-----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, A4vok1ZFX8aVCyot6iL2T8p2th1f7F3p8iGL1ghBLqa9fWAjrvXaHHcouwoNRWiY hOIhLFv6EaU/3hP2ZIhwqw== 0000706015-99-000007.txt : 19990419 0000706015-99-000007.hdr.sgml : 19990419 ACCESSION NUMBER: 0000706015-99-000007 CONFORMED SUBMISSION TYPE: 10-K/A PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19981231 FILED AS OF DATE: 19990416 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FILENET CORP CENTRAL INDEX KEY: 0000706015 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER INTEGRATED SYSTEMS DESIGN [7373] IRS NUMBER: 953757924 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K/A SEC ACT: SEC FILE NUMBER: 000-15997 FILM NUMBER: 99595956 BUSINESS ADDRESS: STREET 1: 3565 HARBOR BLVD CITY: COSTA MESA STATE: CA ZIP: 92626 BUSINESS PHONE: 7149663400 MAIL ADDRESS: STREET 1: 3565 HARBOR BLVD CITY: COSTA MESA STATE: CA ZIP: 926261420 10-K/A 1 AMENDED FORM 10-K FOR FISCAL YEAR ENDED 12/31/98 ================================================================================ FORM 10-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 1998 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from -------- to --------. Commission File Number 0-15997 FILENET CORPORATION (Exact name of Registrant as specified in its charter) Delaware 95-3757924 (State or other jurisdiction of (I.R.S. Employer Identification No.) of incorporation or organization) 3565 Harbor Boulevard, Costa Mesa, California 92626 (Address of principal executive office) (Zip code) Registrant's telephone number, including area code: (714) 966-3400 Securities registered pursuant to Section 12(b) of the Act: None Securities registered pursuant to Section 12(g) of the Act: Title of each class Name of each exchange which registered Common stock, $0.01 par value Nasdaq Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days: Yes [X] No [ ] Indicate by check mark whether the disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the Registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K [X] Based on the closing sale price of March 22, 1999, the aggregate market value of the 31,623,336 shares of voting stock of the Registrant held by nonaffiliates of the Registrant on such date was $243,183,454. For purposes of such calculation, only executive officers, board members and beneficial owners of more than 10% of the Company's outstanding common stock are deemed to be affiliates. The number of shares outstanding of the Registrant's common stock was 31,934,143 at March 22, 1999. DOCUMENTS INCORPORATED BY REFERENCE Portions of Registrant's definitive proxy statement for its 1999 Annual Meeting are incorporated by reference into Part III as set forth herein. Portions of Registrant's Annual Report to Stockholders for the fiscal year ended December 31, 1998 are incorporated by reference into Parts II, III and IV as set forth herein. ================================================================================ Index to Exhibits Exhibit No. Description - ------- ----------------------------------------------------------------------- 3.1* Restated Certificate of Incorporation, as amended (filed as Exhibit 3.1 to Form S-4 filed on January 26, 1996; Registration No. 333-00676). 3.1.1* Certificate of Amendment of Restated Certificate of Incorporation (filed as Exhibit 3.1.1 to Form S-4 filed on January 26, 1996, Registration No. 333-00676). 3.2* Bylaws (filed as Exhibit 3.2 of the Registrant's registration statement on Form S-1, Registration No. 33-15004 (the "Form S-1")). 4.1* Form of certificate evidencing Common Stock (filed as Exhibit 4.1 to the Form S-1, Registration No. 33-15004). 4.2* Rights Agreement, dated as of November 4, 1988 between FileNET Corporation and the First National Bank of Boston, which includes the form of Rights Certificate as Exhibit A and the Summary of Rights to Purchase Common Shares as Exhibit B (filed as Exhibit 4.2 to Form S-4 filed on January 26, 1996; Registration No. 333-00676). 4.3* Amendment One dated July 31, 1998 and Amendment Two dated November 9, 1998 to Rights Agreements between FileNET Corporation and BANKBOSTON N.A. formerly known as The First National Bank of Boston (filed as Exhibit 4.3 to Form 10-Q for the quarter ended September 30, 1998). 10.1* Second Amended and Restated Credit Agreement (Multicurrency) by and among the Registrant and Bank of America National Trust and Savings Association dated June 25, 1997, effective June 1,1997 (filed as Exhibit 10.1 to Form 10-Q for the quarter ended June 30, 1997). 10.2* Business Alliance Program Agreement between the Registrant and Oracle Corporation dated July 1, 1996, as amended by Amendment One thereto (filed as Exhibit 10.4 to Form 10-QA for the quarter ended June 30, 1996). 10.3* Runtime Sublicense Addendum between the Registrant and Oracle Corporation dated July 1, 1996, as amended by Amendment One thereto (filed as Exhibit 10.4 to Form 10-QA for the quarter ended June 30, 1996). 10.3.1* Runtime Sublicense Addendum between the Registrant and Oracle Corporation dated July 1, 1996; as amended by Amendments Two through Six thereto (filed as Exhibit 10.3.1 to Form 10-Q for the quarter ended September 30, 1998). 10.4* Full Use and Deployment Sublicense Addendum between the Registrant and Oracle Corporation dated July 1, 1996, as amended by Amendment One thereto (filed as Exhibit 10.4 to Form 10-QA for the quarter ended June 30, 1996). 10.5* Lease between the Registrant and C. J. Segerstrom & Sons for the headquarters of the Company, dated April 30, 1987 (filed as Exhibit 10.19 to the Form S-1). 10.6* Third Amendment to the Lease between the Registrant and C. J. Segerstrom & Sons dated April 30, 1987, for additional facilities at the headquarters of the Company, dated October 1, 1992 (filed as exhibit 10.7 to Form 10-K filed on April 4, 1997). 10.7* Fifth Amendment to the Lease between the Registrant and C. J. Segerstrom & Sons dated April 30, 1987, for the extension of the term of the lease, dated March 28, 1997 (filed as exhibit 10.8 to Form 10-Q for the quarter ended March 31, 1997). 10.8* 1989 Stock Option Plan for Non-Employee Directors of FileNET Corporation, as amended by the First Amendment, Second Amendment, Third Amendment thereto (filed as Exhibit 10.9 to Form S-4 filed on January 26, 1996; Registration No. 333-00676). 10.9* Amended and Restated 1995 Stock Option Plan of FileNET (filed as Exhibit 99.1 to Form S-8 filed on November 9, 1998; Registration No. 333-66997). - -------------------------------------------- * Incorporated herein by reference 16 Exhibit No. Description - ------- ----------------------------------------------------------------------- 10.10* Second Amended and Restated Stock Option Plan of FileNET Corporation, together with the forms of Incentive Stock Option Agreement and Non-Qualified Stock Option Agreements (filed as Exhibits 4(a), 4(b) and 4(c), respectively, to the Registrant's Registration Statement on Form S-8, Registration No. 33-48499), and an Amendment thereto (filed as Exhibit 4(d) to the Registrant's Registration Statement on Form S-8, Registration No. 33-69920), and the Second Amendment thereto (filed as Appendix A to the Registrant's Proxy Statement for the Registrant's 1994 Annual Meeting of Stockholders, filed on April 29, 1994). 10.11* Non-Statutory Stock Option Agreement (with Notice of Grant of Stock Option and Special Addendum) between Registrant and Mr. Lee Roberts (filed as exhibit 99.17 to Form S-8 on August 20, 1997). 10.12* Non-Statutory Stock Option Agreement (with Notice of Grant of Stock Option and Special Addendum) between Registrant and Mr. Ron Ercanbrack (filed as exhibit 99.19 to Form S-8 on August 20, 1997). 10.13* Agreement for the Purchase of IBM products dated December 20, 1991 (filed on May 5, 1992 with the Form 8 amending the Company's Form 10-K for the fiscal year ended December 31, 1991). 10.14* Amendment #A1011-941003-01 dated September 30, 1994, to the Agreement for the Purchase of IBM products dated December 20, 1991 (filed as exhibit 10.12 to form 10-K for the fiscal year ended December 31, 1996). 10.15* Development and Initial Supply Agreement between the Registrant and Quintar Company dated August 20, 1992 (filed as Exhibit 10.21 to Form 10-K for the year ended January 3, 1993). 10.16* Amendment dated December 22, 1992 to the Development and Initial Supply Agreement between the Registrant and Quintar Company dated August 20, 1992 (filed as Exhibit 10.22 to Form 10-K for the year ended January 3, 1993). 10.17 Amendment 2 dated December 18, 1998 to the Product License Agreement between the Registrant and Novell, Inc. dated May 16, 1995. 10.18* Agreement and Plan of Merger between the Registrant and Watermark Software Inc. dated July 18, 1995 (filed as Exhibit 10.27 to Form 10-Q for the quarter ended July 2, 1995). 10.19* Agreement and Plan of Merger between the Registrant and Saros Corporation, as amended, dated January 17, 1996 (filed as Exhibits 2.1, 2.2, 2.3, and 2.4 to Form 8-K on March 13, 1996). 10.20* Stock Purchase Agreement by and Among FileNET Corporation, IFS Acquisition Corporation, Jawaid Khan and Juergen Goersch dated January 17, 1996 and Amendment 1 to Stock Purchase Agreement dated January 30, 1996 (filed as Exhibit 10.2 to form 10-K for the year ended December 31, 1995). 10.21* Amended and Restated FileNET Corporation 1998 Employee Stock Purchase Plan (filed as Exhibit 99.15 to Form S-8, filed on November 9, 1998; Registration No. 333-66997). 10.22* FileNET Corporation International Employee Stock Purchase Plan. (filed as Exhibit 99.16 to Form S-8, filed on November 9, 1998; Registration No. 333-66997). 13.1 Market for the Registrant's Common Stock and Related Stockholder Matters incorporated by reference to page 48 of the 1998 Annual Report. 13.2 Management's Discussion and Analysis of Financial Condition and Results of Operations incorporated by reference to pages 16 through 26 of the 1998 Annual Report. 13.3 Financial Statements incorporated by reference to pages 27 through 46 of the 1998 Annual Report. 13.4 Certain Relationships and Related Transactions incorporated by reference to page 44 of the 1998 Annual Report. 21.1 List of subsidiaries of Registrant (filed as FileNET Corporation Subsidiary Information). 23.1 Consent of Deloitte & Touche LLP (filed as Independent Auditors' Consent). 27 Financial Data Schedule. - --------------------------------------------- * Incorporated herein by reference 17 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 thereunto duly authorized. FILENET CORPORATION Date: March 30, 1999 By: /s/ Lee D. Roberts ------- ------------------------------------ Lee D. Roberts President and Chief Executive Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated. Date: March 30, 1999 By: /s/ Lee D. Roberts ------- ------------------------------------ Lee D. Roberts President and Chief Executive Officer (Principal Executive Officer) Director Date: March 30, 1999 By: /s/ Mark S. St. Clare ------- ------------------------------------ Mark S. St. Clare Chief Financial Officer and Sr. Vice President, Finance (Principal Financial Officer) Date: March 30, 1999 By: /s/ Brian A. Colbeck ------- ------------------------------------ Brian A. Colbeck Controller and Chief Accounting Officer Date: March 30, 1999 By: /s/ Theodore J. Smith ------- ------------------------------------ Theodore J. Smith Chairman of the Board Date: March 30, 1999 By: /s/ L. George Klaus ------- ------------------------------------ L. George Klaus Director Date: March 30, 1999 By: /s/ William P. Lyons ------- ------------------------------------ William P. Lyons Director Date: March 30, 1999 By: /s/ John C. Savage ------- ------------------------------------ John C. Savage Director Date: March 30, 1999 By: /s/ Roger S. Siboni ------- ------------------------------------ Roger S. Siboni Director Date: March 30, 1999 By: /s/ Carolyn M. Ticknor ------- ------------------------------------- Carolyn M. Ticknor Director 18 EX-10.17 2 AMENDMENT 2 TO NOVELL PRODUCT LICENSE AGREEMENT Novell Confidential AMENDMENT 2 TO PRODUCT LICENSE AGREEMENT Amendment 2 Effective Date: December 18, 1998 This Amendment ("Amendment 2") amends and supplements the Product License Agreement, effective May 16, 1995, between Novell, Inc. and FileNet Corporation (the "Agreement"), as amended by Amendment 1 to the Agreement, effective June 27, 1996 ("Amendment 1"). In the event of a conflict between the Agreement and this Amendment 2, the provisions of this Amendment 2 shall control. Except as expressly amended and supplemented by this Amendment 2, the terms and conditions of the Agreement will remain in effect unchanged. 1. CONSIDERATION. Novell shall pay FileNet One Million ($1,000,000) Dollars within ten (10) days of the Amendment 2.Effective Date and receipt of invoice from FileNet. 2. Section 1 of the Agreement is hereby modified as follows. The licenses granted to Novell with respect to Visual WorkFlo are hereby terminated. Commencing on the Amendment 2 Effective Date, the licenses granted to Novell with respect to Ensemble Lite are converted to fully-paid-up and royalty-free licenses and shall be limited to use with Novell's GroupWise 5.5x product and prior versions that include Ensemble Lite as of the Amendment 2 Effective Date. Novell shall have no obligation to pay Royalties or minimum Royalties in connection with the licensing of Ensemble Lite as set forth herein. 3. Sections II, III, IV, V and VIII of the Agreement are hereby deleted. 4. Section VI.A of the Agreement is hereby deleted and replaced with the following provision: Beginning upon the date of shipment of Ensemble to a customer of Novell for revenue (the "Ensemble Effective Date") and until such time as Novell has paid an additional two million dollars ($2,000,000) in Ensemble Royalties to FileNet, Novell shall pay FileNet an initial Royalty of five percent (5%) of Novell's standalone Ensemble suggested list price for standalone Ensemble and two percent (2%) of Novell's standalone Ensemble suggested list price for bundled Ensemble, or fifty percent (50%) of the minimum per copy Royalty amounts set forth in Exhibit E, whichever is higher. Thereafter, Novell shall pay FileNet a Royalty of ten percent (10%) of Novell's standalone Ensemble suggested list price for standalone Ensemble and four percent (4%) of Novell's standalone Ensemble suggested list price for bundled Ensemble, or the minimum per copy Royalty amounts set forth in Exhibit E, whichever is higher. In the case of products sold as upgrades (i.e. customers purchasing (i) a new version of standalone Ensemble for which they own a previous version of such product, or (ii) in the case of bundles, a Novell product which contains a new version of Ensemble for which they own a previous version of such Novell product), the Royalty shall be reduced to twenty percent (20%) of the Royalty applicable to Ensemble as set forth in Exhibit E. 5. Sections VI.B and VII of the Agreement shall be applicable only to Ensemble. The last sentence of Section VII.A of the Agreement is hereby deleted. 6. Section XVIII of the Agreement is hereby modified as follows. The last sentence of Section XVIII.B of the Agreement is deleted. The last sentence of Section XVIII.C of the Agreement is deleted. Section XVIII.E of the Agreement is deleted and replaced with the following: E. Without Cause. This Agreement may be terminated by either party without cause or penalty at any time after November 24, 1999 upon 90 days prior written notice. 7. Section XIX of the Agreement is hereby deleted and replaced in its entirety with the following: XIX. EFFECT OF TERMINATION. Upon termination of this Agreement, Novell shall remove the standalone and bundled Ensemble Products from its price lists. Termination of this Agreement shall not affect the licenses granted to Novell prior to termination. Upon termination of this Agreement, FileNet agrees to promptly make available and deliver at no additional charge a fully-paid-up, perpetual license to the source code for Ensemble for maintenance purposes only. 8. Section 4 of Amendment 1 is hereby deleted. 9. The parties acknowledge and agree that the rights and obligations under Section XI of the Agreement shall survive termination or expiration of the Agreement for a period of ninety (90) days. 10. Ensemble Lite Source Code and Technical Assistance. Upon FileNet's receipt of the payment specified in Section 1 of this Amendment 2, FileNet agrees to promptly make available and deliver at no additional charge a fully-paid-up, perpetual license to the source code for Ensemble Lite for maintenance purposes only. Upon delivery of such source code for Ensemble Lite to Novell, FileNet's obligations under Section XI of the Agreement shall terminate in connection with all Ensemble Products other than Ensemble. 11. General Release. Upon receipt of the payment specified in Section 1 of this Amendment 2 to FileNet by Novell of the invoice from FileNet dated December 18, 1998, the Amendment 2 Effective Date, and for other good and valuable consideration, each of Novell and FileNet releases and forever discharges, and by these presents does for itself and its successors and assigns, remise, release, and forever discharge the other party, its respective predecessors and successors and present and former officers, directors, employees, and agents and their respective heirs, administrators, executors, successors, and assigns (hereinafter collectively referred to as "Releasees") of and from all manner of actions, causes of action, suits, debts, covenants, contracts, controversies, damages, judgments, claims, and demands whatsoever in law or in equity, whether or not well founded in fact or in law and whether or not presently known to Novell and/or FileNet, which against each of the Releasees or any of them it ever had, or has as of the Amendment 2 Effective Date, including without limitation any claims arising out of or related to oral or written discussions, commitments or agreements between Novell and FileNet in connection with the Agreement, Amendment 1, and this Amendment 2, thereto except for the mutually acknowledged continuing obligations under the aforementioned Agreement, Amendment 1, and this Amendment 2. 12. SIGNATURES. When executed by both parties, this Amendment 2 shall become effective on the Amendment 2 Effective Date. Novell, Inc. FileNet Corporation Signature: /s/ Signature: /s/ ______________________________ ____________________________ Name: Christopher Stone Name: Mary K. Carringotn ______________________________ ____________________________ Title: Senior Vice President Title: Senior Vice President General Counsel ______________________________ ____________________________ Date: December 20, 1998 Date: December 17, 1998 -----END PRIVACY-ENHANCED MESSAGE-----