-----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, FvIIrlYdkY/oTJOhnehGXN17hcCURHo/mYR2LXJKdQaGLyYejZkNYT7qi81iXyE5 MCb2UPdCUe/6L4GUFK6xYQ== 0000950123-00-002677.txt : 20000327 0000950123-00-002677.hdr.sgml : 20000327 ACCESSION NUMBER: 0000950123-00-002677 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 20000324 EFFECTIVENESS DATE: 20000324 FILER: COMPANY DATA: COMPANY CONFORMED NAME: COMPUTER CONCEPTS CORP /DE CENTRAL INDEX KEY: 0000879703 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER INTEGRATED SYSTEMS DESIGN [7373] IRS NUMBER: 112895590 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-8 SEC ACT: SEC FILE NUMBER: 333-33274 FILM NUMBER: 578580 BUSINESS ADDRESS: STREET 1: 80 ORVILLE DR CITY: BOHEMIA STATE: NY ZIP: 11716 BUSINESS PHONE: 5162441500 MAIL ADDRESS: STREET 1: 80 ORVILLE DRIVE CITY: BOHEMIA STATE: NY ZIP: 11716 S-8 1 COMPUTER CONCEPTS CORP 1 Filed: March 24, 2000 Registration No. 333-__________ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. FORM S-8 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 COMPUTER CONCEPTS CORP. (Exact name of registrant as specified in its charter) DELAWARE 11-2895590 (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 80 ORVILLE DRIVE, BOHEMIA, NEW YORK 11716 (Address of principal executive offices) (Zip Code) 1998 STOCK/STOCK OPTION PLAN (Full Title of the Plan) ANTHONY COPPOLA, PRESIDENT COMPUTER CONCEPTS CORP. 80 ORVILLE DRIVE BOHEMIA, NEW YORK 11716 (Name and address of agent for service) (631) 244-1500 (Telephone number, including area code, of agent for service) CALCULATION OF REGISTRATION FEE
Title of Each Proposed Proposed Class of Maximum Maximum Amount of Securities Amount to be Offering Price Per Aggregate Registration to be Registered Registered Security (1) Offering Price(1) Fee Common Stock, 4,657,300 (2)(3) $1.97 $9,174,881 $ 2,550.62 par value $.0001 per share
(1) Estimated solely for the purpose of calculating the registration fee, based upon the average of high and low prices of our common stock on the NASDAQ on March 22, 2000. (2) The Registration Statement also covers an indeterminate number of additional shares of common stock which may become issuable pursuant to anti-dilution and adjustment provisions of the plans. (3) Includes shares issued and issuable upon exercise of options under the plans. 2 PROSPECTUS This Prospectus relates to an aggregate 4,657,300 shares, including 384,800 shares issued under the 1998 Stock/Stock Option Plan and 2,047,500 shares authorized and issuable pursuant to the 1998 plan and 2,225,000 shares issuable upon exercise of options for the common stock $.0001 par value of Computer Concepts Corp. and is to be used in connection with the reoffer and resale of such shares of our common stock and/or shares issuable upon exercise of options which have been issued or are issuable to our directors, officers, employees and consultants, some of whom are our affiliates, pursuant to our 1998 Incentive Stock Option Plan and grants of our common stock or options in 1999 and 2000 to our directors, officers, employees and consultants pursuant to written compensation agreements. The amount of our common stock to be reoffered or resold hereby by each selling stockholder who is an affiliate, and any other person with whom he or she is acting in concert for the purpose of selling our common stock, may not exceed, during any three month period, the amount specified in Rule 144 (e) of the Securities Act of 1933, as amended (the "Securities Act"). See "Selling Stockholders" and "Plan of Distribution." Our common stock may be offered by the selling stockholders from time to time in transactions on the National Association of Securities Dealers, Inc., Automated Quotation System ("NASDAQ") in negotiated transactions, through the writing of options on the common stock, or a combination of such methods of sale, at fixed prices that may be changed, at market prices prevailing at the time of sale, at prices related to such prevailing market prices or at negotiated prices. The selling stockholders may effect such transactions by the sale of the common stock to or through broker-dealers, and such broker-dealers may receive compensation in the form of discounts, concessions or commissions from the selling stockholders and/or the purchasers of the common stock for whom such broker-dealers may act as agent or to whom they may sell as principal, or both (which compensation to a particular broker-dealer might be in excess of customary commissions). The selling stockholders and any broker-dealer who acts in connection with the sale of common stock hereunder may be deemed to be "underwriters" as that term is defined in the Securities Act. The selling stockholders may also sell the common stock pursuant to all of the terms and conditions of Rule 144 promulgated under the Securities Act or any other exemption from the registration requirements of the Act which may be applicable. See "Selling Stockholders" and "Plan of Distribution." We will not receive any of the proceeds from the sale of the common stock by the selling stockholders, however, to the extent options are exercised, we will receive the applicable option exercise premiums. Our common stock is listed on the NASDAQ Small Cap Market under the Symbol "CCEE." On March 22, 2000, the last reported sale price of our common stock as reported by NASDAQ was $1.97 per share. We will bear all expenses (other than underwriting discounts and selling commissions, and fees and expenses of counsel or other advisors to the selling stockholders) in connection with the registration of our common stock being offered hereby, which expenses are estimated to be approximately $20,000. An investment in the securities offered hereby involves a high degree of risk. See Risk Factors beginning on page 3. Neither the SEC nor any state securities commission has approved these securities or determined that this Prospectus is accurate or complete. Any representation to the contrary is a criminal offense. You should rely only on information contained in this document or that we have referred you to. We have not authorized anyone to provide you with information that is different. This Prospectus does not consummate an offer to sell or the solicitation of an offer to buy the securities offered hereby in any state to any person to whom it is unlawful to make such offer or solicitation. Except where otherwise indicated, this Prospectus speaks as of its date and neither the delivery of this Prospectus nor any sale made hereunder shall, under any circumstances, create an implication that there has been no change in our affairs since the date hereof. ------------------------- THE DATE OF THIS PROSPECTUS IS MARCH 24, 2000 3 INTRODUCTION Computer Concepts Corp. is a Delaware corporation originally organized on August 27, 1987 under the corporate name Unique Ventures, Inc. As of April 22, 1989, we were restructured and we initiated our first business activities in regard to research and development of computer software and hardware technology as a development stage company in the data-base information retrieval area, and effective September 20, 1989, we changed our name to Computer Concepts Corp. Effective October 31, 1990, we acquired Ramp Associates, Inc. as a subsidiary which provided software consulting services. Effective September 1, 1993, we acquired Softworks, Inc. as a subsidiary which developed, marketed and sold mainframe computer systems management software. We eliminated the Ramp Associates, Inc. line of consulting services effective December 1993. In June of 1994, we acquired the Superbase software technology, and effective December 31, 1994, we acquired MapLinx Corp. as a subsidiary, which provided PC based software that allows for geographical presentation of database information. During December 1994, we also acquired DBopen, Inc., which provided PC database administration tools employing client/server technology, and in 1998 acquired the ComputerCop technology and related assets. Subsequent thereto, we sold MapLinx Corp., the Superbase technology and discontinued the DBopen products. In 1998 and 1999, we sold or transferred shares of our Softworks, Inc. subsidiary in conjunction with its Initial Public Offering and a secondary offering in August, 1998 and June, 1999, respectively, and the raising of capital through the sale of Softworks' shares, and the acquisition of certain assets and in fulfillment of corporate obligations. In January and February, 2000, we sold our interests in Softworks and the ComputerCop related assets. We now own and operate computer software development, marketing and sales, and provide internet based telecommunications related services in New York. Our executive offices are located at 80 Orville Drive, Bohemia, New York 11716 and our telephone number at that address is (631) 244-1500. AVAILABLE INFORMATION We are subject to the information requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance therewith file reports, proxy statements and other information with the Securities and Exchange Commission (the "Commission"). Such reports, proxy statements and other information filed by us can be inspected and copied at the public reference facilities maintained by the Commission at 450 Fifth Street, N. W., Judiciary Plaza, Washington, D. C. 20549 and at the Commission's regional offices located at 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511 and at 7 World Trade Center, New York, New York 10048. We have filed with the Commission a Registration Statement on Form S-8 under the Securities Act, with respect to the shares of common stock offered hereby. This Prospectus does not contain all of the information set forth in the Registration Statement and the exhibits and schedules thereto. For further information with respect to us and the shares of common stock offered hereby, reference is hereby made to the Registration Statement, exhibits and schedules. RECENT DEVELOPMENTS In January 2000, we completed the sale of our investment in Softworks, Inc. for approximately $61 million in cash. In February 2000, we also completed the sale of our ComputerCOP assets (which included software technology and $20,500,000 in cash) to NetWolves Corporation in exchange for 1,775,000 shares of NetWolves' common stock valued at $35 million. On March 14, 2000, we announced that Daniel DelGiorno (Sr.) was retiring from his Chairman and officer positions. Our remaining Board elected James Cannavino to complete Mr. DelGiorno's term and to act as Chairman of the Board until the next annual shareholder's meeting. In conjunction with Mr. Cannavino's election as Chairman, and having completed these recent transactions, our President and CEO, Daniel DelGiorno (Jr.), informed the Board that he was electing to retire from his positions as a director and officer concurrent with his father's retirement in order to spend more time with his family in retirement. Anthony Coppola, Executive Vice-President in charge our d.b.Express internet telecommunications business, was named as acting President pending further actions by the Board. On March 17, 2000, we announced the decision of Messrs. Pellicano, Beige and Medina to voluntarily resign from their positions as members of our Board of Directors. Additionally, the Board elected Dr. Dennis Murray, President of Marist College, to serve as director for the balance of Mr. Pellicano's term. We also announced the election of Mr. Charles Feld of Delta Airlines, to serve the balance of Mr. DelGiorno's (Jr.) term as a director. Our new Board members are considering a number of alternatives for our future direction, which may include modifying our overhead, facilities usage, personnel, compensation structure, marketing, sales and growth strategies which could result in significant changes to our present structure and could therefore result in possible, significant one-time charges. We cannot be assured that any of those changes, or others, will result in our success. Background information for each of our three new Board members is as follows: 4 - - James Cannavino, the new Chairman of the Board, has extensive experience in the computer industry including serving as a board member for several computer industry companies, and as the CEO and Chairman of Cybersafe Corporation. Prior to joining Cybersafe, Mr. Cannavino served as President of Perot Systems Corporation, which grew from $300 million to more than $800,000 million under his leadership, and prior to Perot, he was a senior executive at IBM, holding numerous executive management positions. As a 32 year veteran at IBM Corporation, Mr. Cannavino retired from IBM in March, 1995 as Senior Vice President for Strategy and Development. He was a member of the IBM Corporate Executive Committee and Worldwide Management Council, and served on the Board of IISM's Integrated Services and Solutions Company. He was also a Board member of three IBM joint-venture companies, including Prodigy Services, Inc., Digital Domain, Inc. and New Leaf Entertainment. He was responsible for driving IBM's thrust into network-centered computing, and is also widely recognized as the force behind IBM's investments in object technologies and new services offerings. Mr. Cannavino brings us a wealth of knowledge and experience in developing and implementing successful long-term strategic plans. - - Dennis Murray has been President of Marist College since 1979. Under Dr. Murray's leadership, Marist has become one of the most technologically advanced liberal arts colleges in the country, having recently completed a five-year, $16 million joint study with the IBM Corporation that included an integrated voice and data network that connects virtually every room on campus, and the integration of information technology across the curriculum. Dr. Murray serves on several boards, including Bank of New York/Dutchess Division, the Franklin and Eleanor Roosevelt Institute, the McCann Foundation and Vassar Brothers Hospital Foundation. He is also the editor of three books in the field of government and public affairs and is co-author of a guide to corporate-sponsored university research in biotechnology. - - Charles Feld has acted in the capacity of Chief Information Officer for Delta Airlines since December, 1997, and is highly respected and acknowledged as a leader in the computer industry. From June, 1992 until August, 1997, Mr. Feld served as Chief Information Officer for Burlington Northern Santa Fe Corp. Mr. Feld also has been President of the Feld Group, Inc., a provider of temporary chief information officer consulting services for more than five years. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE We hereby incorporate by reference into this Prospectus the following: (a) Report on Form 10-K for the year ended December 31, 1999, and including specifically the Consolidated Financial Statements for the years ended December 31, 1999, 1998 and 1997, as reported on by Hays & Company, Certified Public Accountants; (b) All other reports filed pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 since the end of the fiscal year covered by the Registrant document referred to in (a) above. All documents filed by us pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act subsequent to the date hereof and prior to the filing of a post-effective amendment to the Registration Statement which indicates that all shares of common stock offered hereby have been sold or which deregisters all shares of common stock then remaining unsold, shall be deemed to be incorporated by reference into this Prospectus and to be a part hereof from the date of filing of such documents. Any statement contained herein or in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this Prospectus to the extent that such statement is modified or superseded by a statement contained herein or in a subsequently filed document which also is or is deemed to be incorporated by reference herein. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Prospectus. We will provide, without charge, to each person (including any beneficial owner) to whom this Prospectus is delivered, upon written or oral request of such person, a copy of any and all of the information that has been incorporated by reference in this Prospectus (not including exhibits to such information unless such exhibits are specifically incorporated by reference into such information). Such requests should be directed to Office of the President, at our executive offices at 80 Orville Drive, Bohemia, New York 11716, telephone number (631) 244-1500. 5 RISK FACTORS The securities offered hereby are speculative and involve a high degree of risk. Only those persons able to lose their entire investment should purchase these securities. Prospective investors, prior to making an investment decision, should carefully read this prospectus and consider, along with other matters referred to herein, the following risk factors: 1. LACK OF PROFITABLE OPERATIONS AND CASH FLOW FROM OPERATIONS; FUTURE PROFITABILITY UNCERTAIN. We first acquired operating assets in April of 1989. We have incurred net losses of approximately $12,385,000 and $5,572,000 for the years ended December 31, 1997 and 1999, respectively, and although we reported a net profit of $9,547,000 for the year ended December 31, 1998, we had cumulative losses of $77,766,000 through December 31, 1999, and may incur additional losses in the course of building our business. Our profitability under our current business plan is substantially dependent upon the successful exploitation of our d.b.Express technology. There can be no assurances that we will be able to successfully exploit the d.b.Express technology. 2. LIMITED REVENUES; CONTRACTION OF OPERATIONS. We started our business in 1989. Effective October 1990, we acquired Ramp Associates, Inc. and effective September 1993, we acquired Softworks, Inc., both of which operated as private self-sufficient companies prior to their acquisition by us. We eliminated the Ramp Associates, Inc. line of consulting services effective December 1993. We purchased the "Superbase" database software technology in June 1994 and acquired DBopen Inc., and MapLinx, Inc. in December 1994. Subsequent to these acquisitions, as a result of limited sales, changing market conditions and our decision to focus our activities on exploitation of d.b.Express and Softworks, we determined to sell the "Superbase" technology assets (sold in the second quarter of 1996), discontinue the DBopen related products and sold the net assets of MapLinx in 1997. In June, 1998, we acquired asset rights related to the software product now known as ComputerCOP, and in August, 1998, sold shares of our Softworks, Inc. subsidiary in an Initial Public Offering. In 1998 and 1999 additional interests in Softworks were sold with the balance of our interest being sold pursuant to a tender offer by EMC Corporation in January, 2000. In February 2000, the ComputerCop assets were sold. Our primary source of revenue is currently generated from d.b.Express. Although we have taken the steps we believe are necessary to exploit d.b.Express, there can be no assurance that our efforts will be successful in this regard. Although revenues from our d.b.Express related operations have been increasing, to date, revenues generated therefrom have not been sufficient to pay our operating costs. 3. POTENTIAL ADVERSE IMPACT ON MARKET PRICE OF SHARES ELIGIBLE FOR FUTURE SALE. We have approximately 22,135,600 shares of common stock outstanding as of March 22, 2000, including the shares issuable under the plans and being registered herein, of which approximately 17,000,000 are currently without restriction on resale, and virtually all of the restricted shares not included in this registration have been outstanding in excess of one year and may qualify for sale pursuant to various securities laws and regulations. The influx of all of this common stock on the market together with the 4,657,300 (if all options are earned and exercised) shares registered herein, could have a significant adverse effect on the market for, as well as the price of, the common stock. If all outstanding options and warrants, including options registered herein and/or subject to various performance requirements (approximately 4,665,000), were exercised, the outstanding shares would total approximately 26,800,500 shares. A decline in the market price also may make the terms of future financings which involve our common stock or the use of convertible debt more burdensome. Although the exercise of options would result in significant proceeds to us (approximately $9,504,000 if all outstanding warrants and options are earned and are exercised for cash), the impact of any significant number of such shares entering the market would likely have a negative impact on the market price for our common stock. We have authorized capital of 150,000,000 shares of common stock, par value $.0001 per share. 4. COMPETITION. Our products and services are marketed in a highly competitive environment characterized by rapid change, frequent product introductions and declining prices. Further, our personal computer products have been designed specifically for use on the Intel x86 family of computers, utilizing other well known database products. A decline in the use of this type of personal computer or the emergence of competitive platforms could materially adversely affect the market for ours products. We consider certain end-user data access tool and executive information system software companies to be competitors of our d.b.Express product, including Trinzic Corporation, 6 Cognos, Inc., Comshare Corp., and Pilot Software, Inc. While we believe that d.b.Express can compete effectively against such companies' product offerings based on ease of use, lack of programming, data access, speed and price, no assurance can be given in this regard, and we have focused our activities in the area of certain telecommunications industry related services which also have numerous competitive companies. Many of our existing and potential competitors possess substantially greater financial, marketing and technology resources than we do. 5. CURRENT LITIGATION. We, and certain of our officers and directors, are parties to several lawsuits, including a class action complaint and a derivative action complaint, among others. While we are vigorously defending these actions, any substantial judgment against us would have a material adverse effect on our financial condition and could threaten our viability. 6. DEPENDENCE ON KEY PERSONNEL AND RECENT CHANGES IN MANAGEMENT. We have been highly dependent on our executive officers and management personnel, the loss of any of whom could have an adverse affect upon our operations. Our senior officers and founding directors recently retired and new directors were elected by remaining Board members to serve out the balance of the retiring Board members' terms or until the next shareholder meeting. Should any of the members of our remaining senior management be unable or unwilling to continue in their present roles or should such person determine to enter into competition with us, our prospects could be adversely affected. Our new Board members are considering a number of alternatives for our future direction, which may include modifying our overhead, facilities usage, personnel, compensation structure, marketing, sales and growth strategies which could result in significant changes to our present structure. We cannot be assured that any of those changes, or others, will result in our success. Our success is also dependent upon our ability to attract, retain and motivate highly-trained technical, marketing, sales and management personnel. The inability to attract, retain and motivate personnel required for development, maintenance and expansion of our activities could adversely affect our business and prospects. 7. SUBSTANTIAL NUMBER OF OUTSTANDING SHARES OF COMMON STOCK AND VOLATILITY IN TRADING PRICE. We have approximately 22,135,600 shares of common stock outstanding as of March 22, 2000, of which approximately 17,000,000 are currently without restriction on resale. The price of our common stock is subject to fluctuation and has increased and decreased substantially from $1.00 to $7.00 during 1998 and 1999. The trading activity in our common stock also varies from time to time so that, at any given time, the sale of a large block could adversely affect the market price of our common stock. 8. NO CREDIT FACILITY. We have no bank or other credit facility arrangements and have no other significant assets other than cash and/or our investment interest in NetWolves Corporation common stock which is subject to various restrictions on sale. Accordingly, our business could be adversely affected in the event that we have a need for funds in amounts greater than ours cash on hand. If additional funds are needed, we could obtain the funds through debt or equity financing, or if necessary, we could sell a portion of our investment in NetWolves Corporation. 9. NO REGULAR DIVIDENDS. We have not declared or paid, and do not anticipate declaring or paying in the foreseeable future, a regular periodic cash dividend on our common stock. However, we have declared two dividends of $6,000,000 and approximately $2,000,000. Our ability to pay dividends is dependent upon, among other things, future earnings, our operating and financial condition, our capital requirements, general business conditions and other pertinent factors, and is subject to the discretion of the Board of Directors. Accordingly, there is no assurance that any additional dividends will be paid on our common stock. 10. IMPORTANCE OF AND RISKS RELATING TO INTELLECTUAL PROPERTY RIGHTS. The computer software industry is characterized by extensive use of intellectual property protected by copyright, patent and trademark laws. While we believe that we do not infringe on the intellectual property rights of any third parties in the conduct of our business, allegations of any such infringement, or disputes or litigations relating thereto, could have a material adverse affect on our business and financial condition. Also, if third parties were permitted to use our proprietary technology without our consent or without our being compensated therefor, we believe that one of our competitive advantages could be eroded. No assurance can be given that our patents and copyrights will effectively protect us from any copying or emulation of our products in the future. 7 11. LACK OF MANAGING UNDERWRITER. The sale of common stock by the selling stockholders will not be coordinated or controlled by a managing underwriter. Certain selling stockholders may be deemed to be underwriters, as such term is defined by the Securities Act. Selling stockholders will, during the distribution period, also be subject to the restrictions on their purchases and sales of common stock as set forth in Rules 10b-6 and 10b-7 under the Exchange Act. See "Selling Security holders" and "Plan of Distribution." 12. POTENTIAL IMPACT IF RULE 15G BECOMES APPLICABLE TO OUR SECURITIES. Rule 15G of the Securities Act of 1934 provides certain requirements for the sale of securities which are classified as "penny stocks." As our stock exceeds the stock price, asset and revenue parameters for classification as a penny stock (more than $5.00, less than $2 million of tangible assets or $6 million of revenues for companies in business more than three years) and trades on the NASDAQ exchange (Small Cap Market) those rules are not currently applicable to us. However, in the event, we were to be so classified in the future, the compliance requirements for the sale of securities under Rule 15G could have a negative effect on the marketability of our securities. 13. POTENTIAL LOSS OF ENTIRE INVESTMENT IN OUR SECURITIES. An investment in our securities involves a high degree of risk, including the potential total loss of your investment. SELLING STOCKHOLDERS Certain of the selling stockholders whose shares of common stock are registered by the Registration Statement and covered by this Prospectus are "affiliates" of us as that term is defined in Rule 405 of the Securities Act. Such shares of common stock are issuable to the selling stockholders under the plans. Additional shares of common stock which are registered by the Registration Statement and which become issued pursuant to options issued to the selling stockholders may be added to this Prospectus by supplements hereto. The amount of common stock to be reoffered or resold by each selling stockholder hereby who is an affiliate, and any other person with whom each selling stockholders is acting in concert for the purpose of selling our common stock, is limited by Rule 144(e) of the Securities Act, which as currently in effect would prohibit such reoffers or resales from exceeding, during any three month period, the greater of (i) one percent of the common stock outstanding as shown by the most recent report or statement published by us, or (ii) the average weekly reported volume of trading in the common stock reported by NASDAQ during the four calendar weeks preceding the date of receipt of the order to execute the transaction by the broker or the date of execution of the transaction directly with a market maker. Included in the 4,657,300 shares we are registering are 384,800 shares authorized and issued, but which we had not previously included in a registration. The names of those selling stockholders and certain information with respect to them are listed below. Except as otherwise noted, none of such persons has had any material relationship with the Company during the past three years.
Amount of Percentage of Amount of Common Outstanding Common Amount of Stock to be Common Stock Stock Common Owned if to be Owned if Name of Beneficially Stock to be all Shares all Shares Selling Owned Prior Offered Offered Hereby Offered Hereby Stockholder to Offering* Hereby are Sold are Sold ** - ----------- ------------ ----------- -------------- -------------- Amico, Claudia 800 800 *** Athans, Leigh 22,050 6,000 16,050 *** Balan, Sajay 22,110 6,000 16,110 *** Beach, Brian 36,500 6,000 30,500 *** Beige, Jack S.+ 186,250 25,000 161,250 *** Brander, Roni 10,560 2,000 8,560 *** Bronson, Scott 6,500 4,000 2,500 *** Castoro, Michael 58,350 12,500 46,350 *** Chamberlain, Orland 31,750 6,000 25,750 *** Coppola, Anthony ++ 228,875 22,500 206,375 *** Dageyev, Igor 19,350 6,000 13,350 *** Desmet, Clark 10,000 2,000 8,000 *** Dengler, Chris 8,500 2,000 6,500 *** DiMare, Salvatore 31,000 6,000 25,000 *** Dietl, Jaclyn 5,500 2,000 3,500 ***
8 Eisenberg, Michael 195,000 10,000 185,000 *** Gordon, Sindy 1,000 1,000 *** Hallock, Gail 2,000 1,000 1,000 *** Heuzey, Doug 67,950 10,000 57,950 *** Hoffman, Warren 25,000 25,000 *** Johnston, Tim 17,750 2,000 15,750 *** Kaemmlein, Hans 247,500 50,000 197,500 *** Kale, Udayan 22,100 6,000 16,100 *** Koenig, Michael 71,150 10,000 61,150 *** Kogan, Ian 11,000 2,000 9,000 Kolenik, Michelle 4,750 2,000 2,750 *** Kopelson, Edward 3,000 3,000 *** Leap, Arnold 92,950 10,000 82,950 *** Leuly, Mark 70,650 20,000 50,650 *** Mata, Corina 20,760 4,000 16,760 *** Neely, Linda 100,000 50,000 50,000 *** Pellicano, Russell+ 230,000 25,000 205,000 *** Rybalko, Oleg 19,750 4,000 15,750 *** Sages, Allan 2,750 2,000 750 *** Sassano, Louis 17,500 4,000 13,500 *** Singh, Jasmeet Paul 3,000 3,000 *** Sosias, Margie 1,500 1,000 500 *** Vadul, Anand 4,000 4,000 *** Wang, Xiaoli 18,250 7,000 11,250 *** West, James 4,000 4,000 *** White, Tim 51,000 8,000 42,000 *** Whitney, Allison 4,750 4,000 750 *** Zvonik, Linda 4,000 4,000 *** --------- --------- --------- 1,991,655 384,800 1,606,855
* Includes shares issuable upon exercise of options ** Based on approximately 26,780,500 shares deemed outstanding if all outstanding options are exercised. *** Less than one percent + Director until March 17, 2000 ++ Officer effective March 14, 2000 PLAN OF DISTRIBUTION The common stock may be offered by the selling stockholders from time to time in transactions on NASDAQ, in negotiated transactions, through the writing of options on the common stock, or a combination of such methods of sale, at fixed prices that may be changed, at market prices prevailing at the time of sale, at prices related to such prevailing market prices or at negotiated prices. The selling stockholders may effect such transactions by the sale of the common stock to or through broker-dealers, and such broker-dealers may receive compensation in the form of discounts, concessions or commissions from the selling stockholders and/or the purchasers of the common stock for whom such broker-dealers may act as agent or to whom they may sell as principal, or both (which compensation to a particular broker-dealer might be in excess of customary commissions). The selling stockholders and any broker-dealer who acts in connection with the sale of common stock hereunder may be deemed to be "underwriters" as that term is defined in the Securities Act, and any commission received by them and any profit on any resale of the common stock as principal might be deemed to be underwriting discounts and commissions under the Securities Act. The selling stockholders also may sell the common stock pursuant to all the terms and conditions of Rule 144 promulgated under the Securities Act. USE OF PROCEEDS We will not receive any proceeds from the sale of the common stock offered hereby; however, we would receive the exercise price for options exercised by selling stockholders. LEGAL MATTERS The legality of the securities offered hereby will be passed upon for us by Daniel B. Kinsey, P. C. Mr. Kinsey beneficially owns 428,000 shares and options to purchase 150,000 shares of our common stock. EXPERTS An opinion is included herein and in the registration statement in reliance upon the authority of the firm of Daniel B. Kinsey, P.C., as experts regarding the legality of the securities offered hereby. 9 NO DEALER, SALESPERSON OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS IN CONNECTION WITH THIS OFFERING OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS. ANY INFORMATION OR REPRESENTATIONS NOT HEREIN CONTAINED, IF GIVEN OR MADE, MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY US. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITY OTHER THAN THE SECURITIES OFFERED BY THIS PROSPECTUS, NOR DOES IT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY THE SECURITIES BY ANY PERSON IN ANY JURISDICTION WHERE SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED, OR IN WHICH THE PERSON MAKING SUCH OFFER IS NOT QUALIFIED TO DO SO, OR TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. THE DELIVERY OF THIS PROSPECTUS SHALL NOT, UNDER ANY CIRCUMSTANCES CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN OUR AFFAIRS SINCE THE DATE HEREOF. TABLE OF CONTENTS
Page ---- Introduction.............................. 2 Available Information..................... 2 Recent Developments....................... 2 Incorporation of Certain Documents by Reference......................... 3 Risk Factors.............................. 4 Selling Stockholders...................... 6 Plan of Distribution...................... 7 Use of Proceeds........................... 7 Legal Matters............................. 7 Experts................................... 7
4,657,300 SHARES OF COMMON STOCK COMPUTER CONCEPTS CORP. PROSPECTUS MARCH 24, 2000 10 PART II INFORMATION REQUIRED IN THE REGISTRATION STATEMENT Item 3. Incorporation of Documents by Reference. The Registrant hereby incorporates by reference into this Registration Statement the documents listed in (a) through (c) below: (a) The Registrant's latest annual report filed pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, or either (I) the latest prospectus filed pursuant to Rule 424(b) under the Securities Act of 1933 that contains audited financial statements for the Registrant's latest fiscal year for which such statements have been filed or (II) the Registrant's effective registration statement on Form 10 filed under the Securities Exchange Act of 1934 containing audited financial statements for the Registrant's latest fiscal year; (b) All other reports filed pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 since the end of the fiscal year covered by the Registrant document referred to in (a) above; (c) The description of the class of securities to be offered which is contained in a registration statement filed under Section 12 of the Securities Exchange Act of 1934, including any amendment or report filed for the purpose of updating such description. All documents subsequently filed by the Registrant pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, prior to the filing of a post-effective amendment which indicates that all securities offered have been sold or which indicates that all securities offered have been sold or which deregisters all such securities then remaining unsold, shall be deemed to be incorporated by reference in this Registration Statement and to be a part hereof from the date of filing of such documents. Item 4. Description of Securities. Not applicable. Item 5. Interests of Named Experts and Counsel. The legality of the securities offered hereby will be passed upon for the Company by Daniel B. Kinsey, P.C. Mr. Kinsey beneficially owns 428,000 shares and options to purchase 150,000 shares of our common stock. An opinion is included in the registration statement in reliance upon the authority of the firm of Daniel B. Kinsey, P.C., as experts regarding the legality of the securities offered hereby. Item 6. Indemnification of Directors and Officers. Under the provisions of the Certificate of Incorporation and By-Laws of Registrant, each person who is or was a director or officer of Registrant shall be indemnified by Registrant as of right to the full extent permitted or authorized by the General Corporation Law of Delaware. Under such law, to the extent that such person is successful on the merits of defense of a suit or proceeding brought against him by reason of the fact that he is a director or officer of Registrant, he shall be indemnified against expenses (including attorneys' fees) reasonably incurred in connection with such action. If unsuccessful in defense of a third-party civil suit or a criminal suit is settled, such a person shall be indemnified under such law against both (1) expenses (including attorneys' fees) and (2) judgments, fines and amounts paid in settlement if he acted in good faith and in a manner he reasonably believed to be in, or not opposed to, the best interests of Registrant, and with respect to any criminal action, had no reasonable cause to believe his conduct was unlawful. If unsuccessful in defense of a suit brought by or in the right of Registrant, or if such suit is settled, such a person shall be indemnified under such law only against expenses (including attorneys' fees) incurred in the defense or settlement of such suit if he acted in good faith and in a manner he reasonably believed to be in, or not opposed to, the best interests of Registrant except that if such a person is adjudicated to be liable in such suit for negligence or misconduct in the performance of his duty to Registrant, he cannot be made whole even for expenses unless the court determines that he is fairly and reasonably entitled to be indemnified for such expenses. 11 The officers and directors of the Company are covered by officers' and directors' liability insurance. The policy coverage is $5,000,000, which includes reimbursement for costs and fees. There is a maximum aggregate deductible for each loss under the policy of $250,000, for officers and directors as a group of $50,000 and for each officer or director of $5,000. Item 7. Exemption from Registration Claimed. Not applicable. Item 8. Exhibits. 4.1 1998 Stock / Stock Option Plan 5 Opinion and consent of Daniel B. Kinsey, P. C. 23.1 Consent of Daniel B. Kinsey, P. C. - included in the opinion filed as Exhibit 5 23.2 Consent of Hays & Company, Independent Certified Public Accountants 24 Powers of Attorney. Item 9. Undertakings. (a) The undersigned Registrant hereby undertakes: To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement: (i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; (ii) To reflect in the prospectus any facts or events arising after the effective date of the Registration Statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the Registration Statement; (iii) To include any material information with respect to the plan of distribution not previously disclosed in the Registration Statement or any material change to such information in the Registration Statement; provided, however, that paragraphs (a)(l)(i) and (a)(l)(ii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed by the Registrant pursuant to section 13 or section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the Registration Statement. (2) That, for the purposes of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new Registration Statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (b) The undersigned Registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the Registration Statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at the time shall be deemed to be the initial bona fide offering thereof. (c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question 12 whether such indemnification by it is against policy as expressed in the Act and will be governed by final adjudication of such issue. *** 13 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all requirements for filing on Form S-8 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Bohemia, New York on the 22nd day of March, 2000. COMPUTER CONCEPTS CORP. By: /s/ James Cannavino. James Cannavino., Chairman POWER OF ATTORNEY Pursuant to the requirements of the Securities Act of 1933, as amended, this Registration Statement has been signed on March 22, 2000, by the following persons in the capacities indicated. Each person whose signature appears below constitutes and appoints James Cannavino and George Aronson, and each of them acting individually, with full power of substitution, our true and lawful attorneys-in-fact and agents to do any and all acts and things in our name and on our behalf in our capacities indicated below which they or either of them may deem necessary or advisable to enable Computer Concepts Corp. to comply with the Securities Act of 1933, as amended, and any rules, regulations and requirements of the Securities and Exchange Commission, in connection with this Registration Statement including specifically, but not limited to, power and authority to sign for us or any of us in our names in the capacities stated below, any and all amendments (including post-effective amendments) thereto, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in such connection, as fully to all intents and purposes as we might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or his substitute or substitutes, may lawfully do or cause to be done by virtue thereof.
Signature Title --------- ----- /s/ James Cannavino. Chairman, Director - ------------------------------ James Cannavino /s/ Dennis Murray Director - ------------------------------ Dennis Murray /s/Anthony Coppola President - ------------------------------ Anthony Coppola /s/ George Aronson Chief Financial Officer - ------------------------------ George Aronson
14 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 COMPUTER CONCEPTS CORP. Form S-8 Registration Statement EXHIBIT INDEX
Page No. in Sequential Exhibit Numbering of all Pages, Number Exhibit Description including Exhibit Pages - ------ ------------------- ----------------------- 4.1 1998 Stock / Stock Option Plan ........... 5 Opinion and Consent of Counsel ........... 23.1 Consent of Counsel ....................... See Exhibit 5 23.2 Consent of Hays & Company ................ 24 Powers of Attorney ....................... See signature page
EX-4.1 2 1998 STOCK/STOCK OPTION PLAN 1 COMPUTER CONCEPTS CORP. 1998 STOCK / STOCK OPTION PLAN 1. Purpose; Effectiveness of the Plan. A. The purpose of this Plan is to advance the interests of the Company and its stockholders by helping the Company obtain and retain the services of employees and consultants, upon whose judgment, initiative and efforts the Company is substantially dependent, and to enable the Company to provide compensation in the form of securities when deemed appropriate, and to provide those persons with further incentives to advance the interests of the Company. B. This Plan will become effective on the date of its adoption by the Board. This Plan will remain in effect until it is terminated by the Board or the Committee (as defined hereafter) under section 9 hereof. This Plan will be governed by, and construed in accordance with, the laws of the State of Delaware. 2. Certain Definitions. Unless the context otherwise requires, the following defined terms (together with other capitalized terms defined elsewhere in this Plan) will govern the construction of this Plan, and of any stock option agreements entered into pursuant to this Plan: A. "10% Stockholder" means a person who owns, either directly or indirectly by virtue of the ownership attribution provisions set forth in Section 424(d) of the Code at the time he or she is granted an Option, stock possessing more than ten percent (10%) of the total combined voting power or value of all classes of stock of the Company and/or of its subsidiaries; B. "1933 Act" means the federal Securities Act of 1933, as amended; C. "Board" means the Board of Directors of the Company; D. "called for under an Option," or words to similar effect, means issuable pursuant to the exercise of an Option; E. "Code" means the Internal Revenue Code of 1986, as amended (references herein to Sections of the Code are intended to refer to Sections of the Code as enacted at the time of this Plan's adoption by the Board and as subsequently amended, or to any substantially similar successor provisions of the Code resulting from recodification, renumbering or otherwise); F. "Committee" means a committee of two or more Disinterested Directors, appointed by the Board, to administer and interpret this Plan; provided that the term "Committee" will refer to the Board during such times as no Committee is appointed or qualified by the Board; the Board may always act in lieu of the Committee; G. "Company" means Computer Concepts Corp., a Delaware corporation; H. "Disability" has the same meaning as "permanent and total disability," as defined in Section 22(e)(3) of the Code; I. "Disinterested Director" means a member of the Board who is not during the period of one year prior to his or her service as an administrator of the Plan, or during the period of such service, granted or awarded Stock, options to acquire Stock, or similar equity securities of the Company under this Plan or any similar plan of the Company; J. "Eligible Participants" means persons who, at a particular time, are employees or consultants of the Company or its subsidiaries; K. "Fair Market Value" means, with respect to the Stock, the market price per share of such Stock determined by the Committee, consistent with the requirements of Section 422 of the Code and to the extent consistent therewith, as follows: i. If the Stock was traded on a stock exchange on the date in question, then the Fair Market Value will be equal to the closing price reported by the applicable composite-transactions report for such date; 2 ii. If the Stock was traded over-the-counter on the date in question and was classified as a national market issue, then the Fair Market Value will be equal to the last-transaction price quoted by the NASDAQ system for such date; iii. If the Stock was traded over-the-counter on the date in question but was not classified as a national market issue, then the Fair Market Value will be equal to the average of the last reported representative bid and asked prices quoted by the NASDAQ system for such date; and iv. If none of the foregoing provisions is applicable, then the Fair Market Value will be determined by the Committee in good faith on such basis as it deems appropriate. L. "ISO" has the same meaning as "incentive stock option," as defined in Section 422 of the Code; M. "Just Cause Termination" means a termination by the Company of an Optionee's employment by and/or service to the Company (or if the Optionee is a director, removal of the Optionee from the Board by action of the stockholders or, if permitted by applicable law and the by-laws of the Company, the other directors), in connection with the good faith determination of the Company's board of directors (or of the Company's stockholders if the Optionee is a director and the removal of the Optionee from the Board is by action of the stockholders, but in either case excluding the vote of the Optionee if he or she is a director or a stockholder) that the Optionee has engaged in any acts involving dishonesty or moral turpitude or in any acts that materially and adversely affect the business, affairs or reputation of the Company or its subsidiaries, or as defined in any applicable employment agreement; N. "NSO" means any option granted under this Plan whether designated by the Committee as a "non-qualified stock option," a "non-statutory stock option" or otherwise; O. "Option" means an option granted pursuant to this Plan entitling the option holder to acquire shares of Stock issued by the Company pursuant to the valid exercise of the option; P. "Option Agreement" means an agreement between the Company and an Optionee, in form and substance satisfactory to the Committee in its sole discretion, which may consist solely of an option certificate, consistent with this Plan; Q. "Option Price" with respect to any particular Option means the exercise price at which the Optionee may acquire each share of the Option Stock called for under such Option; R. "Option Stock" means Stock issued or issuable by the Company pursuant to the valid exercise of an Option; S. "Optionee" or "Grantee" means an Eligible Participant to whom Stock and/or Options are granted hereunder, and any transferee thereof pursuant to a Transfer authorized under this Plan; T. "Plan" means this 1998 Stock Option Plan of the Company; U. "QDRO" has the same meaning as "qualified domestic relations order" as defined in Section 414(p) of the Code; V. "Stock" means shares of the Company's Common Stock, $.0001 par value; W. "Stock Award" means any and all awards or grants of Stock henceforth made by the Company, unless otherwise specified, to employees or consultants by the Board or Committee in regard to services rendered to the Company; X. "Transfer," with respect to Option Stock, includes, without limitation, a voluntary or involuntary sale, assignment, transfer, conveyance, pledge, hypothecation, encumbrance, disposal, loan, gift, attachment or levy of such Option Stock, including without limitation an assignment for the benefit of creditors of the Optionee, a transfer by operation of law, such as a transfer by will or under the laws of descent and distribution, an execution of judgment against the Option Stock or the acquisition of record or beneficial ownership thereof by a lender or creditor, a transfer pursuant to a QDRO, or to any decree of divorce, dissolution or separate maintenance, any property settlement, any separation agreement or any other agreement with a spouse (except for estate planning purposes) under which a part or all of the shares of Option Stock are transferred or awarded to the spouse of the Optionee or are required to be sold; or a transfer resulting from the filing by the Optionee of a petition for relief, or the filing of an involuntary petition against such Optionee, under the bankruptcy laws of the United States or of any other nation. 3 3. Eligibility. The Company may grant Stock and/or Options under this Plan only to persons who are Eligible Participants as of the time of such grant. Subject to the provisions of sections 4(d), 5 and 6 hereof, there is no limitation on the number or amount of Options or Stock that may be granted to an Eligible Participant. 4. Administration. A. Committee. The Committee, if appointed by the Board, will administer this Plan. If the Board, in its discretion, does not appoint such a Committee, or chooses to act in lieu of the Committee, the Board itself will administer this Plan and take such other actions as the Committee is authorized to take hereunder; provided that the Board may take such actions hereunder in the same manner as the Board may take other actions under the Company's articles of incorporation and by-laws generally. B. Authority and Discretion of Committee. The Committee will have full and final authority in its discretion, at any time and from time to time, subject only to the express terms, conditions and other provisions of the Company's articles of incorporation, by-laws and this Plan, and the specific limitations on such discretion set forth herein: (i) to select and approve the persons who will be granted Stock or Options under this Plan from among the Eligible Participants, and to grant to any person so selected one or more shares of stock or Options to purchase such number of shares of Option Stock on such terms as the Committee may determine; ii. to determine the period or periods of time during which Options may be exercised, the Option Price, vesting provisions in regard to Stock or Options in the discretion of the Committee and the duration of such Options, and other matters to be determined by the Committee in connection with specific grants and Option Agreements as specified under this Plan; iii. to interpret this Plan, to prescribe, amend and rescind rules and regulations relating to this Plan, and to make all other determinations necessary or advisable for the operation and administration of this Plan; and iv. to delegate all or a portion of its authority under subsections (i) and (ii) of this section 4(b) to one or more directors of the Company who are executive officers of the Company, but only in connection with Options granted to Eligible Participants who are not subject to the reporting and liability provisions of Section 16 of the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder, and subject to such restrictions and limitations (such as the aggregate number of shares of Option Stock called for by such Options that may be granted) as the Committee may decide to impose on such delegate directors. C. Limitation on Authority. Notwithstanding the foregoing, or any other provision of this Plan, the Committee will have no authority to grant Stock or Options under this Plan to any of its members, however, the Board may so act, with any subject Board member abstaining from action in regard to himself. D. Option Agreements. Options will be deemed granted hereunder on the date the grant of Options is approved by the Committee or Board, as the case may be. E. Designation of Options. Except as otherwise provided herein, the Committee will designate any Option granted hereunder as an NSO, it being the Company's intent to adopt a separate plan in regard to the granting of ISOs. 5. Shares Reserved. A. Pool. The aggregate number of shares of Option Stock that may be issued pursuant to the exercise of Options granted under this Plan and all other compensation plans adopted by the Company, i) in regard to Option Stock issued with an exercise price less than Fair Market Value on the date of granting the Option Stock, the aggregate number granted will not exceed five percent (5%) (to be measured for all plans on a calendar year basis, but separate and in addition to the Option Stock issued pursuant to item "ii," below) of the outstanding common stock of the Company on the date of granting the Option Stock; and ii) in regard to Option Stock issued with an exercise price equal to or greater than Fair Market Value on the date of granting the Option Stock, the aggregate number granted will not exceed fifteen percent (15%) (to be measured for all plans on a calendar year basis) of the outstanding common stock of the Company on the date of granting the Option Stock (separately or collectively referred to as the "Option Pool," as the case may be), provided that such number will be increased from time to time by the number of shares of Option Stock available to be issued in any prior 4 calendar year which are not granted during that year and/or that the Company subsequently may reacquire through repurchase or otherwise. These terms shall not act to limit the number of shares of Stock which may be awarded from time to time independent of Option grants. Shares of Option Stock that would have been issuable pursuant to Options, but that are no longer issuable because all or part of those Options have terminated or expired, will be deemed not to have been issued for purposes of computing the number of shares of Option Stock remaining in the Option Pool and available for issuance. In addition, stock awards shall not exceed 2,432,300. B. Adjustments Upon Changes in Stock. In the event of any change in the outstanding Stock of the Company as a result of a stock split, reverse stock split, stock dividend, recapitalization, combination or reclassification, appropriate proportionate adjustments will be made in: (i) the aggregate number of shares of Option Stock in the Option Pool that may be issued pursuant to the exercise of Options granted hereunder; (ii) the Option Price and the number of shares of Option Stock called for in each outstanding Option granted hereunder; and (iii) other rights and matters determined on a per share basis under this Plan or any Option Agreement hereunder. Any such adjustments will be made only by the Board, and when so made will be effective, conclusive and binding for all purposes with respect to this Plan and all Options then outstanding. No such adjustments will be required by reason of the issuance or sale by the Company for cash or other consideration of additional shares of its Stock or securities convertible into or exchangeable for shares of its Stock. 6. Terms of Stock Option Agreements. Each Option granted pursuant to this Plan will be evidenced by an agreement (an "Option Agreement") between the Company and the person to whom such Option is granted, in form and substance satisfactory to the Committee in its sole discretion, consistent with this Plan. Without limiting the foregoing, each Option Agreement (unless otherwise stated therein) will be deemed to include the following terms and conditions: A. Covenants of Optionee. At the discretion of the Committee, the person to whom an Option is granted hereunder, as a condition to the granting of the Option, may be deemed to accept and agree to all conditions and terms which the Options may be made subject to. Upon request, such Optionee shall deliver to the Company a confidential information agreement approved by the Committee, an investor representations and subscriptions letter and a questionnaire, in form acceptable to the Committee. Nothing contained in this Plan, any Option Agreement or in any other agreement executed in connection with the granting of an Option under this Plan will confer upon any Optionee any right with respect to the continuation of his or her status as an employee of, consultant or independent contractor to, or director of, the Company or its subsidiaries. B. Vesting Periods. Except as otherwise provided herein, each Stock Award or Option Agreement may specify the period or periods of time within which each Option or portion thereof will first become vested or exercisable (the "Vesting Period") with respect to the total number of shares of Option Stock called for thereunder (the "Total Award Option Stock"). Such Vesting Periods will be fixed by the Committee in its discretion in regard to each Option Agreement, and may be accelerated or shortened by the Committee in its discretion. C. Exercise of the Option. i. Mechanics and Notice. An Option may be exercised to the extent exercisable (1) by giving written notice of exercise to the Company, specifying the number of full shares of Option Stock to be purchased and accompanied by full payment of the Option Price thereof and the amount of withholding taxes pursuant to subsection 6(c)(ii) below; and (2) by giving assurances satisfactory to the Company that the shares of Option Stock to be purchased upon such exercise are being purchased for investment and not with a view to resale in connection with any distribution of such shares in violation of the 1933 Act; provided, however, that in the event the Option Stock called for under the Option is registered under the 1933 Act, or in the event resale of such Option Stock without such registration would otherwise be permissible, this second condition will be inoperative if, in the opinion of counsel for the Company, such condition is not required under the 1933 Act, or any other applicable law, regulation or rule of any governmental agency. ii. Withholding Taxes. As a condition to the issuance of the shares of Option Stock upon full or partial exercise of an NSO granted under this Plan, upon request the Optionee will pay to the Company in cash, or in such other form as the Committee may determine in its discretion, the amount of the Company's tax withholding liability required in connection with such exercise. For purposes of this subsection 6(c)(ii), "tax withholding liability" will mean all federal and state income taxes, social security tax, and any other taxes applicable to the compensation income arising from the transaction required by applicable law to be withheld by the Company. D. Payment of Option Price. Each Option Agreement will specify the Option Price with respect to the exercise 5 of Option Stock thereunder, to be fixed by the Committee in its discretion. The Option Price will be payable to the Company in United States dollars in cash or by check or, such other legal consideration or methods of payment as may be approved by the Committee, in its discretion, including, but not limited to the following: i. The Committee, in its discretion, may permit a particular Optionee to pay all or a portion of the Option Price, and/or the tax withholding liability set forth in subsection 6(c)(ii) above, with respect to the exercise of an Option either by surrendering shares of Stock already owned by such Optionee or by withholding shares of Option Stock, provided that the Committee determines that the fair market value of such surrendered Stock or withheld Option Stock is equal to the corresponding portion of such Option Price and/or tax withholding liability, as the case may be, to be paid for therewith. ] ii. If the Committee permits an Optionee to pay any portion of the Option Price and/or tax withholding liability with shares of Stock with respect to the exercise of an Option (the "Underlying Option") as provided in subsection 6(d)(i) above, then the Committee, may, but is not obligated to, in its discretion, grant to such Optionee (but only if Optionee remains an Eligible Participant at that time) additional NSOs, the number of shares of Option Stock called for thereunder to be equal to all or a portion of the Stock so surrendered or withheld (a "Replacement Option"). Each Replacement Option will be evidenced by an Option Agreement. Unless otherwise set forth therein, each Replacement Option will be immediately exercisable upon such grant (without any Vesting Period) and will be coterminous with the Underlying Option. The Committee, in its sole discretion, may establish such other terms and conditions for Replacement Options as it deems appropriate. E. Termination of the Option. Except as otherwise provided herein, each Option Agreement will specify the period of time, to be fixed by the Committee in its discretion, during which the Option granted therein will be exercisable (the "Option Period"). To the extent not previously exercised, each Option will terminate upon the expiration of the Option Period specified in the Option Agreement; provided, however, that each such Option will terminate, if earlier: (i) ninety days after the date that the Optionee ceases to be an Eligible Participant for any reason, other than by reason of death or disability or a Just Cause Termination; (ii) twelve months after the date that the Optionee ceases to be an Eligible Participant by reason of such person's death or disability; or (iii) immediately as of the date that the Optionee ceases to be an Eligible Participant by reason of a Just Cause Termination. In the event of a sale or all or substantially all of the assets of the Company, or a merger or consolidation or other reorganization in which the Company is not the surviving corporation, or in which the Company becomes a subsidiary of another corporation (any of the foregoing events, a "Corporate Transaction"), then notwithstanding anything else herein, the successor corporation must agree to assume the outstanding Options or substitute therefor comparable options of such successor corporation or a parent or subsidiary of such successor corporation, or the right to exercise all then outstanding Options will vest immediately prior to such Corporate Transaction. F. Options Nontransferable. Unless otherwise expressly provided, no Option will be transferable by the Optionee otherwise than by will or the laws of descent and distribution, or pursuant to a QDRO. During the lifetime of the Optionee, the Option will be exercisable only by him or her, or the transferee of an NSO if it was transferred pursuant to a QDRO. G. Qualification of Stock. The right to exercise an Option will be further subject to the requirement that if at any time the Board determines, in its discretion, that the listing, registration or qualification of the shares of Option Stock called for thereunder upon any securities exchange or under any state or federal law, or the consent or approval of any governmental regulatory authority, is necessary or desirable as a condition of or in connection with the granting of such Option or the purchase of shares of Option Stock thereunder, the Option may not be exercised, in whole or in part, unless and until such listing, registration, qualification, consent or approval is effected or obtained free of any conditions not acceptable to the Board, in its discretion. H. Additional Restrictions on Transfer. By accepting Stock, Options and/or Option Stock under this Plan, the Optionee will be deemed to represent, warrant and agree as follows: i. Securities Act of 1933. The Optionee understands that the shares of Option Stock have not been registered under the 1933 Act, and that such shares are not freely tradeable and must be held indefinitely unless such shares are either registered under the 1933 Act or an exemption from such registration is available. The Optionee understands that the Company is under no obligation to register the shares of Option Stock. ii. Other Applicable Laws. The Optionee further understands that Transfer of the Option Stock requires full compliance with the provisions of all applicable laws. iii. Investment Intent. Unless a registration statement is in effect with respect to the sale of Stock or Option Stock obtained through exercise of Options granted hereunder: (1) The Stock grantee acquires, or 6 upon exercise of any Option, the Optionee will purchase the Option Stock for his or her own account and not with a view to distribution within the meaning of the 1933 Act, other than as may be effected in compliance with the 1933 Act and the rules and regulations promulgated thereunder; (2) no one else will have any beneficial interest in the Stock or Option Stock; and (3) he or she has no present intention of disposing of the Stock or Option Stock at any particular time. I. Compliance with Law. Notwithstanding any other provision of this Plan, Stock or Options may be granted pursuant to this Plan, and Option Stock may be issued pursuant to the exercise thereof by an Optionee, only after there has been compliance with all applicable federal and state securities laws which may require providing of representations and questionnaires by Optionee, and all of the same will be subject to this overriding condition. The Company will not be required to register or qualify Option Stock with the Securities and Exchange Commission or any State agency, except that the Company will register with, or as required by local law, file for and secure an exemption from such registration requirements from, the applicable securities administrator and other officials of each jurisdiction in which an Eligible Participant would be granted an Option hereunder prior to such grant. J. Stock Certificates. Unless registered, certificates representing the Stock or Option Stock issued pursuant to the exercise of Options will bear all legends required by law and necessary to effectuate this Plan's provisions. The Company may place a "stop transfer" order against shares of the Option Stock until all restrictions and conditions set forth in this Plan and in the legends referred to in this section 6(j) have been complied with. K. Notices. Any notice to be given to the Company under the terms of an Option Agreement will be addressed to the Company at its principal executive office, Attention: Corporate Secretary, or at such other address as the Company may designate in writing. Any notice to be given to an Optionee will be addressed to the Optionee at the address provided to the Company by the Optionee. Any such notice will be deemed to have been duly given if and when enclosed in a properly sealed envelope, addressed as aforesaid, registered and deposited, postage and registry fee prepaid, in a post office or branch post office regularly maintained by the United States Government. L. Other Provisions. The Option Agreement may contain such other terms, provisions and conditions, including such special forfeiture conditions, rights of repurchase, rights of first refusal and other restrictions on Transfer of Option Stock issued upon exercise of any Options granted hereunder, not inconsistent with this Plan, as may be determined by the Committee in its sole discretion. 7. Proceeds from Sale of Stock. Cash proceeds from the sale of shares of Option Stock issued from time to time upon the exercise of Options granted pursuant to this Plan will be added to the general funds of the Company and as such will be used from time to time for general corporate purposes. 8. Modification, Extension and Renewal of Options. Subject to the terms and conditions and within the limitations of this Plan, the Committee may modify, extend or renew outstanding Options granted under this Plan, or accept the surrender of outstanding Options (to the extent not theretofore exercised) and authorize the granting of Stock or new Options in substitution therefor (to the extent not theretofore exercised). Notwithstanding the foregoing, however, no modification of any Option will, without the consent of the holder of the Option, negatively alter or impair any rights or obligations under any Option theretofore granted under this Plan. 9. Amendment and Discontinuance. The Board may amend, suspend or discontinue this Plan at any time or from time to time; provided further that no such action may negatively alter or impair any Option previously granted under this Plan without the consent of the holder of such Option. 10. Plan Compliance with Rule 16b-3. With respect to persons subject to Section 16 of the Securities Exchange Act of 1934, this plan has not been approved by the shareholders of the Company which is one of the requirements for qualification for exemption from liability under Section 16. By acceptance of Options, Optionees acknowledge and agree with the following provisions: A. Rule 16b-3 Compliance. If the Optionee is subject to Rule 16b-3 compliance, the Optionee 7 will not sell Option Stock until at least six months after issuance of the Option Stock to the Optionee. B. No Section 16 Exemption. As certain requirements for qualification for exemption from Section 16 liability have not been met, until such time as being advised in writing by the Company that the Plan qualifies for the exemption, Optionees are subject to Section 16 liability on exercise of the Options and should carefully review the timing of transactions involving the Option Stock to avoid liability under Section 16 (the "short-swing profit" rules; profits from any transaction within a six month period are deemed to be based on insider information and all profits must be paid to the Company). The exercise of the Option may be deemed a purchase, thereby requiring a six month wait prior to a transfer or sale of the Option Stock after the exercise of the Option. Although the exercise of options is normally a taxable event, if the shares received may not be sold without incurring Rule 16b liability, the taxable event is deemed not to occur until the six month period has expired; therefore, the timing of an exercise should be carefully considered well in advance of the time the Optionee may desire to sell Option Stock. 11. Copies of Plan. A copy of this Plan will be delivered to each Optionee at or before the time he or she executes an Option Agreement. * * * (Date Plan Adopted by Board of Directors: February 19, 1998) EX-5 3 OPINION AND CONSENT OF COUNSEL 1 March 22, 2000 Securities and Exchange Commission 450 Fifth Street, N.W. Washington, D.C. 20549 Re: Computer Concepts Corp. Registration Statement on Form S-8 Gentlemen: Reference is made to the filing by Computer Concepts Corp. (the "Corporation") of a Registration Statement on Form S-8 with the Securities and Exchange Commission pursuant to the provisions of the Securities Act of 1933, as amended, covering the registration of 4,657,300 shares of the Corporation's Common Stock, $.0001 par value per share, in connection with the Corporation's stock incentive plans (the "Plans"). As counsel for the Corporation, I have examined its corporate records, including its Certificate of Incorporation, as amended, its By-Laws, its corporate minutes, the form of its Common Stock certificate, the Plans, related documents under the Plans and such other documents as deemed necessary or relevant under the circumstances. Based upon this examination, I am of the opinion that: 1. The Corporation is duly organized and validly existing under the laws of the State of Delaware. 2. The 2,432,300 shares and the 2,225,000 shares of the Corporation's Common Stock issuable upon exercise of options, when issued pursuant to the Plans and in accordance with the agreements related thereto, will be validly authorized, legally issued, fully paid and non-assessable. I hereby consent to be named in the Registration Statement and in the Prospectus which constitutes a part thereof as counsel of the Corporation, and I hereby consent to the filing of this opinion as Exhibit 5 to the Registration Statement. Very truly yours, DANIEL B. KINSEY, P.C. Daniel B. Kinsey EX-23.2 4 CONSENT OF HAYS & COMPANY 1 INDEPENDENT AUDITOR'S CONSENT We consent to the incorporation by reference in this Registration Statement of Computer Concepts Corp. on Form S-8 (being filed herewith) of our report dated February 18, 2000, appearing in the Annual Report on Form 10-K of Computer Concepts Corp. for the year ended December 31, 1999. s/ Hays & Company March 22, 2000 New York, New York -----END PRIVACY-ENHANCED MESSAGE-----