<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
CATALYST INTERNATIONAL, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
-------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
-------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-------------------------------------------------------------------------
(5) Total fee paid:
-------------------------------------------------------------------------
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-------------------------------------------------------------------------
(3) Filing Party:
-------------------------------------------------------------------------
(4) Date Filed:
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Notes:
<PAGE>
LOGO
CATALYST INTERNATIONAL, INC.
8989 NORTH DEERWOOD DRIVE
MILWAUKEE, WISCONSIN 53223
----------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
APRIL 28, 1997
To the Stockholders of Catalyst International, Inc.:
The 1997 Annual Meeting of Stockholders of Catalyst International, Inc. will
be held at the offices of the Company, 8989 North Deerwood Drive, Milwaukee,
Wisconsin 53223, on Monday, April 28, 1997 at 8:00 a.m., local time, for the
following purposes:
(1) To elect two Class II Directors to serve for a three-year term;
(2) To approve the Company's 1997 Director Stock Option Plan;
(3) To ratify the appointment of Ernst & Young LLP as the Company's
independent auditors for 1997; and
(4) To transact such other business as may properly come before the
Annual Meeting or any adjourment thereof.
Stockholders of record at the close of business on March 14, 1997 are
entitled to notice of and to vote at the Annual Meeting and at all
adjournments thereof.
YOU ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING. YOUR VOTE IS
IMPORTANT. HOLDERS OF A MAJORITY OF THE OUTSTANDING SHARES MUST BE PRESENT IN
PERSON OR BY PROXY IN ORDER FOR THE ANNUAL MEETING TO BE HELD. THEREFORE, YOU
ARE URGED TO DATE, SIGN AND RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED
ENVELOPE WHETHER OR NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING IN PERSON. IF
YOU ATTEND THE ANNUAL MEETING AND WISH TO VOTE YOUR SHARES PERSONALLY, YOU MAY
DO SO BY REVOKING YOUR PROXY AT ANY TIME PRIOR TO THE VOTING THEREOF.
By Order of the Board of Directors,
Mark T. Ehrmann, Secretary
March 26, 1997
<PAGE>
LOGO
CATALYST INTERNATIONAL, INC.
8989 NORTH DEERWOOD DRIVE
MILWAUKEE, WISCONSIN 53223
----------------
PROXY STATEMENT
----------------
ANNUAL MEETING OF STOCKHOLDERS
APRIL 28, 1997
----------------
The enclosed proxy is solicited by the Board of Directors of Catalyst
International, Inc. for use at the Company's 1997 Annual Meeting of
Stockholders to be held at the time and place and for the purposes set forth
herein and in the accompanying Notice of Annual Meeting of Stockholders.
Only holders of record of the 6,587,534 shares of Common Stock outstanding
at the close of business on March 14, 1997 (the "Record Date") are entitled to
notice of and to vote at the Annual Meeting. The presence, in person or by
proxy, of a majority of the shares of the Common Stock outstanding on the
Record Date will constitute a quorum. Abstentions and broker non-votes (i.e.,
proxies from brokers or nominees indicating that such persons have not
received instructions from the beneficial owners or other persons entitled to
vote shares as to a matter with respect to which brokers or nominees do not
have discretionary power to vote) will be treated as present for purposes of
determining the quorum. Neither abstentions nor broker non-votes will have an
impact on the election of Directors. With respect to Proposals Two and Three,
abstentions and broker non-votes will have the same effect as a vote against
the proposal. Each share of Common Stock entitles its holder to cast one vote
on each matter to be voted upon at the Annual Meeting.
This Proxy Statement, Notice of Annual Meeting of Stockholders and the
accompanying proxy card, together with the Company's Annual Report to
Stockholders, including audited financial statements for the year ended
December 31, 1996, are being mailed to stockholders of the Company commencing
on or about March 26, 1997.
IF THE ACCOMPANYING PROXY CARD IS PROPERLY SIGNED AND RETURNED TO THE
COMPANY AND NOT REVOKED, IT WILL BE VOTED IN ACCORDANCE WITH THE INSTRUCTIONS
CONTAINED THEREON. EACH STOCKHOLDER MAY REVOKE A PREVIOUSLY GRANTED PROXY AT
ANY TIME BEFORE IT IS EXERCISED BY WRITTEN NOTICE OF REVOCATION OR BY
SUBMITTING A DULY EXECUTED PROXY BEARING A LATER DATE TO THE SECRETARY OF THE
COMPANY.
<PAGE>
PROPOSAL ONE
ELECTION OF DIRECTORS
The Company's directors are divided into three classes, designated as Class
I, Class II and Class III, with staggered terms of three years each. The term
of office of Directors in Class II expires at the 1997 Annual Meeting. The
Board of Directors proposes that the nominees described below, both of whom
are currently serving as Class II Directors, be elected as Class II Directors
for a new term of three years ending at the Company's 2000 Annual Meeting of
Stockholders or until their successors are duly elected and qualified.
Nominees receiving the largest number of affirmative votes cast will be
elected as Directors up to the maximum number of Directors to be chosen at the
election.
NOMINEES FOR DIRECTORS
CLASS II DIRECTORS (TERM TO EXPIRE IN 2000)
<TABLE>
<CAPTION>
NAME PRINCIPAL OCCUPATION AND DIRECTORSHIPS
---- --------------------------------------
<C> <S>
Douglas B. Coder ........... Mr. Coder has served as a Director of the
Age 61 Company since July 1992 and as Chairman of the
Board since January 1997. Mr. Coder has served
as a principal of the Coder Company (a real
estate brokerage firm) and DBC Realty (a real
estate holding company) since 1969 and 1971,
respectively.
Terrence L. Mealy........... Mr. Mealy has served as a Director of the
Age 66 Company since July 1992. Mr. Mealy has been an
attorney in private practice since 1957 and is a
member of the State Bar of Iowa.
CONTINUING DIRECTORS
CLASS III DIRECTOR (TERM EXPIRING IN 1998)
Roy J. Carver............... Mr. Carver has served as a Director of the
Age 53 Company since April 1994. Since 1982, Mr. Carver
has served as Chairman of the Board of Carver
Pump Company (a manufacturer of pumps and
related products).
CLASS I DIRECTORS (TERM EXPIRING IN 1999)
Vaemond H. Crane............ Mr. Crane has served as a Director of the
Age 57 Company since July 1992. From January 1993 until
January 1997, Mr. Crane served as Chairman and
Chief Executive Officer of the Company. From
April 1994 until January 1997, Mr. Crane served
as President and Treasurer of the Company. From
1990 until joining the Company, Mr. Crane was a
private investor in several technology
companies. Mr. Crane previously served as
President and Chief Executive Officer of MIPS
Computer Systems (a microprocessor development
company), as President and Chief Operating
Officer of Computer Consoles, Inc. (an
application software company), as Vice President
and General Manager-Systems Group of Intel Corp.
(a manufacturer of semiconductors) and in
various management positions with Sperry Univac
(a manufacturer of computer systems).
James F. Goughenour......... Mr. Goughenour has served as a Director of the
Age 59 Company since January 1997, when he was elected
to fill the vacancy created by the resignation
of Thomas Roberts in November 1996. Since 1979,
Mr. Goughenour has served successively as Vice
President of Information Technologies, Customer
Service, Distribution, Logistics, and Process
Improvement & Technology for HON Industries (a
manufacturer of office furniture and
fireplaces).
</TABLE>
2
<PAGE>
The Board of Directors recommends you vote FOR the election of each of the
individuals nominated to serve as Class II Directors and your proxy will be so
voted unless you specify otherwise.
MEETINGS AND COMMITTEES OF THE BOARD
The Board of Directors has standing Audit, Compensation and Nominating
Committees. The Board of Directors does not have a Finance Committee. The
Board of Directors held six meetings in 1996. Each director attended at least
75% of the full board meetings and meetings of committees on which such
Director served in 1996.
The Audit Committee, consisting of Messrs. Carver, Crane, Mealy and
Goughenour, nominates the Company's independent auditors for approval by the
Board of Directors and reviews the scope, results and costs of the audit with
the Company's independent auditors. It also reviews the financial statements
of the Company and the audit function to assure full compliance with the
requirements of regulatory agencies and full disclosure of necessary
information to the stockholders of the Company. The Audit Committee was
established in November 1995 and held one meeting in 1996. It has recommended
the appointment of Ernst & Young LLP as the independent auditors of the
Company for the year ending December 31, 1997.
The Compensation Committee, consisting of Messrs. Carver, Coder and Mealy,
establishes compensation levels for the executive officers of the Company,
including the annual bonus plan for senior management, and administers the
Company's 1993 Stock Option Plan, as amended. The Compensation Committee did
not meet independently in 1996 because compensation decisions were made by the
full Board of Directors during 1996, but plans to meet in 1997.
The Nominating Committee, consisting of Messrs. Carver, Crane and Mealy,
nominates persons for election as directors of the Company. The Nominating
Committee was established in March 1997 and has not yet held a meeting in
1997.
Mr. Coder receives compensation of $2,000 per month plus full medical
benefits in consideration for performing his duties as Chairman of the Board.
In addition, Mr. Goughenor performs consulting services for the Company at a
daily rate of $2,000.
DIRECTOR COMPENSATION
Directors of the Company who are not employees of the Company receive a fee
of $1,500 for each Board of Directors meeting they attend and $500 for each
Committee meeting they attend; they are also reimbursed for their expenses
incurred in connection with their responsibilities as directors.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Based solely upon a review of Forms 3, 4 and 5 furnished to the Company
pursuant to Section 16 of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), Vaemond H. Crane failed to file a Form 5 on a timely basis
reporting a disposition of shares pursuant to a gift transaction in December,
1996; Judy Fearn failed to file a Form 5 on a timely basis reporting a stock
option grant of 10,000 shares in December, 1996 and failed to file a Form 5 on
a timely basis reporting a stock purchase of 200 shares in November, 1995;
Doug Kennedy failed to file a Form 5 on a timely basis reporting a stock
option grant of 5,000 shares in December, 1996; Dave Kogut failed to file a
Form 5 on a timely basis reporting a stock option grant of 5,000 shares in
December, 1996; Sean McGowan failed to file a Form 5 on a timely basis
reporting a stock option grant of 10,000 shares in December, 1996; Scott
Rishel failed to file a Form 5 on a timely basis reporting a stock option
grant of 2,000 shares in December, 1996; Lisa Sanregret failed to file a Form
5 on a timely basis reporting a stock option grant of 5,000 shares in
December, 1996 and Marcie Wargolet failed to file a Form 5 on a timely basis
reporting a stock option grant of 5,000 shares in December, 1996. All forms
have subsequently been filed.
3
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table indicates, as of February 28, 1997 (unless otherwise
noted), beneficial ownership of Common Stock by directors, certain executive
officers and persons known by the Company to be beneficial owners of more than
5% of its outstanding Common Stock, and all directors and executive officers of
the Company as a group. Unless otherwise indicated, the person listed has sole
voting and investment power.
<TABLE>
<CAPTION>
AMOUNT AND
NAME AND ADDRESS OF NATURE OF
BENEFICIAL BENEFICIAL PERCENT OF
OWNERS OWNERSHIP CLASS
------------------- ---------- ----------
<S> <C> <C>
Roy J. Carver................................ 234,742 3.56%
2415 Park Avenue
Muscatine, IA 52761
Douglas B. Coder............................. 788,146(1) 11.96%
8711 East Pinnacle Peak Road #127
Scottsdale, AZ 85255
Vaemond H. Crane............................. 78,076(2) 1.19%
10801 East Happy Valley Road #69
Scottsdale, AZ 85255
James F. Goughenour.......................... 0 *
200 Oak Street
Muscatine, IA 52761
Terrence L. Mealy............................ 826,489 12.55%
301 East Second Street
Muscatine, IA 52761
James G. Stowers............................. 380,000(3) 5.77%
8989 North Deerwood Drive
Milwaukee, WI 53223
Sean P. McGowan.............................. 12,000 *
8989 North Deerwood Drive
Milwaukee, WI 53223
David M. Kogut............................... 17,750(4) *
8989 North Deerwood Drive
Milwaukee, WI 53223
Marcie A. Wargolet........................... 28,916(5) *
8989 North Deerwood Drive
Milwaukee, WI 53223
Judith K. Fearn.............................. 18,200(6) *
8989 North Deerwood Drive
Milwaukee, WI 53223
John F. Kramer............................... 400(7) *
8989 North Deerwood Drive
Milwaukee, WI 53223
James C. Slawny.............................. 9,249(8) *
8989 North Deerwood Drive
Milwaukee, WI 53223
State of Wisconsin Investment Board.......... 795,000(9) 12.07%
Post Office Box 7842
Madison, WI 53707
Massachusetts Financial Services............. 437,500(10) 6.64%
500 Bolston Street, 15th Floor
Boston, MA 02116
All directors and executive officers as a
group (18 persons).......................... 2,406,658(11) 36.13%
</TABLE>
4
<PAGE>
- --------
*Less than 1% of the outstanding Common Stock.
(1) Includes 36,271 shares held by Mr. Coder's spouse, 286,240 shares held by
S&S Partnership and 104,498 shares held in trust for the benefit of Mr.
Coder's children. Mr. Coder disclaims beneficial ownership of all such
shares. Mr. Coder has sole voting and investment power with respect to
355,137 shares and shared voting and investment power with respect to
433,009 shares.
(2) Includes 27,265 shares held in the name of the Crane Revocable Trust. Mr.
Crane has sole voting and investment power with respect to 51,000 shares
and shared voting and investment power with respect to 27,076 shares.
(3) Includes 20,000 shares held in the name of Mr. Stowers' minor children as
to which Mr. Stowers disclaims beneficial ownership. Mr. Stowers has sole
voting and investment power with respect to 360,000 shares and shared
voting and investment power with respect to 20,000 shares.
(4) Includes options to purchase 14,000 shares which are exercisable within 60
days of February 28, 1997. Mr. Kogut was promoted to Senior Vice President
of Operations in January 1997.
(5) On February 27, 1997, Ms. Wargolet ceased being an employee of the
Company. This number includes options to purchase 20,583 shares which are
exercisable on or before March 29, 1997 in accordance with the terms of
her stock option agreement.
(6) Includes options to purchase 18,000 shares which are exercisable within 60
days of February 28, 1997.
(7) Represents options to purchase 400 shares which are exercisable within 60
days of February 28, 1997. Mr. Kramer was promoted to Vice President of
Sales in October 1996.
(8) On February 27, 1997, Mr. Slawny ceased being an employee of the Company.
This number represents options to purchase 9,249 shares which are
exercisable on or before March 29, 1997 pursuant to the terms of his stock
option agreement.
(9) This information is based on a Schedule 13G dated January 21, 1997.
(10) This information is based on a Schedule 13G dated February 12, 1997.
(11) Includes shares and options to purchase 73,048 shares which are
exercisable within 60 days of February 28, 1997 for persons who are no
longer employed by the Company as of March 14, 1997.
5
<PAGE>
EXECUTIVE OFFICERS*
<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- --------
<C> <C> <S>
Sean P. McGowan................ 36 President and Chief Operating
Officer
James G. Stowers............... 53 Senior Vice President--Corporate
Development
David M. Kogut................. 45 Senior Vice President--Operations
Judith K. Fearn................ 35 Vice President--European Operations
Douglas J. Kennedy............. 33 Vice President--Software Engineering
John F. Kramer................. 33 Vice President--Sales
David Harney................... 58 Vice President--Research and
Development
Steven S. Rishel............... 31 Vice President--Marketing
</TABLE>
- --------
* Information current as of March 14, 1997
SEAN P. MCGOWAN has served the President and Chief Operating Officer since
January 1997. Prior thereto, Mr. McGowan served as Senior Vice President--
North American Operations from May 1996 to January 1997. Prior to joining the
Company, Mr. McGowan served as General Manager and as Sales Manager at
Professional Control Corporation from 1991 to 1996; as General Manager and
part-owner of All-Prox Distribution Services, Inc., from 1986 to 1991 and as a
salesman for Sencon, an Industrial Controls corporation, with territories
including the East Coast and Midwest from 1982 to 1985.
JAMES G. STOWERS is one of the co-founders of the Company and has served as
its Senior Vice President--Corporate Development since April 1994. Prior
thereto, Mr. Stowers served as a Vice President of the Company with various
marketing, sales and management responsibilities. Mr. Stowers was a director
of the Company from August 1982 to November 1993.
DAVID M. KOGUT has served as Senior Vice President--Operations since January
1997. Prior thereto, Mr. Kogut served as Vice President--Customer Service of
the Company from October 1995 to January 1997; as Vice President--Marketing
from October 1993 to October 1995 and as Vice President--Systems Integration
since rejoining the Company in October 1991.
JUDITH K. FEARN has served as Vice President--European Operations since
December 1995 and prior thereto served as the Company's Managing Director--
United Kingdom from May 1994. Prior to joining the Company, Ms. Fearn was
employed for over eight years by Calidus Systems, a competitor of the Company,
and served as its Principal Consultant/Account Manager from 1992 to 1994, and
as its Research and Development Manager from 1989 to 1992.
DOUGLAS J. KENNEDY has served as Vice President--Software Engineering since
August 1996. From December 1995 to August 1996, Mr. Kennedy served as
Director--Retail Operations. Prior thereto, Mr. Kennedy served as a Project
Manager from November 1994 to November 1995. Prior to joining the Company, Mr.
Kennedy worked in various positions at Woolworth Corporation.
JOHN F. KRAMER has served as Vice President--Sales since October 1996. From
January 1996 to October 1996, Mr. Kramer served as Regional Sales Manager for
the Northeast United States. Prior to joining the Company, Mr. Kramer was
employed as a Regional Salesperson for Pansophic/Computer Associates from
December 1990 to January 1996.
DAVID L. HARNEY has served as Vice President--Research and Development of
the Company since December 1992 and served as Vice President--Software
Development from February 1991 to December 1992.
STEVEN S. RISHEL has served as Vice President--Marketing since August 1996.
Prior to joining the Company, Mr. Rishel served as a Regional Manager at
Computer Technology Corporation from August 1993 to August 1996. Prior
thereto, Mr. Rishel served as a Regional Manager at Tayio America.
6
<PAGE>
EXECUTIVE COMPENSATION
Summary Compensation Table. The following table sets forth the compensation
paid by the Company to the Chief Executive Officer and certain of the other
most highly compensated executive officers (collectively, the "named executive
officers") of the Company for services rendered in all capacities to the
Company for the years ended December 31, 1994, 1995 and 1996.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL
COMPENSATION LONG TERM COMPENSATION AWARDS
---------------- ------------------------------------
NAME AND PRINCIPAL SALARY
POSITION YEAR ($) BONUS SECURITIES UNDERLYING OPTIONS (#)(1)
- ------------------ ---- -------- ------- ------------------------------------
<S> <C> <C> <C> <C>
Vaemond H. Crane(2)..... 1996 $190,000 $ -- --
President and Chief
Executive Officer 1995 177,500 15,625 100,000
1994 158,617 35,688 66,670
Sean P. McGowan(3)...... 1996 114,845 40,000 120,000
Sr. Vice President,
N.A. Operations
Marcie A. Wargolet(4)... 1996 114,760 -- 5,000
Vice President--
Software Development.. 1995 90,128 4,165 40,000
1994 66,667 17,190 40,000
Judith K. Fearn......... 1996 118,400 -- 10,000
Vice President--
European Operations... 1995 99,200 8,394 45,000
1994 62,000 15,500 15,000
James C. Slawny(5)...... 1996 100,000 --
Vice President--
Software Engineering.. 1995 78,000 4,790 45,000
1994 63,000 -- 15,000
</TABLE>
- --------
(1) None of the named executive officers held restricted stock at the end of
1996.
(2) Mr. Crane resigned all of his positions as an officer of the Company in
January 1997. His right to exercise the options to purchase stock expired
on February 2, 1997 pursuant to the terms of his stock option agreement.
(3) Mr. McGowan was hired by the Company in May 1996, and was named President
and Chief Operating Officer in January 1997.
(4) As of February 27, 1997, Ms. Wargolet ceased being an employee of the
Company. Her right to exercise her options to purchase stock expires on
March 29, 1997 pursuant to the terms of her stock option agreement.
(5) As of February 27, 1997, Mr. Slawny ceased being an employee of the
Company. His right to exercise his options to purchase stock expires on
March 29, 1997 pursuant to the terms of his stock option agreement.
Options. The Company granted options to the named executive officers during
fiscal 1996 as set forth below.
OPTION GRANTS IN LAST FISCAL YEAR (1996)
<TABLE>
<CAPTION>
PERCENTAGE OF TOTAL OPTIONS EXERCISE
NUMBER OF SECURITIES GRANTED TO EMPLOYEES IN PRICE EXPIRATION
NAME UNDERLYING OPTIONS GRANTED FISCAL 1996 ($/SHARE)(1) DATE
- ---- -------------------------- --------------------------- ------------ ----------
<S> <C> <C> <C> <C>
Vaemond H. Crane........ 100,000(2) 6.91% $8.50 04/03/06
Sean P. McGowan......... 110,000(3) 7.60% 6.75 07/26/06
10,000(4) 0.69% 4.125 12/06/06
Marcie A. Wargolet...... 40,000(5) 2.76% 8.50 03/29/97
5,000(6) 0.34% 4.125 03/29/97
Judith K. Fearn......... 45,000(7) 3.11% 8.50 04/03/06
10,000(8) 0.69% 4.125 12/06/06
James C. Slawny......... 45,000(9) 3.11% 8.50 03/29/97
</TABLE>
7
<PAGE>
- --------
(1) Options were granted or repriced at an exercise price equal to the fair
market value of the shares as of the date of grant or date of repricing.
(2) Represents repricing of options granted in 1995. In connection with the
repricing, the option vesting schedule was reset as of the date of
repricing (April 3, 1996). The repriced options vest 20% on the first
anniversary of the repricing (April 3, 1997) and 1 2/3% each month
thereafter provided Mr. Crane remained an employee of the Company. As of
January 3, 1997, Mr. Crane ceased being an employee of the Company, and
therefore, none of the options are or will be exercisable.
(3) The options vest 20% on the first anniversary of the date of grant (July
26, 1996) and 1 2/3% each month thereafter provided Mr. McGowan remains an
employee of the Company. Represents options issued following the
cancellation of options granted at the time of Mr. McGowan's hire. In the
event of certain change in control transactions involving the Company or
upon termination of Mr. McGowan's employment under certain circumstances,
all such options shall vest immediately.
(4) The options vest 20% on the first anniversary of the date of grant
(December 6, 1996) and 1 2/3% each month thereafter provided Mr. McGowan
remains an employee of the Company. In the event of certain change in
control transactions involving the Company or upon termination of Mr.
McGowan's employment under certain circumstances, all such options shall
vest immediately.
(5) Represents repricing of options granted in 1995. In connection with the
repricing, the option vesting schedule was reset as of the date of
repricing (April 3, 1996). The repriced options vest 20% on the first
anniversary of the repricing (April 3, 1997) and 1 2/3% each month
thereafter provided that Ms. Wargolet remained an employee of the Company.
As of February 27, 1997, Ms. Wargolet ceased being an employee of the
Company, and therefore, none of the options are or will be exercisable.
(6) The options vest 20% on the first anniversary of the date of grant
(December 6, 1996) and 1 2/3% each month thereafter provided Ms. Wargolet
remained an employee of the Company. As of February 27, 1997, Ms. Wargolet
ceased being an employee of the Company, and therefore, none of the
options are or will be exercisable.
(7) Represents repricing of options granted in 1995. In connection with the
repricing, the option vesting schedule was reset as of the date of
repricing (April 3, 1996). The repriced options vest 20% on the first
anniversary of the repricing (April 3, 1997) and 1 2/3% each month
thereafter provided Ms. Fearn remains an employee of the Company.
(8) The options vest 20% on the first anniversary of the date of grant
(December 6, 1996) and 1 2/3% each month thereafter provided Ms. Fearn
remains an employee of the Company.
(9) Represents repricing of options granted in 1995. In connection with the
repricing, the option vesting schedule was reset as of the date of
repricing (April 3, 1996). The repriced options vest 20% on the first
anniversary of the repricing (April 3, 1997) and 1 2/3% each month
thereafter provided Mr. Slawny remained an employee of the Company. As of
February 27, 1997, Mr. Slawny ceased being an employee of the Company, and
therefore, none of the options are or will be exercisable.
8
<PAGE>
AGGREGATED OPTION EXERCISES AND FISCAL YEAR-END OPTION VALUE TABLE
The following table provides information regarding the value of stock
options held at December 31, 1996 by the persons named in the Summary
Compensation Table. No executive officers exercised options in 1996.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED OPTIONS/SAR IN-THE-MONEY OPTIONS
AT FISCAL YEAR-END AT FISCAL YEAR-END
-------------------------------------- -----------------------
NAME EXERCISABLE UNEXERCISABLE EXCISABLE UNEXERCISABLE
- ---- ---------------- ------------------ --------- -------------
<S> <C> <C> <C> <C>
Vaemond H. Crane(1)..... 45,003 121,667 $4,500 $98,043
Sean P. McGowan......... 0 120,000 0 5,000
Marcie A. Wargolet(2)... 19,250 57,417 1,925 58,687
Judith K. Fearn......... 8,000 62,000 800 36,675
James C. Slawny(3)...... 8,749 51,251 1,599 5,995
</TABLE>
- --------
(1) In January 1997, following his resignation as President, Chairman of the
Board and Chief Executive Officer, Mr. Crane exercised options to purchase
46,670 shares of common stock and realized an aggregate value of $129,509
upon exercise.
(2) Pursuant to the terms of her stock option agreement, Ms. Wargolet's right
to exercise options to purchase 20,583 shares of common stock expires on
March 29, 1997.
(3) Pursuant to the terms of his stock option agreement, Mr. Slawny's right to
exercise options to purchase 9,249 shares of common stock expires on March
29, 1997.
EMPLOYMENT AGREEMENTS; SERVICE AGREEMENTS
The Company and Mr. Stowers are parties to a letter agreement dated August
1, 1992 which sets forth the terms under which Mr. Stowers will continue to
serve as Senior Vice President--Corporate Development through August 1, 1997.
The agreement may be earlier terminated upon the death, disability or
resignation of Mr. Stowers or by the Company for "cause," as defined in such
agreement. Under the employment agreement, Mr. Stowers receives a base salary
as provided in such agreement, subject to adjustment by the Board of Directors
and is entitled to participate in the benefit plans generally provided by the
Company to its executive officers, including annual bonus plans, vacation
plans, and health and welfare plans. The employment agreement prohibits Mr.
Stowers from competing with the Company and requires Mr. Stowers to assign to
the Company any intellectual property rights developed by Mr. Stowers during
his employment. The covenants against competition extend until July 31, 1997,
unless Mr. Stowers terminates his employment for "good reason" or the Company
terminates Mr. Stowers without "cause" (as such terms are defined in the
employment agreement), in which case they expire upon termination of Mr.
Stowers' employment with the Company. The agreement also requires the Company
to indemnify Mr. Stowers for claims related to the intellectual property
rights assigned by such executive under his employment contract.
The Company and Mr. Templar were parties to a letter agreement dated August
1, 1992 which set forth the terms under which Mr. Templar would continue to
serve as Senior Vice President--Systems Technology through August 1, 1997. In
July 1996, Mr. Templar resigned from his position with the Company and,
accordingly, his employment agreement with the Company was terminated. The
Company retains Mr. Templar's services on a part-time basis as a consultant.
The Company and Mr. Crane were parties to a letter agreement dated October
30, 1995 which set forth the terms under which Mr. Crane would continue to
serve as Chairman of the Board, President and Chief Executive Officer of the
Company through June 30, 1999. In January, 1997, Mr. Crane resigned all of his
positions as an officer of the Company. Pursuant to the terms of an agreement
between the Company and Mr. Crane, the
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October, 1995 letter agreement was terminated, Mr. Crane received a lump sum
payment in the amount of $190,000 and the Company redeemed 225,945 shares of
common stock owned by Mr. Crane at a per share price of $4.75.
REPRICING OF OPTIONS
In March 1996, the Company's Board of Directors approved the repricing of
stock options granted in 1995 and 1996 as an additional incentive for
employees of the Company to remain employed with the Company because certain
of their options previously granted were issued at a price above the market
value of the Company's common stock. The repricing was made effective April 3,
1996 at a per share option price of $8.50, the market value of the Company's
common stock on that date. The repricing was made available to all employees
on a voluntary basis and was made in exchange for the agreement of each such
employee to modify the vesting schedule with respect to such options so that
20% of the shares would be vested on the first anniversary of the date of the
option amendment (i.e. April 3, 1997) and the balance would vest at a rate of
1 2/3% per month over the next 48 months thereafter provided the optionee
remains an employee of the Company.
PROPOSAL TWO
APPROVAL OF THE COMPANY'S 1997 DIRECTOR STOCK OPTION PLAN
GENERAL
Proxies solicited by the Board of Directors, will, unless otherwise
directed, be voted for the approval of the Catalyst International, Inc. 1997
Director Stock Option Plan (the "Director Option Plan"). The Director Option
Plan was adopted by the Board of Directors on March 19, 1997, subject to
approval by the Company's stockholders. The Director Option Plan was adopted
for the purpose of attracting and retaining outside directors and
strengthening the mutuality of interests between such directors and the
Company's stockholders.
The proposed text of the Director Option Plan is set forth in its entirety
in Exhibit A attached hereto and the description of the Director Option Plan
set forth herein is qualified in its entirety by reference thereto.
ELIGIBILITY
All non-employee directors of the Company ("Eligible Directors") are
eligible to receive options under the Director Option Plan. The Company
currently has five non-employee directors eligible to participate in the
Director Option Plan, two of whom are standing for reelection to the Board of
Directors. See Proposal One.
TYPE AND DESCRIPTION OF OPTIONS
The Director Option Plan provides for initial and annual option grants,
option grants in lieu of cash compensation to the Board of Directors for
services performed and additional option grants from time to time, in the
Board's sole discretion. Upon the Effective Date, as defined in the Director
Option Plan, each Eligible Director shall automatically be granted options to
purchase 10,000 shares of Catalyst Common Stock, $0.10 par value ("Common
Stock"), and each Eligible Director who first becomes a member of the Board
after the Effective Date shall automatically be granted options to purchase
10,000 shares of Common Stock on the date of his or her election to the Board.
Each Eligible Director shall also automatically be granted options to purchase
5,000 shares of Common Stock on each anniversary of the date of such initial
grant (beginning on the second such anniversary), so long as that person is an
Eligible Director on such date. As of March 20, 1997, the fair market value of
the shares underlying the options was $3.625.
The number of options which may be granted to any Eligible Director under
the Director Option Plan cannot be determined because the number of options
issued and the terms of the Option Agreements are in the discretion of the
Board. The total number of shares which may be granted under the Director
Option Plan shall not exceed 250,000.
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ADMINISTRATION
The Director Option Plan shall be administered by the Board. The Board may
delegate any or all of its administrative responsibilities under the Director
Option Plan to officers or employees of the Company.
TERMS OF OPTIONS
The option price per share of Common Stock which each Eligible Director may
purchase upon exercise of a stock option shall be equal to the closing price
of a share of Common Stock on the date of grant on The Nasdaq Stock Market.
Options granted under the Director Option Plan become exercisable and shall
be for a term as set forth in separate option agreements between the Company
and the Eligible Director (the "Option Agreements").
Unless otherwise determined by the Board, an option granted under the
Director Option Plan shall not be transferable by an Eligible Director
otherwise than by will or by the laws of descent and distribution, to the
extent consistent with the terms of the Director Option Plan and the Option
Agreement, and all Options shall be exercisable, during an Eligible Director's
lifetime, only by the Eligible Director.
The Director Option Plan may be amended, discontinued or terminated in whole
or in part by the Board; the Board may likewise amend the terms of the Option
Agreements, prospectively or retroactively, but no such amendment may impair
the rights of any Eligible Director without the Eligible Director's consent.
FEDERAL INCOME TAX CONSEQUENCES RELATING TO OPTIONS
An Eligible Director who is granted a non-qualified stock option does not
have taxable income at the time of grant, but does have taxable income at the
time of exercise equal to the difference between the exercise price of the
shares and the market value of the shares on the date of exercise. The Company
will generally be entitled to a corresponding tax deduction for the same
amount.
The affirmative vote of holders of a majority of shares of Common Stock
present in person or represented by proxy at the Annual Meeting and entitled
to vote thereon is required to approve the adoption of the Director Option
Plan. The Board of Directors recommends you vote FOR the approval of the
Director Option Plan and your proxy will be so voted unless you specify
otherwise.
PROPOSAL THREE
RATIFICATION OF INDEPENDENT AUDITORS
Upon recommendation of the Audit Committee and subject to ratification by
the stockholders at the Annual Meeting, the Board of Directors has appointed
Ernst & Young LLP, an independent public accounting firm, to audit the
financial statements of the Company for the year ending December 31, 1997.
Ernst & Young LLP has audited the Company since 1993. Representatives of Ernst
& Young LLP will attend the Annual Meeting and have the opportunity to make a
statement if they so desire, and will also be available to answer questions.
The affirmative vote of holders of a majority of shares of Common Stock
present in person or represented by proxy at the Annual Meeting and entitled
to vote thereon is required to ratify the appointment of Ernst & Young LLP as
the Company's independent auditors for the year ending December 31, 1997. The
Board of Directors recommends you vote FOR the ratification of the appointment
of Ernst & Young LLP and your proxy will be so voted unless you specify
otherwise.
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SUBMISSION OF STOCKHOLDER PROPOSALS
In accordance with the Company's By-Laws, nominations, other than by or at
the direction of the Board of Directors, of candidates for election as
directors at the Company's 1998 Annual Meeting of Stockholders and other
proposals to be submitted for consideration at the Company's 1998 Annual
Meeting of Stockholders must be received by the Company no later than January
28, 1998 and must otherwise be in accordance with the requirements of the
Company's By-Laws. To be considered for inclusion in the proxy statement for
the Company's 1998 Annual Meeting of Stockholders, stockholder proposals for
consideration at the Company's 1998 Annual Meeting of Stockholders must be
received by the Company at the Company's principal executive offices by
December 28, 1997. Such nominations or proposals must be submitted to Catalyst
International, Inc., 8989 North Deerwood Drive, Milwaukee, Wisconsin 53223,
Attention: Corporate Secretary. To avoid disputes as to the date of receipt,
it is suggested that any stockholder proposal be submitted by certified mail,
return receipt requested.
OTHER MATTERS
Although management is not aware of any other matters that may come before
the Annual Meeting, if any such matters should be properly presented, the
persons named in the accompanying proxy intend to vote such proxy in
accordance with their best judgment.
The expenses of printing and mailing proxy material, including expenses
involved in forwarding materials to beneficial owners of stock, will be borne
by the Company. No solicitation other than by mail is contemplated, except
that officers or employees of the Company may solicit the return of proxies
from certain stockholders by telephone, personal solicitation or facsimile.
STOCKHOLDERS MAY OBTAIN A COPY OF THE COMPANY'S ANNUAL REPORT TO THE
SECURITIES AND EXCHANGE COMMISSION AS FILED ON FORM 10-KSB AT NO COST BY
WRITING TO THE INVESTOR RELATIONS DEPARTMENT, CATALYST INTERNATIONAL, INC.,
8989 NORTH DEERWOOD DRIVE, MILWAUKEE, WISCONSIN 53223. EXHIBITS TO FORM 10-KSB
WILL BE FURNISHED UPON PAYMENT OF THE COMPANY'S REASONABLE EXPENSES IN
FURNISHING THE EXHIBITS.
By Order of the Board of Directors,
/s/ Mark T. Ehrmann
Mark T. Ehrmann, Secretary
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EXHIBIT A
CATALYST INTERNATIONAL, INC.
1997 DIRECTOR STOCK OPTION PLAN
ARTICLE I
Purpose
The purpose of the 1997 Director Stock Option Plan (the "Plan") is to enable
Catalyst International, Inc. (the "Company") to attract and retain outside
directors and to strengthen the mutuality of interests between such directors
and the Company's stockholders.
ARTICLE II
Definitions
For purposes of the Plan, the following terms shall have the following
meanings:
2.1 "Board" shall mean the Board of Directors of the Company.
2.2 "Code" shall mean the Internal Revenue Code of 1986, as amended, and
rules and regulations under the Internal Revenue Code of 1986, as amended.
2.3 "Common Stock" shall mean the Common Stock, par value $0.10 per share of
the Company.
2.4 "Effective Date" shall mean the date on which the Plan is approved by
the affirmative vote of the holders of a majority of the outstanding shares of
Common Stock present, or represented, and entitled to vote at a duly held
meeting of the stockholders of the Company.
2.5 "Eligible Director" shall mean any member of the Board who, on the date
on which Options are to be granted, is not an employee of the Company or any
of the Company's subsidiaries, but shall exclude any such member of the Board
who advises the Company in writing of his or her desire not to participate in
the Plan.
2.6 "Fair Market Value" for purposes of the Plan, unless otherwise required
by the Code, shall mean, of any date, the closing price of a share of Common
Stock as reported on the principal national securities exchange on which the
Common Stock is listed or admitted to trading, or, if not listed or traded on
any such exchange, on the Nasdaq Stock Market, or, if not so listed or traded,
the fair market value as determined by the Board, which determination shall be
conclusive.
2.7 "Optionee" shall mean an individual to whom a Stock Option has been
granted under the Plan.
2.8 "Stock Option" or "Option" shall mean any option to purchase shares of
Common Stock granted pursuant to Article VI.
ARTICLE III
Administration
3.1 Administration. The Plan shall be administered and interpreted by the
Board.
3.2 Guidelines. Subject to Article VII, the Board shall have the authority
to adopt, alter and repeal administrative rules, guidelines and practices
governing the Plan as it, from time to time, deems advisable; to interpret the
terms and provisions of the Plan and any Option granted under the Plan (and
any related agreements); to make discretionary grants under the Plan; to
accelerate vesting or exercise of an option; to
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determine the terms, conditions and restrictions of an option; to grant
waivers of Plan terms; and to otherwise supervise the administration of the
Plan. The Board may correct any defect, supply any omission, conform the Plan
to any change in law or regulation, or reconcile any inconsistency or
ambiguity in the Plan or in any Option in the manner and to the extent it
shall deem necessary to carry the Plan into effect. Notwithstanding the
foregoing, no action of the Board under this Section 3.2 shall impair the
rights of any Option without such person's consent, unless otherwise required
by law.
3.3 Decisions Final. Any decision, interpretation or other action made or
taken in good faith by the Board in accordance with the Plan shall be final,
binding and conclusive on the Company, all members of the Board and their
respective heirs, executors, administrators, successors and assigns.
3.4 Delegation. The Board may delegate any or all of its administrative
responsibilities under the Plan to officers or employees of the Company.
ARTICLE IV
Share Limitation
4.1 Shares. The maximum aggregate number of shares of Common Stock that may
be issued under the Plan shall be 250,000 shares of Common Stock, subject to
any increase or decrease pursuant to Section 4.2. If any Option granted under
the Plan shall terminate or be canceled for any reason without having been
exercised in full, the number of unpurchased shares shall again be available
for the purpose of the Plan.
4.2 Changes. In the event of any merger, reorganization, consolidation,
recapitalization, dividend (other than a regular cash dividend), stock split,
or other change in the capital structure of the Company affecting the Common
Stock, such substitution or adjustment shall be made in the maximum aggregate
number of shares that may be issued under the Plan, in the number of shares
for which Stock Options are to be granted to Eligible Directors pursuant to
Section 6.2 and in the number of shares subject to, and the option price of,
outstanding Options as may be determined to be appropriate by the Board, in
its sole discretion, provided that the number of shares subject to any Option
shall always be a whole number. In the event of a change in the capital
structure of the Company, merger, consolidation, combination or exchange of
shares or the like, as a result of which Common Stock is changed into another
class, or securities of another person, cash or other property, the
consideration to be received upon exercise shall be adjusted as deemed
equitable by the Board in its sole discretion.
ARTICLE V
Eligibility
5.1 Eligible Directors. Only Eligible Directors shall be granted Options
under the Plan.
ARTICLE VI
Stock Options
6.1 Options. All Stock Options granted under the Plan shall be non-qualified
stock options (i.e., options that do not qualify as incentive stock options
under Section 422 of the Code).
6.2 Grants. Pursuant to the terms of the Plan contained herein, Eligible
Directors shall be granted Stock Options on an ongoing basis in exchange for
their agreement to serve on the Board and shall also be eligible to receive
Stock Options in lieu of cash compensation for their fees for meetings of the
Board, any committees thereof, for any other services they perform on behalf
of the Company or for any other reason as determined by the Board from time to
time, in its sole discretion.
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(a) Initial Stock Option Grant; Anniversary Stock Option Grants. On the
Effective Date, each Eligible Director shall automatically be granted Stock
Options to purchase 10,000 shares of Common Stock, and each Eligible Director
who first becomes a member of the Board after the Effective Date shall
automatically be granted Stock Options to purchase 10,000 shares of Common
Stock on the date of his or her election to the Board. For as long as the Plan
remains in effect, each Eligible Director shall also automatically be granted
Stock Options to purchase 5,000 shares of Common Stock on each anniversary of
the date of such initial grant (beginning on the second such anniversary),
provided such person is an Eligible Director on such date.
(b) Additional Stock Option Grants. Each Eligible Director shall be entitled
to receive Options as the Board may determine in its sole discretion from time
to time.
(c) Execution of Nonqualified Stock Option Agreements. The Company shall
effect the granting of Stock Options under the Plan by execution of
Nonqualified Stock Option Agreements which shall contain, among other things,
such representations, warranties and other terms and conditions as shall be
necessary in the opinion of counsel of the Company to comply with all
applicable Federal and state securities laws.
6.3 Terms of Options. Options granted under the Plan shall be subject to the
following terms and conditions and shall contain such additional terms and
conditions, not inconsistent with the terms of the Plan, as the Board shall,
in its discretion, determine:
(a) Option Price. The option price per share of Common Stock purchasable
upon exercise of a Stock Option shall be equal to the Fair Market Value of
a share of Common Stock on the date the Stock Option is granted.
(b) Method of Exercise. Stock Options may be exercised in whole or in
part at any time during the option term by giving written notice of
exercise to the Secretary or Assistant Secretary of the Company, specifying
the number of shares of Common Stock to be purchased. Such notice shall be
accompanied by payment in full of the option price and, if requested, by
the representation described in Section 9.2. The option price may be paid
in cash or by check payable to the Company or in such other form as the
Board deems acceptable. The Company shall have the right to delay the
issuance or delivery of any shares of Common Stock under this Plan until
(a) the completion of such registration or qualification of such shares
under any applicable federal or state law, ruling or regulation as the
Company shall determine to be necessary or advisable and (b) receipt from
the Participant of such documents and information as the Board may deem
necessary or appropriate in connection with such registration or
qualification.
(c) Non-transferability of Option. Unless otherwise determined by the
Board, no Stock Option shall be transferable by an Optionee otherwise than
by will or by the laws of descent and distribution, to the extent
consistent with the terms of the Plan and the Option, and all Stock Options
shall be exercisable, during an Optionee's lifetime, only by the Optionee.
ARTICLE VII
Termination or Amendment
7.1 Termination or Amendment of the Plan. The Board may at any time amend,
discontinue or terminate the Plan in whole or in part (including any amendment
deemed necessary to ensure that the Company may comply with any regulatory
requirement referred to in Article IX); provided, however, that, unless
otherwise required by law, the rights of an Optionee with respect to Options
granted prior to such amendment, discontinuance or termination, may not be
impaired without the consent of such Optionee.
7.2 Amendment of Options. The Board may amend the terms of the Stock
Options, prospectively or retroactively, but, subject to Article IV, no such
amendment or other action by the Board shall impair the rights of any Optionee
without the Optionee's consent.
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ARTICLE VIII
Unfunded Plan
8.1 Unfunded Status of Plan. The Plan is intended to constitute an
"unfunded" plan for incentive compensation. With respect to any payment not
yet made to an Optionee by the Company, nothing contained herein shall give
any such individual any rights that are greater than those of a general
creditor of the Company.
ARTICLE IX
General Provisions
9.1 Nonassignment. Except as otherwise provided in the Plan or as otherwise
determined by the Board, Options granted hereunder and the rights and
privileges conferred thereby shall not be transferred, assigned, pledged or
hypothecated in any way (whether by operation of law or otherwise), and shall
not be subject to execution, attachment or similar process. Upon any attempt
to transfer, assign, pledge, hypothecate or otherwise dispose of such Option,
right or privilege contrary to the provisions hereof, or upon the levy of any
attachment or similar process thereon, such Option and the rights and
privileges conferred thereby shall immediately terminate and the Option shall
immediately be forfeited to the Company.
9.2 Legend. The Board may require each person purchasing shares upon
exercise of an Option to represent to the Company in writing that the Optionee
is acquiring the shares for investment only and not for resale or with a view
to distribution and to make such other representations as the Board may
require. The stock certificates representing such shares may include any
legend which the Board deems appropriate to reflect any restrictions on
transfer.
All certificates representing shares of Common Stock delivered under the
Plan shall be subject to such stock transfer orders and other restrictions as
the Board may deem advisable under the rules, regulations and other
requirements of the Securities and Exchange Commission, any stock exchange
upon which the Common Stock is then listed or traded or the Nasdaq Stock
Market, any applicable Federal or state securities law, and any applicable
corporate law, and the Board may cause a legend or legends to be put on any
such certificates to make appropriate reference to such restrictions.
9.3 Other Plans. Nothing contained in the Plan shall prevent the Board from
adopting other or additional compensation arrangements and such arrangements
may be either generally applicable or applicable only in specific cases.
9.4 No Right to Continue Relationship. Neither the Plan nor the grant of any
Option under the Plan shall confer upon any person any right to continue as a
director of the Company or obligate the Company to nominate any director for
reelection by the Company's stockholders.
9.5 Listing and Other Conditions.
(a) The issuance of any shares of Common Stock upon exercise of an Option
shall be conditioned upon such shares being listed on a national securities
exchange or on The Nasdaq Stock Market. The Company shall have no obligation
to issue such shares unless and until such shares are so listed, and the right
to exercise any Option shall be suspended until such listing has been
effected.
(b) If at any time counsel to the Company shall be of the opinion that any
sale or delivery of shares of Common Stock upon exercise of an Option is or
may in the circumstances be unlawful or result in the imposition of a material
amount of excise taxes under the statutes, rules or regulations of any
applicable jurisdiction, the Company shall have no obligation to make such
sale or delivery, or to make any application or to effect or to maintain any
qualification or registration under the Securities Act of 1933, as amended, or
otherwise with respect to shares of Common Stock, and the right to exercise
any Option shall be suspended until, in the opinion of such
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counsel, such sale or delivery shall be lawful or shall not result in the
imposition of a material amount of excise taxes.
9.6 Governing Law. The Plan and actions taken in connection herewith shall
be governed and construed in accordance with the laws of the State of
Wisconsin.
9.7 Construction. Wherever any words are used in the Plan in the masculine
gender they shall be construed as though they were also used in the feminine
gender in all cases where they would so apply, and wherever any words are used
herein the singular form they shall be construed as though they were also used
in the plural form in all cases where they would so apply.
9.8 Liability of the Board. No member of the Board nor any employee of the
Company or any of its subsidiaries shall be liable for any act or action
hereunder, whether of omission or commission, by any other member of the Board
or employee or by any agent to whom duties in connection with the
administration of the Plan have been delegated or, except in circumstances
involving bad faith, gross negligence or fraud, for anything done or omitted
to be done by himself.
9.9 Costs. The Company shall bear all expenses incurred in administering the
Plan, including expenses of issuing Common Stock upon the exercise of Options.
9.10 Fractional Shares. No fractional shares of stock shall be issued upon
the exercise of any Option and the Company shall not be under any obligation
to compensate any Optionee in any way for any such fractional share.
9.11 Severability. If any part of the Plan shall be determined to be invalid
or void in any respect, such determination shall not affect, impair,
invalidate or nullify the remaining provisions of the Plan which shall
continue in full force and effect.
9.12 Successors. The Plan shall be binding upon and inure to the benefit of
any successor or successors of the Company.
9.13 Headings. Article and section headings contained in the Plan are
included for convenience only and are not to be used in construing or
interpreting the Plan.
ARTICLE X
Term of Plan
10.1 Effective Date. The Plan shall be effective as of the Effective Date.
10.2 Termination. The Plan shall continue until terminated by the Board.
Termination of the Plan shall not affect Options granted before such date,
which shall continue to be exercisable, in accordance with the terms of the
Plan, after the Plan terminates.
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CATALYST INTERNATIONAL, INC. PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
CATALYST INTERNATIONAL, INC.
Annual Meeting of Stockholders - April 28, 1997
The undersigned hereby appoints Sean P. McGowan and Mark T. Ehrmann, and
each of them, as proxies, each with the power to appoint his substitute, and
hereby authorizes each of them to represent and to vote, as designated hereon,
all of the shares of common stock of Catalyst International, Inc. held of record
by the undersigned on March 14, 1997 at the 1997 Annual Meeting of Stockholders
of Catalyst International, Inc. to be held on April 28, 1997 or at any
adjournment or postponement thereof.
This proxy when properly executed will be voted in the manner directed
herein by the undersigned stockholder. If no direction is made, this proxy will
be voted "FOR" (i) the election of the nominees as Class II Directors, (ii) the
approval of the Catalyst International, Inc. 1997 Director Stock Option Plan,
and (iii) ratification of Ernst & Young LLP as the Company's independent
auditors for 1997, all as more fully described in the accompanying Proxy
Statement.
DETACH BELOW AND RETURN USING THE ENVELOPE PROVIDED
CATALYST INTERNATIONAL, INC. 1997 ANNUAL MEETING
1. ELECTION OF DIRECTORS: 1-DOUGLAS B. CODER 2-TERRENCE L. MEALY
[_] FOR all [_] WITHHOLD AUTHORITY
nominees listed to to vote for all
the left (except as nominees listed
specified below). to the left.
(Instructions: To withhold authority to vote for any indicated nominee, write
the number(s) of the nominee(s) in the box provided to the right.)
[ ]
2. To approve the Catalyst International, Inc, 1997 Director Stock Option Plan.
[_] FOR [_] AGAINST [_] ABSTAIN
3. To ratify the appointment of Ernst & Young LLP as the Company's Independent
auditors for 1997.
[_] FOR [_] AGAINST [_] ABSTAIN
4. In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting or any adjournment or
postponement thereof.
Address Change? Date_____________________ NO. OF SHARES
MARK BOX [_]
Indicate changes below: --------------------------------------
--------------------------------------
SIGNATURE(S) IN BOX
Please sign as your name appears on this
Proxy. When shares are held by joint
tenants, both should sign. When signing
as attorney, executive , administrator,
trustee or guardian, please give full
title as such. If a corporation, please
sign in full corporate name by President
or other authorized officer. If a
partnership, please sign in partnership
name by authorized person.
