-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, FY43pTutcgn8sAcZ+4UoAFl+Lun/qSvTWJzwSQYRynQ1H7yR5fz5J3yA7SS9f9Ex d1ZTPSUnph6SGcvPHaXYGw== 0001104659-05-051244.txt : 20051031 0001104659-05-051244.hdr.sgml : 20051031 20051031160137 ACCESSION NUMBER: 0001104659-05-051244 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20051026 ITEM INFORMATION: Entry into a Material Definitive Agreement FILED AS OF DATE: 20051031 DATE AS OF CHANGE: 20051031 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NIC INC CENTRAL INDEX KEY: 0001065332 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT CONSULTING SERVICES [8742] IRS NUMBER: 522077581 STATE OF INCORPORATION: CO FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-26621 FILM NUMBER: 051166500 BUSINESS ADDRESS: STREET 1: 12 CORPORATE WOODS 10975 BENSON STREET STREET 2: SUITE 390 CITY: OVERLAND PARK STATE: KS ZIP: 66210 MAIL ADDRESS: STREET 1: 12 CORPORATE WOODS 10975 BENSON STREET STREET 2: SUITE 390 CITY: OVERLAND PARK STATE: KS ZIP: 66210 FORMER COMPANY: FORMER CONFORMED NAME: NATIONAL INFORMATION CONSORTIUM DATE OF NAME CHANGE: 19990618 FORMER COMPANY: FORMER CONFORMED NAME: NATIONAL INFORMATION CONSORTIUM INC DATE OF NAME CHANGE: 19990504 8-K 1 a05-19272_18k.htm CURRENT REPORT OF MATERIAL EVENTS OR CORPORATE CHANGES

 

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C.  20549

 

 

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): October 26, 2005

 

NIC INC.

(Exact name of registrant as specified in its charter)

 

Colorado

 

000-26621

 

52-2077581

(State or other jurisdiction of incorporation or
organization)

 

(Commission
File Number)

 

(I.R.S. Employer
Identification No.)

 

10540 South Ridgeview Road

Olathe, Kansas 66061

(Address of principal executive offices, including zip code)

 

(877) 234-3468

(Registrant’s telephone number, including area code)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

o  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

o  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

o  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

o  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 


 

ITEM 1.01             ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT

 

On October 26, 2005, the Board of Directors of NIC Inc. (the “Company”) approved the acceleration of vesting of all unvested options to purchase common stock of the Company that had an exercise price that was greater than the market price on that date.  The closing price of the Company’s common stock on the Nasdaq National Market on October 26, 2005 was $5.63 per share.  As a condition of the acceleration and to prevent unintended personal benefit, the Company’s Directors, executive officers and employees must refrain from selling common stock acquired upon the exercise of accelerated options until the original vesting date or, if earlier, termination of employment with or service to the Company.  All other terms and conditions applicable to such options, including exercise prices, remain unchanged.  This action resulted in the accelerated vesting of options to purchase 163,873 shares of common stock of the Company, or approximately six percent of the total of all outstanding Company options. Of this amount, 142,500 options had been granted to the following Directors and named executive officers of the Company:

 

•                  Jeffery S. Fraser, Chief Executive Officer and Chairman of the Board - 15,000 options with an exercise price of $7.67 per share granted on November 10, 2003

 

•                  Daniel J. Evans, Director – 37,500 options with an exercise price of $6.97 per share granted on November 10, 2003

 

•                  Pete Wilson, Director – 37,500 options with an exercise price of $6.97 per share granted on November 10, 2003

 

•                  John L. Bunce, Jr., Director – 37,500 options with an exercise price of $6.97 per share granted on November 10, 2003

 

•                  Ross C. Hartley, Director – 15,000 options with an exercise price of 6.97 per share granted on November 10, 2003

 

The Company accelerated the vesting of these options because it believed it was in the best interest of its shareholders to reduce future compensation expense that the Company would otherwise be required to report in its statement of income upon adoption of Statement of Financial Accounting Standards (“SFAS”) No. 123R (revised 2004), “Share–Based Payment,” in the first quarter of 2006.  Further, because the options have exercise prices in excess of the current market price, they are viewed to have limited economic value and are not fully achieving their objective of incentive compensation and retention.  Currently, the Company accounts for stock options using the intrinsic value method prescribed in Accounting Principles Board Opinion No. 25, “Accounting for Stock Issued to Employees,” and provides pro forma footnote disclosure of the compensation expense associated with stock options as if the Company had applied the fair value recognition provisions of SFAS No. 123, “Accounting for Stock-Based Compensation.” As a result of the vesting acceleration, the Company estimates that approximately $0.5 million in aggregate future expense will be eliminated over the next three fiscal years.  The vesting acceleration will not result in compensation expense in the Company’s statement of income, but will be reflected in its footnotes as an approximate $0.5 million pre-tax charge to pro forma earnings in the fourth quarter of 2005.

 

The Company believes that equity-based compensation, like stock options, will continue to play an important role in supporting employee retention and providing individuals with long-term incentives to meet Company goals.  The Company will consider granting additional stock options to Directors and employees in the future with exercise prices equal to then current market prices.

 

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SIGNATURES

 

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 hereunto duly authorized.

 

 

NIC Inc.

 

 

Date: October 31, 2005

/s/ Stephen M. Kovzan

 

 

Stephen M. Kovzan

 

Vice President, Financial Operations

 

Chief Accounting Officer

 

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