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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 30, 2000
REGISTRATION STATEMENT NO. 333-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
ZAMBA CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 41-1636021
(STATE OR OTHER JURISDICTION (I.R.S. EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
7301 OHMS LANE
SUITE 200
MINNEAPOLIS, MINNESOTA 55439
(952) 832-9800
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
------------------------
PAUL EDELHERTZ
PRESIDENT AND CEO
ZAMBA CORPORATION
7301 OHMS LANE, SUITE 200
MINNEAPOLIS, MINNESOTA 55439
(952) 832-9800
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC: AS SOON AS
PRACTICABLE AFTER THIS 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. [ ] 333-
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. [ ] 333-
IF DELIVERY OF THE PROSPECTUS IS EXPECTED TO BE MADE PURSUANT TO RULE 434,
PLEASE CHECK THE FOLLOWING BOX. [ ]
<PAGE>
CALCULATION OF REGISTRATION FEE
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PROPOSED PROPOSED
MAXIMUM MAXIMUM AMOUNT OF
TITLE OF EACH CLASS OF AMOUNT TO BE OFFERING AGGREGATE REGISTRATION
SECURITIES TO BE REGISTERED REGISTERED PRICE PER UNIT OFFERING PRICE FEE
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<S> <C> <C> <C> <C>
Common Stock, $.01 320,001 $5.8438(1) $1,870,006(1) $493.68
par value per share
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(1) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457(c) under the Securities Act and based upon the average of the high
and low prices on the Nasdaq National Market on May 23, 2000.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE 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), SHALL DETERMINE.
<PAGE>
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. THESE
SECURITIES MAY NOT BE SOLD UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS DECLARED EFFECTIVE. THIS PROSPECTUS IS NOT
AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
SUBJECT TO COMPLETION, DATED MAY 30, 2000
PROSPECTUS
ZAMBA CORPORATION
7301 OHMS LANE, SUITE 200
MINNEAPOLIS, MINNESOTA 55439
(952) 832-9800
320,001 SHARES OF COMMON STOCK
In December 1999, we issued 1,000,000 shares of common stock to the
former stockholders of Camworks, Inc. ("Camworks") in connection with our
acquisition of that company. In January 2000, we issued 80,001 shares of
common stock to the former stockholders of Fusion Consulting, Inc. ("Fusion")
in connection with our acquisition of that company. This prospectus relates
to resales of some of those shares by certain former stockholders of Camworks
and Fusion. We will not receive any of the proceeds from the sale of the
shares registered herein.
The selling stockholders will pay any underwriting discounts and
commissions and expenses incurred by the selling stockholders for brokerage,
accounting, tax or legal services or any other expenses incurred by the
selling stockholders in disposing of the shares. We will bear all other
costs, fees and expenses incurred in effecting the registration of the shares
covered by this prospectus, including, without limitation, all registration
and filing fees, Nasdaq listing fees and fees and expenses of our counsel and
our accountants.
The selling stockholders, or their pledgees, donees, transferees or
other successors-in-interest, may offer the shares from time to time through
public or private transactions at prevailing market prices, at prices related
to prevailing market prices or at privately negotiated prices. Our common
stock is traded on the Nasdaq National Market under the symbol ZMBA. On May
23, 2000, the closing sale price of our common stock on Nasdaq was $5.8438
per share.
INVESTING IN OUR COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. SEE
"RISK FACTORS" BEGINNING ON PAGE 5.
THE SECURITIES AND EXCHANGE COMMISSION AND STATE SECURITIES
REGULATORS HAVE NOT APPROVED OR DISAPPROVED THESE SECURITIES OR DETERMINED IF
THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
The date of this Prospectus is May 30, 2000.
We will pay no underwriting commissions or discounts in connection
with this offering. We expect to pay approximately $11,500 in expenses in
connection with this offering. The aggregate proceeds to the selling
stockholders 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 us. See "Plan of Distribution."
<PAGE>
TABLE OF CONTENTS
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PAGE
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Where to Find More Information............................................ 3
Incorporation of Certain Documents by Reference........................... 3
Special Note Regarding Forward-looking Statements......................... 4
Risk Factors.............................................................. 5
Summary Description of Our Business....................................... 11
Use of Proceeds........................................................... 11
The Acquisitions.......................................................... 11
Selling Stockholders...................................................... 12
Plan of Distribution...................................................... 13
Legal Matters............................................................. 14
Experts................................................................... 14
</TABLE>
WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH INFORMATION DIFFERENT FROM
THAT CONTAINED OR INCORPORATED BY REFERENCE IN THIS PROSPECTUS. THE SELLING
STOCKHOLDERS ARE OFFERING TO SELL, AND SEEKING OFFERS TO BUY, SHARES OF OUR
COMMON STOCK ONLY IN JURISDICTIONS WHERE OFFERS AND SALES ARE PERMITTED. THE
INFORMATION CONTAINED IN THIS PROSPECTUS IS ACCURATE ONLY AS OF THE DATE OF
THIS PROSPECTUS, REGARDLESS OF THE TIME OF DELIVERY OF THIS PROSPECTUS OR OF
ANY SALE OF COMMON STOCK.
2
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WHERE TO FIND MORE INFORMATION
We file reports, proxy statements, and other documents with the
Securities and Exchange Commission and with Nasdaq. Here are ways you can
access this information:
<TABLE>
<CAPTION>
WHAT IS AVAILABLE WHERE TO GET IT
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<S> <C>
Paper copies of information SEC's Public Reference Room
Judiciary Plaza Building
450 Fifth Street, N.W.
Room 1024
Washington, D.C. 20549
The Nasdaq Stock Market, Inc.
1735 K Street, N.W.
Washington, D.C. 20006
On-line information SEC's Internet website at
http://www.sec.gov
Information about the Call the SEC at
SEC's Public Reference Room 1-800-SEC-0330
</TABLE>
This prospectus is part of a registration statement that we filed
with the SEC. The registration statement contains more information than this
prospectus regarding us and our common stock, including certain exhibits and
schedules. You can obtain a copy of the registration statement from the
sources listed above.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The SEC allows us to "incorporate" into this prospectus information
that we file with the SEC in other documents. This means that we can disclose
important information to you by referring to other documents that contain
that information. The information incorporated by reference is considered to
be part of this prospectus. Information contained in this prospectus and
information that we file with the SEC in the future and incorporate by
reference in this prospectus automatically updates and supercedes previously
filed information. We are incorporating by reference the documents listed
below and any future filings we make with the SEC under Sections 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934 prior to the sale
of all the shares covered by this prospectus. You are encouraged to obtain
copies of these documents and to review them.
(i) Our Annual Report on Form 10-K for the year ended December 31,
1999, filed with the SEC on March 8, 2000;
(ii) our Current Reports on Form 8-K and Form 8-K/A, filed with the
SEC on January 12, 2000, January 21, 2000, March 3, 2000, and
March 8, 2000;
(iii) the information contained in the following listed section of
our Proxy Statement for our 2000 Annual Meeting of
Stockholders, filed with the SEC on March 22, 2000:
- "Nominees" in Proposal 1
- "Executive Officers"
- "Section 16(a) Beneficial Ownership Reporting Compliance"
- "Director's Compensation"
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- "Executive Compensation"
- "Compensation Committee Interlocks and Insider
Participation"
- "Security Ownership of Certain Beneficial Owners and
Management"
- "Certain Transactions"
(iv) our Quarterly Report on Form 10-Q for the quarter ended March
31, 2000, filed with the SEC on May 15, 2000;
(v) all of our filings pursuant to the Exchange Act after the date
of filing the initial registration statement and prior to
effectiveness of the registration statement; and
(vi) the description of our common stock contained in our
Registration Statement on Form 8-A, filed with the SEC on
October 25, 1993.
You may request a copy of these documents, which will be provided to
you at no cost, by contacting:
ZAMBA CORPORATION
7301 OHMS LANE, SUITE 200
MINNEAPOLIS, MINNESOTA 55439
ATTENTION: INVESTOR RELATIONS
(952) 832-9800
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus contains or incorporates "forward-looking
statements" within the meaning of Section 27A of the Securities Act of 1933
and Section 21E of the Securities Exchange Act of 1934. You can identify
these forward-looking statements by our use of the words "believes,"
"anticipates," "plans," "expects," "may," "will," "would," "intends,"
"estimates" and similar expressions, whether in the negative or affirmative.
We cannot guarantee that we actually will achieve these plans, intentions or
expectations. Actual results or events could differ materially from the
plans, intentions and expectations disclosed in the forward-looking
statements that we make. We have included important factors in the cautionary
statements contained or incorporated by reference in this prospectus,
particularly under the heading "Risk Factors" that we believe could cause
actual results to differ materially from the forward-looking statements that
we make. We do not assume any obligation to update any forward-looking
statements that we make. Although we believe that the expectations reflected
in the forward-looking statements are reasonable, we cannot guarantee future
results, levels of activity, and/or performance of achievements.
4
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RISK FACTORS
You should carefully consider the risks described below before you
decide to buy our common stock. The risks and uncertainties described below
are not the only ones facing our company. Additional risks and uncertainties
may also impair or affect our business operations. If any of the following
risks actually occur, our business, financial condition, or results of
operations would likely suffer. In such case, the trading price of our common
stock could fall, and you may lose all or part of the money you paid to buy
our common stock.
WE MAY NOT BE ABLE TO MANAGE GROWTH SUCCESSFULLY
Our growth has placed significant demands on our management and
other resources. Our revenues increased approximately 202% in 1999 from $9.4
million in 1998 to $28.3 million in 1999. Our staff increased from 95
full-time employees at January 1, 1999, to 225 at March 31, 2000. Our future
success will depend on our ability to manage our growth effectively,
including by:
- developing and improving our operational, financial and other
internal systems;
- integrating and managing acquired businesses, joint ventures and
strategic investments;
- training, motivating and managing our employees;
- estimating fixed-price fees and project timeframes accurately;
- maintaining high rates of employee utilization; and
- maintaining project quality and client satisfaction.
Our management has limited experience managing a business of Zamba's
current size. If we are unable to manage our growth and projects effectively,
the quality of our services and products, our ability to retain key personnel
and our business, financial condition, results of operations and cash flow
may be materially adversely affected.
THE FOCUS OF OUR BUSINESS MAY NOT RECEIVE MARKET ACCEPTANCE
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, results of operations and
cash flow.
The technology consulting industry in general presents several
risks, many of which are outside of our control. As the market changes, we
will need to constantly redefine our company, which 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.
WE MAY FAIL TO SUCCESSFULLY COMPLETE AND INTEGRATE COMPANIES THAT WE ACQUIRE
On December 29, 1999, we acquired Camworks, Inc. ("Camworks") and on
January 10, 2000, we acquired Fusion Consulting, Inc. ("Fusion"). Integrating
Camworks and Fusion will be a complex, time-consuming and expensive process.
Before the acquisitions, Camworks and Fusion operated independently,
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each with its own business, business culture, clients, employees and
systems. After the mergers, Camworks and Fusion must operate together with
Zamba 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 Camworks and Fusion. These may include:
- distracting management from the business of the combined company;
- potential incompatibility of business cultures;
- inability to retain talented employees of the acquired business;
- 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;
- inability to achieve efficiencies, or to achieve them in a timely
manner; and
- potential inefficiencies in delivering services to the clients of
the combined company.
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 our company
or the business we acquired. The failure to successfully integrate Camworks
and/or Fusion into Zamba would have a material adverse effect on our
business, financial condition, results of operations and cash flow.
We could also experience financial or other setbacks if any of the
acquired businesses experienced problems in the past of which our management
does not yet know. For example, if an acquired business had dissatisfied
customers or had any performance problems, our reputation could suffer as a
result of our association with that business. We are not aware of any
material legal claims against the acquired companies. However, to the extent
any customer or other third party asserts any material legal claims against
any of the acquired companies, our business, financial condition, results
of operations and cash flow could suffer material harm.
FAILURE TO QUALIFY FOR POOLING OF INTERESTS ACCOUNTING TREATMENT FOR
ACQUISITIONS MAY HARM OUR FUTURE OPERATING RESULTS.
The acquisitions of Camworks and Fusion were accounted for under the
"pooling of interests" accounting treatment under U.S. generally accepted
accounting principles. Under pooling of interests accounting treatment, the
accounts of Camworks and Fusion are combined with those of Zamba at their
historical carrying amounts, and Zamba's financial statements for all prior
periods reflect its accounts as if Camworks and Fusion had been combined for
all periods.
If events subsequently occur that cause either of the mergers to
fail to qualify for pooling of interests accounting treatment, the purchase
method of accounting would apply. Under that method, we would record the
estimated fair value of our common stock issued in the mergers as the cost of
acquiring the businesses of Camworks or Fusion. That cost would be allocated
to the individual assets acquired and liabilities assumed according to their
respective fair values, with the excess of the estimated fair value of our
common stock over the fair value of net assets acquired recorded as goodwill,
to be amortized over a period that could be as long as 10 years, but is
likely to be shorter. The amount of goodwill amortized reduces our reported
earnings. The estimated fair value of our common stock issued in the mergers
is
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much greater than the historical net book value at which Camworks and Fusion
carried their assets in their accounts. Therefore, purchase accounting
treatment could have a material adverse effect on the reported operating
results of the combined company compared to pooling of interests accounting
treatment.
WE NEED TO ATTRACT AND RETAIN QUALITY EMPLOYEES IN ORDER TO CONTINUE OUR
GROWTH
Our business is labor-intensive and requires highly skilled
employees. Most of our consultants possess extensive expertise in information
technology, strategy, project management, sales and marketing. To serve a
growing client base, we must continue to recruit and retain qualified
personnel with expertise in each of these areas. 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. In
addition, the Internet has created many opportunities for people with the
skills we seek to form their own companies or join startup companies and
these opportunities frequently offer the potential for significant future
financial gain through equity incentives which we cannot match. Zamba from
time to time has had 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,
results of operations and cash flow could be adversely affected.
OUR OPERATING RESULTS MAY FLUCTUATE
A high percentage of our operating expenses, particularly personnel
and related costs, depreciation, office rent and occupancy costs, are fixed
in advance of any particular quarter. As a result, unanticipated variations
in the number, or progress toward completion, of our projects may cause
significant variations in operating results in any particular quarter and
could result in losses for that quarter. 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;
- the contractual terms and timing of completion of projects;
- any delays incurred in connection with projects;
- the accuracy of our estimates of resources required to complete
projects;
- uncertainty and changes in our sales cycle;
- the adequacy of provisions for losses;
- costs of obtaining or losing customers and accounts;
- increased competition and pricing pressures; and
- changes in our or our competitor's business strategy, pricing and
billing policies.
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
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earnings or otherwise fail to meet public market expectations, which could
materially adversely affect our business, financial condition, results of
operations, cash flow, and the market
price of our common stock.
WE FACE RISKS FROM OUR FIXED-PRICE, FIXED-TIMEFRAME BUSINESS MODEL
Most of our projects are performed on fixed-price, fixed-timeframe
contracts, rather than contracts in which payment to us is determined on a
time and materials basis. If we don't accurately estimate the resources
required for a project or fail to complete our contractual obligations in a
manner consistent with the project plan upon which our fixed-price,
fixed-timeframe contract was based, our overall profitability and our
business, financial condition and results of operations could be adversely
affected. We have been required to commit unanticipated additional resources
to complete projects in the past, which has resulted in losses on those
contracts. We recognize that we will experience similar situations in the
future and that the consequences could be more severe than in the past due to
the increased size and complexity of our projects. In addition, for some
projects we may fix the price at an early stage of the process, which could
result in a fixed price that turns out to be too low and therefore would
adversely affect our profitability.
OUR REVENUES ARE DIFFICULT TO PREDICT BECAUSE THEY ARE GENERATED ON A
PROJECT-BY-PROJECT BASIS.
We derive our revenues primarily from fees for services generated on
a project-by-project basis. These projects vary in size and scope. Therefore,
a client that accounts for a significant portion of our revenues in a given
period may not generate a similar amount of revenues, if any, in subsequent
periods. In addition, after we complete a project, we have no assurance that
the client will retain us in the future.
We have clients who may terminate their agreements with us, whether
time and materials or fixed-fee based, without any prior written notice.
Clients may terminate projects before completion. If our clients terminate
existing agreements, our business, financial condition, results of
operations, and cash flow could suffer material harm.
THE LOSS OF A SIGNIFICANT CLIENT COULD IMPACT OUR OPERATIONS
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 that 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 engagements and could materially
adversely effect our business, financial condition, results of operations and
cash flow.
In the course of providing services, we may 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.
WE ARE IN A COMPETITIVE MARKET
We compete in the information technology services market, which is
relatively new and intensely competitive. We expect competition to continue
to intensify as the market evolves. We compete with the following kinds of
companies:
- internet service firms;
- technology consulting firms;
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- technology integrators;
- strategic consulting firms;
- the consulting divisions of "Big 5" accounting firms; and
- in-house information technology departments of our clients and
potential clients.
Many of our competitors have longer operating histories, larger
client bases, longer relationships with clients, greater brand or name
recognition and significantly greater financial, technical, marketing and
public relations resources than we have.
Relatively few barriers prevent competitors from entering the
information technology services market. As a result, new market entrants pose
a threat to our business. We do not own any patented technology that prevents
or discourages competitors from entering the information technology services
market. Existing or future competitors may develop or offer services that are
comparable or superior to ours at a lower price, which could materially harm
our business, results of operations, financial condition and cash flow.
We believe that establishing and maintaining a good reputation and
name recognition is critical for attracting and expanding our targeted client
base. We also believe that the importance of reputation and name recognition
will increase due to the growing number of information technology service
providers. If our reputation is damaged or if potential clients do not know
what services we provide, we may become less competitive or lose our market
share. Promotion and enhancement of our name will depend largely on our
success in providing high quality services and digital communications
solutions, which we cannot ensure. If clients do not perceive our services to
be effective or of high quality, our brand name and reputation could be
harmed and our business, results of operations, cash flow, and financial
condition could be materially and adversely affected.
WE NEED TO KEEP PACE WITH TECHNOLOGICAL CHANGES
Our markets and the technologies used in our solutions are
characterized by rapid technological change. Failure to respond in a timely
and cost-effective way to these technological developments would have a
material adverse effect on our business, financial condition and results of
operations. We expect to derive a substantial portion of our revenues from
providing ecommerce and customer care solutions that are based upon leading
technologies and that are capable of adapting to future technologies. As a
result, our success will depend on our ability to offer services that keep
pace with continuing changes in technology, evolving industry standards and
changing client preferences. We may not be successful in addressing future
developments on a timely basis. Our failure to keep pace with the latest
technological developments would have a material adverse effect on our
business, financial condition, results of operations and cash flow.
WE MAY NOT BE ABLE TO PROTECT OUR INTELLECTUAL CAPITAL
We rely on a combination of copyright, trade secret and trademark
laws, and third party nondisclosure agreements to protect our intellectual
property rights. 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. 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. If we are found to have infringed the intellectual property
rights of others, we may be prohibited from using such intellectual property
or might be required to license such intellectual property.
WE MAY NOT BE ABLE TO REUSE TECHNOLOGY THAT WE DEVELOP FOR SPECIFIC CLIENTS
A portion of our business involves the development of technology
solutions for specific client engagements. Ownership of these solutions is
the subject of negotiation and is frequently assigned to the
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client, although we may retain a license for certain uses. Some clients have
prohibited us from marketing the applications developed for them for
specified periods of time or to specified third parties clients may demand
similar or other restrictions in the future. Issues relating to the ownership
of and rights to use solutions can be complicated and disputes may arise that
affect our ability to resell or reuse these solutions. Any limitation on our
ability to resell or reuse a solution could require us to incur additional
expenses to develop new solutions for future projects.
ALTHOUGH WE PASSED THE YEAR 2000 DATE CHANGEOVER WITHOUT PROBLEMS, SUBSEQUENT
EVENTS COULD RESULT IN PROBLEMS SIMILAR TO THOSE ANTICIPATED FOR THE 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.
We have reviewed our internal computer systems and legacy
proprietary hardware and software products that could be affected by the Year
2000 Issue. Based on this review, technology changes for potential Year 2000
issues did not have a material impact on our operations. However, if future
defects arise because of factors not revealed during our review and testing,
including future events that may impact our vendors or other third parties
with which we conduct business, our business, financial condition, results
of operations, and cash flow may be materially adversely affected.
OUR STOCK PRICE IS VOLATILE
Technology companies, including Zamba, frequently experience
volatility in their common stock prices. Factors creating such volatility
include:
- quarterly fluctuations in results of operations and achievement of
key business metrics;
- changes in earnings estimates by securities analysts;
- announcements of technological innovations or the introduction of
new products;
- market reaction to any acquisitions, joint ventures or strategic
investments announced by us or our competitors; and
- 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, if our issued shares and shares issued upon
exercise of stock options are sold on the open market in large
concentrations, our stock price could decline in the short term.
In the past, securities class action litigation has often been
instituted against companies following periods of volatility in the market
price of their securities. This type of litigation could result in
substantial costs and a diversion of management attention and resources.
10
<PAGE>
SUMMARY DESCRIPTION OF OUR BUSINESS
We are a national customer care consulting company. According to
the Gartner Group, customer care is expected to grow at a cumulative average
growth rate of 54% per year through 2002. 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
communication with customers. We deliver our services using a unique
combination of accumulated expertise in the customer care field, existing
technology, and client knowledge. Typically, we perform our services on a
fixed-bid, fixed-timetable basis. Rapid development and significant client
involvement are key aspects to our methodologies. We offer our clients
end-to-end assistance with their implementations, including business case
evaluation, system planning and design, software implementation, modification
and development, training, installation, change management, network
management, and post-implementation support. Our services include the design,
implementation and integration of enterprise level applications to facilitate
sales automation, call center management, marketing automation and automated
field service and sales. We also own approximately 35% of the equity in
NextNet Wireless, Inc., a private corporation engaged in the development of
wireless data products targeted at wireless DSL. Our chairman, Joseph
B. Costello, is also the chairman of NextNet.
USE OF PROCEEDS
We will not receive any proceeds from the sale of shares by the
selling stockholders.
THE ACQUISITIONS
We acquired all of the outstanding common stock of Camworks on
December 29, 1999, through a merger agreement. On that date, the operations
of Camworks were combined with those of Zamba. We acquired all of the
outstanding common stock of Fusion on January 10, 2000, through a merger
agreement. On that date, the operations of Fusion were combined with ours.
Each acquisition has been treated as a "tax-free reorganization" for U.S.
federal income tax purposes and has been accounted for as a pooling-of-
interests for financial reporting purposes under U.S. GAAP.
In exchange for the Camworks stock, we issued an aggregate of
1,000,000 shares of our common stock. 100,000 of the shares were
placed in escrow to secure the indemnification obligations of certain of the
selling stockholders.
In exchange for the Fusion stock, we issued an aggregate of 80,001
shares of our common stock. 8,001 of the shares were placed in
escrow to secure the indemnification obligations of certain of the selling
stockholders.
We agreed to use our best efforts to register 20,001 of the shares
for resale by the former Fusion stockholders following that acquisition, and
we registered for resale 200,000 of the shares held by the former Camworks
stockholders in a registration statement declared effective by the Securities
and Exchange Commission on March 27, 2000.
11
<PAGE>
SELLING STOCKHOLDERS
The following table sets forth, to our knowledge, certain
information about the selling stockholders as of May 26, 2000.
Beneficial ownership is determined in accordance with the rules of
the SEC, and includes voting or investment power with respect to shares.
Unless otherwise indicated below, to our knowledge, all persons named in the
table have sole voting and investment power with respect to their shares of
common stock, except to the extent authority is shared by spouses under
applicable law. The inclusion of any shares in this table does not constitute
an admission of beneficial ownership for the person named below.
<TABLE>
<CAPTION>
------------------- ----------------- ---------------- ----------------- ----------------- -----------------
Name of Selling Number of Percentage of Number of Number of Percentage of
Stockholder Shares of Shares of Shares of Shares of Shares of
Common Stock Common Stock Common Stock Common Stock Common Stock
Beneficially Beneficially Offered Hereby Beneficially Beneficially
Owned Prior to Owned Prior to Owned After Owned After
Offering (1) Offering Offering (1)(2) Offering
------------------- ----------------- ---------------- ----------------- ----------------- -----------------
<S> <C> <C> <C> <C> <C>
Mark Stallings 26,667 * 6,667 20,000 *
------------------- ----------------- ---------------- ----------------- ----------------- -----------------
Doug Eldridge 26,667 * 6,667 20,000 *
------------------- ----------------- ---------------- ----------------- ----------------- -----------------
Mark Beale 26,667 * 6,667 20,000 *
------------------- ----------------- ---------------- ----------------- ----------------- -----------------
Tim Cameron 558,000 1.77 167,400 390,600 1.24
------------------- ----------------- ---------------- ----------------- ----------------- -----------------
Paul Lundberg 372,000 1.18 111,600 260,400 *
------------------- ----------------- ---------------- ----------------- ----------------- -----------------
Scott Owens 70,000 * 21,000 49,000 *
------------------- ----------------- ---------------- ----------------- ----------------- -----------------
</TABLE>
(1) The selling stockholders have sole voting power and
investment power with respect to all shares listed as owned by the selling
stockholders. Of the total shares of common stock listed as owned by
Stallings, Eldridge, and Beale, 8,001 shares are held in an escrow account to
secure indemnification obligations of these former stockholders of Fusion to
us. It is expected that these shares (less any shares that may be distributed
from the escrow account to us in satisfaction of indemnification claims or
retained in escrow pending resolution of any claims) will be released from
escrow and distributed to such selling stockholders in July 2000. Of the
total shares of common stock listed as owned by Cameron, Lundberg, and Owens,
100,000 shares are held in an escrow account to secure indemnification
obligations of these former stockholders of Camworks to us. It is expected
that these shares (less any shares that may be distributed from the escrow
account to us in satisfaction of indemnification claims or retained in escrow
pending resolution of any claims) will be released from escrow and
distributed to such selling stockholders on the earlier of March 31, 2001, or
such earlier date that we file our Report on Form 10-K for the year ended
December 31, 2000. The number of shares indicated as owned by each such
selling stockholder includes those shares (representing 10% of the number of
shares listed as beneficially owned by each selling stockholder) which such
selling stockholder is entitled to receive upon distribution of these shares
from the respective escrow accounts. Twenty Percent (20%) of the shares
issued to Cameron, Lundberg, and Owens were previously registered on a Form
S-3 registration statement that was declared effective by the Securities and
Exchange Commission on March 27, 2000. With the exception of Owens, the
stockholders are under lock-up agreements that restrict the sale of their
remaining shares. The restrictions under the lock-up agreements with
Stallings, Eldridge and Beale are released with regard to 25% of each of the
remaining shares on April 30, 2001, July 31, 2001, October 31, 2001, and
January 31, 2002. The restrictions under the lock-up agreements with Cameron
and Lundberg are released with regard to 20% of the remaining shares on June
30, 2001, and 40% of the remaining shares on each of September 30, 2001, and
December 31, 2001.
(2) We do not know when or in what amounts a selling stockholder
may offer shares for sale and there can be no assurance that the selling
stockholders will sell any or all of the shares offered hereby. Because each
selling stockholder may offer all or some of the shares pursuant to this
offering, and because there are currently no agreements, arrangements or
understandings with respect to the sale of any of the shares that are being
registered in this offering, no estimate can be given as to the amount of the
shares that will be held by the selling stockholders after completion of the
offering. However, for purposes of this table, we have assumed that, after
completion of the offering, none of the shares covered hereby will be held by
the selling stockholders.
* Less than one percent of the number of shares of common stock outstanding.
None of the selling stockholders has held any position or office
with, or has otherwise had a material relationship with, us or any of our
subsidiaries within the past three years, except that the selling
stockholders have been employed by us and Fusion or Camworks. In connection
with the acquisitions of both Fusion and Camworks, we entered into employment
agreements with each of the selling stockholders. Stallings, Eldridge and
Beale are all former employees of Fusion, and Cameron, Lundberg, and Owens
are all former employees of Camworks. The employment agreements with
Stallings, Eldridge, and Beale are
12
<PAGE>
for terms of fifteen (15) months. However, Stallings is no longer employed
with Zamba. The employment agreements with Cameron and Lundberg are for terms
of twenty-four (24) months, and the employment agreement with Owens is for a
term of twelve (12) months. In connection with the merger agreements, all
selling stockholders also entered into non-competition agreements with Zamba.
PLAN OF DISTRIBUTION
The shares covered by this prospectus may be offered and sold from
time to time by the selling stockholders. The term "selling stockholders"
includes donees, pledgees, transferees or other successors-in-interest
selling shares received after the date of this prospectus from a selling
stockholder as a gift, pledge, partnership distribution or other non-sale
related transfer. The selling stockholders will act independently of us in
making decisions with respect to the timing, manner and size of each sale.
Such sales may be made on one or more exchanges or in the over-the-counter
market or otherwise, at prices and under terms then prevailing or at prices
related to the then current market price or in negotiated transactions. The
selling stockholders may sell their shares by one or more of, or a
combination of, the following methods:
- purchases by a broker-dealer as principal and resale by such
broker-dealer for its own account pursuant to this prospectus;
- ordinary brokerage transactions and transactions in which the
broker solicits purchasers;
- block trades in which the broker-dealer so engaged will attempt to
sell the shares as agent but may position and resell a portion of
the block as principal to facilitate the transaction;
- an over-the-counter distribution in accordance with the rules of
the Nasdaq National Market;
- in privately negotiated transactions; and
- in options transactions.
In addition, any shares that qualify for sale pursuant to Rule 144
may be sold under Rule 144 rather than pursuant to this prospectus.
To the extent required, this prospectus may be amended or
supplemented from time to time to describe a specific plan of distribution.
In connection with distributions of the shares or otherwise, the selling
stockholders may enter into hedging transactions with broker-dealers or other
financial institutions. In connection with such transactions, broker-dealers
or other financial institutions may engage in short sales of the common stock
in the course of hedging the positions they assume with selling stockholders.
The selling stockholders may also sell the common stock short and redeliver
the shares to close out such short positions. The selling stockholders may
also enter into option or other transactions with broker-dealers or other
financial institutions which require the delivery to such broker-dealer or
other financial institution of shares offered by this prospectus, which
shares such broker-dealer or other financial institution may resell pursuant
to this prospectus (as supplemented or amended to reflect such transaction).
The selling stockholders may also pledge shares to a broker-dealer or other
financial institution, and, upon a default, such broker-dealer or other
financial institution, may effect sales of the pledged shares pursuant to
this prospectus (as supplemented or amended to reflect such transaction).
In effecting sales, broker-dealers or agents engaged by the selling
stockholders may arrange for other broker-dealers to participate.
Broker-dealers or agents may receive commissions, discounts or concessions
from the selling stockholders in amounts to be negotiated immediately prior
to the sale.
In offering the shares covered by this prospectus, the selling
stockholders and any broker-dealers who execute sales for the selling
stockholders may be deemed to be "underwriters" within the meaning of the
Securities Act in connection with such sales. Any profits realized by the
selling stockholders and the compensation of any broker-dealer may be deemed
to be underwriting discounts and commissions.
13
<PAGE>
In order to comply with the securities laws of certain states, if
applicable, the shares must be sold in such jurisdictions only through
registered or licensed brokers or dealers. In addition, in certain states the
shares may not be sold unless they have been registered or qualified for sale
in the applicable state or an exemption from the registration or
qualification requirement is available and is complied with.
We have advised the selling stockholders that the anti-manipulation
rules of Regulation M under the Exchange Act may apply to sales of shares in
the market and to the activities of the selling stockholders and their
affiliates. In addition, we will make copies of this prospectus available to
the selling stockholders for the purpose of satisfying the prospectus
delivery requirements of the Securities Act. The selling stockholders may
indemnify any broker-dealer that participates in transactions involving the
sale of the shares against certain liabilities, including liabilities arising
under the Securities Act.
At the time a particular offer of shares is made, if required, a
prospectus supplement will be distributed that will set forth the number of
shares being offered and the terms of the offering, including the name of any
underwriter, dealer or agent, the purchase price paid by any underwriter, any
discount, commission and other item constituting compensation, any discount,
commission or concession allowed or reallowed or paid to any dealer, and the
proposed selling price to the public.
We have agreed to indemnify the selling stockholders against certain
liabilities, including certain liabilities under the Securities Act.
We have agreed with the selling stockholders to keep the
Registration Statement of which this prospectus constitutes a part effective
until the earlier of (i) such time as all of the shares covered by this
prospectus have been disposed of pursuant to and in accordance with the
Registration Statement or (ii) January 7, 2001.
LEGAL MATTERS
Leonard, Street and Deinard Professional Association has passed on
the validity of the issuance of the shares offered by this prospectus.
EXPERTS
The consolidated financial statements of Zamba Corporation as of
December 31, 1999 and 1998, and for each of the years in the three-year
period ended December 31, 1999, which are incorporated by reference in this
prospectus, have been audited by KPMG LLP, independent auditors, as set forth
in their report thereon, which as to the year 1997 is based in part on the
report of PricewaterhouseCoopers LLP, independent auditors. The financial
statements referred to above are incorporated herein by reference in reliance
upon these reports given upon the authority of the firms as experts in
accounting and auditing.
14
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the various expenses to be incurred
in connection with the sale and distribution of the securities being
registered hereby, all of which will be borne by the Registrant (except
expenses incurred by the selling stockholders for brokerage, accounting, tax
or legal services or any other expenses incurred by the selling stockholders
in disposing of the shares). All amounts shown are estimates except the
Securities and Exchange Commission registration fee.
<TABLE>
<S> <C>
Filing Fee -- Securities and Exchange Commission............ $ 500
Legal fees and expenses of the Company...................... $ 3,000
Accounting fees and expenses................................ $ 5,000
Miscellaneous expenses...................................... $ 3,000
-------
Total Expenses.................................... $11,500
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the General Corporation Law of Delaware provides that
a corporation has the power to indemnify a director, officer, employee or
agent of the corporation and certain other persons serving at the request of
the corporation in related capacities against amounts paid and expenses
incurred in connection with an action or proceeding to which he is or is
threatened to be made a party by reason of such position, if such person
shall have acted in good faith and in a manner he reasonably believed to be
in or not opposed to the best interests of the corporation, and, in any
criminal proceeding, if such person had no reasonable cause to believe his
conduct was unlawful; provided that, in the case of actions brought by or in
the right of the corporation, no indemnification shall be made with respect
to any matter as to which such person shall have been adjudged to be liable
to the corporation unless and only to the extent that the adjudicating court
determines that such indemnification is proper under the circumstances.
Article 5 of the Registrant's Fourth Amended and Restated
Certificate of Incorporation provides that a director or officer of the
Registrant (a) shall be indemnified by the Registrant against all expenses
(including attorney's fees), judgments, fines and amounts paid in settlement
reasonably incurred in connection with any litigation or other legal
proceeding (other than an action by or in the right of the Registrant)
brought against him by virtue of his position as a director or officer if he
acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the Registrant, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe his conduct
was unlawful, and (b) shall be indemnified by the Registrant against expenses
(including attorney's fees) and amounts paid in settlement reasonably
incurred in connection with any action by or in the right of the Registrant
by virtue of his position as a director or officer of the Registrant if he
acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the Registrant, except that no
indemnification shall be made with respect to any such matter as to which
such director or officer shall have been adjudged to be liable to the
Registrant, unless and only to the extent that a court determines that,
despite the adjudication of liability but in view of all the circumstances of
the case, such person is fairly and reasonably entitled to indemnity for such
expenses as the court deems proper. Notwithstanding the foregoing, to the
extent that a director or officer has been successful, on the merits or
otherwise, he shall be indemnified against all expenses (including attorney's
fees) reasonably incurred by him in connection therewith. Expenses incurred
in defending a civil or criminal action, suit or proceeding shall be advanced
by the Registrant to a director or officer, at his request, upon receipt of
an undertaking by the director or officer to repay such amount if it is
ultimately determined that he is not entitled to indemnification.
Indemnification is required to be made unless the Registrant
determines (in the manner provided in its Amended and Restated Certificate of
Incorporation) that the applicable standard of conduct required for
indemnification has not been met. In the event of a determination by the
Registrant that the director or
<PAGE>
officer did not meet the applicable standard of conduct required for
indemnification, or if the Registrant fails to make an indemnification
payment within 60 days after such payment is claimed by such person, such
person is permitted to petition a court to make an independent determination
as to whether such person is entitled to indemnification. As a condition
precedent to the right of indemnification, the director or officer must give
the Registrant notice of the action for which indemnity is sought and the
Registrant has the right to participate in such action or assume the defense
thereof.
ITEM 16. EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<S> <C>
5.1 Opinion of Leonard, Street and Deinard Professional
Association.
23.1 Consent of KPMG LLP.
23.2 Consent of PricewaterhouseCoopers LLP.
23.3 Consent of Leonard, Street and Deinard Professional
Association, included in Exhibit 5.1 filed herewith.
24.1 Power of Attorney (See page II-4 of this Registration
Statement).
</TABLE>
ITEM 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of this Registration Statement (or
the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in this Registration
Statement; and
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in this
Registration Statement or any material change to such
information in this Registration Statement.
provided, however, that paragraphs (i) and (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
Securities Exchange Act of 1934 that are incorporated by reference in the
Registration Statement.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at the time shall be deemed to
be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
The Registrant hereby undertakes that, for purposes of determining
any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in this
Registration Statement shall be deemed to be a new registration statement
relating to the securities
II-2
<PAGE>
offered therein and the offering of such securities at the time shall be
deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the indemnification
provisions described herein, or otherwise, the Registrant has been advised
that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Amendment 1 to 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 this 30th day of May, 2000.
ZAMBA CORPORATION
By: /s/ Paul Edelhertz
Name: Paul D. Edelhertz
Title: President and Chief Executive Officer
By: /s/ Michael Carrel
Name: Michael H. Carrel
Title: Vice President and Chief Financial Officer
II-3
<PAGE>
We, the undersigned officers and directors of Zamba Corporation,
hereby severally constitute and appoint Paul D. Edelhertz our true and lawful
attorney with full power to sign for us and in our names in the capacities
indicated below the Registration Statement on Form S-3 filed herewith and any
and all pre-effective and post-effective amendments to said Registration
Statement and generally to do all such things in our name and behalf in our
capacities as officers and directors to enable Zamba Corporation to comply
with the provisions of the Securities Act of 1933 and all requirements of the
Securities and Exchange Commission, hereby ratifying and confirming our
signatures as they may be signed by our said attorneys, or any of them, to
said Registration Statement and any and all amendments thereto.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ Paul Edelhertz President and Chief Executive Officer May 26, 2000
---------------------------------- and Director
Paul D. Edelhertz
/s/ Michael Carrel Vice President and Chief Financial Officer May 26, 2000
----------------------------------
Michael H. Carrel
/s/ Joe Costello Director May 26, 2000
----------------------------------
Joseph B. Costello
/s/ Dixon Doll Director May 26, 2000
----------------------------------
Dixon R. Doll
/s/ Todd Fitzwater Director May 26, 2000
----------------------------------
Todd Fitzwater
/s/ John Olsen Director May 26, 2000
----------------------------------
John Olsen
/s/ Sven Wehrwein Director May 26, 2000
----------------------------------
Sven A. Wehrwein
</TABLE>
II-4
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
------- -----------
<S> <C>
5.1 Opinion of Leonard, Street and Deinard Professional
Association.
23.1 Consent of KPMG LLP.
23.2 Consent of PricewaterhouseCoopers LLP
23.3 Consent of Leonard, Street and Deinard Professional
Association, included in Exhibit 5.1 filed herewith.
24.1 Power of Attorney (See page II-4 of this Registration
Statement).
</TABLE>
