<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 24, 1998
REGISTRATION NO. 333-66999
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- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------
PRE-EFFECTIVE AMENDMENT NO. 1
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------------
ZAMBA CORPORATION
(formerly known as Racotek, Inc.)
(Exact name of Registrant as specified in its charter)
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<S> <C> <C>
DELAWARE 3576 41-1636021
(State or other jurisdiction (Primary Standard Industrial (I.R.S. Employer
of Classification Code Number) Identification
incorporation or organization) Number)
</TABLE>
--------------------------
7301 OHMS LANE, SUITE 200
MINNEAPOLIS, MINNESOTA 55439
(612) 832-9800
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)
--------------------------
PAUL EDELHERTZ
PRESIDENT AND CHIEF EXECUTIVE OFFICER
ZAMBA CORPORATION
7301 OHMS LANE, SUITE 200
MINNEAPOLIS, MINNESOTA 55439
(612) 832-9800
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
--------------------------
COPIES TO:
MICHAEL J. SULLIVAN, ESQ.
COOLEY GODWARD LLP
FIVE PALO ALTO SQUARE
3000 EL CAMINO REAL
PALO ALTO, CALIFORNIA 94306
(650) 843-5000
--------------------------
Approximate date of commencement of proposed sale to the public:
As soon as practicable after the Registration Statement becomes effective.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. /X/
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the Prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
--------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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<PAGE>
REGISTRATION NO. 333-66999
PROSPECTUS
DATED NOVEMBER 24, 1998
ZAMBA CORPORATION
4,957,937 SHARES OF COMMON STOCK
This prospectus covers the offer and sale of an estimated 4,957,937 shares
of Zamba common stock. The common stock is being offered and sold by certain of
our securityholders. Twenty of these selling securityholders were formerly
shareholders of QuickSilver Group, Inc. QuickSilver was acquired by Zamba on
September 22, 1998 in the QuickSilver merger. As part of the QuickSilver merger,
former QuickSilver shareholders received 2,337,992 shares of Zamba common stock
and notes with an aggregate principal value of $2,161,674.82. The notes are
convertible into common stock at the option of the holder and with Zamba's
consent. Zamba may withhold its consent in its sole and absolute discretion. The
notes convert based on the twenty day average closing price, as reported on the
Nasdaq National Market, preceding the conversion request. As part of the
QuickSilver merger, one securityholder received warrants to purchase 462,247
shares of common stock at an exercise price of $0.0066623 per share. One
securityholder owns 1,000,000 shares of Series A Junior Participating Preferred
Stock. The preferred stock was issued and sold in a private placement. The
shares of preferred stock are convertible into 1,000,000 shares of common stock
when sufficient authorized common stock becomes available. Some or all of the
selling securityholders expect to sell their shares.
THE PROCEEDS AND DETERMINING THE OFFERING PRICE
All proceeds from the sale of the common stock under this prospectus will go
to the securityholders. Zamba will not receive any proceeds from sales of the
common stock. Zamba will, however, receive the exercise price of the warrants at
the time of conversion.
Zamba common stock is listed on the Nasdaq National Market under the symbol:
"ZMBA." Zamba anticipates that the common stock sold under this prospectus will
be listed on the Nasdaq National Market, although that listing has not yet been
approved. Transactions in the common stock may take place on or off the Nasdaq
National Market. The transactions may take place at prevailing market prices or
at privately negotiated prices. On November 20, 1998, the closing price of one
share of Zamba common stock on the Nasdaq National Market was $1.6563.
------------------------
THIS OFFERING INVOLVES A HIGH DEGREE OF RISK.
SEE "RISK FACTORS" BEGINNING ON PAGE 5.
------------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
No underwriting commissions or discounts will be paid by Zamba in connection
with this offering. Estimated expenses payable by Zamba in connection with this
offering are estimated to be $56,883.74. The aggregate proceeds to the selling
securityholders from the common stock will be the purchase price of the common
stock sold less the aggregate agents' commissions and underwriters' discounts,
if any, and other expenses of issuance and distribution not borne by Zamba. See
"Plan of Distribution."
November 24, 1998
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TABLE OF CONTENTS
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THE COMPANY............................................................................ 3
ADDITIONAL INFORMATION................................................................. 3
WHERE YOU CAN GET MORE INFORMATION..................................................... 3
RISK FACTORS........................................................................... 5
USE OF PROCEEDS........................................................................ 9
DIVIDEND POLICY........................................................................ 9
SELLING SECURITYHOLDERS................................................................ 10
DESCRIPTION OF WARRANTS................................................................ 11
DESCRIPTION OF PREFERRED STOCK......................................................... 11
DESCRIPTION OF NOTES................................................................... 11
PLAN OF DISTRIBUTION................................................................... 12
LEGAL MATTERS.......................................................................... 13
EXPERTS................................................................................ 13
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2
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THE COMPANY
Zamba is a national dedicated customer care consulting company. Our services
are designed to assist clients in building lasting relationships with customers,
increase the effectiveness of customer service and sales operations and improve
overall communications with customers. We deliver our services using a unique
combination of accumulated expertise in the customer care field, existing
technology and client knowledge and guarantee on time/on budget delivery of our
services. Our offices are located in Cupertino and Pleasanton, California,
Boston, Dallas, Minneapolis and other satellite locations.
Our services include the design, implementation and integration of several
enterprise level applications to facilitate sales force automation, call center
management, marketing automation and automated field service and sales. We have
successfully implemented more than 75 customer care solutions for industry
leading clients. Representative clients include: Ameritech, Bay Networks, Cisco,
3-Com, Compaq, Compucom, Hertz, Hewlett-Packard, Honeywell, MCI, Progressive,
SHL, Symbol, Qualcomm, Wang and Xerox. We have also established key partnerships
with leading customer care providers such as Calico Technology, Clarify and
CrossWorlds, to provide integrated solutions to our clients.
Zamba Corporation, formerly Racotek, Inc., was originally incorporated in
Minnesota in March 1989 and reincorporated in Delaware in August 1990. Unless
otherwise indicated, "Zamba" and the "Company" refer to Zamba Corporation, a
Delaware corporation, its wholly-owned subsidiary and predecessors. Our
principal executive offices are located at 7301 Ohms Lane, Suite 200,
Minneapolis, Minnesota 55439. Our telephone number is (612) 832-9800.
ADDITIONAL INFORMATION
We have filed with the SEC (the "SEC" or the "Commission") a registration
statement on Form S-3 under the Securities Act, with respect to the re-sale of
common stock issued in the QuickSilver merger, the exercise of the warrants, and
the conversion of the notes and preferred stock. This prospectus, which
constitutes a part of that registration statement, does not contain all the
information contained in that registration statement and its exhibits. For
further information with respect to us and the our common stock, you should
consult the registration statement and its exhibits. Statements contained in
this prospectus concerning the provisions of any documents are necessarily
summaries of those documents, and each statement is qualified in its entirety by
reference to the copy of the document filed with the SEC. The registration
statement and any of its amendments, including exhibits filed as a part of the
registration statement or an amendment to the registration statement, are
available for inspection and copying through the entities listed below. See
"Where You Can Get More Information."
WHERE YOU CAN GET MORE INFORMATION
We are subject to the informational reporting requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"). Thus, we file annual and
quarterly reports, proxy statements and other information with the Securities
and Exchange Commission. You may read, inspect, and copy any documents we file
at the Commission's public reference facilities, 450 Fifth Street, N.W., Room
1024, Washington, D.C. 20549 or in the Commission's Regional Offices at Seven
World Trade Center, 13th Floor, New York, New York 10048; and Citicorp Center,
500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511. Copies of our
filings can be obtained at prescribed rates from the Public Reference Section of
the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549. Our SEC
filings are also available to the public from the SEC's Website at
"http://www.sec.gov." Our common stock is listed on The Nasdaq National Market
and reports and other information concerning Zamba may be inspected at the
offices of The Nasdaq Stock Market at 1735 "K" Street, N.W., Washington, D.C.
20006-1500.
The SEC allows us to "incorporate by reference" the information we file with
them, which means that we can disclose important information to you by referring
you to those documents. The information incorporated by reference is considered
to be part of this prospectus, and information that we file later
3
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with the SEC will automatically update and supersede this information. We
incorporate by reference the documents listed below as (1), (2), (3) and (4):
(1) Zamba's Current Report on Form 8-K filed with the Commission on October
7, 1998;
(2) Zamba's Annual Report on Form 10-K for the year ended December 31, 1997;
(3) Zamba's Quarterly Reports on Form 10-Q for quarters ended March 31,
1998, June 30, 1998, and September 30, 1998; and
(4) The description of the Zamba's common stock set forth in Zamba's
Registration Statement on Form 8-A filed with the Commission on October
26, 1993.
Each document filed after the date of this prospectus under Sections 13(a),
13(c), 14 or 15(d) of the Exchange Act and before the termination of the
offering is also incorporated by reference into this prospectus and is made a
part of this prospectus from the date of its filing. Any statement contained in
this prospectus or a document incorporated or deemed to be incorporated by
reference in this prospectus, shall be deemed to be modified or superseded for
purposes of this prospectus to the extent that a statement contained herein or
in any subsequently-filed document which also is or is deemed to be incorporated
by reference herein modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this prospectus.
You may request a copy of these filings, except the exhibits to such
documents (unless the exhibits are specifically incorporated by reference into
such documents) at no cost. Such requests should be directed to the Secretary of
the Company, at Zamba's principal executive offices at 7301 Ohms Lane, Suite
200, Minneapolis, MN 55439, or telephone number (612) 832-9800.
YOU SHOULD RELY ONLY ON THE INFORMATION INCORPORATED BY REFERENCE OR
PROVIDED IN THIS PROSPECTUS. WE HAVE AUTHORIZED NO ONE TO PROVIDE YOU WITH
DIFFERENT INFORMATION. YOU SHOULD NOT ASSUME THAT THE INFORMATION IN THIS
PROSPECTUS IS ACCURATE AS OF ANY DATE OTHER THAN THE DATE ON THE FRONT OF THE
DOCUMENT.
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RISK FACTORS
THIS PROSPECTUS CONTAINS FORWARD-LOOKING STATEMENTS THAT INVOLVE KNOWN AND
UNKNOWN RISKS AND UNCERTAINTIES. OUR ACTUAL RESULTS, PERFORMANCE, OR
ACHIEVEMENTS COULD DIFFER MATERIALLY FROM THOSE ANTICIPATED IN, THESE
FORWARD-LOOKING STATEMENTS. YOU SHOULD CAREFULLY CONSIDER THE RISKS DESCRIBED
BELOW, ELSEWHERE IN THIS DOCUMENT AND IN THE DOCUMENTS INCORPORATED HEREIN BY
REFERENCE IN MAKING AN INVESTMENT DECISION. THE RISKS DESCRIBED BELOW MAY NOT BE
THE ONLY RISKS FACING ZAMBA.
RISKS RELATING TO THE MERGER
INTEGRATION RISKS
On September 22, 1998, we acquired QuickSilver Group, Inc. ("QuickSilver").
Integrating Zamba and QuickSilver will be a complex, time-consuming and
expensive process. Before the merger, Zamba and QuickSilver operated
independently, each with its own business, business culture, clients, employees
and systems. After the merger, Zamba and QuickSilver must operate as a combined
organization utilizing common (1) information and communication systems, (2)
operating procedures, (3) financial controls and (4) human resource practices,
including benefit, training and professional development programs. There may be
substantial difficulties, costs and delays involved in integrating Zamba and
QuickSilver. These may include:
- Distracting management from the business of the combined company
- Potential incompatibility of business cultures
- Perceived adverse change in client service standards, business focus,
billing practices, or service offerings available to clients
- Perceived uncertainty in career opportunities, benefits and the long-term
value of stock options held by employees
- Costs and delays in implementing common systems and procedures
- Potential inefficiencies in delivering services to the clients of the
combined company
- Potential inability to obtain consents of third parties required because
of the merger
- Potential inefficiencies in managing operations in Massachusetts and
California from the Minnesota headquarters
Any one or all of these factors may cause increased operating costs, lower
than anticipated financial performance or the loss of clients and employees.
Some of these factors are also outside the control of either company. The
failure to the integrate Zamba and QuickSilver would have a material adverse
effect on the business, financial condition and results of operations of the
combined company.
RISKS RELATING TO THE BUSINESS OF ZAMBA
POTENTIAL INABILITY TO ATTRACT AND RETAIN EMPLOYEES
Our business is labor-intensive and requires highly skilled employees. Most
of our employee consultants possess extensive expertise in information
technology, sales and marketing and consulting fields. To serve a growing client
base, we must continue to recruit and retain qualified personnel with expertise
in each of these three fields. Competition for such personnel is intense. We
compete for such personnel with management consulting firms, software firms and
other businesses. Many of these entities have substantially greater financial
and other resources than we do. Zamba from time to time has difficulty
recruiting a sufficient number of qualified personnel to serve existing and new
clients. If we fail to recruit and retain a sufficient number of qualified
personnel, our ability to expand our client base or services could be impaired
and our business, financial condition and results of operations could be
adversely affected.
5
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FLUCTUATION IN OPERATING RESULTS
Our net revenue and operating results may fluctuate significantly because of
a number of other factors, some of which are outside our control. These factors
may include:
- Losing key personnel and other employees
- Consummating an acquisition
- Costs of integrating acquired operations
- Fluctuations in market demand for our services, consultant hiring and
utilization
- Uncertainty and changes in our sales cycle
- Costs of obtaining or losing customers and accounts
- Increased competition and pricing pressures
- Changes in our or our competitor's business strategy, pricing and billing
policies of Zamba and its competitors
A substantial portion of our expenses, particularly personnel and related
costs, depreciation, office rent and occupancy costs, are relatively fixed. One
or more of the foregoing factors may cause our operating expenses to be
disproportionately high during any given period. Based on the preceding factors,
we may experience a shortfall in revenue or earnings or otherwise fail to meet
public market expectations, which could materially adversely affect our
business, financial condition and the market price of our common stock.
RISKS ASSOCIATED WITH NEW BUSINESS FOCUS
We focus on selling system integration services to clients in a small number
of vertical markets, such as sales force automation, call centers, marketing
automation, customer care, field service and sales. Although we believe that
this specialization will increase our market presence, customer base and
profitability, we may fail to obtain customers, effectively deliver services or
meet customer demands in one or more of these markets. If we fail in any of
these respects, such failure could have a material adverse impact on our
financial condition and results of operations. In addition, part of our strategy
involves divesting certain technology and products. For example, we recently
completed the transfer of our NextNet technology to a 44% owned entity. We may
not realize any return on such divestiture.
The new focus of Zamba presents several risks, many of which are outside of
our control. Redefining a company is a complex, time-consuming and expensive
process. It involves changing strategies, aligning services and product
categories, changing management and employees, and focusing on new markets and
customers. We could spend considerable amounts of money and commit resources,
but ultimately receive little or no return on our investment. Customers may not
be receptive and competitors may already be established in the new markets,
making it difficult for us to gain a sustainable market share or acquire new
customers.
CLIENT CONCENTRATION
We derive a substantial part of our revenues from a small number of clients.
The loss of one or more of these clients will materially adversely affect our
financial condition and results of operations.
Our services often involve the implementation of complex information systems
and software which are critical to the clients' operations. Our failure to meet
client expectations in the performance of our services may damage our reputation
and adversely affect our ability to attract and retain clients. If a client is
not satisfied with our services, we will generally spend additional human and
other resources at our own expense to ensure client satisfaction. Such
expenditures will typically result in a lower margin on such
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engagements and could materially adversely effect our business, financial
condition and results of operations.
In the course of providing services, we will recommend the use of other
software and hardware products. These products may not perform as expected or
may contain defects. If this occurs, our reputation could be damaged and we
could be subject to liability. We attempt to limit our exposure to potential
liability claims. Such limitations may not be effective. A successful liability
claim brought against us may adversely affect our reputation and could have a
material adverse effect on our business, financial condition and results of
operations. Our inability to obtain new clients or large-scale implementation
and integration projects could materially and adversely affect the growth of our
business.
COMPETITION
Competition in the systems implementation industry is intense. We have
competitors that provide some or all of the services we provide. Our principal
competitors include: (1) international consulting firms, (2) regional and
specialty consulting firms, consulting firms, including information technology
consulting firms, such as Cambridge Technology Partners and Sapient and (3) the
consulting groups of international accounting firms such as Andersen Consulting,
Ernst & Young, KPMG and PricewaterhouseCoopers. Many of our current and possible
direct competitors have substantially greater financial, technical, marketing,
sales, and other resources than we have. Such competitors may be able to respond
more quickly to new and emerging technologies and changes in customer demands.
Major software development companies, as well as computer, database and
communication companies, are possible sources of future direct competition for
Zamba's products and services. Competitive pressures may cause our revenue and
operating margins to decline or otherwise materially adversely affect our
business, financial condition and results of operations.
DEPENDENCE ON STRATEGIC PARTNERS
We are dependent upon the strategic relationships that we have formed with
various software and hardware providers and application companies. We use the
products developed by these companies in assembling customer based solutions and
integrate these applications into customer sites. Certain partners and solutions
may prove to be inappropriate for some or all of our clients. Factors which
could lead to the loss of a partner include: (1) obsolescence of a partner's
product or solution; (2) incompatibility of a partner's product or solution with
our client's systems; (3) poor customer service or maintenance services
performed by the partner; (4) introduction of competing products; or (5) change
in customer needs or demands. In addition, a partner could be lost if the
partner no longer wished to collaborate with us, due to such factors as: (1)
inability to negotiate acceptable strategic agreements, (2) change in the
partner's business focus, or (3) development of other competing relationships.
Any one or all of these events could result in the loss of a partner. We may not
be able to replace a partner, leading to an ultimate inability to provide
services on a timely basis, if at all, to our customers.
YEAR 2000
Many computers and computer programs are designed with dates that contain
two digits instead of four digits, potentially causing "19XX" to be the date for
any year entered or processed. As a result, a date-sensitive program with a year
ending in "00" may be read by the computer as "1900" instead of "2000." This may
cause the computer or program to be unable to process date information between
the twentieth and twenty-first centuries. This inability could cause the
disruption or failure of processing by such computer or program (the "Year 2000
Issue"). The Year 2000 Issue could affect Zamba in numerous ways, including
temporarily preventing us from sending invoices to our clients, interfering with
or damaging development work we do for our clients, and causing our clients to
lower their budgets for our customer care solutions in order to fund resolution
of their own Year 2000 issues.
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We have conducted a limited review of our internal computer systems and
legacy proprietary hardware and software products that could be affected by the
Year 2000 Issue. Based on this limited review, technology changes for potential
Year 2000 issues are not currently expected to have a material impact on our
operations. We expect to complete our review of our internal systems and legacy
products by the first quarter of 1999. Because of infrastructure improvements we
are making, which include servers and networking products that are Year 2000
compliant, we currently do not anticipate significant risk to our internal
operations because of the Year 2000 Issue. During the first quarter of 1999, we
will also institute a program to contact material vendors and customers to
determine the impact of Year 2000 issues on their products and businesses,
respectively. However, if our present and future efforts to address the Year
2000 issue are not successful, or if vendors and other third parties with which
we conduct business do not successfully address the Year 2000 issue, our
business, financial condition and results of operations may be materially
adversely affected.
SHARES ELIGIBLE
Sales of substantial amounts of Zamba's common stock in the public market
after this offering could adversely affect the market price of the common stock.
In addition to the estimated 4,957,937 shares offered hereby, upon the closing
of the offering, there will be 25,082,845 shares of common stock outstanding,
none of which are restricted shares ("Restricted Shares") under the Securities
Act of 1933, as amended (the "Securities Act"). Of the 4,957,937 shares covered
by this registration statement, 145,580 shares, will be immediately salable. The
Holder of the warrants, Tom Minick and Todd Fitzwater have signed certain
lock-up agreements that restrict the resale of the their shares. The 462,247
warrant shares will be not be eligible for sale in the public market until March
21, 1999. Tom Minick and Todd Fitzwater hold 2,192,412 shares of common stock
which will not be eligible for sale in the public market until March 22, 1999.
At that time one eighth of these shares will be eligible for sale every three
months. In addition, the 1,000,000 shares of common stock issuable on the
conversion of the preferred stock will not be issued until there are sufficient
authorized shares of common stock. When sufficient additional shares are
authorized, these common shares could be issued and sold in the public market.
The estimated 1,157,698 shares issuable upon conversion of the notes will not be
issued unless note holders request a conversion, and we consent, at our sole
discretion. Sales in the public market of substantial amounts of common stock or
the perception that such sales could occur could depress prevailing market
prices for the common stock.
LIMITED PROTECTION OF PROPRIETARY TECHNOLOGY
We rely on a combination of copyright, trade secret and trademark laws, and
third party nondisclosure agreements to protect our intellectual property
rights. The laws of certain countries in which our services are or may be
performed may not protect our intellectual property rights to the same extent as
the laws of the United States. It may be possible for unauthorized third parties
to obtain and use information that we regard as proprietary or to develop
equivalent implementation methodologies independently. From time to time, third
parties may assert patent, copyright and other intellectual property claims
against us. If we are unable to license protected technology used in our
products, we could be prohibited from manufacturing and marketing such products.
We also could incur substantial costs to redesign our products, to defend any
legal action taken against us or to pay damages to the infringed party.
Litigation, which could result in substantial cost to, and diversion of our
resources, may be necessary to enforce patents or our other intellectual
property rights or to defend ourselves against claimed infringement of the
rights of others.
VOLATILITY OF STOCK PRICE
Technology companies, including Zamba, frequently experience volatility in
their common stock prices. Factors creating such volatility include:
- quarterly fluctuations in results of operations
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- announcements of technological innovations or the introduction of new
products
- macroeconomic conditions in the computer hardware, software, data
communication and wireless communication industries
- extreme price and volume fluctuations of the general stock market, which
have particularly affected the market price for many technology companies,
in some cases unrelated to the operating performance of those companies.
These broad market fluctuations may materially adversely affect the market
price of our stock.
These factors may have a significant adverse impact on the market price of
our stock. If revenues or earnings in any quarter fail to meet the expectations
of the investment community, there could be an immediate impact on our stock
price. In addition, our issued shares and stock options which if sold directly
or exercised and sold on the open market in large concentrations, could cause
our stock price to decline in the short term.
USE OF PROCEEDS
If all of the warrants (with an exercise price of $.0066623 per share) are
exercised, we will realize proceeds in the amount of $3,079.63. Such proceeds
will be contributed to our working capital and used for general corporate
purposes. We will not receive any proceeds from the sale of common stock by the
selling securityholders.
DIVIDEND POLICY
We have never declared or paid cash dividends on our common stock and we
intend to retain all available funds for use in the operation and expansion of
our business. We do not anticipate that any cash dividends will be declared or
paid in the foreseeable future.
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SELLING SECURITYHOLDERS
The following list of selling securityholders includes the 22
securityholders that received Zamba shares, notes or warrants though the
QuickSilver merger and in a private financing. The common stock listed below
represents all of the Zamba common stock that each Selling Securityholder owned
beneficially as of November 4, 1998, and the number of shares which may be
offered pursuant to this Prospectus. This information is based upon information
provided by the selling securityholders. The selling securityholders may sell
all, some or none of their common stock being offered.
<TABLE>
<CAPTION>
ADDITIONAL SHARES OWNED
PRIOR TO OFFERING IF NOTES
ARE CONVERTED,
SHARES OWNED WITH CUMULATIVE PERCENT NUMBER
PRIOR TO OFFERING(1) BENEFICIAL OWNERSHIP OF SHARES
------------------------- --------------------------- BEING
SELLING SECURITYHOLDER NUMBER PERCENT(2) NUMBER(3) PERCENT(2)(4) OFFERED(5)
- -------------------------------------------- ---------- ------------- ---------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
Keith Allaun................................ 10,882 * 5,388 * 16,270
Peggy Apodaca............................... 2,499 * 1,237 * 3,736
William Bamford............................. 512 * 253 * 765
Chinmoy Bhagawat............................ 5,029 * 2,490 * 7,519
Mary Brennock............................... 2,667 * 1,320 * 3,987
Todd Fitzwater.............................. 1,092,024 3.84 540,740 5.62 1,632,764
Zamba Corporation
7301 Ohms Lane, Suite 200
Minneapolis, MN 55439
Robert Gahagan.............................. 890 * 440 * 1,330
Anthony Hart................................ 6,212 * 3,075 * 9,287
Sandra Hunter............................... 3,596 * 1,780 * 5,376
Aarij Khan.................................. 5,545 * 2,743 * 8,288
Victor Kremer............................... 1,884 * 932 * 2,816
Pete Kushmeider............................. 1,783 * 882 * 2,665
Cameron Lewis............................... 43,016 * 21,300 * 64,316
Patrick Lewis............................... 47,051 * 23,298 * 70,349
Tom Minick.................................. 1,100,388 3.87 544,881 5.47 1,645,269
Zamba Corporation
7301 Ohms Lane, Suite 200
Minneapolis, MN 55439
Wendy Novakovich............................ 1,953 * 967 * 2,920
Heather Plep................................ 26 * 12 * 38
Cynthia Sass................................ 602 * 298 * 900
Joe Schlesinger............................. 594 * 293 * 887
Tracy Slap.................................. 2,237 * 1,107 * 3,344
Steven Stolle............................... 8,603 * 4,260 * 12,863
Petra Capital, LLC(6)....................... 462,247 1.63 462,247
Joseph Costello(7).......................... 2,120,187 7.18 1,000,000
Cad.Lab, Inc.
2880 Lakeside Drive, Suite 250
Santa Clara, CA 95054
</TABLE>
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* Less than one percent.
(1) Unless otherwise indicated below, the persons named in the table have sole
voting and investment power with respect to all shares beneficially owned by
them, subject to community property laws where applicable. Beneficial
ownership is determined in accordance with the rules of the Securities
10
<PAGE>
and Exchange Commission and includes sole or shared voting or investment
power with respect to shares shown as beneficially owned.
(2) The applicable percentage of ownership is based on 27,420,837 shares of
common stock outstanding on November 4, 1998.
(3) The number of notes is based on an assumption that the holder requests
conversion, Zamba agreed, and the average closing price as reported on the
Nasdaq National Market for twenty days was $1.8672 per share, the average
closing market price for the twenty days preceding November 3, 1998.
(4) The percentage of shares of common stock owned by the noteholders prior to
the offering is based on the total number of shares outstanding on November
4, 1998 plus the shares issuable upon potential conversion of the notes at
an assumed conversion price of $1.8672 per share.
(5) Assumes the sale of all shares offered hereby.
(6) Represents 462,247 shares issuable upon exercise of the warrants.
(7) Mr. Costello is Chairman of the Board of Directors of Zamba. His ownership
consists of 2,037,187 shares of common stock, options to purchase 83,000
shares of common stock, and 1,000,000 shares of common stock issuable upon
the conversion of 1,000,000 shares of preferred stock.
DESCRIPTION OF WARRANTS
As part of the QuickSilver merger, we issued warrants to purchase 462,247
shares of our common stock to Petra Capital, LLC. The warrants may be exercised,
at the option of the holder, at any time after the grant date of September 18,
1998. The exercise price is $.0066623 per share. The warrants contain provisions
for the adjustment of the exercise price or the aggregate number of shares
issuable upon exercise of the warrants under certain circumstances, including
stock dividends, stock splits, combinations, mergers, consolidations,
recapitalizations, reclassifications, and sales below the exercise price. The
warrants will expire on March 9, 2008. We also agreed to register the common
stock issuable upon the exercise of the warrants.
DESCRIPTION OF PREFERRED STOCK
On October 26, 1998 we sold 1,000,000 shares of our Series A Junior
Participating Preferred Stock, in a private offering. The shares were sold at
$2.00 per share to Joseph Costello, the Chairman of our Board of Directors. The
preferred stock enjoys the same dividend, liquidation and voting rights as the
common stock. The preferred stock is convertible into shares of common stock
when a sufficient number of authorized and unissued shares of common stock
becomes available. The actual number of shares of common stock issuable upon
conversion will be equal to the $2,000,000 purchase price (plus any declared
dividends) divided by $2.00 per share, as adjusted for any dilution. We also
agreed to register the common stock issuable upon the conversion of the
preferred stock.
DESCRIPTION OF NOTES
As part of the QuickSilver merger, QuickSilver shareholders were issued
convertible promissory notes with an aggregate principal value of $2,161,674.82.
The notes accrue interest at the rate of 7% per annum and principal and interest
are payable on the last day of each quarter, beginning on December 31, 1999 and
concluding on December 31, 2003. The notes are convertible at the request of the
holder, and upon our consent. We may withhold our consent in our sole and
absolute discretion. If converted, the actual number of shares of common stock
issuable upon the conversion of the notes will equal (i) the unpaid original
value of the notes being converted, plus accrued interest, divided by (ii) a
Conversion Price equal to the average of the closing prices of the common stock
as reported on the Nasdaq National Market during the twenty consecutive trading
days preceding such request. If converted, we agreed to register any common
stock issuable upon the conversion of the notes.
11
<PAGE>
PLAN OF DISTRIBUTION
Selling securityholders received an aggregate of 2,337,992 reorganization
shares of common stock from Zamba pursuant to the reorganization agreement among
Zamba, QuickSilver Acquisition Corp., QuickSilver and the former QuickSilver
shareholders. We agreed to file a registration statement on Form S-3 for the
reorganization shares pursuant to the reorganization agreement. The
reorganization shares are "restricted securities" for purposes of the Act. A
total of 2,192,412 of the reorganization shares are subject to lock-up
agreements that limit sales or other distributions prior to March 22, 2000.
One-eighth of these shares may be sold after March 22, 1999. After March 22,
1999, an additional one-eighth of these shares will be released from the
provisions of the lock-up every three months. We will not receive any proceeds
from sales of the reorganization shares.
The QuickSilver shareholders were also issued convertible promissory notes
with an aggregate principal value of $2,161,674.82 pursuant to the
reorganization agreement. The notes are convertible at the request of the
holder, and with our consent. We may withhold our consent in our sole and
absolute discretion. Accordingly, there may be no note shares issued or
available for sale. If the holders requested conversion on November 3, 1998, and
we did consent to conversion, 1,157,698 shares of common stock would be issued
upon such conversion. We agreed to file a registration statement on Form S-3 for
any common stock received upon conversion of the notes. We will not receive any
of the proceeds from sales of the note shares. Prior to the effectiveness of
this registration statement, any note shares are "restricted securities" for
purposes of the Act.
Joseph Costello, the Chairman of the Board of Directors of Zamba, purchased
1,000,000 shares of Series A Junior Participating Preferred Stock of Zamba in a
private offering. When sufficient authorized and unissued common stock is
available, 1,000,000 shares of common stock will be issued to Mr. Costello in
exchange for the preferred stock. The trading of these shares, prior to the
effectiveness of this registration statement, is subject to the restrictions of
Rule 144. We agreed to register, under certain circumstances, all of the shares
issued upon conversion of the Series A Preferred Stock. We will not receive any
proceeds from the conversion of the preferred stock or the resale of the
conversion shares.
Petra Capital, LLC holds warrants to purchase 462,247 shares of common stock
of Zamba. The warrants may be exercised, at the option of the holder, at an
exercise price of $.0066623 per share. We agreed to register all of the shares
issuable upon exercise of the warrants. We will not receive any of the proceeds
from resale of the warrant shares. Prior to the effectiveness of this
registration statement, the warrant shares are "restricted securities" for
purposes of the Securities Act. Offers, sales or other transfer of the warrants
are not covered by this prospectus. The warrant shares are subject to a lock-up
agreement that prohibits their resale prior to March 21, 2000.
The selling securityholders may offer their common stock at various times in
one or more of the following transactions:
- on any of the United States securities exchanges where our common stock is
listed, including the Nasdaq National Market, or any other exchange where
our common stock may be listed in the future;
- in the over-the-counter market;
- in transactions other than on such exchanges or in the over-the-counter
market;
- in connection with short sales of the common stock;
- by pledge to secure debts and other obligations;
- in connection with the writing of non-traded and exchange-traded call
options, in hedge transactions and in settlement of other transactions in
standardized or over-the-counter options; or
- in a combination of any of the above transactions.
12
<PAGE>
The selling securityholders may sell their common stock at market prices
prevailing at the time of sale, at prices related to such prevailing market
prices, at negotiated prices or at fixed prices.
The selling securityholders may use broker-dealers to sell their common
stock. If this happens, broker-dealers will either receive discounts or
commissions from the selling securityholders, or they will receive commissions
from purchasers of common stock for whom they acted as agents.
This offering is primarily the result of a plan of acquisition, under which
we acquired all of the outstanding shares of QuickSilver. The general effect of
this acquisition is that QuickSilver became a wholly-owned subsidiary of Zamba
on September 22, 1998, pursuant to the reorganization agreement outlined above.
This offering also includes 1,000,000 Zamba shares of common stock issuable upon
conversion of the Series A Junior Participating Preferred Stock. Upon approval
of a listing by the Nasdaq National Market, the common stock will be offered on
that exchange, under the symbol "ZMBA."
The selling securityholders and any agents, broker-dealers or underwriters
that participate in the distribution of the common stock may be deemed to be
"underwriters" within the meaning of the Securities Act of 1933, as amended (the
"Act"), and any commission received by them and any profit on the resale of the
common stock purchased by them may be deemed to be underwriting discounts or
commissions under the Act. We have agreed to indemnify the selling
securityholders and certain other persons against certain liabilities, including
liabilities under the Act.
To comply with the securities laws of certain jurisdictions, the securities
offered in this prospectus will be offered or sold in those jurisdictions only
through registered or licensed brokers or dealers. In addition, in certain
jurisdictions the securities offered in this prospectus may not be offered or
sold unless they have been registered or qualified for sale in those
jurisdictions, or unless an exemption from registration or qualification is
available and is complied with. The rights under this registration statement and
prospectus are assignable to the distributees, pledgees or other transferees of
the selling securityholders.
We will maintain the effectiveness of the registration statement until the
earlier of (i) such time as all of the Shares have been disposed of in
accordance with the intended methods of disposition set forth in the
registration statement, (ii) the date the common stock is eligible for sale in
its entirety within a 90 day period under Rule 144 of the SEC (assuming
compliance by the selling securityholders with the provisions thereof) or (iii)
two years after the effective date of this registration statement. In the event
that any shares remain unsold at the end of such period, we may file a
post-effective amendment to the registration statement for the purpose of
deregistering the shares of common stock.
LEGAL MATTERS
The validity of the issuance of the common stock offered hereby will be
passed upon for Zamba by Cooley Godward LLP, Palo Alto, California.
EXPERTS
The financial statements and related financial statement schedule of Zamba
as of December 31, 1997 and 1996 and for each of the three years in the period
ended December 31, 1997 incorporated herein by reference from Zamba's Annual
Report on Form 10-K for the year ended December 31, 1997 have been audited by
PricewaterhouseCoopers LLP, independent accountants, as stated in their report,
which is incorporated herein by reference. The financial statements of
QuickSilver Group, Inc. as of December 27, 1996 and December 26, 1997, and for
each of the two years in the period ended December 26, 1997 have been audited by
PricewaterhouseCoopers LLP, independent accountants, as stated in their report,
which is incorporated herein by reference. These financial statements and
financial statement schedule have been so incorporated in reliance upon the
report of such firm given upon their authority as experts in accounting and
auditing.
13
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS AND, IF GIVEN OR MADE, SUCH OTHER INFORMATION AND REPRESENTATIONS
MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY US. THIS PROSPECTUS DOES
NOT CONSTITUTE AN OFFER OR SOLICITATION BY ANYONE IN ANY STATE IN WHICH SUCH
OFFER OR SOLICITATION IS NOT AUTHORIZED, OR IN WHICH THE PERSON MAKING SUCH
OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO, OR TO ANY PERSON TO WHOM IT IS
UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. THE DELIVERY OF THIS PROSPECTUS AT
ANY TIME DOES NOT IMPLY THAT THE INFORMATION HEREIN IS CORRECT AS OF ANY TIME
SUBSEQUENT TO THE DATE HEREOF. WE HAVE NOT AUTHORIZED ANY DEALER, SALESPERSON OR
OTHER PERSON TO GIVE ANY INFORMATION OR REPRESENT ANYTHING NOT CONTAINED IN THIS
PROSPECTUS. YOU MUST NOT RELY ON ANY UNAUTHORIZED INFORMATION. THIS PROSPECTUS
DOES NOT OFFER TO SELL OR BUY ANY SHARES IN ANY JURISDICTION WHERE IT IS
UNLAWFUL. THE INFORMATION IN THIS PROSPECTUS IS CURRENT ONLY AS OF NOVEMBER 9,
1998
4,957,937 SHARES
ZAMBA CORPORATION
COMMON STOCK
---------------------
PROSPECTUS
---------------------
NOVEMBER 24, 1998
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth all expenses, other than the underwriting
discounts and commissions, payable by the Registrant in connection with the sale
of the common stock being registered. All the amounts shown are estimates except
for the registration fee.
<TABLE>
<S> <C>
Registration fee................................................ $2,383.74
Legal fees and expenses......................................... $ 25,000
Accounting Fees and Expenses.................................... $ 10,000
Miscellaneous (NASDAQ listing fees, printer fees)............... $ 19,500
---------
Total................................................... $56,883.74
---------
---------
</TABLE>
ITEM 15. INDEMNIFICATION OF OFFICERS AND DIRECTORS.
As permitted by Section 145 of the Delaware General Corporation Law, the
Registrant's Certificate of Incorporation includes a provision that eliminates
the personal liability of its directors for monetary damages for breach or
alleged breach of their duty of care, except for liability (i) for any breach of
the director's duty of loyalty to the corporation or its securityholders, (ii)
for acts or omissions not in good faith or which involve intentional misconduct
or a knowing violation of law, (iii) under Section 174 of the Delaware General
Corporation Law or (iv) for any transaction from which the director derived an
improper personal benefit. In addition, as permitted by Section 145 of the
Delaware General Corporation Law, the Bylaws of the Registrant provide that (i)
the Registrant is required to indemnify its directors and officers and persons
serving in such capacities in other business enterprises (including, for
example, subsidiaries of the Registrant) at the Registrant's request to the
fullest extent permitted by the Delaware General Corporation Law including those
circumstances in which indemnification would otherwise be discretionary; (ii)
the Registrant may, in its discretion, indemnify employees and agents where
indemnification is not required by law; (iii) upon receipt of an undertaking by
the indemnitee to repay all amounts advanced and if it is ultimately determined
that such indemnitee is not entitled to indemnification, the Registrant is
required to advance expenses, as incurred, to its directors and officers in
connection with defending a proceeding; (iv) the rights conferred in the Bylaws
are not exclusive and the Registrant is authorized to enter into indemnification
agreements with its directors, officers and employees; and (v) the Registrant
may not retroactively amend the Bylaw provisions in a way that is adverse to
such directors, officers and employees.
The Registrant's policy is to enter into indemnification agreements with
each of its directors and executive officers that provide the maximum indemnity
allowed to directors and executive officers by Section 145 of the Delaware
General Corporation Law and the Registrant's Bylaws, as well as certain
procedural protections. In addition, the indemnification agreements provide that
directors and executive officers will be indemnified to the fullest possible
extent not prohibited by law against all expenses including attorneys' fees and
settlement amounts paid or incurred by them in any action or proceeding,
including any derivative action by or in the right of the Registrant, on account
of their services as directors or executive officers of the Registrant or as
directors or officers of any other company or enterprise when they are serving
in such capacities at the request of the Registrant. The Registrant will not be
obligated pursuant to the agreements to indemnify or advance expenses to an
indemnified party with respect to proceedings or claims initiated by the
indemnified party and not by way of defense, except with respect to proceeds
specifically authorized by the Board of Directors or brought to enforce a right
to indemnification under the indemnification agreement, the Registrant's Bylaws
or any statute or law. Under the agreements,
II-1
<PAGE>
the Registrant is not obligated to indemnify the indemnified party (i) for any
amounts paid in settlement of a proceeding unless the Registrant consents to
such settlement; (ii) for any amounts paid in settlement of a proceeding unless
the Registrant consents in advance to such settlement; and (iii) if a final
decision by a court having jurisdiction in the matter shall determine that such
indemnification is not lawful.
The indemnification agreement requires a director or executive officer to
reimburse the Registrant for all expenses advanced only to the extent it is
ultimately determined that the director or executive officer is not entitled,
under Delaware law, the Registrant's Bylaws, the indemnification agreement or
otherwise to be indemnified for such expenses. The indemnification agreement
provides that it is not exclusive of any rights a director or executive officer
may have under the Certificate of Incorporation, the Registrant's Bylaws, other
agreements, any majority-in-interest vote of the securityholders or vote of
disinterested directors, Delaware law, or otherwise.
The indemnification provision in the Registrant's Bylaws, and the
indemnification agreements entered into between the Registrant and its directors
and executive officers, may be sufficiently broad to permit indemnification of
the officers and directors for liabilities arising under the Securities Act of
1933, as amended (the "Securities Act").
The indemnification agreements require the Registrant to maintain director
and officer liability insurance to the extent reasonably available. As
authorized by the Registrant's Bylaws, the Registrant, with approval by the
Board, has purchased director and officer liability insurance.
ITEM 16. EXHIBITS.
5.1* Opinion of Cooley Godward LLP.
23.1 Consent of PricewaterhouseCoopers LLP.
23.2* Consent of Cooley Godward LLP. Reference is made to Exhibit 5.1.
24.1* Power of Attorney.
- ------------------------
* As previously filed.
ITEM 17. UNDERTAKINGS.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Act, each filing of the registrant's annual
report pursuant to Section 13(a) or 15(d) of the Exchange Act (and, where
applicable, each filing of an employee benefit plan's annual report pursuant to
Section 15(d) of the Exchange Act) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial BONA FIDE offering thereof.
Insofar as indemnification for liabilities arising under the Act may be
permitted to directors, officers and controlling persons of the registrant
pursuant to provisions described in Item 15, or otherwise, the registrant has
been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other
than the payment by the registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
II-2
<PAGE>
The undersigned registrant hereby undertakes:
(1) To file, during any period during which offers or sales are being made,
a post-effective amendment to this registration statement;
(i) To include any prospectus required by Section 10(a)(3) of the Act;
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing, any increase or any
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low end or high end of the estimated maximum offering
range may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than 20% change in the maximum aggregate offering
price set forth in the "Calculation of Registration Fee" table in the
effective registration statement.
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement;
PROVIDED, HOWEVER, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the registrant pursuant to Section 13 or 15(d) of the Exchange Act
that are incorporated by reference in the registration statement.
(2) That, for purposes of determining liability under the Act, each such
post-effective amendment shall be deemed to be a new registration statement
relating to the securities to be offered therein, and the offering of such
securities at that time shall be deemed to be an initial BONA FIDE offering
thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which shall remain unsold at the termination
of the offering.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Minneapolis, State of Minnesota, on the 24th day of
November 1998.
<TABLE>
<S> <C> <C>
ZAMBA CORPORATION
By: /s/ PAUL EDELHERTZ
-----------------------------------------
Paul Edelhertz
PRESIDENT AND CHIEF EXECUTIVE OFFICER
</TABLE>
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed below by the following persons on behalf
of the Registrant and in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- ------------------------------ -------------------------- -------------------
<C> <S> <C>
President and Chief
/s/ PAUL EDELHERTZ Executive Officer and
- ------------------------------ Director (Principal November 24, 1998
Paul Edelhertz Executive Officer)
/s/ MICHAEL H. CARREL* Chief Financial Officer
- ------------------------------ (Principal Financial and November 24, 1998
Michael H. Carrel Accounting Officer)
/s/ MICHAEL A. FABIASCHI*
- ------------------------------ Director November 24, 1998
Michael A. Fabiaschi
/s/ JOSEPH B. COSTELLO*
- ------------------------------ Director November 24, 1998
Joseph B. Costello
/s/ DIXON R. DOLL*
- ------------------------------ Director November 24, 1998
Dixon R. Doll
/s/ THOMAS MINICK*
- ------------------------------ Director November 24, 1998
Thomas Minick
*By: /s/ PAUL EDELHERTZ
-------------------------
(Paul Edelhertz, as
Attorney-in-Fact)
</TABLE>
II-4
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ----------- --------------------------------------------------------------------------------------------------------
<C> <S>
5.1* Opinion of Cooley Godward LLP.
23.1 Consent of PricewaterhouseCoopers LLP.
23.2* Consent of Cooley Godward LLP. Reference is made to Exhibit 5.1
24.1* Power of Attorney
</TABLE>
- ------------------------
* As previously filed.
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this Registration Statement
on Form S-3 of our report dated January 12, 1998, on our audits of the financial
statements and financial statement schedule of Zamba Corporation, formerly known
as Racotek, Inc. (the Company), as of December 31, 1997 and 1996, and for each
of the three years in the period ended December 31, 1997, which report is
included in the Company's 1997 Annual Report on Form 10-K, and our report dated
August 14, 1998, except for the sixth paragraph of Note 13 as to which the date
is September 22, 1998, of our audits of the financial statements of QuickSilver
Group, Inc., as of December 27, 1996 and December 26, 1997, and for each of the
two years in the period ended December 26, 1997, which report is included in the
Company's Form 8-K dated October 7, 1998. We also consent to the reference to
our firm under the caption "Experts."
/s/ PRICEWATERHOUSECOOPERS LLP
--------------------------------------
PRICEWATERHOUSECOOPERS LLP
Minneapolis, Minnesota
November 24, 1998
