Exhibit (a)(1)
OFFER TO EXCHANGE OUTSTANDING OPTIONS
TO PURCHASE SHARES OF COMMON STOCK OF CLARUS CORPORATION
GRANTED ON OR AFTER NOVEMBER 1, 1999
THE OFFER AND WITHDRAWAL RIGHTS EXPIRE
AT 12:00 MIDNIGHT, PACIFIC TIME ON AUGUST 6, 2001,
UNLESS THE OFFER IS EXTENDED BY CLARUS
Clarus Corporation, which we refer to as "we," "the company" or
"Clarus," is offering employees the opportunity to exchange certain outstanding
stock options to purchase shares of our common stock granted under the Amended
and Restated Stock Incentive Plan of Clarus Corporation (the "Incentive Plan"),
the Stock Incentive Plan of Software Architects International, Limited (the "SAI
Plan") and the SQL 1992 Stock Option Plan (the "SQL Plan" and with the Incentive
Plan and the SAI Plan, the "stock incentive plans") that were granted on or
after November 1, 1999 for new options we will grant under the stock incentive
plans. We are making this offer upon the terms and subject to the conditions set
forth in this offer to exchange and in the letter of transmittal (which
together, as they may be amended from time to time, constitute the "offer"). The
number of shares of common stock subject to new options to be granted to each
option holder will be equal to the number of shares subject to the options
tendered by such option holder and accepted for exchange by us. We will grant
the new options on or about the first business day which is at least six months
and one day following the date we cancel the options accepted by us for
exchange. You may tender options for all or part of the shares of common stock
subject to your options as long as you tender options, and a partial tender must
include at least 200 shares of common stock and may be made only in increments
of 100 shares of common stock. In addition, if you tender any of your options
for exchange, you will be required to also tender all options granted to you
during the six months immediately prior to the date we cancel the tendered
options accepted for exchange which have an exercise price lower than the
exercise price of any other options being tendered.
Earlier this year, we offered employees an initial opportunity to
exchange outstanding options granted under the stock incentive plans that were
granted on or after November 1, 1999. The period of the first offer (the "first
offer" or the "April 2001 offer") began on April 9, 2001 and ended on May 7,
2001. The terms of the April 2001 offer generally are the same as the terms of
this offer (also referred to as the "second offer" or the "July 2001 offer") as
described in this offer to exchange. Under both this offer and the April 2001
offer, we will grant new options on the first business day which is at least six
months and one day following the date we cancel the options accepted by us for
exchange in the particular offer. OPTION HOLDERS WHO ELECTED TO EXCHANGE OPTIONS
PURSUANT TO THE APRIL 2001 OFFER WILL NOT BE ELIGIBLE TO EXCHANGE OPTIONS
PURSUANT TO THE JULY 2001 OFFER.
This offer is not conditioned upon a minimum number of options being
tendered. This offer is subject to conditions which we describe in Section 6 of
this offer to exchange.
If you tender options for exchange as described in the offer, we will
grant you new options under the Incentive Plan or the SAI Plan and a new option
agreement between us and you. The exercise price of the new options will be
equal to the fair market value on the date of grant, as determined by the last
reported sale price during regular trading hours of our common stock on the
Nasdaq National Market on the grant date. The new options, unlike the options
you may tender for exchange (which generally vest 25% on the first anniversary
of the date of grant and monthly thereafter over the next three years until
fully vested), will vest in thirty-six equal monthly installments over the next
three years until fully vested.
ALTHOUGH OUR BOARD OF DIRECTORS HAS APPROVED THIS OFFER, NEITHER WE
NOR OUR BOARD OF DIRECTORS MAKES ANY RECOMMENDATION AS TO WHETHER YOU SHOULD
TENDER OR REFRAIN FROM TENDERING YOUR OPTIONS FOR EXCHANGE. YOU MUST MAKE YOUR
OWN DECISION WHETHER TO TENDER YOUR OPTIONS. CLARUS IS NOT MAKING THIS OFFER TO
ANY OF ITS DIRECTORS OR EMPLOYEES DEFINED AS OFFICERS FOR PURPOSES OF SECTION
16(B) OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED (THE "EXCHANGE ACT"),
AND, THEREFORE, THEY WILL NOT TENDER THEIR OPTIONS PURSUANT TO THIS OFFER TO
EXCHANGE.
Shares of our common stock are quoted on the Nasdaq National Market
under the symbol "CLRS." On July 6, 2001, the last reported sale price of the
common stock on the Nasdaq
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National Market was $6.38 per share. WE RECOMMEND THAT YOU OBTAIN CURRENT MARKET
QUOTATIONS FOR OUR COMMON STOCK BEFORE DECIDING WHETHER TO TENDER YOUR OPTIONS.
You should direct questions about this offer or requests for
assistance or for additional copies of the offer to exchange or the letter of
transmittal to Clarus Corporation, Attention: Pam Ellis, 3970 Johns Creek Court,
Suite 100, Suwanee, Georgia 30024 (telephone: (770) 291-5394, facsimile: (770)
291-4775 and e-mail: ellisp@claruscorp.com).
IMPORTANT
If you wish to tender your options for exchange, you must complete
and sign the attached letter of transmittal in accordance with its instructions,
and mail or otherwise deliver it and any other required documents to us at
Clarus Corporation, Attention: Pam Ellis, 3970 Johns Creek Court, Suite 100,
Suwanee, Georgia 30024 or fax it and any required documents to us at (770)
291-4775. Delivery by e-mail will not be accepted. Due to restrictions under the
securities laws of Ireland, Irish employees should obtain the letter of
transmittal from our intranet.
We are not making this offer to, nor will we accept any tender of
options from or on behalf of, option holders in any jurisdiction in which the
offer or the acceptance of any tender of options would not be in compliance with
the laws of such jurisdiction. However, we may, at our discretion, take any
actions necessary for us to make this offer to option holders in any such
jurisdiction.
WE HAVE NOT AUTHORIZED ANY PERSON TO MAKE ANY RECOMMENDATION ON OUR
BEHALF AS TO WHETHER YOU SHOULD TENDER OR REFRAIN FROM TENDERING YOUR OPTIONS
PURSUANT TO THE OFFER. YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS
DOCUMENT OR TO WHICH WE HAVE REFERRED YOU. WE HAVE NOT AUTHORIZED ANYONE TO GIVE
YOU ANY INFORMATION OR TO MAKE ANY REPRESENTATION IN CONNECTION WITH THIS OFFER
OTHER THAN THE INFORMATION AND REPRESENTATIONS CONTAINED IN THIS DOCUMENT OR IN
THE RELATED LETTER OF TRANSMITTAL. IF ANYONE MAKES ANY RECOMMENDATION OR
REPRESENTATION TO YOU OR GIVES YOU ANY INFORMATION, YOU MUST NOT RELY UPON THAT
RECOMMENDATION, REPRESENTATION OR INFORMATION AS HAVING BEEN AUTHORIZED BY US.
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TABLE OF CONTENTS
SUMMARY TERM SHEET....................................................... 4
CERTAIN RISKS OF PARTICIPATING IN THE OFFER.............................. 9
ECONOMIC RISKS........................................................... 9
TAX-RELATED RISKS FOR U.S. RESIDENTS .................................... 9
BUSINESS-RELATED RISKS................................................... 10
INTRODUCTION............................................................. 10
THE OFFER................................................................ 11
1.Number of Options; Expiration Date.................................... 11
2.Purpose of the Offer.................................................. 12
3.Procedures for Tendering Options...................................... 13
4.Withdrawal Rights..................................................... 14
5.Acceptance of Options for Exchange and Issuance of New Options........ 14
6.Conditions of the Offer............................................... 15
7.Price Range of Common Stock Underlying the Options.................... 16
8.Source and Amount of Consideration; Terms of New Options.............. 17
9.Information Concerning Clarus Corporation............................. 20
10.Interests of Directors and Officers; Transactions and Arrangements
Concerning the Options................................................ 21
11.Status of Options Acquired by Us in the Offer; Accounting
Consequences of the Offer............................................. 22
12.Legal Matters; Regulatory Approvals................................... 22
13.Material U.S. Federal Income Tax Consequences......................... 22
14.Certain Tax Consequences for Non-U.S.-Based Employees................. 24
15.Extension of Offer; Termination; Amendment............................ 26
16.Fees and Expenses..................................................... 27
17.Additional Information................................................ 27
18.Forward looking statements; Miscellaneous............................. 28
SCHEDULE A--Information Concerning the Directors and Executive Officers of
Clarus Corporation......................................................... A-1
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SUMMARY TERM SHEET
The following are answers to some of the questions that you may have
about this offer. We urge you to read carefully the remainder of this offer to
exchange and the accompanying letter of transmittal because the information in
this summary is not complete, and additional important information is contained
in the remainder of this offer to exchange and the letter of transmittal. We
have included references to the relevant sections in this offer to exchange
where you can find a more complete description of the topics in this summary.
WHAT SECURITIES ARE WE OFFERING TO EXCHANGE?
We are offering to exchange all stock options held by eligible
employees that were granted on or after November 1, 1999 which are outstanding
under our Incentive Plan, SAI Plan and SQL Plan or any lesser number of options
that option holders properly tender in the offer, for new options under the
stock incentive plans. (Section 1.)
WHY ARE WE MAKING THE OFFER?
Retention of our employees is one of the keys to our continued growth
and success. The offer provides an opportunity for us to offer these employees a
valuable incentive to stay with our company. Many of our outstanding options,
whether or not they are currently exercisable, have exercise prices that are
significantly higher than the current market price of our common stock. We
believe these options are unlikely to be exercised in the foreseeable future. By
making this offer to exchange outstanding options for new options that will (1)
have an exercise price equal to the fair market value of our common stock on the
grant date, and (2) vest in thirty-six equal monthly installments over the
following three years, we intend to provide our employees with the benefit of
owning options that over time may have a greater potential to increase in value,
create better performance incentives for employees and thereby maximize
stockholder value. (Section 2.)
WHY DON'T WE SIMPLY REPRICE THE CURRENT OPTIONS?
"Repricing" existing options would result in variable accounting for
such options, which may require us for financial reporting purposes to record
additional compensation expense each quarter until such repriced options are
exercised, cancelled or expired.
WHAT ARE THE CONDITIONS TO THE OFFER?
The offer is not conditioned upon a minimum number of options being
tendered. However, the offer is subject to a number of other conditions with
regard to events that could occur prior to the expiration of the offer. These
events include, among other things, a change in accounting principles, a lawsuit
challenging the tender offer, a third-party tender offer for our common stock or
other acquisition proposal or a change in your employment status with us. These
and various other conditions are more fully described in Section 6.
WHO IS ELIGIBLE TO PARTICIPATE IN THE OFFER?
The offer is available to employees who had options that were granted
on or after November 1, 1999, except for those employees who surrendered options
in the April 2001 offer to exchange. (Section 1.) Members of the board of
directors and all employees who are defined as officers for purposes of Section
16(b) of the Exchange Act (the "Exchange Act") (that is, those officers listed
in Schedule A to this offer to exchange), are not eligible to participate. As of
July 6, 2001, outstanding options to purchase 1,679,021 shares of our common
stock granted on or after November 1, 1999 were held by non-Section 16(b)
officer employees.
ARE THERE ANY ELIGIBILITY REQUIREMENTS I MUST SATISFY AFTER THE EXPIRATION
DATE OF THE OFFER TO RECEIVE THE NEW OPTIONS?
To receive a grant of new options pursuant to the offer and under the
terms of the stock incentive plans, you must be an employee of Clarus or one of
its subsidiaries from the date you tender options through the date we grant the
new options. As discussed below, we will not grant the new options until the
first business day which is at least six months and one day following the date
we cancel the tendered options accepted for exchange. IF, FOR ANY REASON, YOU
ARE NOT AN EMPLOYEE OF CLARUS CORPORATION OR ONE OF OUR SUBSIDIARIES FROM THE
DATE YOU TENDER OPTIONS THROUGH THE DATE WE GRANT THE NEW OPTIONS, YOU WILL NOT
4
RECEIVE ANY NEW OPTIONS OR ANY OTHER CONSIDERATION IN EXCHANGE FOR YOUR TENDERED
OPTIONS THAT HAVE BEEN ACCEPTED FOR EXCHANGE. (Section 5.)
HOW MANY NEW OPTIONS WILL I RECEIVE IN EXCHANGE FOR MY TENDERED OPTIONS?
Subject to the terms of this offer, we will grant you new options to
purchase the number of shares of our common stock which is equal to the number
of shares of common stock subject to the options you tender that we accept for
exchange. Options granted under our Incentive Plan and exchanged for new options
will be replaced with options granted under our Incentive Plan, unless prevented
by law or applicable regulations. Options granted under our SAI Plan and
exchanged for new options will be replaced with options granted under our SAI
Plan, unless prevented by law or generally applicable regulations and except
that some options may be replaced with incentive stock options granted under the
Incentive Plan to the extent permitted by applicable law and regulations.
Options granted under the SQL Plan and exchanged for new options will be
replaced with options granted under our Incentive Plan, unless prevented by law
or applicable regulations. All new options will be subject to a new option
agreement which will be in substantially the same form as the option agreement
or agreements attached as Exhibits (d)(2) and (d)(4) to the Tender Offer
Statement on Schedule TO filed by us with the Securities and Exchange Commission
on July 9, 2001. You must execute the new option agreement prior to receiving
new options.
IF I CHOOSE TO TENDER OPTIONS FOR EXCHANGE, DO I HAVE TO TENDER ALL MY OPTIONS?
You may tender options for all or part of the shares of common stock
subject to your options as long as any partial tender includes options for at
least 200 shares of common stock subject to your options and is made in
increments of 100 shares of common stock. In addition, you will be required to
tender all option grants that you received during the six months immediately
prior to the date we accept options for exchange that have an exercise price
lower than the exercise price of any other options to be tendered. For example,
if you received an option grant in October 2000 with an exercise price of $20.00
per share and a grant in March 2001 at an exercise price of $10.00 per share and
you want to tender your October 2000 option grant, you will also be required to
tender your March 2001 grant for exchange. (Section 1.)
On April 9, 2001, we offered employees an initial opportunity to
exchange outstanding stock options granted under the stock incentive plans that
were granted on or after November 1, 1999 (the "first offer" or the "April 2001
offer"). The first offer expired on May 7, 2001. The terms of the April 2001
offer were generally the same as the terms of the offer as described in this
offer to exchange. We will grant new options on the first business day which is
at least six months and one day following the date we cancel the options
accepted by us for exchange in each offer. OPTION HOLDERS WHO ELECTED TO
EXCHANGE OPTIONS PURSUANT TO THE APRIL 2001 OFFER WILL NOT BE ELIGIBLE TO
EXCHANGE OPTIONS PURSUANT TO THIS OFFER.
WHEN WILL I RECEIVE MY NEW OPTIONS?
We will grant the new options on the first business day that is at
least six months and one day after the date that we cancel the options accepted
for exchange. For example, if we cancel the tendered options accepted for
exchange on August 7, 2001, the business day following the scheduled expiration
date, the grant date of the new options will be on or about February 8, 2002.
HOWEVER, IF YOU ARE NOT AN EMPLOYEE OF CLARUS CORPORATION OR ONE OF OUR
SUBSIDIARIES FROM THE DATE YOU TENDER OPTIONS THROUGH THE DATE WE GRANT THE NEW
OPTIONS, YOU WILL NOT RECEIVE ANY NEW OPTIONS OR ANY OTHER CONSIDERATION IN
EXCHANGE FOR YOUR TENDERED OPTIONS THAT HAVE BEEN ACCEPTED FOR EXCHANGE.
(Section 5.)
WHY WON'T I RECEIVE MY NEW OPTIONS IMMEDIATELY AFTER THE EXPIRATION DATE OF THE
OFFER?
If we were to grant the new options on any date which is earlier than
six months and one day after the date we cancel the options tendered for
exchange, we would be required for financial reporting purposes to record
compensation expense against our earnings. (Section 5.) By deferring the grant
of the new options for at least six months and a day, we believe we will not
have to record such a compensation expense.
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IF I TENDER OPTIONS IN THE OFFER, WILL I BE ELIGIBLE TO RECEIVE OTHER OPTION
GRANTS BEFORE I RECEIVE MY NEW OPTIONS?
No. If we accept eligible options you tender in the offer, you will
not receive any new options, such as annual, bonus or promotional options, for
which you may otherwise be eligible, until the date we grant the replacement
options for those tendered in the offer. We will defer the grant to you of these
other options because we have determined that doing so is necessary to avoid
incurring compensation expense against our earnings because of accounting rules
that could apply to any interim option grants as a result of the offer. (Section
5.)
WILL I BE REQUIRED TO GIVE UP ALL MY RIGHTS TO THE CANCELLED OPTIONS?
Yes. Once we have accepted options tendered by you, your options will
be cancelled and you will no longer have any rights under those options.
(Section 5.)
WHAT WILL THE EXERCISE PRICE OF THE NEW OPTIONS BE?
The exercise price of the new options will equal the fair market
value of our common stock on the date we grant the new options, as determined
based upon the last reported sale price of our common stock on the Nasdaq
National Market on the date we grant the new options. Accordingly, we cannot
predict the exercise price of the new options. HOWEVER, BECAUSE WE WILL NOT
GRANT NEW OPTIONS UNTIL AT LEAST SIX MONTHS AND ONE DAY AFTER THE DATE WE CANCEL
TENDERED OPTIONS ACCEPTED FOR EXCHANGE, THE NEW OPTIONS MAY HAVE A HIGHER
EXERCISE PRICE THAN SOME OR ALL OF YOUR CURRENT OPTIONS. WE RECOMMEND THAT YOU
OBTAIN CURRENT MARKET QUOTATIONS FOR OUR COMMON STOCK BEFORE DECIDING WHETHER TO
TENDER YOUR OPTIONS. (Section 8.)
WHEN WILL THE NEW OPTIONS VEST?
The new options, unlike the outstanding options (which generally vest
25% on the first anniversary of the date of grant and monthly thereafter over
the next three years until fully vested), will vest in thirty-six equal monthly
installments over the next three years under the terms of the stock incentive
plans and a new option agreement. The vesting schedule of the new options will
not begin until the grant date of those options. THEREFORE, EVEN IF THE OPTIONS
YOU TENDER ARE FULLY OR PARTIALLY VESTED, THE NEW OPTIONS YOU RECEIVE WILL BE
SUBJECT TO THE NEW THIRTY-SIX MONTH VESTING PERIOD DESCRIBED ABOVE.
DOES THE COMMENCEMENT OF A NEW VESTING PERIOD UNDER THE NEW OPTIONS MEAN THAT I
WOULD HAVE TO WAIT A LONGER PERIOD BEFORE I CAN PURCHASE COMMON STOCK UNDER MY
OPTIONS?
Yes. Because any new options you receive will not be vested, you will
lose the benefits of any vesting under eligible options you tender in the offer.
As described above, no portion of the new options we grant will be immediately
vested, even if the eligible options you tender for exchange are fully or
partially vested. The three-year vesting schedule of the new options will not
begin until the grant date of those options. Because the new options will not
begin vesting until the grant date, which is at least six months and a day after
the date we cancel tendered options, you will not be able to purchase our common
stock upon exercise of any of the new options until at least seven months and a
day after the cancellation date.
WHAT IF WE ENTER INTO A CHANGE OF CONTROL OR SIMILAR TRANSACTION?
We are reserving the right to take any actions we deem necessary or
appropriate to complete a change of control transaction that our board of
directors believes is in the best interest of our company and our shareholders.
This could include terminating your right to receive new options under this
offer to exchange. If we were to terminate your right to receive new options
under this offer in connection with such a transaction, employees who have
tendered options for cancellation pursuant to this offer would not receive
options to purchase securities of the acquiror or any other consideration for
their tendered options. (Section 2.)
WILL I HAVE TO PAY TAXES IF I EXCHANGE MY OPTIONS IN THE OFFER?
If you exchange your current options for new options, we believe that
you will not be required under current law to recognize income for U.S., U.K. or
Irish income tax purposes as a result of the exchange. If you are a Canadian
resident employee of Clarus or one of our subsidiaries and you exchange your
options pursuant to the offer, we believe
6
that you may be required under current Canadian law to recognize income for
Canadian federal income tax purposes in an amount equal to the value of the
consideration you receive for tendering your options. Neither the tender of your
options nor the grant of new options should, under current law, result in income
for U.S. income tax purposes. However, we recommend that you consult with your
own tax adviser to determine the tax consequences of tendering options pursuant
to this offer. (Sections 13 and 14.)
If your current options are incentive stock options, your new options
will be granted as incentive stock options to the maximum extent they qualify as
incentive stock options under the tax laws on the date of the grant. For options
to qualify as incentive stock options under the current U.S. tax laws, the value
of shares subject to options that first become exercisable by the option holder
in any calendar year cannot exceed $100,000, as determined using the option
exercise price. The excess value is deemed to be a non-qualified stock option,
which is an option that is not qualified to be an incentive stock option under
the current tax laws.
You should note that there is a risk that any incentive stock option
you hold may be affected, even if you do not participate in the exchange. We
believe that you will not be subject to current U.S. federal income tax if you
do not elect to participate in the option exchange program. We also believe that
the option exchange program will not change the U.S. federal income tax
treatment of subsequent grants and exercises of your incentive stock options
(and sales of shares acquired upon exercise of such options) if you do not
participate in the option exchange program. However, the Internal Revenue
Service (the "IRS") may characterize the option exchange program as a
"modification" of those incentive stock options, even if you decline to
participate. A successful assertion by the IRS of this position could extend an
option's holding period to qualify for favorable tax treatment. Accordingly, to
the extent you dispose of your incentive stock option shares prior to the lapse
of the new extended holding period, your incentive stock option could be taxed
similarly to a nonqualified stock option. (Section 13.)
WHAT HAPPENS TO OPTIONS THAT I CHOOSE NOT TO TENDER OR THAT ARE NOT ACCEPTED
FOR EXCHANGE?
Options that you choose not to tender for exchange or that we do not
accept for exchange remain outstanding and retain their current exercise price
and current vesting schedule. However, if you tender any options for exchange,
you will be required to also tender all option grants that you received during
the six months immediately prior to the date we cancel options accepted for
exchange which have an exercise price lower than the exercise price of any other
options being tendered.
On April 9, 2001, we offered employees an initial opportunity to
exchange outstanding stock options granted under the stock incentive plans that
were granted on or after November 1, 1999. This initial offer to exchange (the
"April 2001 offer" or the "first offer") expired on May 7, 2001. The terms of
the first offer were generally the same as the terms of this offer, and we will
grant new options on the first business day which is at least six months and one
day following the date we cancel the tendered options accepted by us for
exchange in each offer. OPTION HOLDERS WHO ELECTED TO EXCHANGE OPTIONS PURSUANT
TO THE APRIL 2001 OFFER WILL NOT BE ELIGIBLE TO EXCHANGE OPTIONS PURSUANT TO
THIS OFFER.
WHEN DOES THE OFFER EXPIRE? CAN THE OFFER BE EXTENDED, AND IF SO, HOW WILL I BE
NOTIFIED IF IT IS EXTENDED?
The offer expires on August 6, 2001, at 12:00 midnight, Eastern time,
unless we extend it.
Although we do not currently intend to do so, we may, in our
discretion, extend the offer at any time. If the offer is extended, we will make
a public announcement of the extension no later than 9:00 a.m. on the next
business day following the previously scheduled expiration of the offer period.
If the offer is extended, then the grant date of the new options will also be
extended. (Section 15.)
HOW DO I TENDER MY OPTIONS?
If you decide to tender your options, you must deliver, before 12:00
midnight, Eastern time, on August 6, 2001, a properly completed and duly
executed letter of transmittal and any other documents required by the letter of
transmittal to Clarus Corporation, Attention: Pam Ellis, 3970 Johns Creek Court,
Suite 100, Suwanee, Georgia 30024 (facsimile: (770) 291-4775). We will only
accept a paper copy or a facsimile copy
7
of your executed letter of transmittal. Delivery by e-mail will not be accepted.
Irish employees should obtain a form of the letter of transmittal from our
intranet.
If the offer is extended by us beyond August 6, 2001, you must
deliver these documents before the extended expiration of the offer.
We reserve the right to reject any or all tenders of options that we
determine are not in appropriate form or that we determine are unlawful to
accept. Otherwise, we expect to accept all properly and timely tendered options
which are not validly withdrawn. Subject to our rights to extend, terminate and
amend the offer, we currently expect that we will accept all such properly
tendered options promptly after the expiration of the offer. (Section 5.)
DURING WHAT PERIOD OF TIME MAY I WITHDRAW PREVIOUSLY TENDERED OPTIONS?
You may withdraw your tendered options at any time before 12:00
midnight, Eastern time, on August 6, 2001. If we extend the offer beyond that
time, you may withdraw your tendered options at any time until the extended
expiration of the offer. To withdraw tendered options, you must deliver to us a
written notice of withdrawal, or a facsimile thereof, with the required
information while you still have the right to withdraw the tendered options.
Once you have withdrawn options, you may re-tender options only by
again following the delivery procedures described above prior to the expiration
of the offer. (Section 4.)
WHAT DO WE AND OUR BOARD OF DIRECTORS THINK OF THE OFFER?
Although our board of directors has approved this offer, neither we
nor our board of directors makes any recommendation as to whether you should
tender or refrain from tendering your options. You must make your own decision
whether to tender options. Our directors and employees who are defined as
officers for purposes of Section 16(b) of the Exchange Act are not eligible to
participate in the offer. (Section 10.)
WHO CAN I TALK TO IF I HAVE QUESTIONS ABOUT THE OFFER?
For additional information or assistance, you should contact:
Clarus Corporation
Attention: Pam Ellis
3970 Johns Creek Court, Suite 100
Suwanee, Georgia 30024
telephone: (770) 291-5394
facsimile: (770) 291-4775
e-mail: ellisp@claruscorp.com
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CERTAIN RISKS OF PARTICIPATING IN THE OFFER
Participation in the offer involves a number of potential risks,
including those described below. This list briefly highlights some of the risks
and is necessarily incomplete. Eligible participants should carefully consider
these and other risks and are encouraged to speak with an investment and tax
adviser as necessary before deciding to participate in the offer. In addition,
we strongly urge you to read the rest of this offer to exchange, along with the
related documents before deciding to participate in the exchange offer. The list
of risks does not include certain risks that may apply to employees who live and
work outside of the United States; again, we urge you to read Section 14 of this
offer to exchange, which discusses tax consequences in the United Kingdom,
Ireland and Canada, as well as the rest of the offer to exchange and related
documents for a fuller discussion of the risks which may apply to you. You
should consult with an investment and tax adviser as necessary before deciding
to participate in this exchange offer.
ECONOMIC RISKS
PARTICIPATION IN THE OFFER WILL MAKE YOU INELIGIBLE TO RECEIVE ANY OPTION GRANTS
UNTIL FEBRUARY 8, 2002 AT THE EARLIEST.
Employees are generally eligible to receive option grants at any time
that the board of directors or compensation committee chooses to make them.
However, if you participate in the offer, you will not be eligible to receive
any option grants until February 8, 2002 at the earliest.
IF THE STOCK PRICE INCREASES AFTER THE DATE YOUR TENDERED OPTIONS ARE CANCELLED,
YOUR CANCELLED OPTIONS MIGHT HAVE BEEN WORTH MORE THAN THE NEW OPTIONS THAT YOU
HAVE RECEIVED IN EXCHANGE FOR THEM.
For example, if you cancel options with an exercise price of $35.00,
and Clarus' stock appreciates to $60 when the new option grants are made, your
option will have a higher exercise price than the cancelled option.
IF YOUR EMPLOYMENT TERMINATES PRIOR TO THE GRANT OF THE NEW OPTION, YOU WILL
RECEIVE NEITHER A NEW OPTION NOR THE RETURN OF YOUR CANCELLED OPTION.
Once your option is cancelled, it is gone for good. Accordingly, if
your employment terminates for any reason prior to the grant of the new option,
you will have the benefit of neither the cancelled option nor the new option.
The offer does not involve any guarantee of employment for any period.
IF WE ENTER INTO A CHANGE OF CONTROL TRANSACTION, YOU MAY NOT RECEIVE NEW OPTION
GRANTS.
We reserve the right to take any actions we deem necessary or
appropriate to complete a change of control transaction that our board of
directors believes is in the best interest of our company and our shareholders.
This could include terminating your right to receive new options under this
offer to exchange. We will not grant new options to you if we are prohibited by
applicable law or regulations (such as SEC rules, regulations or policies or
Nasdaq requirements).
TAX-RELATED RISKS FOR U.S. RESIDENTS
YOUR NEW OPTION MAY BE A NONSTATUTORY STOCK OPTION, WHEREAS YOUR CANCELLED
OPTION MAY HAVE BEEN AN INCENTIVE STOCK OPTION.
If your cancelled options were incentive stock options, your new
options will be incentive stock options, but only to the extent they qualify
under the Internal Revenue Code of 1986, as amended (the "Code"). For options to
qualify as incentive stock options, the value of shares subject to options that
first become exercisable by the option holder in any calendar year cannot exceed
$100,000, as determined using the option exercise price. It is possible that by
participating in this exchange, your options will exceed this limit and will be
treated as nonstatutory stock options. In general, nonstatutory stock options
are less favorable to you from a tax perspective. For more detailed information,
please read the rest of the offer to exchange, and see Section 13 of this offer
to exchange.
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BUSINESS RELATED RISKS
For a description of risks related to Clarus' business, please see
Section 18 of this offer to exchange.
INTRODUCTION
Clarus Corporation is offering to exchange outstanding options to
purchase shares of our common stock granted under the Amended and Restated Stock
Incentive Plan of Clarus Corporation (the "Incentive Plan"), the Stock Incentive
Plan of Software Architects International, Limited (the "SAI Plan") and the SQL
1992 Stock Option Plan (the "SQL Plan" and, collectively, with the Incentive
Plan and the SAI Plan, the "stock incentive plans") that were granted on or
after November 1, 1999 for new options that we will grant under the stock
incentive plans. Members of our board of directors and all employees who are
defined as officers for purposes of Section 16(b) of the Exchange Act ("Section
16(b) officers") are not eligible to participate in this exchange offer. We are
making this offer upon the terms and subject to the conditions set forth in this
offer to exchange and letter of transmittal (which together, as they may be
amended from time to time, constitute the "offer"). The number of shares of
common stock subject to new options to be granted to each option holder will be
equal to the number of shares subject to the options tendered by such option
holder and accepted for exchange by us. We will grant the new options on or
about the first business day which is at least six months and one day following
the date we cancel the options accepted for exchange by us. If you tender
options for exchange, we will grant you new options under the terms of the stock
incentive plans and a new option agreement between us and you. This offer is not
conditioned upon a minimum number of options being tendered by employees. You
may tender options for all or part of the shares of common stock subject to your
options as long as you tender options to purchase at least 200 shares of common
stock and in increments of 100 shares of common stock. In addition, if you
tender an option grant for exchange, you will be required to also tender for
exchange all option grants that you received during the six months immediately
prior to the date we accept tendered options for exchange with an exercise price
lower than the exercise price of any other options being tendered. If you
attempt to tender some of your options but do not include all of the options
granted to you during the six months immediately prior to the date we accept
tendered options for exchange with an exercise price lower than that exercise
price of any other options being tendered, your entire tender will be rejected.
In addition, this offer is subject to conditions which we describe in this offer
to exchange.
On April 9, 2001, we offered employees an initial opportunity to
exchange outstanding stock options granted under the stock incentive plans that
were granted on or after November 1, 1999 (the "first offer" or the "April 2001
offer"). The first offer expired on May 7, 2001. The terms of the April 2001
offer were generally the same as the terms of this offer, as described in this
offer to exchange, and we will grant new options on the first business day which
is at least six months and one day following the date we cancel the tendered
options accepted by us for exchange in each offer. OPTION HOLDERS WHO ELECTED TO
EXCHANGE OPTIONS PURSUANT TO THE APRIL 2001 OFFER WILL NOT BE ELIGIBLE TO
EXCHANGE OPTIONS PURSUANT TO THIS OFFER.
If you tender options granted under the Incentive Plan for exchange,
subject to the terms of this offer, you will be granted new options under our
Incentive Plan, unless prevented by law or applicable regulations. If you tender
options granted under the SAI Plan for exchange, subject to the terms of this
offer, you will be granted new options under our SAI Plan, unless prevented by
law or applicable regulations and except that some options may be replaced with
incentive stock options granted under the Incentive Plan to the extent permitted
by applicable law and regulations. If you tender options granted under the SQL
Plan for exchange, subject to the terms of this offer, you will be granted new
options under the Incentive Plan, unless prevented by law or applicable
regulations. A new option agreement will be entered into between us and you. The
exercise price of the new options will be the fair market value of our common
stock on the grant date, which will be determined by the last sale price during
regular trading hours of our common stock on the Nasdaq National Market the day
of the grant of the new options. The new options will vest in thirty-six equal
monthly installments over a three year period.
As of July 6, 2001 options to purchase 3,090,509 shares of our common
stock were issued and outstanding under the stock incentive plans. Of these
options, options to purchase 1,679,021 shares of our common stock were granted
on or after November 1, 1999 and were held by eligible employees. The shares of
common stock issuable upon exercise of
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options we are offering to exchange represent approximately 54% of the total
shares of common stock issuable upon exercise of all options outstanding under
the stock incentive plans as of July 6, 2001.
All options accepted by us pursuant to this offer will be cancelled
and employees will have no further rights with respect to such cancelled
options.
THE OFFER
1. NUMBER OF OPTIONS; EXPIRATION DATE.
Upon the terms and subject to the conditions of the offer, we are
offering to exchange for new options to purchase common stock under the stock
incentive plans in return for all eligible outstanding options under the stock
incentive plans that are properly tendered and not validly withdrawn in
accordance with Section 4 before the "expiration date," as defined below.
Eligible outstanding options are all options that were granted on or after
November 1, 1999, except for options held by employees who participated in the
April 2001 offer. Members of our board of directors and all employees who are
defined as officers for purposes of Section 16(b) of the Exchange Act ("Section
16(b) officers") are not eligible to participate in this exchange offer. You may
tender options for all or part of the shares of common stock subject to your
options as long as you tender options to purchase at least 200 shares of common
stock and in increments of 100 shares of common stock. In addition, if you
tender an option grant for exchange, you will be required to also tender all
option grants that you received during the six months immediately prior to the
date we cancel tendered options accepted for exchange with an exercise price
lower than the exercise price of any other options being tendered.
In the April 2001 offer, we offered employees an initial opportunity
to exchange outstanding stock options granted under the stock incentive plans
that were granted on or after November 1, 1999. The April 2001 offer expired on
May 7, 2001. The terms of the first offer were generally the same as the terms
of this offer, and we will grant new options on the first business day which is
at least six months and one day following the date we cancel the options
accepted by us for exchange in each offer. OPTION HOLDERS WHO ELECTED TO
EXCHANGE OPTIONS PURSUANT TO THE APRIL 2001 OFFER WILL NOT BE ELIGIBLE TO
EXCHANGE OPTIONS PURSUANT TO THIS OFFER.
If your options are properly tendered and accepted for exchange, you
will be entitled to receive new options to purchase the number of shares of our
common stock which is equal to the number of shares subject to the options or
portion thereof that you tendered, subject to adjustments for any stock splits,
stock dividends and similar events. All new options granted in exchange for
options granted under the Incentive Plan will be subject to the terms of the
Incentive Plan and to a new option agreement between us and you except that some
new options granted in exchange for options granted under the SAI Plan may be
replaced with incentive stock options granted under the Incentive Plan. All new
options granted in exchange for options granted under the SAI Plan will be
subject to the terms of the SAI Plan and to a new option agreement between us
and you. All new options granted in exchange for options granted under the SQL
Plan will be subject to the terms of the Incentive Plan and to a new option
agreement. IF YOU ARE NOT AN EMPLOYEE OF CLARUS CORPORATION OR ONE OF OUR
SUBSIDIARIES FROM THE DATE YOU TENDER OPTIONS THROUGH THE DATE WE GRANT THE NEW
OPTIONS, YOU WILL NOT RECEIVE ANY NEW OPTIONS OR ANY OTHER CONSIDERATION IN
EXCHANGE FOR YOUR TENDERED OPTIONS THAT HAVE BEEN ACCEPTED FOR EXCHANGE. This
means that if you die or quit or we terminate your employment, with or without
cause, prior to the date we grant the new options for any reason, you will not
receive anything for the options that you tendered and we cancelled. Nothing in
the terms of this offer or the stock incentive plans requires us to continue
your employment for any specified period of time.
The term "expiration date" means 12:00 midnight, Eastern time, on
August 6, 2001, unless and until we, in our discretion, have extended the period
of time during which the offer will remain open, in which event the term
"expiration date" refers to the latest time and date at which the offer, as so
extended, expires. See Section 15 for a description of our rights to extend,
delay, terminate and amend the offer.
If we decide to take any of the following actions, we will publish
notice or otherwise inform you in writing of such action:
(a) We increase or decrease the amount of consideration offered for
the eligible options;
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(b) We decrease the number of options eligible to be tendered in the
offer; or
(c) We increase the number of options eligible to be tendered in the
offer by an amount that exceeds 2% of the shares of common stock
issuable upon exercise of the options that are subject to the
offer immediately prior to the increase.
If the offer is scheduled to expire at any time earlier than the
10/th/ business day from, and including, the date that notice of such increase
or decrease is first published, sent or given in the manner specified in Section
15, we will extend the offer so that the offer is open at least 10 business days
following the publication, sending or giving of notice.
We will also notify you of any other material change in the
information contained in this offer to exchange.
For purposes of the offer, a "business day" means any day other than
a Saturday, Sunday or U.S. federal holiday and consists of the time period from
12:01 a.m. through 12:00 midnight, Eastern time.
2. PURPOSE OF THE OFFER.
We issued or assumed the options outstanding under the stock
incentive plans for the following purposes:
. To encourage and enable our employees to acquire or increase
their holdings of common stock and other proprietary interest in
us, in order to promote a closer identification of their
interests with those of Clarus and its stockholders and to
encourage participants to enhance the efficiency, soundness,
profitability, growth and shareholder value of Clarus; and
. To encourage our employees to continue their employment with
Clarus.
Retention of our employees is one of the keys to our continued growth
and success. The offer provides an opportunity for us to offer these employees
an incentive to stay with our company. Many of our outstanding options, whether
or not they are currently exercisable, have exercise prices that are
significantly higher than the current market price of our common stock. We
believe these options are unlikely to be exercised in the foreseeable future. By
making this offer to exchange outstanding options for new options that will have
an exercise price equal to the fair market value of our common stock on the
grant date, we intend to provide our employees with the benefit of owning
options that over time may have a greater potential to increase in value, create
better performance incentives for employees and thereby maximize stockholder
value.
Our stock price could increase (or decrease) between the date of this
offer and the date we intend to grant the new options, due to a change of
control transaction or other factors or events, and the exercise price of the
new options, if awarded, could be higher (or lower) than the exercise price of
eligible options you elect to have cancelled as part of this offer. As outlined
in Section 8, the exercise price of any new options granted to you in return for
your tendered options will be at the fair market value of our common stock on
the date of that grant. You will be at risk of any such increase in our stock
price during the period prior to the grant date of the new options for these or
any other reasons.
We are also reserving the right to take any actions we deem necessary
or appropriate to complete a change of control transaction that our board of
directors believes is in the best interest of our company and our shareholders.
This could include terminating your right to receive new options under this
offer to exchange. If we were to terminate your right to receive new options
under this offer in connection with such a transaction, employees who have
tendered options for cancellation pursuant to this offer would not receive
options to purchase securities of the acquiror or any other consideration for
their tendered options.
Except as otherwise disclosed in this offer to exchange or in our
filings with the SEC, we presently have no plans or proposals that relate to or
would result in:
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(a) An extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving us or any of our
subsidiaries;
(b) Any purchase, sale or transfer of a material amount of our
assets or the assets of any of our subsidiaries;
(c) Any material change in our present dividend rate or policy, or
our indebtedness or capitalization;
(d) Any change in our present board of directors or management,
including a change in the number or term of directors or to fill
any existing board vacancies or to change any executive
officer's material terms of employment;
(e) Any other material change in our corporate structure or
business;
(f) Our common stock not being authorized for quotation in an
automated quotation system operated by a national securities
association;
(g) Our common stock becoming eligible for termination of
registration pursuant to Section 12(g)(4) of the Exchange Act;
(h) The suspension of our obligation to file reports pursuant to
Section 15(d) of the Exchange Act;
(i) The acquisition by any person of any material amount of our
securities or the disposition of any material amount of our
securities; or
(j) Any change in our certificate of incorporation or bylaws, or any
actions which may impede the acquisition of control of us by any
person.
Neither we nor our board of directors makes any recommendation as to
whether you should tender your options, nor have we authorized any person to
make any such recommendation. Note that the new options may have a higher
exercise price than some or all of your current options. You are urged to
evaluate carefully all of the information in this offer to exchange and to
consult your own investment and tax advisers.
You must make your own decision whether to tender your options for
exchange.
3. PROCEDURES FOR TENDERING OPTIONS.
Proper Tender of Options. To validly tender your options pursuant to
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the offer, you must, in accordance with the terms of this offer to exchange and
the letter of transmittal, properly complete, duly execute and deliver to us the
letter of transmittal, or a facsimile thereof, along with any other required
documents. We will only accept a properly executed paper copy or a facsimile
copy of your letter of transmittal and any other required documents. We will not
accept delivery by e-mail. We must receive all of the required documents at 3970
Johns Creek Court, Suite 100, Suwanee, Georgia 30024, Attention: Pam Ellis
(facsimile: (770) 291-4775), before the expiration date. Your new options will
be granted on a date at least six months and one day after the date that we
cancel the tendered options accepted for exchange.
A copy of the letter of transmittal has been distributed with this
offer to exchange; however, due to restrictions under the securities laws of
Ireland, the letter of transmittal has not been delivered to Irish employees. If
you are an Irish employee, you may obtain a copy of the letter of transmittal on
our intranet.
THE METHOD OF DELIVERY OF ALL DOCUMENTS, INCLUDING LETTERS OF
TRANSMITTAL AND ANY OTHER REQUIRED DOCUMENTS, IS AT THE ELECTION AND RISK OF THE
TENDERING OPTION HOLDER. IF DELIVERY IS BY MAIL, WE RECOMMEND THAT YOU USE
REGISTERED MAIL WITH RETURN RECEIPT REQUESTED. IN ALL CASES, YOU SHOULD ALLOW
SUFFICIENT TIME TO ENSURE TIMELY DELIVERY. YOUR OPTIONS WILL NOT BE CONSIDERED
TENDERED UNTIL WE RECEIVE THEM. WE WILL NOT ACCEPT DELIVERY BY E-MAIL.
Determination of Validity; Rejection of Options; Waiver of Defects;
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No Obligation to Give Notice of Defects. We will determine, in our discretion,
- ---------------------------------------
all questions as to form of documents and the validity, form, eligibility,
including time of receipt, and acceptance of any tender of options. Our
determination of these matters will be final and binding on all parties. We may
reject any or all tenders of options that we determine are not in
13
appropriate form or that we determine are unlawful to accept. Otherwise, we
expect to accept all properly and timely tendered options which are not validly
withdrawn. We may also waive any of the conditions of the offer or any defect or
irregularity in any tender with respect to any particular options or any
particular option holder. No tender of options will be deemed to have been
properly made until all defects or irregularities have been cured by the
tendering option holder or waived by us. Neither we nor any other person is
obligated to give notice of any defects or irregularities in tenders, and no one
will be liable for failing to give notice of any defects or irregularities.
Our Acceptance Constitutes an Agreement. Your tender of options
---------------------------------------
pursuant to the procedures described above constitutes your acceptance of the
terms and conditions of the offer. OUR ACCEPTANCE FOR EXCHANGE OF YOUR OPTIONS
TENDERED BY YOU PURSUANT TO THE OFFER WILL CONSTITUTE A BINDING AGREEMENT
BETWEEN US AND YOU UPON THE TERMS AND SUBJECT TO THE CONDITIONS OF THE OFFER.
Subject to our rights to extend, terminate and amend the offer, we
currently expect that we will accept promptly after the expiration of the offer
all properly tendered options that have not been validly withdrawn.
4. WITHDRAWAL RIGHTS.
You may only withdraw your tendered options in accordance with the
provisions of this Section 4.
You may withdraw your tendered options at any time before the
expiration date. If the offer is extended by us beyond that time, you may
withdraw your tendered options at any time until the extended expiration of the
offer. In addition, you may withdraw your tendered options until we accept your
tendered options for exchange.
To validly withdraw tendered options, you must deliver to us at the
address or facsimile number set forth in Section 3 a notice of withdrawal, or a
facsimile thereof, with the required information, while you still have the right
to withdraw the tendered options. Except as described in the following sentence,
the notice of withdrawal must be executed by the option holder who tendered the
options to be withdrawn exactly as such option holder's name appears on the
option agreement or agreements evidencing such options. If the signature is by a
trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or another person acting in a fiduciary or representative capacity,
the signer's full title and proper evidence of the authority of such person to
act in such capacity must be indicated on the notice of withdrawal.
You may not rescind any withdrawal, and any options you withdraw will
thereafter be deemed not properly tendered for purposes of the offer, unless you
properly re-tender those options before the expiration date by following the
procedures described in Section 3.
To validly change your election regarding the tender of options but
continue to elect to tender some of your options, you must deliver a new letter
of transmittal at the address or facsimile number set forth in Section 3. If you
deliver a new letter of transmittal, it will replace any previously submitted
letter of transmittal, which will be disregarded.
Neither we nor any other person is obligated to give notice of any
defects or irregularities in any notice of withdrawal, nor will we incur any
liability for failure to give any such notice. We will determine, in our
discretion, all questions as to the form and validity, including time of
receipt, of notices of withdrawal. Our determination of these matters will be
final and binding.
5. ACCEPTANCE OF OPTIONS FOR EXCHANGE AND ISSUANCE OF NEW OPTIONS.
Upon the terms and subject to the conditions of this offer and as
promptly as practicable following the expiration date, we expect to accept for
exchange and cancel options properly tendered and not validly withdrawn before
the expiration date. Subject to the terms and conditions of this offer, if your
options are properly tendered and accepted for exchange, these options will be
cancelled as of the date of our acceptance and you will be granted new options
on or about the first business day that is at least six months and a day after
the date we cancel the options accepted for exchange. If we cancel options
accepted for exchange on August 7, 2001, you will be granted new options on or
about February 8, 2002, which is the first business day that is at least six
months and one day
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following the date we intend to cancel options accepted for exchange. If the
offer is extended, then the grant date of the new options will also be extended.
If we accept and cancel the options you tender in connection with the
offer, the grant date and the pricing of any additional options that we may
decide to grant to you, such as annual, bonus or promotional options, will be
deferred until a date that is at least six months and a day from the date the
tendered options are cancelled. We have determined that it is necessary for us
to defer the grant date and pricing of any such additional options to avoid
incurring compensation expense against our earnings because of accounting rules
that would apply to these interim option grants as a result of the offer.
Your new options will entitle you to purchase a number of shares of
our common stock which is equal to the number of shares subject to the options
or portion thereof you tender, subject to adjustments for any stock splits,
stock dividends and similar events.
PLEASE NOTE, HOWEVER, THAT IF YOU ARE NOT AN EMPLOYEE OF CLARUS
CORPORATION OR ONE OF OUR SUBSIDIARIES FROM THE DATE YOU TENDER OPTIONS THROUGH
THE DATE WE GRANT THE NEW OPTIONS, YOU WILL NOT RECEIVE ANY NEW OPTIONS OR ANY
OTHER CONSIDERATION IN EXCHANGE FOR YOUR TENDERED OPTIONS THAT HAVE BEEN
ACCEPTED FOR EXCHANGE. THE OFFER DOES NOT INVOLVE ANY GUARANTEE OF EMPLOYMENT
FOR ANY PERIOD. YOUR EMPLOYMENT WITH CLARUS OR ONE OF ITS SUBSIDIARIES REMAINS
"AT WILL" AND MAY BE TERMINATED AT ANY TIME BY EITHER YOU OR CLARUS (OR ONE OF
ITS SUBSIDIARIES, AS APPLICABLE), WITH OR WITHOUT CAUSE OR NOTICE, SUBJECT TO
THE PROVISIONS OF APPLICABLE LAW.
Clarus will take any actions we deem necessary to complete a change
of control transaction that our board of directors believes is in the best
interest of our company and our shareholders. This could include terminating
your right to receive new options under this offer to exchange.
For purposes of the offer, we will be deemed to have accepted for
exchange options that are validly tendered and not properly withdrawn, if and
when we give oral or written notice to the option holders of our acceptance for
exchange of such options, which may be by press release. Subject to our rights
to extend, terminate and amend the offer, we currently expect that we will
accept promptly after the expiration of the offer all properly tendered options
that are not validly withdrawn. Promptly after we accept tendered options for
exchange, we will send each tendering option holder a letter indicating the
number of shares subject to the options that we have accepted for exchange, the
corresponding number of shares that will be subject to the new options and the
expected grant date of the new options.
6. CONDITIONS OF THE OFFER.
Notwithstanding any other provisions of this offer, we will not be
required to accept any options tendered for exchange, and we may terminate or
amend the offer, or postpone our acceptance and cancellation of any options
tendered for exchange, in each case, subject to Rule 13e-4(f)(5) under the
Exchange Act, if at any time on or after July 9, 2001 and before the expiration
date, we determine that any of the following events has occurred and, in our
reasonable judgment the occurrence of the event makes it inadvisable for us to
proceed with the offer or to accept and cancel options tendered for exchange:
(a) Any threatened, instituted or pending action or proceeding by
any government or governmental, regulatory or administrative
agency, authority or tribunal or any other person, domestic or
foreign, before any court, authority, agency or tribunal that
directly or indirectly challenges the making of the offer, the
acquisition of some or all of the tendered options pursuant to
the offer, the issuance of new options, or otherwise relates in
any manner to the offer or that, in our reasonable judgment,
could materially and adversely affect the business, condition
(financial or other), income, operations or prospects of Clarus
Corporation or our subsidiaries, or otherwise materially impair
in any way the contemplated future conduct of our business or
the business of any of our subsidiaries or materially impair the
benefits that we believe we will receive from the offer;
(b) Any action is threatened, pending or taken, or any approval is
withheld, or any statute, rule, regulation, judgment, order or
injunction is threatened, proposed, sought, promulgated,
enacted, entered, amended, enforced or deemed to be applicable
to the offer or us or any of our subsidiaries, by any court
15
or any authority, agency or tribunal that, in our reasonable
judgment, would or might directly or indirectly:
(1) Make the acceptance for exchange of, or issuance of new
options for, some or all of the tendered options illegal or
otherwise restrict or prohibit consummation of the offer or
otherwise relates in any manner to the offer;
(2) Delay or restrict our ability, or render us unable, to
accept for exchange, or issue new options for, some or all
of the tendered options;
(3) Materially impair the benefits that we believe we will
receive from the offer; or
(4) Materially and adversely affect the business, condition
(financial or other), income, operations or prospects of us
or our subsidiaries, or otherwise materially impair in any
way the contemplated future conduct of our business or the
business of any of our subsidiaries;
(c) Any change in generally accepted accounting standards which
could or would require us for financial reporting purposes to
record compensation expense against our earnings in connection
with the offer;
(d) A tender or exchange offer with respect to some or all of our
common stock, or a merger or acquisition proposal for us, is
proposed, announced or made by another person or entity or is
publicly disclosed; or
(e) Any change or changes occurs in our business, condition
(financial or other), assets, income, operations, prospects or
stock ownership or in that of our subsidiaries that, in our
reasonable judgment, is or may be material to us or our
subsidiaries or materially impairs or may materially impair the
benefits that we believe we will receive from the offer.
The conditions to the offer are for our benefit. We may assert them
in our discretion regardless of the circumstances giving rise to them prior to
the expiration date. We may waive them, in whole or in part, at any time and
from time to time prior to the expiration date, in our discretion, whether or
not we waive any other condition to the offer. Our failure at any time to
exercise any of these rights will not be deemed a waiver of any such rights. The
waiver of any of these rights with respect to particular facts and circumstances
is not a waiver with respect to any other facts and circumstances. Any
determination we make concerning the events described in this Section 6 will be
final and binding upon everyone.
7. PRICE RANGE OF COMMON STOCK UNDERLYING THE OPTIONS.
Our common stock is quoted on the Nasdaq National Market under the
symbol "CLRS." The following table shows, for the periods indicated, the high
and low closing sales prices per share of our common stock as reported by the
Nasdaq National Market.
High Low
Quarter ended June 30, 2001.................. $7.29 $5.08
Quarter ended March 31, 2001................. $9.25 $5.09
Quarter ended December 31, 2000.............. $23.75 $6.06
Quarter ended September 30, 2000............. $63.25 $22.81
Quarter ended June 30, 2000.................. $68.38 $21.31
Quarter ended March 31, 2000................. $136.00 $54.50
Quarter ended December 31, 1999.............. $71.00 $9.38
Quarter ended September 30, 1999............. $15.44 $5.06
As of July 6, 2001, the last reported sale price of our common stock,
as reported by the Nasdaq National Market, was $6.38 per share. WE RECOMMEND
THAT YOU OBTAIN CURRENT MARKET QUOTATIONS FOR OUR COMMON STOCK BEFORE DECIDING
WHETHER TO TENDER YOUR OPTIONS.
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8. SOURCE AND AMOUNT OF CONSIDERATION; TERMS OF NEW OPTIONS.
Consideration. We will issue new options to purchase common stock
--------------
under the applicable stock incentive plan (generally the same stock incentive
plan under which the eligible options were granted except that with respect to
options originally granted under the SQL Plan, new options will be granted under
the Incentive Plan and options granted under the SAI Plan may be replaced with
incentive stock options granted under the Incentive Plan to the extent permitted
by applicable law and regulations) in exchange for outstanding eligible options
properly tendered and accepted for exchange by us. The number of shares of
common stock subject to new options to be granted to each option holder will be
equal to the number of shares subject to the options tendered by such option
holder and accepted for exchange, subject to adjustments for any stock splits,
stock dividends and similar events. If we receive and accept tenders of all
outstanding eligible options, we expect to grant new options to purchase a total
of 1,679,021 shares of our common stock. Our directors and our Section 16(b)
officers are not eligible to participate in the offer. The options subject to
this offer to exchange represent 54% of the total options outstanding under our
stock incentive plans as of July 6, 2001.
Terms of New Options. The new options will be issued under the
--------------------
Incentive Plan or the SAI Plan, depending upon the plan under which the options
tendered were granted and applicable laws and regulations. A new option
agreement will be entered into between us and each option holder who has
tendered options in the offer. The new option agreements will be substantially
the same as the form option agreements attached as Exhibits (d)(2) and (d)(4) to
the Tender Offer Statement on Schedule TO that we filed with the SEC on July 9,
2001, as the case may be. Except with respect to the exercise price, the date
the vesting begins, the vesting period and certain other terms specified in the
offer, the terms and conditions of the new options will be substantially the
same as the terms and conditions of the options tendered for exchange. Options
granted under the SAI Plan may be replaced with incentive stock options granted
under the Incentive Plan to the extent permitted by applicable law and
regulations. However, if you exchange options granted under the SQL Plan, your
new options will be granted under the Incentive Plan. The material terms of the
Incentive Plan are described below. Because we will not grant new options until
at least six months and a day after the date we cancel the tendered options, the
new options may have a higher exercise price than some or all of the tendered
options.
The issuance of new options under this offer will not create any
contractual or other right of the recipients to receive any future grants of
stock options or benefits in lieu of stock options or any right of continued
employment.
The following description summarizes the material terms of our stock
incentive plans and the options granted under them. This description is only a
summary, and may not be complete. For complete information please refer to the
copies of the stock incentive plans and the new option agreements that have been
filed with the SEC as exhibits to the Tender Offer Statement on Schedule TO. You
may also contact us at Clarus Corporation, Attention: Pam Ellis, 3970 Johns
Creek Court, Suite 100, Suwanee, Georgia 30024 (telephone: (770) 291-5394,
facsimile: (770) 291-4775 and e-mail: ellisp@claruscorp.com) to request copies
of the stock incentive plans or the forms of the new option agreements, which
will be provided at our expense.
General Information. The Incentive Plan provides the maximum number
-------------------
of shares issuable pursuant to the exercise of options currently may not exceed
3,000,000 shares, plus (i) any shares of common stock available for future
awards under the SQL Plan; and (ii) any shares of common stock that are
represented by awards granted under the Incentive Plan or SQL Plan which are
forfeited, expired, cancelled or terminated without delivery of shares of common
stock or which result in the forfeiture of shares of common stock back to
Clarus. The maximum number of shares subject to options that may be awarded to
one person in any twelve month period under the Incentive Plan is 200,000.
The SAI Plan provides that the maximum number of shares issuable
pursuant to the exercise of options currently may not exceed 750,000 shares,
plus any shares subject to awards under the SAI Plan which are forfeited,
cancelled, terminated or expired without delivery of shares of common stock or
which result in the forfeiture of shares of common stock back to Clarus. The SQL
Plan provides the maximum number of awards currently issuable pursuant to all
awards may not exceed 1,633,938.
The Incentive Plan and the SQL Plan permit the granting of options
intended to qualify as incentive options under the Code and the granting of
options that do not qualify as incentive options. The SAI Plan permits the
granting of nonqualified options only.
17
Administration. The Incentive Plan and the SAI Plan are administered
--------------
by the compensation committee of our board of directors. The compensation
committee is composed solely of "nonemployee directors" as defined in Rule 16b-3
under the Exchange Act and "outside directors" for purposes of Section 162(m) of
the Code. The members of the compensation committee are appointed from time to
time by our board of directors and may be removed at any time by the board.
Vacancies in the compensation committee are filled by the board. The SQL Plan is
administered by the board, or upon delegation by the board, by a committee
appointed by the board.
Term. Under the Incentive Plan and SAI Plan, the term of each option
----
will be determined by the compensation committee and may generally not exceed 10
years from the date of grant(or five years with respect to 10% stockholders).
Under the SQL Plan, the board will determine the term of each option, and no
options may be exercised more than 10 years from the date of grant (or five
years with respect to a 10% stockholder). The new options to be granted pursuant
to the offer will have a term equal to the term of the options being exchanged
for such new option, which generally is 10 years.
Exercise Price. The exercise price of each option will be determined
--------------
by the compensation committee (or board with respect to the SQL Plan). In the
case of an incentive stock option, the exercise price may not be less than 100%
of the fair market value of a share of our common stock on the grant date. The
exercise price of a nonqualified stock option granted under the Incentive Plan
or the SAI Plan may not be less than the par value per share of the Common Stock
and under the SQL Plan may not be less than 85% of the fair market value of a
share of our common stock on the date of the grant. A nonqualified option is an
option that is not qualified to be an incentive stock option under current tax
laws. For 10% stockholders, the exercise price of an incentive stock option may
not be less than 110% of the fair market value of a share of common stock on the
date the option is granted. The exercise price of the new options to be granted
pursuant to the offer will be equal to the fair market value of our common stock
on the grant date, which will be determined by the last reported sale price
during regular trading hours of our common stock on the Nasdaq National Market
on the grant date.
Termination. Options issued under our stock incentive plans generally
-----------
will expire 10 years after the grant date. Unless your option agreement
otherwise provides, options granted pursuant to the Incentive Plan and the SAI
Plan are subject to the following termination provisions. Options will terminate
following the termination of your employment for any reason other than
disability or death, or for cause (as defined in the plans), unless the options
are exercised, to the extent that they were exercisable immediately before such
termination, before the earlier of (i) three (3) months following your
termination or (ii) the end of the option period. In the event that the
termination of your employment is by reason of disability, death while you are
an employee, or death after termination of employment due to a disability, you,
or your executors, administrators, legatees or distributees of your estate, may
exercise your options to the extent that they were exercisable on the date of
your employment termination, before the earlier of (i) the end of the 12-month
period after your termination; or (ii) the end of the option period. If your
employment is terminated for "cause" (as defined in the plans), your options
will lapse and no longer be exercisable as of the effective time of your
termination of employment, unless otherwise determined by the compensation
committee.
Unless your individual option agreement provides otherwise, options
granted under the SQL Plan are subject to the following termination provisions.
If you cease to perform services for any reason other than death or disability,
you may exercise an option, to the extent the option was otherwise exercisable
on the date of termination at any time within the three-month period following
the termination of services. If you cease to perform services because of
disability, you may, at any time within the one-year period following
termination of services, exercise the option to the extent it was exercisable at
the time of termination. If you cease to perform services because of death, the
option, to the extent it was exercisable on the date of death, may be exercised
within a period of one year after the participant's death, by persons to whom
the participant's option passes by will or the laws of descent and distribution.
In no event, however, may any option be exercised after the end of its term.
Vesting and Exercise. The compensation committee (or the Board with
--------------------
respect to the SQL Plan) has the authority to determine at what time or times
each option may be exercised and the period of time, if any, after retirement,
death, disability or termination of employment during which options may be
exercised. Options outstanding as of the date of a "change of control" (as
defined in the stock incentive plans) generally will be exercisable
18
with respect to 50% of that portion of the outstanding options not otherwise
exercisable on the date of the change of control, unless the compensation
committee elects not to accelerate exercisability of such options because other
equitable or other appropriate action has been taken. The new options granted
pursuant to the offer will vest in thirty-six equal monthly installments over
the next three years.
Payment of Exercise Price. You may exercise your options by delivery
-------------------------
of a written notice to us on any business day at the address listed on your
exercise notice, which specifies the number of shares for which the option is
being purchased and which is accompanied by payment in full of the purchase
price. The permissible methods of payment of the option exercise price generally
are the following:
. Cash;
. Delivery of shares of our common stock which have been owned by
the option holder for no less than six months and otherwise are
acceptable to the compensation committee;
. Delivery of written notice to us and delivery to a broker of
written notice of exercise and irrevocable instructions to
promptly deliver to us the amount of sale or loan proceeds to
pay the option price (i.e. cashless exercise); or
. A combination of these methods as elected by you.
Amendment and Termination of the Option Plans. Our board may amend or
---------------------------------------------
terminate the stock incentive plans at any time and in any manner, subject to
certain restrictions. Options may not be granted under the SQL Plan after
November 21, 2002, options may not be granted under the Incentive Plan after
February 4, 2008, and options may not be granted under the SAI Plan after May
28, 2010.
No Stockholder Rights and Employment Rights. A participant shall have
-------------------------------------------
no stockholder rights with respect to the shares of our common stock subject to
his or her outstanding options until such shares are purchased in accordance
with the provisions of the applicable stock incentive plan. Nothing in any of
the stock incentive plans confers upon the participant any right to continue in
our employ. The offer does not involve any guarantee of employment for any
period. Your employment with Clarus or one of its subsidiaries remains "at will"
and may be terminated at any time by either you or Clarus (or one of its
subsidiaries, as applicable), with or without cause or notice, subject to the
provisions of applicable law.
Transferability of Options. Incentive options are not transferable
--------------------------
other than by will or the laws of intestate succession. Nonqualified options
granted under the Incentive Plan or the SAI Plan are not transferable other than
by will or the laws of intestate succession, except as may be permitted by the
compensation committee in a manner consistent with the registration provisions
of the Securities Act of 1933, as amended (the "Securities Act"). In addition,
options (except in the case of a permitted nonqualified option transfer) may be
exercised during your lifetime only by you or your guardian or legal
representative.
Registration of Option Shares. All shares of common stock issuable
-----------------------------
upon exercise of options under the stock incentive plans, including the shares
that will be issuable upon exercise of all new options to be granted pursuant to
the offer, have been registered under the Securities Act on a registration
statement on Form S-8 filed with the SEC. Unless you are one of our affiliates,
you will be able to sell your option shares free of any transfer restrictions
under applicable securities laws.
Tax Consequences. You should refer to Sections 13 and 14 for a
----------------
discussion of the U.S. federal income tax and foreign tax consequences of
accepting or rejecting the new options under this offer to exchange. Whether you
are an employee based inside or outside of the United States, we recommend that
you consult with your own tax adviser to determine the tax consequences of this
transaction under the laws of the country in which you live and work.
Our statements in this offer to exchange concerning the stock
incentive plans and the new options are merely summaries and do not purport to
be complete. The statements are subject to, and are qualified in their entirety
by reference to, all provisions of our stock incentive plans and the forms of
option agreements under the stock incentive plans. Please refer to copies of the
stock incentive plans and the new option agreements that have
19
been filed with the SEC as exhibits to the Tender Offer Statement on Schedule
TO. You may also contact Pam Ellis at Clarus Corporation, 3970 Johns Creek
Court, Suite 100, Suwanee, Georgia 30024 (telephone: (770) 291-5394) to receive
copies of the stock incentive plans and the forms of option agreements
thereunder. We will promptly furnish you copies of these documents at your
expense.
9. INFORMATION CONCERNING CLARUS CORPORATION.
We develop, market, and support Internet-based business-to-business
(B2B) e-commerce solutions targeted for large to mid-size enterprises (LME) that
automate the procurement, sourcing, and settlement of goods and services. Our
software helps organizations reduce the costs associated with the purchasing and
payment settlement of goods and services, and helps to maximize procurement
economies of scale. Our digital marketplace solution provides a framework that
allows companies to create trading communities and additional revenue
opportunities. Our solutions also benefit suppliers by reducing sales costs and
providing the opportunity to increase revenues. Our products have been licensed
by customers such as Comcast Corporation, Burlington Northern Santa Fe Railroad,
Gjensidige NOR, Mastercard International, MetLife, Parsons Brinckerhoff,
Sumurfit and Stone, and Wachovia Operational Services Corporation.
Our Internet-based business-to-business e-commerce solutions are
significantly different than the client/server financial software applications
that were the basis of our initial operations. There have been several
milestones in the evolution of our business since our incorporation in Delaware
in 1991. Those milestones include:
. Initial public offering. On May 26, 1998, we completed an
initial public offering of our common stock in which we sold 2.5
million shares of common stock at $10.00 per share resulting in
net proceeds to us of approximately $22.0 million.
. ELEKOM acquisition. On November 6, 1998, we acquired ELEKOM
Corporation ("ELEKOM") for approximately $15.7 million,
consisting of $8.0 million in cash and approximately 1.4 million
shares of our common stock. ELEKOM developed a software program
that provided electronic corporate procurement capabilities to
its clients.
. Sale of our Financial and Human Resources Software Business. On
October 18, 1999, we sold substantially all of the assets of our
financial and human resources software ("ERP") business to Geac
Computer Systems, Inc. and Geac Canada Limited. In this sale we
received approximately $13.9 million. Approximately $2.9 million
of the purchase price was placed in escrow and was subsequently
settled during 2000.
. Follow-on public offering. On March 10, 2000, we sold 2,243,000
shares of common stock in a secondary public offering at $115.00
per share resulting in net proceeds to us of approximately
$244.4 million.
. iSold.com acquisition. On April 28, 2000, we acquired all the
capital stock of iSold.com, Inc. ("iSold") for approximately
$2.5 million in cash of which $1.6 million was paid at the date
of acquisition and $900,000 was paid in April 2001. iSold
developed a software program that provided auctioning
capabilities to its clients.
. SAI/Redeo Companies acquisition. On May 31, 2000, we acquired
all the outstanding stock of SAI (Ireland) Limited, SAI
Recruitment Limited and its subsidiaries and related companies,
i2Mobile.com Limited and SAI America Limited (the "SAI/Redeo
Companies"). The SAI/Redeo Companies specialize in electronic
payment settlement software.
In December 2000, we announced our business strategy of targeting
large to mid-size enterprises. In support of this strategy, we also announced an
expanded business model that would support a wider range of software licensing
arrangements. As part of this business model expansion, we intend to move from a
traditional up-front license fee revenue model to a ratable revenue recognition
model, as is required in subscription-based licensing agreements. As a result,
we believe that our future financial results may not be comparable to our
historic financial results.
20
Our principal executive offices are located at 3970 Johns Creek Court,
Suite 100, Suwanee, Georgia 30024 and our telephone number at that address is
(770) 291-3900.
The financial statements included in our annual report on Form 10-K
for the fiscal year ended December 31, 2000 and quarterly report on Form 10-Q
for the fiscal quarter ended March 31, 2001 are incorporated herein by
reference. See "Additional Information" below for instructions on how you can
obtain copies of our SEC filings, including filings that contain our financial
statements.
- --------------------------------------------------------------------------------
Summary Selected Historical Consolidated Financial Data
the following table summarizes certain of our historical consolidated Financial
data.
Statement of Operations Data: Year Ended December 31, Three Months Ended March 31,
----------------------- ----------------------------
(Audited) (Unaudited)
1999 2000 2000 2001
---- ---- ---- ----
(in thousands, except per share data)
Total revenues............................ $ 38,142 $ 34,047 $ 7,006 $ 4,572
Operating loss............................ (15,155) (77,338) (11,261) (22,021)
Net Loss.................................. (5,401) (70,647) (11,431) (22,761)
Net Loss per common share:
Basic................................. (0.49) (4.90) (0.93) (1.47)
Diluted............................... (0.49) (4.90) (0.93) (1.47)
Weighted average common shares
outstanding:
Basic................................. 11,097 14,420 12,247 15,508
Diluted............................... 11,097 14,420 12,247 15,508
Book value per share...................... $ 2.83 $ 15.89 $ 19.49 $ 15.67
As of December 31, 2000 As of March 31, 2001
----------------------- --------------------
(Audited) (Unaudited)
Balance Sheet Data:
Cash and cash equivalents......................... $ 118,303 $ 114,481
Working capital................................... 171,336 153,457
Total assets...................................... 266,904 243,093
Current Liabilities............................... 13,354 13,380
Long-term debt, net of current portion............ 5,000 5,000
Total stockholders' equity........................ 246,822 222,830
- --------------------------------------------------------------------------------
10. INTERESTS OF DIRECTORS AND OFFICERS; TRANSACTIONS AND ARRANGEMENTS
CONCERNING THE OPTIONS.
A list of our directors and executive officers is attached to this
offer to exchange as Schedule A. As of July 6, 2001, our executive officers and
directors as a group beneficially owned options outstanding under the Incentive
Plan to purchase a total of 507,302 shares of our common stock, which
represented approximately 25% of the shares subject to all options outstanding
under the Incentive Plan as of that date. As of July 6, 2001, our executive
officers and directors as a group beneficially owned options outstanding under
the SAI Plan to purchase a total of 0 shares of our common stock, which
represented approximately 0.00% of the shares subject to all options outstanding
under the SAI Plan. As of July 6, 2001, our executive officers and directors as
a group beneficially owned options outstanding under the SQL Plan to purchase a
total of 235,638 shares of our common stock, which represented approximately 52%
of the shares subject to all options outstanding under the SAI Plan. None of
these options to purchase shares of common stock are eligible to be tendered in
the offer.
21
There have been no transactions in options to purchase our common
stock or in our common stock which were effected during the past 60 days by
Clarus or, to our knowledge, by any executive officer, director, affiliate or
subsidiary of Clarus, except for the following: (1) ordinary course purchases by
employee participants under the Clarus Corporation Employee Stock Purchase Plan
and Global Employee Stock Purchase Plan; (2) ordinary course grants of stock
options to employees who are not executive officer; (3) Mark Johnson, a
director, purchased 10,000 shares in the open market on May 29, 2001 at a
purchase price of $5.73; (4) Steve Hornyak, an executive officer, exercised an
option for 4,500 shares on May 30, 2001 at an option price of $1.00; and (5)
Mark Johnson, Brady Rackley, Tench Coxe, Donald House and Said Mohammadioun,
each of whom is a director, were each granted options for 10,000 shares on May
22, 2001 pursuant to our annual director option grant program directors at an
option price of $6.06 per share (the fair market value of our common stock on
the option grant date).
11. STATUS OF OPTIONS ACQUIRED BY US IN THE OFFER; ACCOUNTING
CONSEQUENCES OF THE OFFER.
Options we acquire pursuant to the offer will be cancelled and the
shares of common stock subject to those options will be returned to the pool of
shares available for grants of new options under the applicable stock incentive
plan and for issuance upon the exercise of such new options or the grant of
other stock-based awards, except that options cancelled under the SQL Plan will
be allocated to the pool of shares available for grants of new awards under the
Incentive Plan. To the extent such shares are not fully reserved for issuance
upon exercise of the new options to be granted in connection with the offer, the
shares will be available for future awards to employees and other eligible plan
participants without further stockholder action, except as required by
applicable law, regulation or the rules of the Nasdaq National Market or any
other securities quotation system or any stock exchange on which our common
stock is then quoted or listed.
We believe that we will not incur any compensation expense solely as
a result of the transactions contemplated by this offer because:
. We will not grant any new options until a business day that is
at least six months and one day after the date that we accept
and cancel options tendered for exchange; and
. The exercise price of all new options will equal the market
value of the common stock on the date we grant the new options;
and
. We will require any option holder who tenders options in the
offer to tender all options that he or she received during the
six months immediately prior to the date on which the offer
expires if those options have an exercise price lower than the
exercise price of the options he or she tendered in the offer;
and
. We will defer the grant of any other options to which an option
holder who tendered options in the offer may be entitled until
after the date on which we grant the new options.
12. LEGAL MATTERS; REGULATORY APPROVALS.
We are not aware of any license or regulatory permit that appears to
be material to our business that might be adversely affected by our exchange of
options and issuance of new options as contemplated by the offer, or of any
approval or other action by any government or governmental, administrative or
regulatory authority or agency, domestic or foreign, that would be required for
the acquisition or ownership of our options as contemplated herein. Should any
such approval or other action be required, we presently contemplate that we will
seek such approval or take such other action. We are unable to predict whether
we may determine that we are required to delay the acceptance of options for
exchange pending the outcome of any such matter. We cannot assure you that any
such approval or other action, if needed, would be obtained or would be obtained
without substantial conditions or that the failure to obtain any such approval
or other action might not result in adverse consequences to our business. Our
obligation under the offer to accept tendered options for exchange and to issue
new options for tendered options is subject to conditions, including the
conditions described in Section 6.
13. MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES.
The following is a general summary of the material U.S. federal
income tax consequences of an exchange of options pursuant to the offer. This
discussion is based on
22
the Code, its legislative history, Treasury Regulations and administrative and
judicial interpretations as of the date of the offer, all of which are subject
to change, possibly on a retroactive basis. This summary does not discuss all of
the tax consequences that may be relevant to you in light of your particular
circumstances, nor is it intended to be applicable in all respects to all
categories of option holders. This summary assumes that no option holder has
paid any consideration for any options.
If you exchange outstanding incentive or nonqualified stock options
for new options, you will not be required to recognize income for U.S. federal
income tax purposes at the time of the exchange. We believe that the exchange
will be treated as a non-taxable exchange. At the date of grant of the new
options, you will not be required to recognize additional income for U.S.
federal income tax purposes. The grant of options generally is not recognized as
a taxable event to an employee or the employer.
If you tender incentive stock options and those options are accepted
for exchange, the new options will be granted as incentive stock options to the
maximum extent they qualify. For options to qualify as incentive stock options,
the value of shares subject to options that first become exercisable by the
option holder in any calendar year cannot exceed $100,000, as determined using
the option exercise price. The excess value is deemed to be a non-qualified
stock option. You should note that there is a risk that any incentive stock
option you hold may be affected, even if you do not participate in the exchange.
We believe that you will not be subject to current U.S. federal income tax if
you do not elect to participate in the option exchange program. We also believe
that the option exchange program will not change the U.S. federal income tax
treatment of subsequent grants and exercises of your incentive stock options
(and sales of shares acquired upon exercise of such options) if you do not
participate in the option exchange program. However, the IRS may characterize
the option exchange program as a "modification" of those incentive stock
options, even if you decline to participate. A successful assertion by the IRS
of this position could extend an option's holding period to qualify for
favorable tax treatment. Accordingly, to the extent you dispose of your
incentive stock option shares prior to the lapse of the new extended holding
period, your incentive stock option could be taxed similarly to a nonqualified
stock option.
U.S. Federal Income Tax Consequences for Outstanding Incentive Stock
--------------------------------------------------------------------
Options. Under current law you did not realize taxable income when incentive
- -------
stock options were granted to you under the stock incentive plans. In addition,
you generally will not realize taxable income when you exercise an incentive
stock option. However, your alternative minimum taxable income will be increased
by the amount that the aggregate fair market value of the shares you purchase
under an incentive stock option, which fair market value is generally determined
as of the date you exercise the option, exceeds the aggregate exercise price of
the option. Except in certain circumstances that are described in your stock
incentive plan and option agreement, such as your death or disability, if you
exercise an incentive stock option more than three months after your employment
is terminated, the option will not be treated as an incentive stock option and
is subject to taxation under the rules applicable to nonqualified stock options
that are discussed below.
If you sell common stock that you acquired by exercising an incentive
stock option, the tax consequences of the sale depend on whether the disposition
is "qualifying" or "disqualifying." The disposition of the common stock is
qualifying if it is made after the later of (1) two years from the date the
incentive stock option was granted and (2) one year after the date the incentive
stock option was exercised.
If the disposition of the common stock you receive when you exercise
an incentive stock option is qualifying, any excess of the sale price of the
stock over the exercise price of the option will be treated as long-term capital
gain taxable to you at the time of the sale. If the disposition is not
qualifying, which is referred to as a "disqualifying disposition," the excess of
the fair market value of the common stock on the date you exercise the option
over the exercise price will be taxable income to you at the time of the sale of
the stock. Of that income, the excess of the fair market value of the common
stock at the time you exercised the option over the exercise price will be
ordinary income and the balance, if any, of the income will be long or
short-term capital gain, depending on whether or not the common stock was sold
more than one year after the option was exercised.
If you sell common stock you received when you exercised an incentive
stock option in a qualifying disposition, we will not be entitled to a deduction
equal to the gain you realize when you completed that sale. However, if you sell
in a disqualifying disposition
23
common stock you received upon exercise of an incentive stock option, we will be
entitled to a deduction equal to the amount of compensation income taxable to
you.
U.S. Federal Income Tax Consequences of Nonqualified Stock Options.
------------------------------------------------------------------
Under current law, you do not realize taxable income upon the grant of a
nonqualified stock option. However, when you exercise the option, the difference
between the exercise price of the option and the fair market value of the shares
subject to the option on the date of exercise will be treated as taxable
compensation income to you, and you will be subject to withholding of income and
employment taxes at that time. We will generally be entitled to a deduction
equal to the amount of compensation income taxable to you.
The subsequent sale by you of shares acquired pursuant to the
exercise of a nonqualified stock option generally will give rise to capital gain
or loss equal to the difference between the sale price and the sum of the
exercise price paid for the shares plus the ordinary income recognized with
respect to the shares. The capital gain or loss will be treated as long-term
capital gain or loss if you held the shares for more than one year following
exercise of the option.
WE STRONGLY RECOMMEND THAT YOU CONSULT YOUR OWN TAX ADVISER WITH
RESPECT TO THE FEDERAL, STATE AND LOCAL TAX CONSEQUENCES OF PARTICIPATING IN THE
OFFER.
14. CERTAIN TAX CONSEQUENCES FOR NON-U.S.-BASED EMPLOYEES.
Tax Consequences to U.K. Employees. If you are a U.K.-based employee
----------------------------------
of Clarus or one of our subsidiaries, there are certain tax consequences and
conditions of the offer that may apply depending on your tax status for U.K. tax
purposes. WE STRONGLY RECOMMEND THAT YOU CONTACT YOUR PERSONAL TAX ADVISER OR
THE INLAND REVENUE TO ASSIST YOU IN DETERMINING YOUR U.K. TAX STATUS.
If we accept and cancel the options you tender in connection with the
offer, it is our understanding that the grant of the new options will not be a
taxable event for U.K. income tax purposes. When you exercise your new options,
you will be subject to U.K. income tax and, as discussed below, you will be
subject to National Insurance Contributions ("NIC") on the fair market value of
Clarus' shares at the time of exercise less the strike price of your new
options.
In April 1999, the U.K. Government made changes to the tax treatment
on certain share options and introduced a NIC on the exercise of certain stock
options. As a result of this, all new options received as a result of the offer
will be subject to both employee's and employer's NIC upon the exercise of the
new options. The amount of the employee's and employer's NIC withholdings will
be calculated by multiplying the applicable NIC rate by the difference between
the fair market value of Clarus' shares at the time of exercise and the strike
price of your new options. Recent changes to this legislation have made it
possible for the company and the employee to agree to transfer the employer's
NIC charge to the employee. As a condition of this offer, if you are subject to
U.K. tax on the date the new options are granted, the new option agreement
between you and us will provide that you will accept the liability for and to
pay the employer's NIC when you exercise the new options. Accordingly, if you
are subject to U.K. tax and you elect to tender options for exchange, you must
enter into a new option agreement that will transfer the employer's NIC to you.
You should note that you do not have to pay any employee's NIC if
your total earnings in the tax year in which the options were exercised are
above the upper NIC threshold (currently (Pounds) 29,900 for the 2001/2002 tax
year).
Moreover, any options that you currently hold that were granted to
you on or after October 15, 2000 are already subject to you agreeing to sign an
election accepting the liability for the employer's NIC charge. However, if you
are subject to U.K. tax on the date the new options are granted, you must agree
to accept the liability for and agree to pay the employer's NIC on new options
in order to receive your new options.
The above information is a general summary only of certain of the
U.K. income and social tax consequences of the exchange of options under the
offer. This discussion is based on the U.K. legislation, regulations and
administrative and judicial interpretations in force at the date of the offer,
all of which may change, possibly on a retroactive basis. This summary does not
discuss all of the U.K. income and social tax consequences that may be relevant
to you in light of your particular circumstances, nor is it intended to apply in
all respects to all categories of option holders. As such, we recommend that
24
you consult your own tax adviser with respect to the U.K. income tax, National
Insurance Contributions, and foreign tax consequences of participating in the
offer.
The terms of your employment shall not be affected in any way by the
Offer, and the rights deriving from any regrant of the new option shall not form
part of such terms (either expressly or impliedly) nor in any way entitle you to
take into account such participation in calculating any compensation or damages
on the termination of your employment for whatever reason (whether lawful or
unlawful) which might otherwise be payable to you.
This offer to exchange has not been approved for the purposes of
Section 57 of the Financial Services Act 1986 ("FSA") by a person authorized
under the FSA. Accordingly, this offer to exchange may only be issued or passed
on in the United Kingdom to persons who are of a kind described in article 11(3)
of the Financial Services Act 1986 (Investment Advertisements) (Exemptions)
Order 1996 or are persons to whom the offer to exchange may otherwise lawfully
be issued or passed on.
Tax Consequences to Irish Employees. If you are an Irish-based
-----------------------------------
employee of Clarus or one of our subsidiaries, there are certain tax
consequences and conditions of the offer that may apply depending on your tax
status for Irish tax law purposes. This summary does not address all aspects of
Irish tax law that may be relevant to you. This summary assumes no consideration
was paid by an option holder for the options. YOU ARE STRONGLY URGED TO CONTACT
YOUR PERSONAL TAX OR FINANCIAL ADVISER REGARDING THE SPECIFIC TAX CONSEQUENCES
OF EXCHANGE OF YOUR OPTIONS.
If we accept and cancel the options you tender in connection with the
offer, it is our understanding that the grant of the new options will not be a
taxable event for Irish income tax purposes. You will be subject to Irish income
tax when you exercise your new options in an amount equal to the spread between
the option exercise price and the fair market value of the common stock on the
date of exercise. You may elect to defer the income tax payable on the exercise
of an option in which case the income tax will not have to be paid until the
earlier of the relevant payment date in (1) the year of assessment in which the
option shares are disposed or (2) seven years after the year in which the option
was exercised. The options are not subject to payment of related social
insurance or to the levy. You may be subject to a stamp duty charge if the
documentation regarding the exchange is executed in Ireland. The stamp duty
charge is a fixed charge of Irish (pounds) 10.
When you dispose of the shares acquired through the exercise of an
option, you will be liable for Irish capital gains tax at the rate of 20% on
such gains. In computing the amount of gain, you may deduct from the sale
proceeds the option price plus any amount which was chargeable to income tax on
the exercise of the option. These deductions can also be increased to account
for inflation if the expenditures were incurred more than 12 months before the
date of disposal of the common stock. You are also entitled to receive a gain of
Irish (pounds) 1000 per year tax free.
Tax Consequences to Canadian Employees. The following is a general
--------------------------------------
summary of the material Canadian federal income tax consequences to a Canadian
resident employee of Clarus or one of its subsidiaries who has been granted
options by virtue of his or her employment and who exchanges those options
pursuant to the offer. This summary is based upon the current provisions of the
Income Tax Act (Canada) (the "Canadian Tax Act") and the regulations thereunder
and all specific proposals to amend the Canadian Tax Act publicly announced
prior to the date hereof, any of which could change in a manner that would
affect the tax consequences described, possibly with retroactive effect. This
summary does not purport to address all aspects of Canadian federal income tax
law that may be relevant to you in the light of your personal circumstances, and
does not deal with the possible application of provincial, local, or other tax
laws. YOU ARE STRONGLY URGED TO CONSULT YOUR PERSONAL TAX OR FINANCIAL ADVISER
REGARDING THE SPECIFIC TAX CONSEQUENCES OF EXCHANGING YOUR OPTIONS PURSUANT TO
THE OFFER (INCLUDING THE POSSIBLE EFFECT OF CHANGES IN TAX LAWS).
If you tender outstanding options pursuant to the offer, such
tendered options will be cancelled as of the date of our acceptance of your
tender. It is our understanding that this cancellation may be considered a
taxable disposition of your tendered options under the Canadian Tax Act.
Accordingly, you must include in your income for the year during which your
options are cancelled an amount equal to the value of the consideration you
received for the cancellation of your tendered options. The consideration you
received for the cancellation of your tendered options is our undertaking,
subject to certain
25
conditions, to grant you new options on or abo0ut the first business day that is
at least six months and a day from the date we cancel your tendered options. You
will be required to determine the value of this consideration.
Provided that certain conditions are satisfied (including the
condition that the common stock qualifies as "prescribed shares" and that the
exercise price under the tendered options was not less than the fair market
value of the common stock at the time those options were granted), you may be
entitled to a 50% deduction from the income inclusion described above.
When you acquire common stock pursuant to the exercise of your new
options, the amount by which the value of the common stock at that time
(computed in Canadian dollars) exceeds the aggregate of the amount you paid or
will pay for such common stock (computed in Canadian dollars) and the amount you
paid to acquire the options will be deemed to be a benefit you received and will
be included in computing your income. If you have included an amount in income
as a result of the cancellation of your tendered options (as described above)
and we grant you new options pursuant to the offer, the amount previously
included in your income may be considered an amount you paid to acquire the new
options. Provided that certain conditions are satisfied, recognition of the
benefit arising on the exercise of your new options may be deferred until the
year in which the common stock is disposed of. This deferral is available if the
common stock is listed on a prescribed stock exchange (which includes the Nasdaq
National Market) and if the exercise price you paid for the common stock was not
less than the fair market value of the common stock on the date of grant of the
new options. There is a $100,000 annual limit on the tax deferral. This limit is
based upon the fair market value (at the time of grant) of the common stock that
vests in any particular year. If the conditions allowing the tax deferral are
not satisfied, you will be required to include the benefit in income in the year
in which the common stock is acquired.
Regardless of whether the exercise of the new options qualifies for
the tax deferral discussed above, provided that certain conditions are satisfied
(including the condition that the common stock qualifies as "prescribed shares"
and that the exercise price is not less than the fair market value of the common
stock at the time the new options were granted), you may be entitled to a 50%
deduction from the benefit inclusion described above.
The full amount of any benefit included in computing your income in
respect of the exercise of new options is added to your cost of the common stock
to determine the adjusted cost base of the common stock. For the purposes of
computing any capital gain or loss on the disposition of the common stock, the
cost of the common stock acquired by you will be averaged with the adjusted cost
base of all common stock owned by you a the time the common stock is acquired.
Where the deferral described above is available, and in certain other
circumstances, this averaging rule may not be applicable.
If you sell or otherwise dispose of the common stock you acquired by
exercising a new option, you will generally realize a capital gain (or capital
loss) to the extent that the proceeds of disposition, net of any reasonable
costs of disposition, exceed (or are less than) the adjusted cost base to you of
the common stock. One half of any capital gain (the "taxable capital gain") must
be included in your income for the year of disposition. You may deduct one-half
of any capital loss (the "allowable capital loss") so realized against taxable
capital gains for the year of disposition. Any excess of allowable capital
losses over taxable capital gains for the year of disposition may be carried
back up to three taxation years of forward indefinitely and deducted against net
taxable capital gains in those other years to the extent and in the
circumstances prescribed in the Canadian Tax Act.
15. EXTENSION OF OFFER; TERMINATION; AMENDMENT.
We expressly reserve the right, in our discretion at any time and
from time to time, to extend the period of time during which the offer is open
and delay accepting any options tendered to us by publicly announcing the
extension and giving oral or written notice of the extension to the option
holders and making a public announcement thereof. If the offer is extended, then
the grant date of the new options will also be extended.
We also expressly reserve the right, in our reasonable judgment,
prior to the expiration date to terminate or amend the offer and to postpone our
acceptance and cancellation of any options tendered for exchange upon the
occurrence of any of the conditions specified in Section 6, by giving oral or
written notice of such termination or
26
postponement to the option holders and making a public announcement thereof. Our
reservation of the right to delay our acceptance and cancellation of options
tendered for exchange is limited by Rule 13e-4(f)(5) promulgated under the
Exchange Act, which requires that we must pay the consideration offered or
return the options tendered promptly after termination or withdrawal of a tender
offer.
Subject to compliance with applicable law, we further reserve the
right, in our discretion, and regardless of whether any event set forth in
Section 6 has occurred or is deemed by us to have occurred, to amend the offer
in any respect, including, without limitation, by decreasing or increasing the
consideration offered in the offer to option holders or by decreasing or
increasing the number of options being sought in the offer.
Amendments to the offer may be made at any time and from time to time
by public announcement of the amendment. In the case of an extension, the
amendment must be issued no later than 9:00 a.m., Eastern time, on the next
business day after the last previously scheduled or announced expiration date.
Any public announcement made pursuant to the offer will be disseminated promptly
to option holders in a manner reasonably designated to inform option holders of
such change. Without limiting the manner in which we may choose to make a public
announcement, except as required by applicable law, we have no obligation to
publish, advertise or otherwise communicate any such public announcement other
than by making a press release to the Dow Jones News Service.
If we materially change the terms of the offer or the information
concerning the offer, or if we waive a material condition of the offer, we will
extend the offer to the extent required by Rules 13e-4(d)(2) and 13e-4(e)(3)
under the Exchange Act. These rules require that the minimum period during which
an offer must remain open following material changes in the terms of the offer
or information concerning the offer, other than a change in price or a change in
percentage of securities sought, will depend on the facts and circumstances,
including the relative materiality of such terms or information.
16. FEES AND EXPENSES.
We will not pay any fees or commissions to any broker, dealer or
other person for soliciting tenders of options pursuant to this offer to
exchange.
17. ADDITIONAL INFORMATION.
We have filed with the SEC a Tender Offer Statement on Schedule TO,
of which this offer to exchange is a part, with respect to the offer. This offer
to exchange does not contain all of the information contained in the Schedule TO
and the exhibits to the Schedule TO. We recommend that you review the Schedule
TO, including its exhibits, and the following materials which we have filed with
the SEC before making a decision on whether to tender your options:
(a) Our Annual Report on Form 10-K for the year ended December 31,
2000, filed with the SEC on March 21, 2001;
(b) Our Quarterly Report on Form 10-Q for the quarter ended March 31,
2001, filed with the SEC on May 15, 2001; and
(c) The description of our common stock contained in our registration
statement on Form 8-A filed with the SEC on May 15, 1998.
These filings, our other annual, quarterly and current reports, our
proxy statements and our other SEC filings may be examined, and copies may be
obtained, at the following SEC public reference rooms:
450 Fifth Street, N.W. 7 World Trade Center 500 West Madison Street
Room 1024 Suite 1300 Suite 1400
Washington, D.C. 20549 New York, New York 10048 Chicago, Illinois 60661
You may obtain information on the operation of the public reference
rooms by calling the SEC at 1-800-SEC-0330. Our SEC filings are also available
to the public on the SEC's Internet site at http://www.sec.gov.
Our common stock is quoted on the Nasdaq National Market under the
symbol "CLRS," and our SEC filings can be read at the following Nasdaq address:
27
Nasdaq Operations
1735 K Street, N.W.
Washington, D.C. 20006
We will also provide without charge to each person to whom a copy of
this offer to exchange is delivered, upon the written or oral request of any
such person, a copy of any or all of the documents to which we have referred
you, other than exhibits to such documents (unless such exhibits are
specifically incorporated by reference into such documents). Requests should be
directed to:
Clarus Corporation
Attention: Pam Ellis
3970 Johns Creek Court, Suite 100
Suwanee, Georgia 30024
Telephone: (770) 291-5394
Facsimile: (770) 291-4775
E-mail: ellisp@claruscorp.com
between the hours of 9:00 a.m. and 4:00 p.m., Suwanee, Georgia local time. As
you read the documents listed in Section 17, you may find some inconsistencies
in information from one document to another. Should you find inconsistencies
between the documents, or between a document and this offer to exchange, you
should rely on the statements made in the most recent document. The information
contained in this offer to exchange about Clarus Corporation should be read
together with the information contained in the documents to which we have
referred you.
18. FORWARD LOOKING STATEMENTS; MISCELLANEOUS.
This offer to exchange and our SEC reports referred to above contain
certain forward-looking statements, including or related to our future results,
including certain projections and business trends. Assumptions relating to
forward-looking statements involve judgments with respect to, among other
things, future economic, competitive and market conditions and future business
decisions, all of which are difficult or impossible to predict accurately and
many of which are beyond our control. When used in this offer to exchange, the
words "estimate," "project," "intend," "believe" and "expect" and similar
expressions are intended to identify forward-looking statements. Although we
believe that assumptions underlying the forward-looking statements are
reasonable, any of the assumptions could prove inaccurate, and we may not
realize the results contemplated by the forward-looking statement. Management
decisions are subjective in many respects and susceptible to interpretations and
periodic revisions based on actual experience and business developments, the
impact of which may cause us to alter our business strategy or capital
expenditure plans that may, in turn, affect our results of operations. In light
of the significant uncertainties inherent in the forward-looking information
included in this offer to change, you should not regard the inclusion of such
information as our representation that we will achieve any strategy, objectives
or other plans. The forward-looking statements contained in this offer to
exchange speak only as of the date of this offer to exchange, and we have no
obligation to update publicly or revise any of these forward-looking statements.
These and other statements, which are not historical facts, are based
largely on management's current expectations and assumptions and are subject to
a number of risks and uncertainties that could cause actual results to differ
materially from those contemplated by such forward-looking statements. These
risks and uncertainties include the following:
- We may not effectively implement our business strategy.
- We may not be able to maintain referenceable accounts.
- We expect our product line to appeal to early-stage companies
which exposes us to higher than normal credit risk.
- If our subscription-based model is unsuccessful, the market may
adopt our products at a slower rate than anticipated, and our
business may suffer materially.
- We may not generate the substantial additional revenues
necessary to become profitable and anticipate that we will
continue to incur losses.
28
- As we expand our international sales and marketing activities,
our business will be more susceptible to numerous risks
associated with international operations.
- We have limited experience in marketing, selling and supporting
our products and services in foreign countries. We do not have
experience developing foreign language versions of our products.
- Our quarterly operating results are volatile and difficult to
predict. If we fail to meet expectations of public market
analysis or investors, the market price of our common stock may
decrease significantly.
- We may incur costs and liabilities related to potential or
pending litigation.
- Competition from other electronic procurement providers may
reduce demand for our products and cause us to reduce the price
of our products.
- Market adoption of our solution will be impeded if we do not
continue to establish and maintain strategic relationships.
- We expect to depend on our Clarus eProcurement and Clarus
eMarket products for a significant portion of our revenues for
the foreseeable future.
- Our products may perform inadequately in a high volume
environment.
- Defects in our products could delay market adoption of our
solution or cause us to commit significant resources to remedial
efforts.
- Any acquisitions that we attempt or make could prove difficult
to integrate or require a substantial commitment of management
time and other resources.
- We may not be able to retain the existing employees of acquired
companies.
- An increase in the length of our sales cycle may contribute to
fluctuations in our operating results.
- Our success depends on the continued use of Microsoft
technologies or other technologies that operate with our
products.
- The failure to maintain, support or update software licensed
from third parties could materially and adversely affect our
products' performance or cause product shipment delays.
- If we are unable to manage our internal resources, we may incur
increased administrative costs and be unable to capitalize on
revenue opportunities.
- Our success depends on our continuing ability to attract, hire,
train and retain a substantial number of highly skilled
managerial, technical, sales, marketing and customer support
personnel.
- Illegal use of our proprietary technology could result in
substantial litigation costs and divert management resources.
- Claims against us regarding our proprietary technology could
require us to pay licensing or royalty fees or to modify or
discontinue our products.
- A compromise of the encryption technology employed in our
solutions could reduce customer and market confidence in our
products or result in claims against us.
- Our success depends upon market acceptance of e-commerce as a
reliable method for corporate procurement and other commercial
transactions.
- The market for business-to-business e-commerce solutions is
characterized by rapid technological change, and our failure to
introduce enhancements to our products in a timely manner could
render our products obsolete and unmarketable.
29
- Failure to expand Internet infrastructure could limit our
growth.
- Future governmental regulations could materially and adversely
affect our business and e-commerce generally.
- Legislation limiting further levels of encryption technology may
adversely affect our sales.
- The market price of our common stock is highly volatile and
several factors that are beyond our control could adversely
affect the market price of our common stock.
We are not aware of any jurisdiction where the making of the offer is
not in compliance with applicable law. If we become aware of any jurisdiction
where the making of the offer is not in compliance with any valid applicable
law, we will make a good faith effort to comply with such law. If, after such
good faith effort, we cannot comply with such law, the offer will not be made
to, nor will tenders be accepted from or on behalf of, the option holders
residing in such jurisdiction.
WE HAVE NOT AUTHORIZED ANY PERSON TO MAKE ANY RECOMMENDATION ON OUR
BEHALF AS TO WHETHER YOU SHOULD TENDER OR REFRAIN FROM TENDERING YOUR OPTIONS
PURSUANT TO THE OFFER. YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS
DOCUMENT OR TO WHICH WE HAVE REFERRED YOU. WE HAVE NOT AUTHORIZED ANYONE TO GIVE
YOU ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS IN CONNECTION WITH THE OFFER
OTHER THAN THE INFORMATION AND REPRESENTATIONS CONTAINED IN THIS DOCUMENT OR IN
THE RELATED LETTER OF TRANSMITTAL. IF ANYONE MAKES ANY RECOMMENDATION OR
REPRESENTATION TO YOU OR GIVES YOU ANY INFORMATION, YOU MUST NOT RELY UPON THAT
RECOMMENDATION, REPRESENTATION OR INFORMATION AS HAVING BEEN AUTHORIZED BY US.
Clarus Corporation
July 9, 2001
30
SCHEDULE A
INFORMATION CONCERNING
THE DIRECTORS AND EXECUTIVE OFFICERS
OF CLARUS CORPORATION
The directors and executive officers of Clarus Corporation and their
positions and offices as of July 6, 2001, are set forth in the following table:
Name Positions and Offices Held
---- --------------------------
Stephen P. Jeffery Chairman of the Board of Directors,
President and Chief Executive Officer
Steven M. Hornyak Chief Strategy Officer and General Manager,
Americas
Michael W. Mattox Senior Vice President, Operations and
Corporate Counsel
James J. McDevitt Chief Financial Officer
Mark A. Johnson Director
Brady L. Rackley, III Director
Tench Coxe Director
Donald L. House Director
Said Mohammadioun Director
The address of each director and executive officer is: c/o Clarus Corporation,
3970 Johns Creek Court, Suite 100, Suwanee, Georgia 30024.
A-1