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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): January 30, 1997
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Project Software & Development, Inc.
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(Exact name of registrant as specified in its charter)
Massachusetts 0-23852 04-2448516
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(State or other jurisdiction (Commission (IRS Employer
of incorporation or organization) File Number) Identification No.)
20 University Road, Cambridge, MA 02138
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (617) 661-1444
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(Former Name or Former Address, if Changed Since Last Report)
Page 1 of 10 Pages
Exhibit Index Located on Page 5
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ITEM 5. OTHER EVENTS.
On February 24, 1997, David M. Sample joined Project Software &
Development, Inc. ("PSDI") as Chairman of the Board, President and Chief
Executive Officer. On that date, Mr. Sample was elected to PSDI's six member
Board of Directors as a Class I Director. Dean Goodermote, formerly PSDI's
Chairman of the Board, remains a Director.
On February 5, 1997, PSDI issued a press release announcing that Mr. Sample
was joining PSDI to serve as President and Chief Executive Officer of PSDI, that
PSDI expected that Mr. Sample would be elected to serve on the Board of
Directors of PSDI and that Mr. Sample would begin serving in both such
capacities in late February. A copy of the press release is filed as Exhibit
20.1 to this report and is incorporated herein by reference.
In connection with Mr. Sample joining PSDI, PSDI has entered into an offer
letter with Mr. Sample dated January 30, 1997 (the "Offer Letter"). The Offer
Letter provides, among other things, that Mr. Sample will be paid a base salary
of $22,916.67 per month, subject to annual review beginning September 30, 1997,
and will generally be entitled to up to one hundred percent (100%) of his base
salary as a bonus under PSDI's Executive Bonus Plan depending upon PSDI's
performance. During the fiscal year ending 1997 any such bonus will be
pro-rated, but will be guaranteed to be at least sixty percent (60%) of the
maximum payable after such pro-ration. The Offer Letter also indicated that the
Compensation Committee of the Board of Directors of PSDI intended to grant Mr.
Sample a non-qualified stock option to acquire 200,000 shares of the common
stock, par value $.01 per share, of PSDI (the "Common Stock"), which will vest
with respect to twenty-five percent (25%) of the Common Stock covered by such
option after each year for a four year period. The Offer Letter also provides
that PSDI will pay one year's severance pay in the event of the termination of
Mr. Sample's employment under certain circumstances and that PSDI will cover
certain moving costs and extend to Mr. Sample an interest free loan of up to
$300,000 for use solely to acquire a new residence, which loan will be forgiven
with respect to one eighth of the amount thereof at the close of business on the
last business day of each calendar quarter thereafter if Mr. Sample is still
employed by PSDI. A copy of the Offer Letter is attached hereto as Exhibit 10.1.
On February 5, 1997, PSDI's Compensation Committee granted Mr. Sample such
non-qualified option to purchase 200,000 shares of Common Stock at an exercise
price of $42.50 per share.
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ITEM 7. EXHIBITS.
(c) Exhibits.
Exhibit Number Description
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10.1 Offer Letter by and between Project Software &
Development, Inc. and David M. Sample dated
January 30, 1997
20.1 Press release of Project Software & Development, Inc.
dated February 5, 1997
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Signatures
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereto duly authorized.
PROJECT SOFTWARE & DEVELOPMENT, INC.
/s/ Paul D. Birch
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Date: February 26, 1997 Paul D. Birch
Executive Vice President, Finance and
Administration and Chief Financial Officer
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Exhibit Index
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Page Number in
Exhibit Sequentially
Number Description Numbered Copy
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10.1 Offer Letter by and between Project Software & Development,
Inc. and David M. Sample dated January 30, 1997 6
20.1 Press release of Project Software & Development, Inc.
dated February 5, 1997 9
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Exhibit 10.1
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PROJECT SOFTWARE & DEVELOPMENT, INC.
January 30, 1997
Via Hand Delivery
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Strictly Confidential
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Mr. David M. Sample
141 High Ridge Avenue
Ridgefield, CT 06877
Dear David:
On behalf of the Board of Directors of PSDI, I am pleased to set out our offer
to employ you as the President and Chief Executive Officer of Project Software &
Development, Inc. It is expected that you will also be elected to the Board of
Directors as soon as possible on or after February 11, 1997. You should
understand that you will be reporting directly and exclusively to the Board of
Directors of the Company. We would hope and expect that you would be able to
join us on a full-time basis no later than February 15th.
The compensation components of your employment would be:
(1) A base salary of $22,916.67 per month which shall be reviewed annually by
the Board at the end of each fiscal year. Your first review would occur
following the close of our fiscal year's business at the end of September 1997;
and thereafter, annually.
(2) An annual cash bonus would be awarded pursuant to the Executive Bonus
Plan, a copy of which is attached hereto as Exhibit A, up to one hundred percent
(100%) of base salary depending upon performance against pre-determined criteria
determined by the Board of Directors or its Compensation Committee on an annual
basis. It is anticipated the attainment of the annual profit plan will be the
determining factor. For the balance of fiscal year 1997 it will be assumed the
bonus is earned on a pro-rated basis. The 1997 bonus will be guaranteed during
the actual period you are employed to the extent of sixty percent (60%) on a
pro-rated basis.
(3) The Compensation Committee of the Board of Directors intends to grant
non-qualified stock options to you which would be awarded and fixed in price at
a Committee Meeting to be held as soon as you accept our offer, pursuant to the
Plan's rules. This initial non-qualified stock option award would be for 200,000
shares of the Company's Common Stock pursuant to the Company's plan and form of
option agreement on a proper date selected by you. Under this agreement, the
optionee vests in the right to exercise twenty-five percent (25%) of the options
after each year for a four (4) year period. As you and I discussed
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yesterday, the Company is developing an acceleration feature to the Option Plan
in the event of a qualified sale and you would benefit. The Board is considering
pooling and golden parachute issues. Additional options may be granted by the
Compensation Committee from time to time.
(4) PSDI agrees to termination protection which will, for a period of one (1)
year, provide salary continuation, payable at time of salary payments, in the
event of termination other than for disability or cause. This salary
continuation would terminate when and to the extent you are employed elsewhere
during the year except as provided elsewhere. For purposes of this agreement
"cause" shall mean and be defined as any act that will constitute on your part
common law fraud, a felony or other gross malfeasance of duty. For purposes of
this agreement, "disability" shall mean disability that qualifies for benefits
under the Company's Long-Term Disability Plan as from time to time in effect.
You and the Company agree that any dispute concerning whether there was "cause"
for termination of your employment by the Company will be settled by binding
arbitration in Boston, Massachusetts, in accordance with the rules of the
American Arbitration Association. The arbitration will be limited to this issue,
and the arbitrator(s) will have no authority to award damages, whether
compensatory, punitive or otherwise. The Company agrees that if it shall lose
any such arbitration concerning whether there was cause for termination of your
employment, the Company will pay your legal fees and expenses incurred in such
arbitration.
(5) During your employment, the Company will provide a car allowance of $800
per month.
(6) The Company will be responsible for your reasonable, normal and customary
relocation expenses. It would be our intention to pay for the cost of selling
your current residence in Ridgefield, Connecticut and purchasing a home in the
greater Boston area. We would expect these expenses to be comprised of a real
estate brokerage commission of not greater than six percent (6%) of the ultimate
sales price of your Ridgefield home, a reasonable fee for a lawyer to close the
real estate sale, the cost to pack, move and unpack your family's personal
belongings, the reasonable fee for a lawyer to purchase your new home in the
greater Boston area, and any temporary housing costs associated with your having
to live in the Boston area before your family moves. You have explained that it
is your intention to not move your family before the end of the school year and
to begin to market the house before that time. Should it occur that you would
move prior to having sold your current residence in Ridgefield, the Company
would be responsible for making interest and other incidental and direct
carrying costs for your residence in Ridgefield until such time as it is sold,
up to one (1) year.
(7) You shall also be eligible for and benefit from the Company's other employee
benefit plans, summary current plan descriptions for which are collectively
attached hereto as Exhibit B.
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(8) At the time of your purchase of a house in the Boston area to serve as
your principal residence, the Company will lend you $300,000 for use solely in
the purchase of that house. This loan will be evidenced by a promissory note
executed by you and will not bear interest. On-eighth (1/8) of the original
principal amount of the loan ($37,500) will be forgiven at the close of business
on the last day of each calendar quarter if you are still employed by the
Company at that time. If you cease for any reason to be employed by the Company,
such principal forgiveness will not continue and the full unpaid and unforgiven
principal balance of the loan will automatically be due and payable ninety (90)
days after the cessation of your employment by the Company.
In accordance with good business practices and except for passive investments in
publicly-traded securities, during your employment by the Company and for twelve
(12) months thereafter, you will not, without the written consent of the
Company, be concerned or interested in any other business of a similar nature
to, or competitive with, that carried on by the Company. The non-competition
requirements of this paragraph will apply only if you resign, if your employment
is terminated for cause or if in the event of your termination for any other
reason, the Company pays your salary continuation described above during the
non-competition period. In making this offer, the Company understands that you
are not under any obligation to any former employer or entity which would
prevent or limit your performance as an employee of the company.
You understand that all of the Company's employees are employees at will, that
they do not have contracts of employment or severance and that, except as set
forth above, you will not be entitled to any severance or salary continuation.
You also understand that, as a condition to your employment, you will be
required to sign the Company's standard confidentiality and inventions
agreement, a copy of which is attached hereto as Exhibit C.
We feel that is an exciting and rewarding opportunity for you at PSDI and on
behalf of our shareholders are encouraged that, under your leadership and with
your experience in sales and marketing, the Company would continue to grow
swiftly and continue to build wealth for our shareholders.
We are anxious to announce your election and acceptance. We anticipate your
starting on or about February 27th.
Sincerely, Agreed and Accepted:
/s/ Charles S. Jones /s/ David M. Sample
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Director, PSDI David M. Sample
CC: Mr. Robert L. Daniels Date: January 30, 1997
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Exhibit 20.1
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PSDI
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FOR IMMEDIATE RELEASE
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CONTACT:
Constance Mazelsky Paul D. Birch
Lois Paul & Partners EVP, Finance & Administration
(617) 238-5751 Chief Financial Officer & Treasurer
[email protected] (617) 503-3550
[email protected]
PSDI APPOINTS DAVID SAMPLE AS PRESIDENT AND CHIEF EXECUTIVE OFFICER
CAMBRIDGE, MASS. -- February 5, 1997 -- The board of directors of Project
Software & Development, Inc. (NASDAQ:PSDI), a leading provider of maintenance
management software, announced today that David M. Sample, 48, is joining the
company as president and chief executive officer.
Sample joins PSDI after 11 years with Hyperion Software Corp. of Stamford, Conn.
(NASDAQ:HYSW), which International Data Corp. recently ranked first worldwide in
budgeting software revenue and third worldwide in client/server accounting
software revenue. Sample most recently served as senior vice president of
international operations and North American sales, helping to grow the business
to $173 million in fiscal 1996. During 1995, Sample served as head of Hyperion's
Pillar Software subsidiary. Previously, he headed Hyperion's UK business unit as
senior vice president and general manager. Prior to Hyperion, Sample spent eight
years with Ceridian Corporation (NYSE:CEN), a Bloomington, Minn. computer
services company, in a variety of increasingly responsible sales and marketing
positions.
"I stepped aside as CEO in August to facilitate this search and this is the type
of executive I was seeking who can help PSDI accomplish its goals," said Bob
Daniels, PSDI founder and chairman of the executive committee of the board. "The
board is very pleased that David is joining us to help lead PSDI in the next
phase of its growth in revenue and profitability."
Dean Goodermote, chairman of the board of PSDI, added, "We look forward to
taking advantage of David's extensive background in client/server application
software, strong international experience, and proven track record in helping
Hyperion grow from $1 million in 1986 to nearly $200 million in 1996."
The board expects that Sample will begin in his new role in late February. It is
expected
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that he will be elected to the board at that time.
PSDI develops, markets and supports applications software used by businesses,
government agencies, and other organizations to assist them in maintaining
high-value capital assets such as plants, facilities and production equipment.
The Company's products are designed to enable customers to reduce downtime,
control maintenance expenses, cut spare parts inventories and costs, improve
purchasing efficiency, and more effectively deploy productive assets, personnel
and other resources.
Based in Cambridge, Mass., PSDI markets its products through a direct sales
force with sales offices throughout the United States, Canada, Argentina,
Australia, UK, France, Germany, Hong Kong, Thailand, Sweden and the Netherlands,
combined with a network of international sales agents.
The statements made in this release that are not historical facts are
forward-looking statements and are made pursuant to the safe harbor provisions
of the Private Securities Litigation Reform Act of 1995. Investors are cautioned
that all forward-looking statements involve risks and uncertainties, including
without limitation risks related to delays in product development and new
product introductions, rapidly changing technology, an intensely competitive
market, market acceptance of new products, foreign operations and general
economic conditions. Each of these factors, and others, are discussed more fully
in the Company's Form 10-K and the Company's other filings with the Securities
and Exchange Commission.
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EDITOR'S NOTE: ALL PSDI NEWS RELEASES ARE AVAILABLE VIA THE PSDI HOME PAGE AT
HTTP://WWW.PSDI.COM. THE INTERNET PROVIDES AN EASY WAY TO FIND INFORMATION ABOUT
ALL PSDI PRODUCTS AND SERVICES.
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