Vice President, General
Counsel and Secretary of Concurrent Computer Corporation, a public company
supplier of real-time computer systems.
J. ROBERT JONES, 47, serves as Executive Vice President, Business
Development of the Company. He previously served as Senior Vice President,
Business Development since 1996 and in a similar position within the BISYS
organization since 1991. From March 1989 to June 1991, Mr. Jones served as Vice
President, Sales and Marketing.
NEIL P. MARCOUS, 52, serves as Executive Vice President, Strategic
Marketing and Technology. He joined the Company in May 1998 as Executive Vice
President, including responsibilities as Group President, Marketing and
Information Services. Prior to joining the Company, he served as Vice
President/General Manager of the Electronic Commerce Division of Electronic Data
Systems, Inc., a provider of information technologies services including
electronic funds transfer services, since joining that company in 1989. He
served as a Director of the Company from 1994 to 1998.
4
<PAGE> 7
WILLIAM W. NEVILLE, 46, serves as Executive Vice President, including
responsibilities as Group President, Information Services. He previously served
since 1997 as President of the Information Solutions division. He joined the
Company in 1992 as Senior Vice President/General Manager Sales, Eastern Region
of the Information Solutions division.
LEONARD L. REYNOLDS, 55, serves as Executive Vice President, including
responsibilities as Group President, Insurance and Education Services. He joined
the Company in July 2000 as Group President following the Company's acquisition
of Ascensus Insurance Services, Inc. where he served as President since its
founding in 1996. Prior to joining the Company, he served as President of
Accordia Personal Benefits of Utah, Inc., an insurance carrier, from 1992 to
1996.
MARK J. RYBARCZYK, 45, serves as Executive Vice President, Human
Resources of the Company. He previously served as Senior Vice President, Human
Resources since 1993. He has also served as Vice President, Human Resources of
the Company and its predecessor company since June 1987 and Director, Human
Resources since October 1984.
DENNIS R. SHEEHAN, 44, serves as Executive Vice President and Chief
Financial Officer of the Company, a position to which he was elected in February
1998. He previously served as Senior Vice President, Finance of the Company,
which became an executive officer position in 1997 and served in a similar
position within the BISYS organization since joining BISYS in connection with
its acquisition of Concord Holding Corporation ("Concord") in March 1995. Since
1992, he served in various executive officer positions with Concord, including
Executive Vice President and Chief Financial Officer.
WILLIAM J. TOMKO, 42, serves as Executive Vice President, including
responsibilities as Group President, Investment Services, a position to which he
was promoted in September 2000. He previously served as President of the BISYS
Fund Services division since 1999 and served in various other management and
executive officer positions with that company since joining BISYS in 1993
following its acquisition of the Winsbury Group.
Executive officers serve at the discretion of the Board of Directors.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Based on a review of Forms 3, 4 and 5 submitted to the Company during
and with respect to fiscal 2000, all statements of beneficial ownership required
to be filed with the Securities and Exchange Commission (the "Commission") were
timely filed, with the exception of one Form 4 for Mr. Neville, reporting in
September 2000 his May 5, 2000 sale of 500 shares at a sale price of $61.08 per
share and his May 16, 2000 sale of 500 shares at a sale price of $61.32 per
share. Forms 4 were timely filed for Mr. Marcous but inadvertently failed to
include the grant of options to purchase 40,000 shares of Common Stock of the
Company at an exercise price of $50.375 on August 20, 1999 which was
subsequently reported on Form 5 timely filed. A review of prior filings for Mr.
Jones revealed that a prior year Form 4 filing failed to include his acquisition
of 530 shares on December 31, 1998 at a purchase price of $28.26 pursuant to the
Company's 1998 Employee Stock Purchase Plan, which was subsequently reported in
his August 2000 Form 4 statement filed September 2000. A similar review of prior
filings for Mr. Rybarczyk revealed that certain prior transactions inadvertently
had not been included. Mr. Rybarczyk's Form 4 for August 2000 filed September
2000 included these previously unreported prior transactions: the sale of 2,500
shares of Common Stock of the Company on May 21, 1997 at a sale price of $36.50;
the sale of 1,500 shares of Common Stock on March 2, 1998 at a sale price of
$33.56; and the gift of 1,055 shares of Common Stock on March 1, 1999.
5
<PAGE> 8
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information, based on filings
with the Commission for the period ended June 30, 2000, with respect to the
shares of Common Stock beneficially owned by stockholders reporting ownership of
more than 5%of the 27,807,047 outstanding shares of Common Stock as of June 30,
2000:
<TABLE>
<CAPTION>
BENEFICIAL OWNER NUMBER OF SHARES BENEFICIALLY OWNED PERCENT OF CLASS
---------------- ----------------------------------- ----------------
<S> <C> <C>
Massachusetts Financial Services Company 3,187,605(1) 11.5%
500 Boylston Street
Boston, MA 02116
T. Rowe Price Associates, Inc. 1,725,500(2) 6.2%
100 East Pratt Street
Baltimore, Maryland 21202
</TABLE>
(1) The stockholder has sole investment power with respect to the shares
shown as beneficially owned by it, and sole voting power with respect
to 2,997,485 shares and no voting power with respect to the remaining
shares shown as beneficially owned by it.
(2) These securities are owned by various individual and institutional
investors for which T. Rowe Price Associates, Inc. ("Price Associates")
serves as investment adviser with power to direct investments and/or
sole power to vote the securities. For purposes of the reporting
requirements of the Securities Exchange Act of 1934, Price Associates
is deemed to be a beneficial owner of such securities; however, Price
Associates expressly disclaims that it is, in fact, the beneficial
owner of such securities. The stockholder has sole investment power
with respect to the shares shown as beneficially owned by it, and sole
voting power with respect to 244,500 shares and no voting power with
respect to the remaining shares shown as beneficially owned by it.
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<PAGE> 9
The following table sets forth, as of the September 29, 2000 record date,
certain information with respect to the shares of Common Stock beneficially
owned by (i) each director, (ii) each of the persons for whom compensation
information is disclosed below under the heading "Executive Compensation," and
(iii) all the Company's directors and executive officers at September 29, 2000
as a group.
<TABLE>
<CAPTION>
BENEFICIAL OWNER NO. OF SHARES BENEFICIALLY OWNED(1) PERCENT OF CLASS
---------------- ----------------------------------- ----------------
<S> <C> <C>
Lynn J. Mangum 378,808 1.3%
Robert J. Casale 5,000 *
Thomas A. Cooper 26,050 *
Jay W. DeDapper 17,900 *
John J. Lyons 25,600 *
Thomas E. McInerney 53,942 *
Joseph J. Melone 12,000 *
Dennis R. Sheehan 117,727 *
J. Robert Jones 142,270(10) *
Charles J. Mohr 3,144 *
Neil P. Marcous 35,389(11) *
All directors and executive officers
as a group (16 persons) 1,071,395(12) 3.8%
</TABLE>
* Less than 1.0%.
(1) Each person has sole voting and investment power with respect to the
shares shown as beneficially owned by him. Assumes re-election of
nominees for Director and resulting vesting of certain stock options
pursuant to the Company's Non-Employee Directors' Stock Option Plan.
(2) Includes an aggregate 30,997 shares subject to stock options
exercisable as of November 28,2000 (60 days from the record date for
the Annual Meeting).
(3) Includes an aggregate 5,000 shares subject to stock options exercisable
as of November 28, 2000.
(4) Includes an aggregate 12,998 shares subject to stock options
exercisable as of November 28, 2000.
(5) Includes an aggregate 17,400 shares subject to stock options
exercisable as of November 28, 2000.
(6) Includes an aggregate 22,732 shares subject to stock options
exercisable as of November 28, 2000.
(7) Includes an aggregate 23,600 shares subject to stock options
exercisable as of November 28, 2000.
(8) Includes an aggregate 10,000 shares subject to stock options
exercisable as of November 28, 2000.
(9) Includes an aggregate 54,480 shares subject to stock options
exercisable as of November 28, 2000.
(10) Includes an aggregate 28,937 shares subject to stock options
exercisable as of November 28, 2000.
(11) Includes an aggregate 25,289 shares subject to stock options
exercisable as of November 28, 2000.
(12) Includes an aggregate 362,848 shares subject to stock options
exercisable as of November 28, 2000.
7
<PAGE> 10
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table shows, for the fiscal years ended June 30, 2000, 1999 and
1998, certain compensation information as to the Chief Executive Officer, and
each of the four most highly compensated executive officers of the Company
serving as executive officers at June 30, 2000 ("Named Executive Officers").
<TABLE>
<CAPTION>
Long Term Comp-
Annual Compensation ensation Awards
(a) (b) (c) (d) (g) (i)
Securities All Other
Name and Principal Salary Bonus Underlying (1) Compensation(2)
Position Year ($) ($) Options/SARs (#) ($)
-------- ---- --- --- ---------------- ---
<S> <C> <C> <C> <C> <C>
Lynn J. Mangum 2000 595,057 605,000 157,616 37,797
Chairman of the Board, 1999 534,077 510,000 65,000 39,436
President and Chief 1998 449,615 475,000 65,000 30,359
Executive Officer
Dennis R. Sheehan 2000 277,768 315,000 54,500 13,297
Executive Vice President 1999 242,346 275,000 30,000 8,487
and Chief Financial Officer 1998 196,683 245,000 60,000 6,608
J. Robert Jones 2000 256,385 310,000 56,000 32,284
Executive Vice President, 1999 236,462 260,000 30,000 26,992
Business Development 1998 216,539 200,000 30,000 16,293
Charles J. Mohr (3) 2000 366,383 200,000 43,075 38,062
Executive Vice President, 1999 343,269 225,000 75,000 1,638
Group President,
Investment Services
Neil P. Marcous (3) 2000 366,383 190,000 40,000 72,201
Executive Vice President, 1999 342,885 175,000 0 55,098
Strategic Marketing and 1998 40,625 21,875 75,000 0
Technology
</TABLE>
---------------------------
(1) For fiscal year 2000, includes reload options as follows: Mr. Mangum,
72,616 options; Mr. Sheehan, 14,500 options; Mr. Jones, 16,000 options;
and Mr. Mohr, 3,075 options.
(2) For fiscal years 1998, 1999 and 2000 represents the Company's matching
contribution under the Company's 401(k) Plan as follows: Mr. Mangum
($5,000, $5,000 and $5,250); Mr. Sheehan ($5,000, $5,000 and $5,600);
Mr. Jones ($5,000, $5,000 and $5,300); Mr. Mohr ($0, $0, and $6,100);
and Mr. Marcous ($0, $3,779 and $5,150). For fiscal years 1998, 1999
and 2000, includes the economic value of a "split dollar" life
insurance policy as follows: Mr. Mangum ($1,830, $5,186 and $4,297);
Mr. Sheehan ($356, $737 and $822); Mr. Jones ($475, $992 and $984); Mr.
Mohr ($0, $1,638 and $2,212); and Mr. Marcous ($0, $1,319 and $2,051).
Also includes for fiscal years 1998, 1999 and 2000 the value of the
Company's matching contribution under a voluntary executive deferred
compensation program as follows: Mr. Mangum ($23,529, $19,250 and
$28,250); Mr. Sheehan ($1,250, $2,750 and $6,875); Mr. Jones ($10,818,
$21,000 and $26,000); Mr. Mohr ($0, $0 and $29,750); and Mr. Marcous
($0, $0 and $15,000). For Mr. Marcous, includes a $50,000 hiring
advance earned in fiscal year 1999 and 2000 as of the anniversary dates
of his employment.
(3) Mr. Mohr and Mr. Marcous became executive officers of the Company
during fiscal 1999 and 1998, respectively.
8
<PAGE> 11
STOCK OPTIONS AND STOCK APPRECIATION RIGHTS
The following table contains information concerning the grant of stock
options to the Named Executive Officers during the fiscal year ended June 30,
2000. The first grant shown for each named Executive Officer represents an
initial grant under the Company's stock option plans. The per share exercise
price for all options is the last sale price on the NASDAQ National Market
System on the trading day before the option grant. The remaining options were
granted under the Company's reload program (designated by the letter "R"). Under
this program, options holders may use BISYS common stock to pay the exercise
price of their options and have shares withheld for the payment of income taxes
due on exercise. They then receive a new reload option to make up for the shares
they used or had withheld.
Reload options maintain the option holder's commitment to BISYS by
maintaining as closely as possible the holder's net equity position - the sum of
shares owned and shares subject to option. The issuance of a reload option is
not a new discretionary grant by BISYS. Rather, the issuance results from rights
granted to the option holder pursuant to the reload program as part of the
initial grant. Reload options do not vest (i.e., become exercisable) for six
months. The expiration date of the reload option is the same as that of the
initial underlying grant.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
NUMBER OF % OF TOTAL POTENTIAL REALIZABLE VALUE
SECURITIES OPTIONS EXERCISE AT ASSUMED ANNUAL RATES OF
UNDERLYING GRANTED OR BASE STOCK PRICE APPRECIATION FOR
OPTIONS TO EMPLOYEES IN PRICE EXPIRATION OPTION TERM
NAME GRANTED FISCAL YEAR ($/SH) DATE 5% ($) (1) 10% ($) (1)
---- ------- ----------- ------ ---- ---------- -----------
<S> <C> <C> <C> <C> <C> <C>
Lynn J. Mangum 85,000 7.0% 50.375 8/20/09 2,692,848 6,824,206
21,410 R 1.8% 45.0625 8/22/05 328,120 744,393
1,589 R 2.6% 45.0625 8/15/06 579,499 1,350,479
19,617 R 1.6% 45.0625 8/14/07 422,066 1,010,922
Charles J. Mohr 40,000 3.3% 50.375 8/20/09 1,267,223 3,211,391
3,075 R 0.3% 45.0625 7/6/08 76,396 188,167
Dennis R. Sheehan 40,000 R 3.3% 50.375 8/20/09 1,267,223 3,211,391
3,244 R 0.3% 45.0625 11/14/06 59,511 138,686
3,018 R 0.3% 45.0625 8/14/07 64,933 155,527
8,238 R 0.7% 45.0625 2/26/08 177,243 424,529
Neil P. Marcous 40,000 R 3.3% 50.375 8/20/09 1,267,223 3,211,391
J. Robert Jones 40,000 R 3.3% 50.375 8/20/09 1,267,223 3,211,391
6,946 R 0.6% 45.0625 8/22/05 106,451 241,502
9,054 R 0.8% 45.0625 8,14,07 194,800 466,580
</TABLE>
-----------------------------
(1) The dollar amounts under these columns are based on the assumed
appreciation rates of 5% and 10% prescribed by the Commission. These
amounts are not intended to forecast possible future appreciation, if
any, of the Company's stock price.
9
<PAGE> 12
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR END
OPTION VALUES
The following table sets forth information with respect to the Named
Executive Officers concerning the exercise of options during the last fiscal
year and unexercised options held at the end of the fiscal year ended June 30,
2000 based on the last sale price of a share of Common Stock on June 30, 2000 of
$61.50.
<TABLE>
<CAPTION>
Shares Number of Securities
Acquired Underlying Unexercised Value of Unexercised
on Options at Fiscal In-the-Money Options at
Exercise Value Year End (#) Fiscal Year End
Name (#) Realized ($) Exercisable/Unexercisable Exercisable/Unexercisable
---- --- ------------ ------------------------- -------------------------
<S> <C> <C> <C> <C> <C> <C>
Lynn J. Mangum 306,214 $7,480,038 112,593 226,000 $2,798,926 $4,996,125
Dennis R. Sheehan 52,884 $1,257,512 52,892 110,000 $1,602,494 $2,264,250
0
J. Robert Jones 107,583 $2,762,222 49,417 94,000 $1,609,675 $2,022,500
Charles J. Mohr 3,219 $ 9,858 14,856 100,000 $ 317,415 $1,865,000
Neil P. Marcous 33,911 $ 974,714 12,289 95,000 $ 333,339 $2,103,125
</TABLE>
LOANS TO EXECUTIVE OFFICERS
The Board of Directors has approved and the Company has made interest
free loans to selected executive officers to assist them in exercising
non-qualified stock options, retaining the underlying shares and paying the
applicable taxes resulting from such exercises. Of the approximately $11.3
million in principal amount of the loans, approximately $9 million represents
the option exercise price paid to the Company. The remaining principal amount of
approximately $2.3 million was used to pay withholding taxes resulting from the
option exercises. Since the options exercised were non-qualified options, the
resulting compensation expense is deductible for corporate income tax purposes.
These loans are full recourse and are secured by that number of the shares of
the Company's Common Stock acquired pursuant to the exercise of the option
representing up to 120% of the principal amount of the loan. The principal is
repayable the later of five years from the date of the loan or the expiration
date of the option exercised using such loan proceeds. The principal is also
repayable within one year of the employee's death or termination of employment
due to disability and within 30 days of voluntary resignation.
The table below sets forth the executive officers to whom the loans
were made, the loan principal for each officer and the number of shares acquired
through option exercises using the loans proceeds. As of October 11, 2000, no
principal amount of any loan was due, and no principal amount has been repaid.
<TABLE>
<CAPTION>
NUMBER OF SHARES OF
NAME LOAN PRINCIPAL COMMON STOCK ACQUIRED
---- -------------- ---------------------
<S> <C> <C>
Lynn J. Mangum $5,636,968 150,237
Dennis R. Sheehan $ 941,476 28,979
J. Robert Jones $2,479,051 82,999
Mark J. Rybarczyk $1,718,879 48,702
Kevin J. Dell $ 570,172 14,056
</TABLE>
In addition, the Board of Directors has authorized a payment to each
loan recipient to cover the individual income taxes, if any, incurred by such
individual as a result of the imputed income on the interest free loan to the
extent that such imputed income is not offset by the deductibility of the loan
interest. The payment will be grossed up to cover any additional taxes resulting
from such payment.
10
<PAGE> 13
EMPLOYMENT AGREEMENTS
The Company does not have employment agreements with any of the Named
Executive Officers. In June 1999, the Company entered into Key Executive
Separation Agreements with Messrs. Mangum, Sheehan and Jones, and certain other
executive officers of the Company. The Agreement with Mr. Mangum replaced a
similar agreement entered into in 1995. The Agreements provide for certain lump
sum severance payments in the event of termination other than for cause or
following a change in control of the Company. For terminations other than for
cause, the executive would receive one time (one and one-half times in the case
of Mr. Mangum) the sum of (i) his then current base salary and (ii) the greater
of his then current fiscal year "at Plan" annual incentive target amount or the
immediately prior year's annual incentive compensation settlement amount (such
sum, prior to being multiplied, referred to as the "Applicable Severance
Amount"). For terminations after a change in control, the executive would
receive two times (three times in the case of Mr. Mangum) his Applicable
Severance Amount. In the event of a change in control of the Company, the
executive may unilaterally terminate his employment with the Company for any
reason during the first 12 months after the change in control and, under certain
circumstances, during the 13th through 36th month after the change in control.
In the event of such termination of employment, he would receive a lump sum
severance payment equal to two times (three times in the case of Mr. Mangum) his
Applicable Severance Amount. The Agreement does not provide any guarantee of
employment or any other terms and conditions of employment.
Pursuant to the terms of their stock option agreements, in the event of
a change in control of the Company, all options then granted to the executive
officers of the Company become automatically vested, to the extent not
previously vested, as of the effective date of such change in control.
REPORT ON EXECUTIVE COMPENSATION
All issues relating to executive officer compensation are addressed by
the Board of Director's Compensation Committee. The Compensation Committee,
which for fiscal 2000 was comprised of Messrs. Lyons and Casale, approves base
salary and incentive compensation plans for executive officers reporting to the
chief executive officer and other senior executives with a base salary in excess
of a designated amount, and reviews and recommends base salary and incentive
compensation plans for executive officers who are also directors for final
approval by the Board of Directors. Mr. Mangum, the Company's Chairman,
President and Chief Executive Officer, does not participate in decisions of the
Board regarding his compensation. The Compensation Committee also establishes
stock option plan participation levels for all employees, including executive
officers. This report is submitted by the Compensation Committee.
The components of the Company's executive compensation program consist
of base salaries, annual cash incentive plans and stock options. The Company's
compensation program, with Committee review, is intended to provide executive
officers with overall levels of compensation opportunity that are competitive
within the information, investment, and insurance and education services
industries, as well as within a broader spectrum of companies of comparable size
and complexity. Competitive compensation information is determined from
published sources as well as independent consultants. The Company's compensation
program is structured and administered to support the Company's business mission
and to generate favorable returns for its stockholders.
BASE SALARY. Each executive officer's base salary is derived primarily
through an analysis of appropriate industry and competitive labor markets for
executive officer services, prepared at the direction of the Committee by the
Company's Human Resources department with the advice of independent consultants.
Other factors in formulating base salary recommendations include the level of an
executive's compensation in relation to other executives in the Company with the
same, more or less responsibilities, the performance of the particular
executive's business unit or department in relation to established strategic
plans, the Company's operating budget for the year and the overall financial and
strategic performance of the Company compared to target objectives.
11
<PAGE> 14
INCENTIVE COMPENSATION PLAN. For each executive officer, a cash
incentive compensation plan is established at the beginning of each fiscal year
in connection with the establishment of the Company's strategic plans and annual
operating budgets. Each individual's plan establishes a range of minimum, "at
Plan" and maximum incentive compensation and a number of performance objectives.
The performance objectives generally include operating earnings per share
growth, the financial performance of an executive's business unit, and various
other measurable financial and non-financial objectives. Incentive compensation
earned is determined following completion of the fiscal year based on
performance compared to objectives. Incentive compensation in excess of the
established range may be paid where outstanding accomplishments have been
achieved by the executive during the fiscal year. For fiscal year 2000, the
Company and each of the Named Executive Officers met or exceeded established
performance objectives resulting in the bonus compensation set forth in the
Summary Compensation Table.
STOCK OPTION AWARDS. The Company maintains stock option plans that are
designed to align executive employees' and stockholders' interests in the
enhancement of stockholder value. In formulating recommendations for stock
option awards, the Compensation Committee evaluates the dilutive impact of
additional stock options, the Company's overall financial performance for the
year, the desirability of long-term service from an executive officer and the
number of options held by other executives of the Company with the same, more or
less responsibility than the executive officer under consideration. To encourage
long-term performance, stock options typically vest over a five year period and
remain exercisable for ten years.
CEO COMPENSATION. Compensation for Mr. Mangum, the Company's Chairman,
President and Chief Executive Officer, is based on the same criteria used for
executive officers generally, including an analysis of chief executive
compensation of comparable companies. Mr. Mangum's incentive compensation for
fiscal 2000 reflects favorable achievement of the performance objectives
established under his cash incentive plan, particularly revenue and operating
earnings per share growth, and the strategic positioning of the Company, which
were the key determinants of Mr. Mangum's incentive compensation under his cash
incentive plan.
August 17, 2000 John J. Lyons
Robert J. Casale
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The members of the Company's Compensation Committee during fiscal year
2000 were John J. Lyons and Robert J. Casale, each of whom are directors but are
not current or former employees of the Company. There were no Compensation
Committee interlocks or insider participation during fiscal year 2000.
12
<PAGE> 15
PERFORMANCE GRAPH
Set forth below is a line graph comparing the yearly percentage change over
the past five fiscal years in the cumulative shareholder return (assuming the
reinvestment of dividends) on the Company's Common Stock with the cumulative
total returns of both a broad equity market index (S&P MidCap 400 Index) and a
peer group index (S&P Super Composite Services (Data Processing) Index).
Assumes $100 invested on June 30, 1995 in BISYS Common Stock and each of
the broad market and published industry group indices.
<TABLE>
<CAPTION>
6/30/95 6/30/96 6/30/97 6/30/98 6/30/99 6/30/00
<S> <C> <C> <C> <C> <C> <C>
BISYS $100 $169.7 $187.6 $184.3 $262.9 $276.4
S&P MidCap 400 Index $100 $121.6 $149.9 $190.6 $223.4 $261.3
S&P Super Composite
Services (Data Processing) $100 $140.4 $161.3 $195.4 $241.5 $285.6
Index
</TABLE>
The above report of the Compensation Committee and the Performance Graph is
not deemed to be soliciting material or to be filed with or incorporated by
reference into any filing by the Company under the Securities Act of 1933, as
amended, or the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), except to the extent that the Company specifically incorporates such
report or graph by reference.
13
<PAGE> 16
2. APPROVAL OF AMENDMENT TO THE COMPANY'S AMENDED AND RESTATED CERTIFICATE OF
INCORPORATION TO INCREASE THE COMPANY'S AUTHORIZED SHARES OF STOCK FROM
80,000,000 SHARES OF COMMON STOCK TO 160,000,000 SHARES OF COMMON STOCK
On September 21, 2000,at the same time it adopted resolutions declaring a 2
for 1 stock split in the form of a stock dividend, the Board of Directors of the
Company adopted resolutions approving an amendment to the Company's Amended and
Restated Certificate of Incorporation (the "Restated Certificate") to increase
the Company's authorized number of shares of stock from 80,000,000 shares of
Common Stock to 160,000,000 shares of Common Stock, consistent with the 2 for 1
stock split. The Board adopted the amendment, and recommends the amendment to
stockholders, because the Board believes that it is advisable and in the
Company's best interests to have available authorized and unissued shares in an
amount adequate to provide for the future needs of the Company.
VOTE REQUIRED FOR APPROVAL
The amendment to the Restated Certificate will be submitted to stockholders
for their approval at the Annual Meeting. The affirmative vote of a majority of
the outstanding shares of Common Stock entitled to vote at the Annual Meeting is
required for approval of the proposal to amend the Restated Certificate.
SUMMARY OF PROPOSAL
The proposed amendment will modify the first sentence of Article FOURTH of
the Restated Certificate to read as follows:
"FOURTH: The total number of shares of stock which the Corporation
shall have authority to issue is 160,000,000 shares, consisting of
160,000,000 shares of Common Stock, $.02 par value (the "Common
Stock")."
The Company is currently authorized to issue 80,000,000 shares of stock,
consisting solely of Common Stock. The proposed amendment would increase the
total number of shares of authorized stock to 160,000,000 shares of Common
Stock. As of the September 29, 2000 record date for the Annual Meeting,
27,8xx,xxx shares of Common Stock were issued and outstanding, and approximately
_________ additional shares of Common Stock were reserved for issuance under the
Company's stock option plans and 2000 Employee Stock Purchase Plan.
On October 20, 2000, the Company will effect a 2 for 1 stock split in the
form of a stock dividend, which will utilize approximately 27.9 million shares
of Common Stock. The Board of Directors of the Company believes that it is
advisable and in the best interests of the Company to have available additional
authorized but unissued shares of Common Stock in an amount adequate to provide
for the future needs of the Company. Following the effectiveness of the stock
dividend, the increase in authorized Common Stock will result in the Company
having the same percentage of shares of Common Stock available for issuance as
prior to the stock dividend.
The increase in authorized Common Stock will not have an immediate effect
on the rights of existing stockholders. However, the additional shares will be
available for issuance from time to time by the Company in the discretion of the
Board of Directors without further authorization by vote of the stockholders
unless such authorization is otherwise required by applicable law or regulation.
These shares may be issued for any proper corporate purpose including, without
limitation: acquiring other businesses in exchange for shares of the Company's
Common Stock; entering into joint venture or similar arrangements with other
companies in which Common Stock or the right to acquire Common Stock are part of
the consideration; stock splits or stock dividends; raising capital through the
sale of Common Stock; attracting and retaining valuable employees by the
issuance of additional stock options or use of stock-based compensation plans;
assumption of stock options held by employees of companies acquired by the
Company; and the issuance of Common Stock pursuant to the Company's stockholder
rights plan, for which an insufficient number of shares of Common Stock is
currently available as a
14
<PAGE> 17
result of the October 2000 stock dividend. Although the Company may engage in
the foregoing actions in the future, except for the issuance of shares upon
exercise of outstanding stock options, the issuance of additional stock options
under the Company's 1999 Equity Participation Plan, and the issuance of shares
under the Company's 2000 Employee Stock Purchase Plan, no such actions involving
the issuance of additional shares of Common Stock are pending as of the date
hereof. If the proposed amendment is approved, the Board of Directors would be
able to authorize the issuance of shares of Common Stock without the necessity,
and related costs or delays, of either calling a special stockholders' meeting
or waiting for the next Annual Meeting of Stockholders to increase the
authorized shares of Common Stock.
Shares of Common Stock, including the additional shares proposed for
authorization, do not have preemptive or similar rights, and current
stockholders will not have a prior right to purchase any new issue of Common
Stock of the Company in order to maintain their proportionate ownership of
Common Stock. Each additional authorized share of Common Stock will have the
same rights and privileges as currently authorized common stock.
The issuance of the additional shares of Common Stock could have the effect
of diluting earnings per share and book value per share, which could adversely
affect the Company's existing stockholders. Issuing additional shares of Common
Stock could dilute the voting rights of stockholders and could be issued in one
or more transactions that could have the effect of delaying, making more costly
or preventing a change of control or takeover of the Company. The proposed
amendment to the Restated Certificate is not being recommended in response to
any specific effort of which the Company is aware to obtain control of the
Company, and the Board of Directors has no present intention to use the
additional shares of Common Stock in order to impede a takeover attempt.
The affirmative vote of a majority of the outstanding shares of Common
Stock entitled to vote at the Annual Meeting is required for approval of this
amendment to the Restated Certificate to increase the Company's authorized
shares of Common Stock.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" APPROVAL OF THE
AMENDMENT TO THE RESTATED CERTIFICATE.
3. APPROVAL OF THE 2001 EMPLOYEE STOCK PURCHASE PLAN
On August 17, 2000, the Board of Directors of the Company adopted, subject
to stockholder approval, The BISYS Group, Inc., 2001 Employee Stock Purchase
Plan (the "2001 Plan"). Under the 2001 Plan, which is intended to qualify as an
"employee stock purchase plan" under Section 423 of the Internal Revenue Code of
1986, as amended (the "Code"), options to purchase shares of Common Stock
(hereinafter, "Employee Options") will be granted to eligible employees of the
Company. The Board of Directors believes that the grant of Employee Options is
an important incentive for attracting, retaining and motivating employees
through the opportunity of equity participation. The 2001 Plan in intended to
serve this function. A copy of the 2001 Plan is attached to this Proxy Statement
as Exhibit A. The principal features of the 2001 Plan are summarized below.
VOTE REQUIRED FOR APPROVAL
The 2001 Plan will be submitted to stockholders for their approval at the
Annual Meeting. The proposal to adopt the 2001 Plan must be approval the
affirmative vote of the holders of a majority of the shares of Common Stock
present or represented by proxy and entitled to vote at the Annual Meeting.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT STOCKHOLDERS VOTE
"FOR" APPROVAL OF THE 2001 PLAN.
15
<PAGE> 18
SUMMARY OF THE 2001 PLAN
An aggregate of 350,000 shares of Common Stock (after giving effect to the
stock dividend anticipated to take place on or about October 20, 2000) have been
reserved for issuance upon the exercise of Employee Options granted under the
2001 Plan, subject to stockholder approval of the 2001 Plan. If approved by
stockholders, the 2000 Plan will become effective on January 1, 2001. The 2001
Plan will terminate on December 31, 2001, unless it is earlier terminated by the
Board of Directors. The approximately 3,500 employees who are regularly
scheduled to work for the Company, or its subsidiaries, at least 20 hours per
week and who have completed one month of employment as of January 1, 2001 for
the Company, or its subsidiaries, will be eligible to receive Employee Options.
In addition, any persons who become employees of the Company during 2001 by
virtue of a merger or acquisition (whether such transaction involves the
acquisition of stock or assets) (an "Acquisition") and who meet the remaining
eligibility requirements ("Acquired Employees") will be eligible to receive
Employee Options as of the first day of the calendar quarter following such
Acquisition. The maximum number of shares that may be purchased by any
participant under the 2001 Plan will be equal to the lesser of 15% of base pay
or $25,000, divided by 85% of the lesser of the fair market value of the
Company's Common Stock on January 1, 2001 (or, in the case of Acquired
Employees, the higher of the fair market value of the Company's Common Stock on
January 1, 2001 or their eligibility date) and December 31, 2001 based upon the
closing price of the Common Stock on the Nasdaq National Market on the most
recent prior trading day. No employee will be granted an Employee Option if (i)
immediately after such grant such employee would own stock possessing 5% or more
(including stock subject to outstanding options) of the total combined voting
power or value of all classes of stock of the Company; or (ii) the exercise of
such Employee Option would result in the employee acquiring a cumulative total
of more than 1,400 shares of Common Stock under the 2001 Plan. In the event that
any outstanding Employee Option expires or is terminated for any reason, the
shares allocable to the unexercised portion of such Employee Option will be
available for issuance under the 2001 Plan.
Under the 2001 Plan, the exercise price of an Employee Option will be the
lower of: (i) 85% of the fair market value of a share of Common Stock on January
1, 2001 (or, in the case of Acquired Employees, the higher of the fair market
value of the Company's Common Stock on January 1, 2001 or their eligibility
date) based upon the closing price of the Common Stock on the Nasdaq National
Market on December 31, 2000 or (ii) 85% of the fair market value of a share of
Common Stock on December 31, 2001, based upon the closing price of the Common
Stock on the Nasdaq National Market on December 31, 2001. All Employee Options
will be deemed to be exercised on December 31, 2001.
The 2001 Plan will be administered by the Compensation Committee of the
Board of Directors. The Committee's authority to administer the 2001 Plan
includes the authority (i) to interpret the 2001 Plan and decide any matters
arising thereunder and (ii) to adopt such rules and regulations, not
inconsistent with the provisions of the 2001 Plan, as it may deem advisable to
carry out the purposes of the 2001 Plan. All expenses and liabilities incurred
by the Board of Directors or the Committee in administering the 2001 Plan are to
be borne by the Company.
The 2001 Plan provides that Employee Options are not transferable other
than by will or by the laws of descent and distribution, and during an
optionee's lifetime an Employee Option is exercisable only by an optionee. In
the event that after the adoption of the 2001 Plan the outstanding shares of the
Company's Common Stock are increased or decreased or changed into or exchanged
for a different number or kind of shares of stock or other securities of the
Company or of another corporation through reorganization, merger or
consolidation, recapitalization, stock split, split-up, combination or exchange
of shares or declaration of any dividends payable in Common Stock, the number of
shares of Common Stock (and the price per share) subject to the unexercised
portion of any outstanding Employee Option and the number of shares for which
Employee Options may be granted under the 2001 Plan will be appropriately
adjusted (to the nearest possible full share) by the Board of Directors, and
such adjustment shall be effective and binding for all purposes. Notwithstanding
the foregoing, the Board may make such adjustment as it deems equitable in
respect of outstanding Employee Options, including, without limitation, the
revision or cancellation of any outstanding Employee Options, in the event of an
offer to acquire the outstanding shares of the Company or a transaction
involving the sale of all or substantially all of the assets of the Company.
16
<PAGE> 19
The market value of the Common Stock as of the close of business on
September 29, 2000, as reflected by the closing price of the Common Stock on the
Nasdaq National Market, was $______ per share. The decision whether to
participate in the 2001 Plan, and the extent of such participation, is in the
discretion of each eligible employee and, thus, the amount of Employee Options
to be granted is presently not determinable. To date, no Employee Options have
been granted.
FEDERAL INCOME TAX CONSEQUENCES
The tax consequences of the Employee Options issuable under the 2001 Plan
are complex. Therefore, the description of tax consequences set forth below is
necessarily general in nature and does not purport to be complete. Moreover,
statutory provisions are subject to change, as are their interpretations, and
their application may vary in individual circumstances. The tax consequences
under applicable state and local income tax laws may not be the same as under
the federal income tax laws.
Employee Options granted pursuant to the 2001 Plan are intended to qualify
as options issued under an "employee stock purchase plan" within the meaning of
Section 423 of the Code. If an optionee makes no disposi tion of the shares
acquired pursuant to exercise of an Employee Option within one year after the
transfer of shares to such optionee and within two years from grant of the
option, then, (i) such optionee will realize no taxable income as a result of
the grant or exercise of such Employee Option, and (ii) on the subsequent
disposition of the shares received upon exercise of the Employee Option or the
death of the optionee, the optionee generally will realize ordinary compensation
income equal to the lesser of (a) the excess of the fair market value of the
shares at the time of such disposition or death over the exercise price, or (b)
15% of the fair market value of the shares at the time the Employee Option was
granted. In the case of such a disposition, the optionee's basis in the shares
will be increased by the amount of ordinary compensation so realized, with the
result that the optionee generally will realize long-term capital gain or loss
equal to the difference, if any, between the proceeds realized from the
disposition over the sum of (x) the exercise price and (y) the amount of
ordinary compensation income realized. Under these circumstances, the Company
will not be entitled to a deduction for federal income tax purposes with respect
to either the issuance of the Employee Options, the transfer of shares upon
their exercise or the disposition of those shares.
If shares subject to an Employee Option are disposed of prior to the
expiration of the above time periods, the optionee will recognize ordinary
income in the year in which the disqualifying disposition occurs, the amount of
which will generally be the lesser of (i) the excess of the fair market value of
the shares on the date of exercise over the exercise price, or (ii) the gain
recognized on such disposition. Such amount will ordinarily be deductible by the
Company for federal income tax purposes in the same year, provided that the
Company satisfies certain federal income tax withholding requirements. In
addition, the excess, if any, of the amount realized on a disqualifying
disposition over the fair market value of the shares on the date of exercise
generally will be treated as short-term capital gain.
4. RATIFICATION OF APPOINTMENT OF AUDITORS
The Board of Directors has appointed the firm of PricewaterhouseCoopers
LLP, independent public accountants, as the auditors of the Company for the
fiscal year ending June 30, 2001, subject to the ratification of such
appointment by stockholders at the Annual Meeting. This firm and Coopers &
Lybrand L.L.P. (which merged with Price Waterhouse LLP in 1998 to form
PricewaterhouseCoopers LLP) have audited the Company's financial statements
since the Company's inception in 1989.
If the foregoing appointment of PricewaterhouseCoopers LLP is not ratified
by stockholders, the Board of Directors will appoint other independent
accountants whose appointment for any period subsequent to the 2001 Annual
Meeting of Stockholders will be subject to the approval of stockholders at that
meeting. A representative of PricewaterhouseCoopers LLP will be present at the
Annual Meeting and will have an opportunity to make a statement should he so
desire and to respond to appropriate questions.
17
<PAGE> 20
VOTE REQUIRED FOR RATIFICATION
The proposal to ratify the appointment of PricewaterhouseCoopers LLP as the
auditors of the Company for fiscal 2001 must be approved by the affirmative vote
of the holders of a majority of the shares of Common Stock present or
represented by proxy and entitled to vote at the Annual Meeting.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT STOCKHOLDERS VOTE "FOR"
THE RATIFICATION OF THE APPOINTMENT OF THE FIRM OF PRICEWATERHOUSECOOPERS LLP.
OTHER MATTERS
The Board of Directors does not know of any matters that are to be
presented at the Annual Meeting other than those stated in the Notice of Annual
Meeting and referred to in this Proxy Statement. If any other matters should
properly come before the Meeting, it is intended that the proxies in the
accompanying form will be voted as the persons named therein may determine in
their discretion. The Company's Annual Report to Stockholders for the year ended
June 30, 2000 is being mailed to stockholders together with this Proxy
Statement.
SOLICITATION OF PROXIES
The cost of solicitation of proxies in the accompanying form will be borne
by the Company, including expenses in connection with preparing and mailing this
Proxy Statement. In addition to solicitation of proxies by mail, directors,
officers and employees of the Company (who will receive no additional
compensation therefor) and Corporate Investors Communications, Inc. a proxy
solicitor (for an estimated total cost to the Company of $4,500) may solicit the
return of proxies by telephone, telegram or personal interview. Arrangements
have also been made with brokerage houses and other custodians, nominees and
fiduciaries for the forwarding of solicitation material to the beneficial owners
of stock held of record by such persons, and the Company will reimburse them for
reasonable out-of-pocket expenses incurred by them in connection therewith.
Each holder of the Company's Common Stock who does not expect to be present
at the Annual Meeting or who plans to attend but who does not wish to vote in
person is urged to fill in, date and sign the proxy and return it promptly in
the enclosed return envelope.
STOCKHOLDER PROPOSALS
If any stockholder of the Company intends to present a proposal for
consideration at the 2001 Annual Meeting of Stockholders and desires to have
such proposal included in the proxy statement and form of proxy distributed by
the Board of Directors with respect to such meeting, such proposal must be
received at the Company's principal executive offices, 150 Clove Road, Little
Falls, New Jersey 07424, Attention: Secretary, not later than June 10, 2001.
DISCRETIONARY AUTHORITY
A duly executed proxy given in connection with the Company's Annual Meeting
of Stockholders in 2000 will give each of the proxies named therein
discretionary authority to vote on any matter of which the Company does not have
written notice on or before August 27, 2001 (forty-five days prior to the
anniversary date on which the Company is first mailing its proxy materials for
its 2000 Annual Meeting), without advice as to the nature of such matter in the
Company's 2001 Proxy Statement.
ANNUAL REPORT ON FORM 10-K
A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR
ENDED JUNE 30, 2000, FILED BY THE COMPANY WITH THE COMMISSION, WILL BE
FURNISHED, WITHOUT EXHIBITS, WITHOUT CHARGE TO ANY PERSON REQUESTING A COPY
THEREOF IN WRITING AND STATING THAT SUCH PERSON IS A BENEFICIAL HOLDER OF SHARES
OF COMMON STOCK OF THE COMPANY ON SEPTEMBER 29, 2000, THE RECORD DATE FOR THE
ANNUAL MEETING OF STOCKHOLDERS. REQUESTS AND INQUIRIES SHOULD BE ADDRESSED TO
THE BISYS GROUP, INC., 150 CLOVE ROAD, LITTLE FALLS, NEW JERSEY 07424,
ATTENTION: SECRETARY.
18
<PAGE> 21
EXHIBIT A
THE BISYS GROUP, INC.
2001 EMPLOYEE STOCK PURCHASE PLAN
SECTION 1. PURPOSE. The purpose of The BISYS Group, Inc. 2001 Employee
Stock Purchase Plan (the "Plan") is to promote the interests of The BISYS Group,
Inc., a Delaware corporation (the "Company") and any Subsidiary thereof (as
hereinafter defined), and its stockholders by providing an opportunity to
certain current employees of the Company or any Subsidiary thereof to purchase
Common Stock of the Company. By encouraging such stock ownership, the Company
seeks to attract, retain and motivate such employees and to encourage such
employees to devote their best efforts to the business and financial success of
the Company. It is intended that the Plan qualify as an "employee stock purchase
plan" under Section 423 of the Internal Revenue Code of 1986, as amended (the
"Code"). The provisions of the Plan shall be construed so as to extend and limit
participation in a manner consistent with the requirements of Section 423.
SECTION 2. DEFINITIONS. For purposes of this Plan, the following terms used
herein shall have the following meanings, unless a different meaning is clearly
required by the context.
2.01. "Base Pay" shall be determined as of the first business day of
December 2000 by multiplying the normal biweekly rate of a salaried Employee by
26 or the hourly rate of an hourly Employee by 2,080; provided, that, in the
case of a part-time hourly Employee, the Employee's Base Pay shall be determined
by multiplying such Employee's hourly rate by the number of regularly scheduled
hours of work for such Employee during the one-year period beginning on the
first business day of December 2000. The calculation of Base Pay shall be made
without regard to payments for overtime, shift premium, bonuses and other
special payments, commissions and other marketing incentive payments.
2.02. "Board of Directors" shall mean the Board of Directors of the
Company.
2.03. "Committee" shall mean the committee of the Board of Directors
referred to in Section 5 hereof.
2.04. "Common Stock" shall mean the Common Stock, $.02 par value, of the
Company.
2.05. "Eligibility Date" shall mean January 1, 2001; provided that any
Employee who becomes an Employee of the Company or any Subsidiary by virtue of a
merger or acquisition (whether such transaction involves the acquisition of
stock or assets) (an "Acquisition") shall have an Eligibility Date of the first
day of the calendar quarter following the completion of such acquisition.
2.06. "Employee" shall mean any person, including an officer or director of
the Company or a Subsidiary of the Company, who is customarily employed on a
full-time or part-time basis by the Company or a Subsidiary of the Company and
is regularly scheduled to work at least 20 hours per week.
2.07. "Offering" shall have the meaning described in Section 4.01.
2.08. "Option" shall mean any option to purchase Common Stock granted to an
Employee pursuant to this Plan.
2.09. "Participant" shall mean any Employee that is eligible to participate
in the Plan and who elects to participate in the Plan.
2.10. "Parent of the Company" shall have the meaning set forth in Section
424(e) of the Code.
<PAGE> 22
2.11. "Subsidiary of the Company" shall have the meaning set forth in
Section 424(f) of the Code.
SECTION 3. ELIGIBILITY AND PARTICIPATION. The following provisions shall
govern the eligibility of Employees to participate in the Plan.
3.01. Initial Eligibility. Any Employee who shall have completed one (1)
month of employment as of January 1, 2000 (including, for Employees who become
Employees by virtue of an Acquisition, employment with the acquired company)
shall be eligible to participate in the Offering.
3.02. Restrictions on Participation. Notwithstanding any provisions of the
Plan to the contrary, no Employee shall be granted an Option under the Plan
(1) if, immediately after such grant, such Employee would own stock
possessing 5% or more of the total combined voting power or value of all classes
of stock of any of the Company, a Subsidiary of the Company or the Parent of the
Company, such ownership to be determined by applying the rules of Section 424(d)
of the Code and treating stock which the Employee may purchase under outstanding
options as stock owned by the Employee; or
(2) which would permit his rights to purchase stock under the Plan (and
under any other plans of the Company qualifying under Section 423 of the Code)
to accrue at a rate which exceeds the lesser of (i) $25,000 (or, for an Employee
who becomes an Employee by virtue of an Acquisition, a pro rata portion of
$25,000 based on the portion of the year during which such Employee is eligible
to participate hereunder) or (ii) 15% of the Employee's Base Pay of fair market
value of the stock (determined at the time such Option is granted) for each
calendar year in which such Option is outstanding; or
(3) if the exercise of such Option would result in the Employee
acquiring a cumulative total of more than 1,400 shares of Common Stock under the
Plan.
3.03. Commencement of Participation. An eligible Employee may become a
Participant in the Plan by completing an authorization for a payroll deduction
on the form provided by the Company and filing it with the office of the
Executive Vice President of Human Resources of the Company on or before the date
set therefor by the Committee which date shall be prior to the Eligibility Date.
Payroll deductions shall be made from a Participant's 2001 Base Pay and shall
commence on the first regularly scheduled payday after the Eligibility Date and
shall terminate on the last regularly scheduled payday on or before December 31,
2001, unless sooner terminated by the Participant pursuant to Section 9.01.
SECTION 4. COMMON STOCK SUBJECT TO THE PLAN.
4.01. Number of Shares. The total number of shares of Common Stock for
which Options may be granted under this Plan shall not exceed in the aggregate
three hundred fifty thousand (350,000) shares of Common Stock. The Plan will be
implemented by an Offering of shares of Common Stock (the "Offering"). The
Offering shall begin on January 1, 2001 and shall terminate on December 31,
2001.
4.02. Reissuance. The shares of Common Stock that may be subject to Options
granted under this Plan may be either authorized and unissued shares or shares
reacquired at any time and now or hereafter held as treasury stock, as the
Committee may determine. In the event that any outstanding Option expires or is
terminated for any reason, the shares allocable to the unexercised portion of
such Option may again be subject to an Option granted under this Plan.
Page 2 of 6
<PAGE> 23
SECTION 5. ADMINISTRATION OF THE PLAN.
5.01. Committee. The Plan shall be administered by a committee (the
"Committee") which shall be established by the Board of Directors and shall
consist of no less than two persons. All members of the Committee shall be
"Non-Employee Directors" within the meaning of Rule 16b-3 under the Securities
Exchange Act of 1934. The Committee shall be appointed from time to time by, and
shall serve at the pleasure of, the Board of Directors.
5.02. Interpretation. The Committee shall be authorized (i) to interpret
the Plan and decide any matters arising thereunder and (ii) to adopt such rules
and regulations, not inconsistent with the provisions of the Plan, as it may
deem advisable to carry out the purpose of this Plan.
5.03. Finality. The interpretation and construction by the Committee of any
provision of the Plan, any Option granted hereunder or any agreement evidencing
any such Option shall be final and conclusive upon all parties.
5.04. Voting by Committee Members. Only members of the Committee shall vote
on any matter affecting the administration of the Plan or the granting of
Options under the Plan.
5.05. Expenses, Etc. All expenses and liabilities incurred by the Board of
Directors or the Committee in the administration of the Plan shall be borne by
the Company. The Committee may employ attorneys, consultants, accountants or
other persons in connection with the administration of the Plan. The Company,
and its officers and directors, shall be entitled to rely upon the advice,
opinions or valuations of any such persons. No member of the Board of Directors
or the Committee shall be liable for any action, determination or interpretation
taken or made in good faith with respect to the Plan or any Option granted
hereunder.
SECTION 6. PAYROLL DEDUCTIONS.
6.01. Amount of Deduction. At the time a Participant files his
authorization for payroll deduction pursuant to Section 3.03, he shall elect to
have deductions made from his pay on each payday during the time he is a
Participant in the Offering at the rate of from 1 to 15% of his Base Pay, as
determined as of the first business day of December 2000.
6.02. Participant's Account; No Interest. All payroll deductions made for a
Participant shall be credited to his account under the Plan. A Participant may
not make any separate cash payment into such account. No interest shall accrue
on amounts credited to a Participant's account under the Plan, regardless of
whether or not the funds in such account are ultimately used to acquire shares
of Common Stock.
6.03. Changes in Payroll Deductions. A Participant may discontinue his
participation in the Plan pursuant to Section 9.01, but no other change can be
made during the Offering and, specifically, a Participant may not alter the
amount of his payroll deductions for the Offering.
6.04. Use of Funds. All payroll deductions received or held by the Company
under this Plan may be used by the Company for any corporate purpose, and the
Company shall not be obligated to segregate such payroll deductions.
SECTION 7. GRANT OF OPTION.
7.01. Terms and Conditions. A description of the terms and conditions of
this Plan shall be made available to the Participants in such form and manner as
the Committee shall approve. Such description shall be consistent with this Plan
and with the treatment of Options as being issued under an "employee stock
purchase plan" under Section 423 of the Code.
Page 3 of 6
<PAGE> 24
7.02. Number of Option Shares; Pro Rata Allocation.
(a) On the Eligibility Date, each Participant shall be deemed to have been
granted an Option, subject to the limitations of Section 3.02, to purchase a
maximum number of shares of Common Stock equal to the number obtained by
multiplying (i) the percentage of the Employee's Base Pay which he has elected
to have withheld pursuant to Section 6.01 by (ii) the Employee's Base Pay and
dividing the resulting product by the lesser of : (y) the greater of: (1) 85% of
the fair market value of a share of Common Stock of the Company on January 1,
2001, based upon the closing price of the Common Stock on the Nasdaq National
Market on December 31, 1999; and (2) 85% of the fair market value of a share of
Common Stock of the Company on the Eligibility Date, based upon the closing
price of the Common Stock on the Nasdaq National Market on the day immediately
preceding the Eligibility Date; and (z) 85% of the fair market value of a share
of Common Stock of the Company on December 31, 2001, based upon the closing
price of the Common Stock on the Nasdaq National Market on December 31, 2001;
provided, however, that in no event shall the total number of shares of Common
Stock for which Options are granted exceed 350,000 shares.
(b) If the total number of shares of Common Stock for which Options would
have been granted pursuant to Section 7.02(a) would have exceeded 350,000 shares
(absent the proviso to that section), the Company shall make a pro rata
allocation of the Options available for grant in as nearly a uniform manner as
shall be practicable and as it shall determine to be equitable.
7.03. Option Price. The Option price of shares of Common Stock subject to
an Option shall be the lower of:
(a) the greater of (1) 85% of the fair market value of a share of Common
Stock of the Company on January 1, 2001, based upon the closing price of the
Common Stock on the Nasdaq National Market on December 31, 1999; and (2) 85% of
the fair market value of a share of Common Stock of the Company on the
Eligibility Date, based upon the closing price of the Common Stock on the Nasdaq
National Market on the day immediately preceding the Eligibility Date; and
(b) 85% of the fair market value of the shares of Common Stock subject to
the Option on December 31, 2001, based upon the closing price of the Common
Stock on the Nasdaq National Market on December 31, 2001.
7.04. Fair Market Value. For purposes of this Plan, the fair market value
per share of Common Stock as of any day shall mean the closing price as quoted
on the Nasdaq system on such day or, if such day is not a trading day, the last
preceding trading day. If at any time the Common Stock is not quoted in the
Nasdaq system, the fair market value of the shares of Common Stock subject to an
Option on the date the Option is granted shall be the fair market value thereof
determined in good faith by the Board of Directors.
7.05. Interest in Option Stock. A Participant shall have no interest in
shares of Common Stock covered by his Option until such Option has been
exercised.
7.06. Transferability. Neither payroll deductions credited to a
Participant's account nor Options shall be transferable otherwise than by will
or the laws of descent and distribution, and, during an Optionee's lifetime, an
Option shall be exercisable only by the Optionee.
7.07 Tax Withholding. In the event that the Company or any Parent or
Subsidiary of the Company is required to withhold any Federal, state or local
taxes in respect of any compensation income realized by the Participant as a
result of any "disqualifying disposition" of any shares of Common Stock acquired
upon exercise of an Option granted hereunder, the Company shall be entitled to
deduct from any payments of any kind otherwise due to such Participant the
aggregate amount of such Federal, state or local taxes required to be so
withheld or, if such payments are insufficient to satisfy such Federal, state or
local taxes, such Participant will be required to pay to the Company, or make
other arrangements satisfactory to the Company regarding payment to the Company
of,
Page 4 of 6
<PAGE> 25
the aggregate amount of any such taxes. All matters with respect to the total
amount of taxes to be withheld in respect of any such compensation income shall
be determined by the Committee in its sole discretion.
SECTION 8. EXERCISE OF OPTIONS.
8.01. Automatic Exercise. Unless a Participant gives written notice to the
Company of withdrawal pursuant to Section 9.01, his Option to acquire Common
Stock with payroll deductions made during any Offering will be deemed to have
been exercised automatically on December 31, 2001 for the purchase of the number
of full shares of Common Stock which the accumulated payroll deductions in his
account at that time will purchase at the applicable Option price (but not in
excess of the number of shares of Common Stock for which Options have been
granted to the Employee pursuant to Section 7.02), and any excess in his account
at that time will be returned to him.
8.02. Fractional Shares. Fractional shares will not be issued under the
Plan and any accumulated payroll deductions which would have been used to
purchase fractional shares will be returned to any Employee promptly following
the termination of the Offering.
8.03. Delivery of Stock. As promptly as practicable after December 31,
2001, the Company will deliver to each Participant, in such Participant's name,
the shares of Common Stock purchased upon exercise of such Participant's Option.
SECTION 9. WITHDRAWAL.
9.01. In General. A Participant may withdraw payroll deductions credited to
his account under the Plan at any time by giving written notice to the Executive
Vice President of Human Resources of the Company. All of the Participant's
payroll deductions credited to his account will be paid to him within 30 days
after receipt of his notice of withdrawal, and no further payroll deductions
will be made from his pay; provided, that, the Participant gives notice of
withdrawal sufficiently prior to the next scheduled payroll deduction.
9.02. Cessation of Employee Status. In the event a Participant shall cease
to be an Employee, as defined in Section 2.05, for any reason, other than as a
result of his death, the payroll deductions credited to his account will be
returned to him.
9.03. Termination Due to Death. In the event a Participant shall cease to
be an Employee, as defined in Section 2.05, by reason of his death, his legal
representative shall have the right to elect, by written notice given to the
Executive Vice President of Human Resources of the Company prior to December 31,
2001 either:
(a) to withdraw all of the payroll deductions credited to the Participant's
account under the Plan, or
(b) to exercise the Participant's Option granted under Section 7.02 for the
purchase of shares of Common Stock on December 31, 2001 for the purchase of the
number of full shares of Common Stock which the accumulated payroll deductions
in the Participant's account will purchase at the applicable Option price, and
any excess in such account will be returned to the Participant's legal
representative.
In the event that no such written notice of election shall be duly received
by the office of the Executive Vice President of Human Resources of the Company,
the Participant's legal representative shall automatically be deemed to have
elected, pursuant to paragraph (b), to exercise the Participant's Option.
SECTION 10. ADJUSTMENTS.
(a) In the event that after the adoption of the Plan by the Board of
Directors, the outstanding shares of the Company's Common Stock shall be
increased or decreased or changed into or exchanged for a different number or
Page 5 of 6
<PAGE> 26
kind of shares of stock or other securities of the Company or of another
corporation through reorganization, merger or consolidation, recapitalization,
reclassification, stock split, split-up, combination or exchange of shares or
declaration of any dividends payable in Common Stock, the Board of Directors
shall appropriately adjust (i) the number of shares of Common Stock (and the
Option price per share) subject to the unexercised portion of any outstanding
Option (to the nearest possible full share); provided, however, that the
limitations of Section 424 of the Code shall apply with respect to such
adjustments; (ii) the number of shares of Common Stock for which Options may be
granted under this Plan, as set forth in Section 4.01 hereof, and such
adjustment shall be effective and binding for all purposes of this Plan.
(b) Notwithstanding the foregoing, in the event of (i) any offer to holders
of the Company's Common Stock generally relating to the acquisition of their
shares, including, without limitation, through purchase, merger or otherwise, or
(ii) any transaction generally relating to the acquisition of substantially all
of the assets or business of the Company, the Board of Directors may make such
adjustment as it deems equitable in respect of outstanding Options including,
without limitation, the revision or cancellation of any outstanding Options. Any
such determination by the Committee shall be effective and binding for all
purposes of this Plan.
SECTION 11. EFFECT OF THE PLAN ON EMPLOYMENT RELATIONSHIP. Neither this
Plan nor any Option granted hereunder to a Participant shall be construed as
conferring upon such Participant any right to continue in the employ of the
Company or any Subsidiary as the case may be, or limit in any respect the right
of the Company or any Subsidiary to terminate such Participant's employment or
other relationship with the Company or any Subsidiary, as the case may be, at
any time.
SECTION 12. AMENDMENT OF THE PLAN. The Board of Directors may amend the
Plan from time to time as it deems desirable; provided, however, that, without
the approval of the holders of a majority of the outstanding stock of the
Company entitled to vote thereon at a meeting, the Board of Directors may not
amend the Plan (i) to increase materially the benefits accruing to Participants
under the Plan, (ii) to increase materially (except for increases due to
adjustments in accordance with Section 10 hereof) the aggregate number of shares
of Common Stock for which Options may be granted hereunder or (iii) to modify
materially the requirements as to eligibility for participation in the Plan.
SECTION 13. TERMINATION OF THE PLAN. The Board of Directors may terminate
the Plan at any time. Unless the Plan shall theretofore have been terminated by
the Board of Directors, the Plan shall terminate one year after its effective
date. No Option may be granted hereunder after termination of the Plan. The
termination or amendment of the Plan shall not alter or impair any rights or
obligations under any Option theretofore granted under the Plan.
SECTION 14. EFFECTIVE DATE OF THE PLAN. This Plan shall be effective as of
January 1, 2001, subject to approval by the holders of the majority of the
Common Stock present and represented at a special or annual meeting of the
shareholders held on or before December 31, 2000. If the Plan is not so
approved, the Plan shall not become effective.
Page 6 of 6
<PAGE> 27
THE BISYS GROUP, INC.
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
Annual Meeting of Stockholders
Friday, November 16, 2000
The undersigned stockholder of THE BISYS GROUP, INC., a Delaware
corporation, hereby appoints Dennis R. Sheehan and Kevin J. Dell, or either of
them, voting singly in the absence of the other, attorneys and proxies, with
full power of substitution and revocation, to vote, as designated below, all
shares of Common Stock of The BISYS Group, Inc., that the undersigned is
entitled to vote at the Annual Meeting of Stockholders of said corporation to be
held at 150 Clove Road, Little Falls, New Jersey 07424 on November 16, 2000, at
9:00 a.m. (local time) and at any adjournment thereof, in accordance with the
instructions on the reverse side.
This proxy when properly executed will be voted in the manner directed
herein by the undersigned stockholder. IF NO DIRECTION IS MADE, THE PROXY WILL
BE VOTED "FOR" ALL NOMINEES IN PROPOSAL NO. 1 AND "FOR" PROPOSALS NO. 2, NO. 3,
AND NO. 4. The proxies are authorized to vote as they may determine in their
discretion upon such other business as may properly come before the meeting.
PLEASE MARK, DATE AND SIGN ON THE REVERSE SIDE AND RETURN PROMPTLY USING
THE ENCLOSED ENVELOPE.
THE BISYS GROUP, INC.
P. O. BOX ?
NEW YORK, NY 10203-0357
<PAGE> 28
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ALL NOMINEES IN PROPOSAL NO. 1
AND "FOR" PROPOSALS NO. 2, NO. 3, AND NO. 4.
1. Election of Directors: FOR all nominees listed below _______
*WITHHOLD AUTHORITY to vote for all
nominees listed below ______
*EXCEPTIONS _____
Nominees: Lynn J. Mangum, Robert J. Casale, Thomas A. Cooper, Jay W.
DeDapper, John J. Lyons, Thomas E. McInerney, and Joseph J.
Melone
(INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
MARK THE "EXCEPTIONS" BOX AND WRITE THAT NOMINEE'S NAME IN THE SPACE
PROVIDED BELOW.)
Exceptions:________________________________________________________________
2. The proposal to approve an amendment to the Company's Amended and Restated
Certificate of Incorporation to increase the Company's authorized shares of
stock from 80,000,000 shares of Common Stock to 160,000,000 shares of
Common Stock.
FOR ____ AGAINST ____ ABSTAIN ____
3. The proposal to approve the Company's 2001 Employee Stock Purchase Plan.
FOR ____ AGAINST ____ ABSTAIN ____
4. The proposal to ratify the appointment of PricewaterhouseCoopers LLP as
auditors of the Company for the fiscal year ending June 30, 2001.
FOR ____ AGAINST ____ ABSTAIN ____
The proxies are authorized to vote as they may determine in their
discretion upon such other business as may properly come before the
meeting.
Change of Address and
or Comments Mark Here ____
Please sign exactly as name appears hereon. When shares are
held in name of joint holders, each should sign. When
signing as attorney, executor, trustee, guardian, etc.
please so indicate. If a corporation, please sign in full
corporate name by an authorized officer. If a partnership,
please sign in partnership name by an authorized person.
Date__________________________________________________, 2000
Signature___________________________________________________
Signature (if held jointly)_________________________________
SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY VOTES MUST BE INDICATED
USING THE ENCLOSED ENVELOPE (X) IN BLACK OR BLUE INK.
