SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to
Rule 14a-11(c) or Rule 14a-12
MANHATTAN ASSOCIATES, INC.
--------------------------
(Name of Registrant as Specified in Its Charter)
-------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules
14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction
applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth the
amount on which the filing fee is calculated and state how it
was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for
which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the Form
or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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MANHATTAN ASSOCIATES, INC.
2300 Windy Ridge Parkway, Suite 700
Atlanta, Georgia 30339
(770) 955-7070
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 17, 2002
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of
Manhattan Associates, Inc. (the "Company") will be held at 2300 Windy Ridge
Parkway, Atlanta, Georgia 30339, at 10:00 a.m., Atlanta, Georgia time, on
Friday, May 17, 2002 (the "Annual Meeting"), to consider and act upon:
1. the election of two directors to the Company's Board of
Directors;
2. a proposal to increase the number of shares available for
issuance under the Company's Stock Incentive Plan from
11,017,358 shares to 12,017,358 shares, an increase of
1,000,000 shares; and
3. such other business as may properly come before the Annual
Meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on April 1,
2002, as the record date for the determination of shareholders entitled to
notice of, and to vote at, the Annual Meeting.
By Order of the Board of Directors,
/s/ David K. Dabbiere
-------------------------------------------
David K. Dabbiere
Secretary
April 26, 2002
Atlanta, Georgia
IMPORTANT
WHETHER OR NOT YOU EXPECT TO BE PRESENT AT THE MEETING, PLEASE MARK, DATE AND
SIGN THE ENCLOSED PROXY AND RETURN IT IN THE ENVELOPE THAT HAS BEEN PROVIDED.
NO POSTAGE IS REQUIRED FOR MAILING IN THE UNITED STATES. IN THE EVENT YOU ARE
ABLE TO ATTEND THE MEETING, YOU MAY REVOKE YOUR PROXY AND VOTE YOUR SHARES IN
PERSON.
MANHATTAN ASSOCIATES, INC.
2300 WINDY RIDGE PARKWAY, SUITE 700
ATLANTA, GEORGIA 30339
--------------------
PROXY STATEMENT
---------------------
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 17, 2002
-------------------------------
INFORMATION CONCERNING SOLICITATION AND VOTING
SHAREHOLDERS MEETING
This Proxy Statement and the enclosed proxy card ("Proxy") are
furnished on behalf of the Board of Directors of Manhattan Associates, Inc., a
Georgia corporation ("Manhattan" or the "Company" or "we"), for use at the
Annual Meeting of Shareholders to be held on Friday, May 17, 2002, at 10:00
a.m., Atlanta, Georgia time (the "Annual Meeting"), or at any adjournment or
postponement thereof, for the purposes set forth herein and in the accompanying
Notice of Annual Meeting. The Annual Meeting will be held at 2300 Windy Ridge
Parkway, Atlanta, Georgia 30339. The Company intends to mail this Proxy
Statement and the accompanying Proxy on or about April 26, 2002, to all
shareholders entitled to vote at the Annual Meeting.
SHAREHOLDERS ENTITLED TO VOTE
Only holders of record of the Company's $.01 par value per share
common stock (the "Common Stock") at the close of business on April 1, 2002
will be entitled to notice of and to vote at the Annual Meeting. At the close
of business on April 1, 2001, the Company had outstanding and entitled to vote
28,508,482 shares of Common Stock. Each holder of record of Common Stock on
such date will be entitled to one vote for each share held on all matters to be
voted upon at the Annual Meeting. Any shareholder who signs and returns a Proxy
has the power to revoke it at any time before it is exercised by providing
written notice of revocation to the Secretary of the Company or by filing with
the Secretary of the Company a Proxy bearing a later date. The holders of a
majority of the total shares of Common Stock outstanding on the record date,
whether present at the Annual Meeting in person or represented by Proxy, will
constitute a quorum for the transaction of business at the Annual Meeting. The
shares held by each shareholder who signs and returns the enclosed Proxy will
be counted for the purposes of determining the presence of a quorum at the
meeting, whether or not the shareholder abstains on all or any matter to be
acted on at the meeting. Abstentions and broker non-votes both will be counted
toward fulfillment of quorum requirements. A broker non-vote occurs when a
nominee holding shares for a beneficial owner does not vote on a particular
proposal because the nominee does not have discretionary voting power with
respect to that proposal and has not received instructions from the beneficial
owner.
COUNTING OF VOTES
The purpose of the Annual Meeting is to consider and act upon the
matters that are listed in the accompanying Notice of Annual Meeting and set
forth in this Proxy Statement. The enclosed Proxy provides a means for a
shareholder to vote upon all of the matters listed in the accompanying Notice
of Annual Meeting and described in the Proxy Statement. The enclosed Proxy also
provides a means for a shareholder to vote for all of the nominees for Director
listed thereon or to withhold authority to vote for one or more of such
nominees. The Company's Bylaws provide that Directors are elected by a
plurality of the votes cast. Plurality means that the nominees who receive the
most votes for the available directorships will be elected as Directors.
1
Accordingly, the withholding of authority by a shareholder (including broker
non-votes) will not be counted in computing a plurality and thus will have no
effect on the results of the election of such nominees.
The accompanying Proxy also provides a means for a shareholder to vote
for, against or abstain from voting on the other matters to be acted upon at
the Annual Meeting. Each Proxy will be voted in accordance with the
shareholder's directions. Approval of the amendment to the Company's Stock
Incentive Plan and any other matters as may properly come before the meeting
will require the affirmative vote of a majority of the shares of Common Stock
present in person or represented by a Proxy and entitled to vote at the
meeting. Abstentions with respect to such proposals will have the same effect
as a vote against the proposals. With respect to broker non-votes, the shares
will not be considered present at the meeting for the proposal to which
authority was withheld. Consequently, broker non-votes will not be counted with
regard to such proposals, but they will have the effect of reducing the number
of affirmative votes required to approve the proposals, because they reduce the
number of shares present or represented from which a majority is calculated.
PROXIES
When the enclosed Proxy is properly signed and returned, the shares
that it represents will be voted at the Annual Meeting in accordance with the
instructions noted thereon. In the absence of such instructions, the shares
represented by a signed Proxy will be voted in favor of the nominees for
election to the Board of Directors and in favor of the amendment to the
Company's Stock Incentive Plan.
2
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth the amount and percent of shares of
Common Stock that, as of April 1, 2002, are deemed under the rules of the
Securities and Exchange Commission (the "Commission") to be "beneficially
owned" by each member of the Board of Directors of the Company, by each nominee
to become a member of the Board of Directors, by each Named Executive Officer
of the Company, by all Directors and Executive Officers of the Company as a
group, and by any person or "group" (as that term is used in the Securities Act
of 1934, as amended) known to the Company as of that date to be a "beneficial
owner" of more than 5% of the outstanding shares of Common Stock.
COMMON STOCK
BENEFICIALLY OWNED (2)
-----------------------------
NUMBER OF PERCENTAGE
SHARES OF OF
NAME OF BENEFICIAL OWNER (1) COMMON STOCK CLASS
---------------------------- ------------- ----------
Richard M. Haddrill (3)................................................... 295,743 1.0%
Deepak Raghavan (4)....................................................... 1,407,693 4.9
Thomas W. Williams, Jr. (5)............................................... 18,334 *
Jeffry W. Baum (6)........................................................ 215,833 *
Jeffrey S. Mitchell (7)................................................... 10,000 *
Neil Thall (8)............................................................ 5,000 *
Brian J. Cassidy (9)...................................................... 177,000 *
Alan J. Dabbiere (10)..................................................... 7,111,675 24.9
John R. Hardesty (11)..................................................... 45,000 *
John J. Huntz, Jr. (12)................................................... 33,000 *
Thomas E. Noonan (13)..................................................... 20,000 *
Ponnambalam Muthiah (14).................................................. 1,707,196 6.0
Deepak M.J. Rao (15)...................................................... 1,594,211 5.6
Brown Capital Management, Inc. (16)....................................... 2,040,200 7.2
All executive officers and directors as a group (11 persons) (17)......... 9,339,278 32.0
---------
* Less than 1% of the outstanding Common Stock.
(1) Except as set forth herein, the street address of the named beneficial
owner is c/o Manhattan Associates, Inc., 2300 Windy Ridge Parkway,
Suite 700, Atlanta, Georgia 30339.
(2) For purposes of calculating the percentage beneficially owned, the
number of shares of Common Stock deemed outstanding include (i)
28,508,482 shares outstanding as of April 1, 2002 and (ii) shares
issuable by the Company pursuant to options held by the respective
person or group that may be exercised within 60 days following April
1, 2002 ("Presently Exercisable Options"). Presently Exercisable
Options are considered to be outstanding and to be beneficially owned
by the person or group holding such options for the purpose of
computing the percentage ownership of such person or group but are not
treated as outstanding for the purpose of computing the percentage
ownership of any other person or group.
(3) Includes 217,174 shares issuable pursuant to Presently Exercisable
Options.
(4) Includes 1,259,093 shares held by a limited partnership controlled by
Mr. Raghavan, the 99% limited partnership interest of which is owned
by a trust for the benefit of his descendants, 6,000 shares held by
Mr. Raghavan for the benefit of his minor child, 413 shares held by
Mr. Raghavan's wife, and 42,126 shares held by a trust controlled by
Mr. Raghavan's wife. Mr. Raghavan disclaims beneficial ownership of
the shares held by the limited partnership that are allocable to the
interest held by the trust, the shares held for the benefit of his
child, the shares held by his wife, and the shares held by the trust
controlled by his wife.
(5) Includes 18,334 shares issuable pursuant to Presently Exercisable
Options.
(6) Includes 215,833 shares issuable pursuant to Presently Exercisable
Options.
(7) Includes 10,000 shares issuable pursuant to Presently Exercisable
Options.
(8) Includes 5,000 shares issuable pursuant to Presently Exercisable
Options.
(9) Includes 150,000 shares issuable pursuant to Presently Exercisable
Options.
(10) Consists of 7,111,675 shares held by Pegasys Systems Incorporated, a
corporation controlled by Mr. Dabbiere, 80% of the equity interest of
which is held by a trust for the benefit of Mr. Dabbiere's siblings,
certain extended relatives and any future descendants. Mr. Dabbiere
disclaims beneficial ownership of the shares held by Pegasys that are
allocable to the interest held by the trust.
(11) Includes 30,000 shares issuable pursuant to Presently Exercisable
Options.
(12) Includes 30,000 shares issuable pursuant to Presently Exercisable
Options.
(13) Includes 20,000 shares issuable pursuant to Presently Exercisable
Options.
(14) Based on an Amendment to Schedule 13G filed with the Securities and
Exchange Commission on February 14, 2002. Includes 1,298,952 shares
held by a limited partnership controlled by Ponnambalam Muthiah, the
99% limited partnership interest of which is held by a trust for the
benefit of his descendants, and 12,750 shares held by him for the
benefit of his minor children. Mr. Muthiah disclaims beneficial
ownership of the shares held by the limited partnership that are
allocable to the interest held by the trust and the shares held for
the benefit of his children. Mr. Muthiah's address is c/o Manhattan
Associates, Inc., 2300 Windy Ridge Parkway, Suite 700, Atlanta,
Georgia 30339.
(15) Based on an Amendment to Schedule 13G filed with the Securities and
Exchange Commission on February 14, 2002. Includes 1,318,461 shares
held by a limited partnership controlled by Mr. Rao, the 99% limited
partnership interest of which is held by a trust for the benefit of
his descendants. Mr. Rao disclaims beneficial ownership of the shares
held by the limited partnership that are allocable to the interest
held by the trust. Mr. Rao's address is c/o Manhattan Associates,
Inc., 2300 Windy Ridge Parkway, Suite 700, Atlanta, Georgia 30339.
(16) Based on an Amendment to Schedule 13G filed with the Securities and
Exchange Commission on February 5, 2002. Includes 2,040,200 shares
owned by various investment advisory clients of Brown Capital
Management, Inc., which is deemed to be a beneficial owner of those
shares pursuant to Rule 13d-3 under the Securities Exchange Act of
1934, due to its discretionary power to make investment decisions over
such shares for its clients and its ability to vote such shares. In
all cases, persons other than Brown Capital Management, Inc. have the
right to receive, or the power to direct the receipt of, dividends
from, or the proceeds from the sale of the shares. The address of
Brown Capital Management, Inc. is 1201 N. Calvert Street, Baltimore,
Maryland 21202.
(17) Includes 7,111,675 shares held by a corporation controlled by Mr.
Dabbiere; 100,061 shares held by Mr. Raghavan; 1,259,093 shares held
by a limited partnership controlled by Mr. Raghavan; 6,000 shares held
by Mr. Raghavan's child, who is a minor; 413 shares held by Mr.
Raghavan's wife; 42,126 shares held by a trust controlled by Mr.
Raghavan's wife; 78,569 shares held by Mr. Haddrill; 27,000 shares
held by Mr. Cassidy; 15,000 shares held by Mr. Hardesty; 3,000 shares
held by Mr. Huntz; and 696,341 shares issuable pursuant to Presently
Exercisable Options.
3
PROPOSAL 1
ELECTION OF DIRECTORS
INTRODUCTION
At the Annual Meeting, two directors are to be elected for the terms
described below. The Board of Directors is divided into three classes, each of
whose members serve for staggered three-year terms. The Board is currently
comprised of two Class I directors (Messrs. Cassidy and Dabbiere), two Class II
directors (Messrs. Haddrill and Raghavan) and three Class III directors (Messrs.
Hardesty, Huntz and Noonan). At each annual meeting of shareholders, a class of
directors will be elected for a three-year term to succeed the directors of the
same class whose terms are then expiring. The terms of the Class I directors,
Class II directors and Class III directors will expire upon the election and
qualification of successor directors at the 2002, 2003 and 2004 annual meeting
of shareholders, respectively. There are no family relationships among any of
the directors or director nominees of the Company.
The Board of Directors has adopted a policy statement that provides as
follows: "[i]t is the policy of Manhattan Associates, Inc., in order to ensure
full representation of the Company's shareholders on the Board of Directors and
to enhance the Company's access to talented managerial advisors, that no
nonemployee director of the Company shall serve as a director for more than
eight consecutive years and that each nonemployee director when first elected
to the Board of Directors (including after a period of non-service) shall serve
for only a one year term unless renominated by the Board of Directors at that
time, in which case he or she shall be included in the Company's staggered
board in a manner determined by the Board of Directors."
Shares represented by executed Proxies will be voted, if authority to
do so is not withheld, for the election of the two nominees named below. In the
event that any nominee should be unavailable for election as a result of an
unexpected occurrence, such shares will be voted for the election of such
substitute nominee as the Board of Directors may select. Each person nominated
for election has agreed to serve if elected, and management has no reason to
believe that any nominee will be unable to serve.
The Board of Directors recommends a vote FOR each named nominee.
NOMINEES
The name and age, principal occupation or employment, and other data
regarding each nominee to serve as a Class I Director, based on information
received from the respective nominees, are set forth below:
ALAN J. DABBIERE, age 40, a founder of Manhattan, has served as
Chairman of the Board since February 1998 and served as Chief Executive Officer
and President of Manhattan from October 1990 until October 1999. From 1986
until 1990, Mr. Dabbiere was employed by Kurt Salmon Associates, a management
consulting firm specializing in consumer products manufacturing and retailing,
where he specialized in consulting for the retail and consumer products
manufacturing industries. At Kurt Salmon Associates, Mr. Dabbiere participated
in Quick Response pilot projects focused on the value of an integrated
supply-chain initiative. Mr. Dabbiere serves on the American Apparel
Manufacturer Association's Management Systems Committee.
BRIAN J. CASSIDY, age 56, has served as a Director of Manhattan since
May 1998. Mr. Cassidy has served as the Vice-Chairman and Co-Founder of
Webforia Inc., formerly LiveContent Inc., a developer and supplier of computer
software applications, since April 1996. Prior to joining Webforia, Mr. Cassidy
served as Vice President of Business Development of Saros Corporation, a
developer of document management software, from January 1993 to March 1996.
Prior to joining Saros Corporation, Mr. Cassidy was employed by Oracle
Corporation, as Joint Management Director of European Operations and a member
of the Executive Management Board from 1983 to 1988 and as Worldwide Vice
President of Business Development from 1988 to 1990.
4
CURRENT DIRECTORS
The Directors of the Company continuing in office as Class II
Directors, elected to serve until the 2003 Annual Meeting, are as follows:
RICHARD M. HADDRILL, age 48, has served as a Director of Manhattan
since October 1999 and has served as President and Chief Executive Officer of
Manhattan since October 1999. Prior to joining Manhattan, Mr. Haddrill served
as President, CEO and a board member for Powerhouse Technologies, a technology,
services and gaming company. He served Powerhouse as its Executive Vice
President from December 1994 through September 1996 and served as President and
Chief Executive Officer from September 1996 through June 1999. From 1992 until
1994, Mr. Haddrill was President of the international subsidiaries of
KnowledgeWare, a computer software company. During his employment at Ernst &
Young, from 1975 until 1991, Mr. Haddrill held various positions within the
company, including Managing Partner and Partner. Mr. Haddrill also serves on
the Board of Directors of Danka, a publicly-traded office products company.
DEEPAK RAGHAVAN, age 35, a founder of Manhattan, has served as a
Director of Manhattan since August 1998. Mr. Raghavan has served as Manhattan's
Senior Vice President--Product Strategy since January 2001 and has served as a
Senior Vice President of Manhattan since August 1998. Mr. Raghavan served as
Manhattan's Chief Technology Officer from its inception in 1990 until 2001.
From 1987 until 1990, Mr. Raghavan was a Senior Software Engineer for Infosys
Technologies Limited, a software development company, where he specialized in
the design and implementation of information systems for the apparel
manufacturing industry.
The Directors of the Company continuing in office as Class III
Directors, elected to serve until the 2004 Annual Meeting, are as follows:
JOHN R. HARDESTY, age 62, has served as a Director of Manhattan since
July 2000. Mr. Hardesty has been self-employed as an investor since March 1995.
Since 1995, Mr. Hardesty has served as owner and Chairman of the Board of
Directors of Thermo Dynamics, Inc., a quartz manufacturing company. From 1988
until 1995, Mr. Hardesty was the owner and Chairman of the Board of Dixson,
Inc., a manufacturer of electronic instruments for the heavy-duty truck market
and process control market.
JOHN J. HUNTZ, JR., age 51, has served as a Director of Manhattan
since January 1999. Mr. Huntz has served as Managing Director of Fuqua
Ventures, LLC, a private equity investment firm since March 1998. Mr. Huntz
served as Executive Vice President and Chief Operating Officer of Fuqua
Enterprises, Inc., a company that manufactures health-care products, from
August 1995 to March 1998 and as its Senior Vice President from March 1994
until August 1995. From September 1989 to January 1994, Mr. Huntz served as the
Managing Partner of Noble Ventures International, Inc., a private international
investment company. From 1984 to 1989, Mr. Huntz held the position of Director
of Capital Resources for Arthur Young & Company, and from 1979 to 1984, Mr.
Huntz was with Harrison Capital, Inc., a venture capital investment subsidiary
of Texaco, Inc. Mr. Huntz founded and serves as President of the Atlanta
Venture Forum, a risk capital network, and is a member of the National
Association of Small Business Investment Companies. Mr. Huntz serves as a
director and Chairman of the Compensation Committee of GMP Companies, a
developer of medical technologies.
THOMAS E. NOONAN, age 41, has served as a Director of Manhattan since
January 1999. Mr. Noonan has served as the President and as a Director of
Internet Security Systems, Inc., a provider of network security monitoring,
detection and response software, since June 1995, and as its Chief Executive
Officer and Chairman of the Board of Directors since November 1996. Prior to
joining Internet Security Systems, Mr. Noonan served as Vice President, Sales
and Marketing with TSI International, Inc., an electronic commerce company,
from September 1994 until August 1995. From November 1989 until October 1994,
Mr. Noonan held high-level sales and marketing positions at Dun & Bradstreet
Software, a developer of enterprise business software.
5
BOARD OF DIRECTORS MEETINGS, COMMITTEES AND COMPENSATION
During 2001, the Board of Directors held four meetings. All of the
incumbent directors attended at least 75% of the aggregate total number of
meetings of the Board of Directors and meetings of committees of the Board of
Directors on which they served.
Messrs. Dabbiere and Raghavan served as members of the Executive
Committee in 2001. The Executive Committee is empowered to exercise all
authority of the Board of Directors, except as limited by the Georgia Business
Corporation Code ("GBCC"). Under the GBCC, an Executive Committee may not,
among other things, approve or propose to shareholders actions required to be
approved by shareholders, fill vacancies on the Board of Directors or any of
its committees, amend or repeal the bylaws, or approve a plan of merger not
requiring shareholder approval. Messrs. Hardesty, Huntz and Noonan served as
members of the Compensation Committee throughout 2001. The Compensation
Committee is responsible for reviewing and recommending salaries, bonuses and
other compensation for our officers. The Compensation Committee is also
responsible for administering Manhattan's stock option plans and for
establishing the terms and conditions of all stock options granted under these
plans. Messrs. Hardesty, Huntz and Noonan served as members of the Audit
Committee throughout 2001. The Audit Committee is responsible for recommending
independent auditors, reviewing with the independent auditors the scope and
results of the audit engagement, monitoring our financial policies and internal
control procedures, and reviewing and monitoring the provisions of non-audit
services by our auditors.
Non-employee members of the Board of Directors received $1,000 for
each board meeting attended in 2001 and $500 for each committee meeting held
independently of a board meeting. The Company may also grant stock options to
the non-employee members of the Board of Directors. In 2001, the Company
granted stock options to purchase 15,000 shares of Common Stock to each
non-employee director.
6
EXECUTIVE COMPENSATION
Summary Compensation Table. The following table sets forth, for the
three years ended December 31, 2001, the total compensation paid to or accrued
for the Chief Executive Officer and other Executive Officers as defined under
the rules of the Securities and Exchange Commission with the next highest total
annual salary and bonus that exceeded $100,000 (collectively, the "Named
Executive Officers").
LONG TERM
ANNUAL COMPENSATION COMPENSATION
---------------------------------------- ------------
NUMBER OF
OTHER SECURITIES ALL
ANNUAL UNDERLYING OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS(1) COMPENSATION(2) OPTIONS COMPENSATION
--------------------------- ------ -------- --------- --------------- ------------ ------------
Richard M. Haddrill (3)........... 2001 $300,000 $473,000 -- 500,000 --
President, Chief Executive 2000 300,000 520,920 $ 52,672(4) -- --
Officer And Director 1999 44,000 52,060 100,000(4) 1,300,000 $300,000(5)
Jeffry W. Baum.................... 2001 150,000 137,655 -- 35,000 --
Senior Vice President 2000 150,000 206,047 -- 10,000 --
-- International Operations 1999 125,000 265,220 -- 80,000 --
Jeffrey S. Mitchell............... 2001 175,000 118,554 -- 36,000 --
Senior Vice President--North 2000 150,000 249,714 -- 20,000 --
American Sales 1999 150,000 128,750 -- 175,000 --
Neil Thall........................ 2001 250,000 105,042 -- 20,000 --
Executive Vice President, 2000 250,000 162,221 -- 20,000 --
Global Operations 1999 229,167 -- -- 140,000 --
Thomas W. Williams, Jr. (6)....... 2001 160,000 68,000 -- 35,000 --
Senior Vice President, Chief 2000 146,667 85,381 50,273(4) 60,000 --
Financial Officer and 1999 -- -- -- -- --
Treasurer
---------
(1) Bonuses represent amounts earned in the applicable year, regardless of
whether such bonuses were paid prior to the end of such year.
(2) In accordance with the rules of the Securities and Exchange
Commission, other compensation received in the form of perquisites and
other personal benefits has been omitted because such perquisites and
other personal benefits constituted less than the lesser of $50,000 or
10% of the total annual salary and bonus for the Named Executive
Officer for such year.
(3) Mr. Haddrill joined the Company in October 1999.
(4) Represents relocation expenses paid in 2000.
(5) Represents compensation expense relating to 85,000 shares of Common
Stock issued to Mr. Haddrill in 1999.
(6) Mr. Williams joined the Company in February 2000.
7
OPTION GRANTS IN LAST FISCAL YEAR
The following table sets forth all individual grants of stock options
during the year ended December 31, 2001 to each of the Named Executive
Officers:
INDIVIDUAL GRANTS
------------------------------------------------------
NUMBER OF PERCENT OF POTENTIAL REALIZABLE
SECURITIES TOTAL OPTIONS VALUE AT ASSUMED
UNDERLYING GRANTED TO EXERCISE OR ANNUAL RATES OF STOCK
OPTIONS EMPLOYEES IN BASE PRICE EXPIRATION PRICE APPRECIATION
NAME GRANTED FISCAL YEAR PER SHARE DATE FOR OPTION TERM(1)
---------- ------------- ----------- ---------- ---------------------------
5% 10%
---------- -----------
Richard M. Haddrill........ 500,000 30.1% $26.05 7/19/11 $8,191,353 $20,758,496
Jeffry W. Baum............. 15,000 0.9 28.83 7/12/11 271,965 689,214
5,000 0.3 12.90 9/24/11 40,564 102,796
15,000 0.9 27.41 12/17/11 258,570 655,267
Jeffrey S. Mitchell........ 10,000 0.6 28.83 7/12/11 181,310 459,476
5,000 0.3 12.90 9/24/11 40,564 102,796
21,000 1.3 27.41 12/17/11 361,998 917,374
Neil Thall ................ 10,000 0.6 12.90 9/24/11 81,127 205,593
10,000 0.6 27.41 12/17/11 172,380 436,845
Thomas W. Williams, Jr..... 10,000 0.6 36.00 2/5/11 226,402 573,747
5,000 0.3 28.83 7/12/11 90,655 229,738
5,000 0.3 12.90 9/24/11 40,564 102,796
15,000 0.9 27.41 12/17/11 258,570 655,267
----------
(1) Amounts represent hypothetical gains that could be achieved for the
respective options if exercised at the end of the option term. These gains
are based on the fair market value per share on the date of grant and
assumed rates of stock price appreciation of 5% and 10% compounded
annually from the date the respective options were granted to their
expiration date. These assumptions are mandated by the rules of the
Securities and Exchange Commission and are not intended to forecast future
appreciation of our stock price. The potential realizable value
computation is net of the applicable exercise price, but does not take
into account federal or state income tax consequences and other expenses
of option exercises or sales of appreciated stock. Actual gains, if any,
are dependent upon the timing of such exercise and the future performance
of our Common Stock. There can be no assurance that the rates of
appreciation in this table can be achieved. This table does not take into
account any appreciation in the price of our Common Stock to date.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND YEAR-END OPTION VALUES
The following table summarizes the number of shares and value realized
by each of the Named Executive Officers upon the exercise of options and the
value of the outstanding options held by the Named Executive Officers at
December 31, 2001:
NUMBER OF VALUE OF
SHARES SECURITIES UNDERLYING UNEXERCISED
ACQUIRED VALUE UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS
NAME ON EXERCISE REALIZED(1) AT FISCAL YEAR-END AT FISCAL YEAR-END(2)
---- ----------- ----------- --------------------------- ------------------------------
EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
----------- ------------- ----------- -------------
Richard M. Haddrill....... 528,318 $12,968,379 171,168 902,180 $4,385,110 $11,853,349
Jeffry W. Baum............ -- -- 195,833 89,167 4,360,450 1,209,888
Jeffrey S. Mitchell....... 70,000 1,571,849 45,000 121,000 856,000 1,435,240
Neil Thall................ 70,000 1,940,280 35,000 85,000 643,875 1,291,775
Thomas W. Williams, Jr.... 12,500 365,781 2,500 80,000 -- 904,184
----------
(1) Amounts disclosed in this column do not reflect amounts actually received
by the Named Executive Officers but are calculated based on the difference
between the fair market value on the date of exercise of the options and
the exercise price of the options. The Named Executive Officers will
receive cash only if and when they sell the Common Stock issued upon
exercise of the options, and the net amount of cash received by such
individuals is dependent on the price of our Common Stock at the time of
such sale, as well as federal and state income taxes and other expenses of
option exercises and sales of stock.
(2) Based on the fair market value of our Common Stock as of December 31, 2001
of $29.15 per share as reported on the Nasdaq National Market, less the
exercise price payable upon exercise of such options.
8
EMPLOYMENT AGREEMENTS
Mr. Haddrill entered into an employment agreement with Manhattan
effective October 11, 1999 and amended on July 19, 2001. Pursuant to this
agreement, as amended, Mr. Haddrill is entitled to receive an annual base salary
of $300,000, with increases of up to 6% per year, and a performance-related
bonus equal to 2% of our pre-tax operating income. In addition, upon the
effective date of his original employment agreement in October 1999, Mr.
Haddrill received 85,000 shares of our Common Stock and an option to purchase
1,300,000 shares of our Common Stock, which vests in equal quarterly
installments over three years commencing in October 1999. Upon the effective
date of the amendment to his employment agreement in July 2001, Mr. Haddrill
became entitled to receive an option to purchase 500,000 shares of our Common
Stock, which vests in eight equal installments on the last day of the eight
financial quarters of 2003 and 2004. All of the shares granted pursuant to these
options will become immediately exercisable upon a change in control as defined
in the agreement. Under the agreement, Mr. Haddrill has agreed to assign to us
all patents, copyrights and other intellectual property developed by him during
the course of his employment. In addition, Mr. Haddrill has agreed not to
solicit our customers for a period of one year following his termination. In
connection with any termination of Mr. Haddrill's employment, other than a
termination based on gross negligence or willful misconduct, or a termination
based on a change in control, as defined in the agreement, through December 31,
2002, Mr. Haddrill will be entitled to receive a severance payment within 10
days of termination equal to two times his base salary and bonus (limited for
these purposes to an amount not to exceed his base salary). In connection with
any termination of Mr. Haddrill's employment based on a change of control
through December 31, 2002, other than a termination based on cause or voluntary
termination, Mr. Haddrill will be entitled to receive a severance payment equal
to his base salary. In addition, Mr. Haddrill is eligible to receive up to $1.2
million as reimbursement for certain taxes, if incurred, upon a change in
control as defined in the agreement.
Mr. Thall entered into an employment agreement with Manhattan effective
November 25, 1997. For 2002, Mr. Thall is entitled to receive an annual base
salary of $250,000 and is entitled to a performance-related bonus of up to
$180,000. In addition, Mr. Thall is entitled to receive a monthly stipend of up
to $3,000 for each month during which he is responsible for the global services
organization of the Company. Under the terms of the agreement, Mr. Thall has
agreed to assign to us all patents, copyrights and other intellectual property
developed by him during the course of his employment. In addition, Mr. Thall has
agreed not to solicit our customers for a period of one year following his
termination.
STOCK OPTION PLANS
Manhattan Associates, LLC Option Plan. The Manhattan Associates, LLC
Option Plan (the "LLC Option Plan") became effective on January 1, 1997. The
aggregate number of shares reserved for issuance under the LLC Option Plan was
5,000,000 shares. The purpose of the LLC Option Plan was to provide incentives
for key employees, officers, consultants and directors to promote the success
of Manhattan and to enhance our ability to attract and retain the services of
such persons. Options granted under the LLC Option Plan were not options
intended to qualify as "incentive stock options" under Section 422 of the
Internal Revenue Code of 1986, as amended (the "Code"). Since February 28,
1998, no additional options could be granted pursuant to the LLC Option Plan.
As of April 1, 2002, we had outstanding options to purchase 838,135
shares of Common Stock under the LLC Option Plan at a weighted average exercise
price of $5.56 per share.
Stock Incentive Plan. The Manhattan Associates, Inc. Stock Incentive
Plan was adopted by the Board of Directors and approved by our shareholders in
February 1998. As amended to date, up to 12,017,358 shares of Common Stock
(subject to adjustment in the event of stock splits and other similar events),
less the number of shares issued under the LLC Option Plan, may be issued
pursuant to stock options and other stock incentives granted under the Stock
Incentive Plan. The number of shares available for issuance under the Stock
Incentive Plan is automatically adjusted, without shareholder approval, on the
first day of each fiscal year, by a number of shares such that the total number
of shares reserved for issuance under the Stock Incentive Plan equals the sum of
(i) the aggregate number of shares previously issued under the Stock Incentive
Plan and the LLC Option Plan; (ii) the aggregate number of shares subject to
then outstanding stock incentives granted under the Stock Incentive Plan and the
LLC Option Plan; and (iii) 5% of the number of shares of the Company's common
stock outstanding on the last day of the preceding fiscal year. However, no more
than 1,000,000 of the shares available for grant each year shall be available
for issuance pursuant to incentive stock options, and no more than 10,000,000
shares resulting from such automatic adjustments may ever be issued during the
term of the Stock Incentive Plan. On January 1, 2002, the number of shares of
Common Stock available for issuance under the Plan automatically increased
357,905 shares to 11,017,358 shares pursuant to this provision. As of April 1,
2002, we had outstanding options or other stock incentives to acquire 4,917,145
shares of Common Stock under the Stock Incentive Plan at a weighted average
exercise price of $21.77 per share.
9
The Stock Incentive Plan provides for the grant of incentive stock
options intended to qualify under Section 422 of the Code, nonstatutory stock
options, restricted stock awards and stock appreciation rights ("SARs", and,
together with the other options and incentives, "Awards"). Officers, employees,
directors, advisors and consultants of Manhattan and any of our subsidiaries
are eligible to be granted Awards under the Stock Incentive Plan. Under present
law, however, incentive stock options may be granted only to employees. The
granting of Awards under the Stock Incentive Plan is discretionary. We will be
required to recognize compensation expense over the vesting period of any SARs
granted.
Optionees receive the right to purchase a specified number of shares
of Common Stock at a specified option price and subject to such other terms and
conditions as are specified in connection with the option grant. Options may be
granted at an exercise price that may be less than, equal to or greater than
the fair market value of the Common Stock on the date of grant. Under present
law, incentive stock options may not be granted at an exercise price less than
the fair market value of the Common Stock on the date of grant (or less than
110% of the fair market value in the case of incentive stock options granted to
optionees holding more than 10% of our voting power). The Stock Incentive Plan
permits the payment of the exercise price of options to be in the form of cash,
or if the individual option agreement so provides, by surrender to us of shares
of Common Stock or by a cashless exercise through a brokerage transaction.
The Stock Incentive Plan is administered by the Compensation Committee
of the Board of Directors. The committee has the authority to adopt, amend and
repeal the administrative rules, guidelines and practices relating to the Stock
Incentive Plan generally and to interpret the provisions thereof. The Committee
may amend, modify or terminate any outstanding Award and with respect to new
Awards will determine:
- the number of shares of Common Stock covered by options,
restricted stock awards or SARs, the dates upon which such
options or SARs become exercisable and the restrictions on
restricted stock lapse;
- the exercise price of options and SARs and the purchase price,
if any, of restricted stock;
- the duration of options and SARs; and
- the conditions and duration of restrictions on restricted
stock.
No Award may be made under the Stock Incentive Plan after February
2008, but Awards previously granted may extend beyond that time. The Board of
Directors may at any time terminate the Stock Incentive Plan. Any such
termination will not affect outstanding options, restricted stock or SARs.
Other Options. In addition to options issued under the LLC Option Plan
and the Stock Incentive Plan, as of April 1, 2002, we had outstanding options
to purchase an aggregate of 128,458 shares of Common Stock to employees outside
of the LLC Option Plan and the Stock Incentive Plan at a weighted average
exercise price of $0.55 per share.
LIMITATION OF LIABILITY AND INDEMNIFICATION OF OFFICERS AND DIRECTORS
Our Articles of Incorporation provide that the liability of the
directors to the shareholders for monetary damages shall be limited to the
fullest extent permissible under Georgia law. This limitation of liability does
not affect the availability of injunctive relief or other equitable remedies.
Our Bylaws provide that we will indemnify each of our officers,
directors, employees and agents to the extent that he or she is or was a party,
or is threatened to be made a party, to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative because he or she is or was a director, officer, employee or
agent of Manhattan, against reasonable expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement in connection with such action,
suit or proceeding; provided, however, that no indemnification shall be made
for:
10
- any appropriation, in violation of his or her duties, of any
business opportunity of Manhattan;
- acts or omissions that involve intentional misconduct or a
knowing violation of law;
- any liability under Section 14-2-832 of the GBCC, which
relates to unlawful payments of dividends and unlawful stock
repurchases and redemptions; or
- any transaction from which he or she derived an improper
personal benefit.
We have entered into indemnification agreements with certain officers and
directors providing indemnification similar to that provided in the Bylaws.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The following non-employee directors were the members of the
Compensation Committee of the Board of Directors during 2001: John R. Hardesty,
John J. Huntz, Jr. and Thomas E. Noonan. To our knowledge, there were no
interlocking relationships involving members of the Compensation Committee or
other of our directors requiring disclosure in this Proxy Statement.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires our
directors and executive officers and persons who own beneficially more than 10%
of our Common Stock to file reports of ownership and changes in ownership of
such stock with the Securities and Exchange Commission. To our knowledge, our
directors, executive officers and 10% shareholders complied during 2001 with
all applicable Section 16(a) filing requirements.
11
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
GENERAL
The Compensation Committee of the Company's Board of Directors has
furnished the following report on Executive Compensation in accordance with the
rules and regulations of the Securities and Exchange Commission. This report
outlines the duties of the Committee with respect to executive compensation,
the various components of the Company's compensation program for executive
officers and other key employees, and the basis on which the 2001 compensation
was determined for the executive officers of the Company, with particular
detail given to the 2001 compensation for the Company's Chairman of the Board
and Chief Executive Officer.
COMPENSATION OF EXECUTIVE OFFICERS GENERALLY
The Compensation Committee of the Board of Directors (the "Committee")
is responsible for establishing compensation levels for the executive officers
of the Company, including the annual bonus plan for executive officers and for
administering the Company's Stock Incentive Plan. The Committee is currently
comprised of three non-employee directors: Messrs. Noonan (Chairman), Hardesty
and Huntz. The Committee's overall objective is to establish a compensation
policy that will (i) attract, retain and reward executives who contribute to
achieving the Company's business objectives; (ii) motivate executives to obtain
these objectives; and (iii) align the interests of executives with those of the
Company's long-term investors. The Company compensates executive officers with
a combination of salary and incentives designed to focus their efforts on
maximizing both the near-term and long-term financial performance of the
Company. In addition, the Company's compensation program rewards individual
performance that furthers Company goals. The executive compensation program
includes the following: (i) base salary; (ii) incentive bonuses; (iii)
long-term equity incentive awards in the form of stock option grants; and (iv)
other benefits. Each executive officer's compensation package is designed to
provide an appropriately weighted mix of these elements, which cumulatively
provide a level of compensation roughly equivalent to that paid by companies of
similar size and complexity.
Base Salary. Base Salary levels for each of the Company's executive
officers, including the Chief Executive Officer, are generally set within a
range of base salaries that the Committee believes are paid to similar
executive officers at companies deemed comparable based on the similarity in
revenue level, industry segment and competitive employment market to the
Company. In addition, the Committee generally takes into account the Company's
past financial performance and future expectations, as well as the performance
of the executives and changes in the executives' responsibilities.
Incentive Bonuses. The Committee recommends the payment of bonuses to
provide an incentive to executive officers to be productive over the course of
each fiscal year. These bonuses are awarded only if the Company achieves or
exceeds certain corporate performance objectives. The incentive bonus to each
executive officer is based on the individual executive's performance as it
relates to the Company's performance.
Equity Incentives. Stock options are used by the Company for payment
of long-term compensation to provide a stock-based incentive to improve the
Company's financial performance and to assist in the recruitment, retention and
motivation of professional, managerial and other personnel. Generally, stock
options are granted to executive officers from time to time based primarily
upon the individual's actual and/or potential contributions to the Company and
the Company's financial performance. Stock options are designed to align the
interests of the Company's executive officers with those of its shareholders by
encouraging executive officers to enhance the value of the Company, the price
of the Common Stock, and hence, the shareholder's return. In addition, the
vesting of stock options over a period of time is designed to create an
incentive for the individual to remain with the Company. The Company has
granted options to the executives on an ongoing basis to provide continuing
incentives to the executives to meet future performance goals and to remain
with the Company. During the fiscal year ended December 31, 2001, options to
purchase an aggregate of 626,000 shares of Common Stock were granted to the
Company's executive officers.
12
Other Benefits. Benefits offered to the Company's executive officers
are provided to serve as a safety net of protection against the financial
catastrophes that can result from illness, disability, or death. Benefits
offered to the Company's executive officers are substantially the same as those
offered to all of the Company's regular employees. In 1995, the Company
established a tax-qualified deferred compensation 401(k) Savings Plan (the
"Plan") covering all of the Company's eligible full-time employees. Under the
Plan, participants may elect to contribute, through salary reductions, up to
18% of their annual compensation subject to a statutory maximum. The Company
provides additional matching contributions in the amount of 50% up to the first
6% contributed under the Plan. The Plan is designed to qualify under Section
401 of the Internal Revenue Code so that the contributions by employees or by
the Company to the Plan, and income earned on plan contributions, are not
taxable to employees until withdrawn from the Plan, and so that contributions
by the Company will be deductible by the Company when made.
COMPENSATION OF THE CHAIRMAN OF THE BOARD OF DIRECTORS
The Committee annually reviews the performance and compensation of the
Chairman of the Board of Directors based on the assessment of his past
performance and its expectation of his future contributions to the Company's
performance. Alan J. Dabbiere has served as the Company's Chairman of the Board
since February 1998. In 2001, Mr. Dabbiere's base salary as Chairman of the
Board was set at $150,000. The Committee believes the compensation paid to Mr.
Dabbiere was reasonable.
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
The Committee annually reviews the performance and compensation of the
Chief Executive Officer based on the assessment of his past performance and its
expectation of his future contributions to the Company's performance. Richard
M. Haddrill has served as the Company's Chief Executive Officer since October
1999. For the twelve-month period commencing on January 1, 2001, Mr. Haddrill's
base salary was set at $300,000. The Committee believes the compensation paid
to Mr. Haddrill was reasonable.
POLICY WITH RESPECT TO QUALIFYING COMPENSATION FOR DEDUCTIBILITY
Section 162(m) of the Internal Revenue Code imposes a limit on tax
deductions for annual compensation (other than performance-based compensation)
in excess of one million dollars paid by a corporation to its Chief Executive
Officer and the other four most highly compensated executive officers of a
corporation. The Company has not established a policy with regard to Section
162(m) of the Code, since the Company has not and does not currently anticipate
paying cash compensation in excess of one million dollars per annum to any
employee. None of the compensation paid by the Company in 2001 was subject to
the limitations on deductibility. The Board of Directors will continue to
assess the impact of Section 162(m) on its compensation practices and determine
what further action, if any, is appropriate.
Compensation Committee
Thomas E. Noonan, Chairman
John R. Hardesty
John J. Huntz, Jr.
13
STOCK PERFORMANCE GRAPH
The following line-graph provides a comparison of the cumulative total
shareholder return on our Common Stock for the period from the date of the
Company's initial public offering on April 23, 1998 through December 31, 2001,
against the cumulative shareholder return during such period achieved by The
Nasdaq Stock Market (U.S. Companies) ("Nasdaq US") and the Index for Nasdaq
Listed Supply Chain Solution Provider Stocks (the "Nasdaq Computer Index"). The
graph assumes that $100 was invested on April 23, 1998 in our Common Stock and
in each of the comparison indices, and assumes reinvestment of dividends.
[GRAPH APPEARS HERE]
Measurement Period Manhattan Nasdaq Computer
(Fiscal Year Covered) Associates Nasdaq US Index
--------------------- ---------- --------- ---------------
4/23/98 $100.00 $100.00 $100.00
12/31/98 181.67 120.14 51.41
12/31/99 49.17 223.27 103.10
12/31/00 284.17 134.33 117.21
12/31/01 194.34 106.55 58.65
The Stock Performance Graph shall not be deemed incorporated by
reference by any general statement incorporating by reference this proxy
statement into any filing under the Securities Act of 1933, as amended, or the
Securities Exchange Act of 1934, as amended (collectively, the "Acts"), except
to the extent that the Company specifically incorporates this information by
reference, and shall not otherwise be deemed filed under such Acts.
RELATED PARTY TRANSACTIONS
During 2001, Peter V. Dabbiere, a brother of Alan J. Dabbiere, was
employed by us as the general manager of hardware sales and support and
received an aggregate payment of $142,000.
During 2001, David K. Dabbiere, a brother of Alan J. Dabbiere, was
employed by us as Senior Vice President, Chief Legal Officer and Secretary and
received an aggregate payment of $220,000. In addition, we granted options to
purchase 6,000 shares of Common Stock at $27.41 per share to Mr. Dabbiere
during 2001.
All cash compensation paid to Alan Dabbiere's brothers was comparable
to compensation that would have been paid to unaffiliated persons.
14
AUDIT COMMITTEE REPORT
This Audit Committee Report does not constitute soliciting material
and should not be deemed filed or incorporated by reference into any other
Company filing under the Securities Act of 1933 or the Securities Exchange Act
of 1934, except to the extent the Company specifically incorporates this Report
by reference therein.
The Audit Committee of the Board of Directors currently consists of
Messrs. Huntz (Chairman), Hardesty and Noonan, all of whom meet the
independence requirements of The Nasdaq Stock Market, Inc. During fiscal 2000,
the Audit Committee of the Board of Directors developed a charter for the
Committee, which was approved by both the Audit Committee and the full Board on
June 30, 2000. The complete text of the new charter was attached as "Annex A"
to the Company's Proxy Statement for its 2001 Annual Meeting, which was filed
with the Securities and Exchange Commission on April 24, 2001.
In overseeing the preparation of the Company's financial statements,
the Audit Committee met with both management and the Company's independent
auditors to review and discuss the financial statements prior to their issuance
and to discuss significant accounting issues. Management advised the Committee
that all financial statements were prepared in accordance with generally
accepted accounting principles, and the Committee discussed the statements with
both management and the independent auditors. The Committee's review included
discussion with the independent auditors of matters required to be discussed
pursuant to Statement on Auditing Standards No. 61 (Communication with Audit
Committees).
With respect to the Company's independent auditors, the Audit
Committee, among other things, discussed with Arthur Andersen LLP, matters
relating to its independence, including the disclosures made to the Audit
Committee as required by the Independence Standards Board Standard No. 1
(Independence Discussions with Audit Committees).
Based on these reviews and discussions, the Audit Committee
recommended to the Board of Directors that the Company's audited financial
statements be included in the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 2001.
Audit Committee
John J. Huntz, Jr., Chairman
John R. Hardesty
Thomas E. Noonan
AUDIT FEES
The aggregate fees billed by Arthur Andersen LLP, the Company's
independent auditors, for professional services rendered in connection with the
audit of the Company's financial statements included in the Company's Annual
Report on Form 10-K for Fiscal Year 2001, as well as for the review of the
Company's financial statements included in the Company's Quarterly Reports on
Form 10-Q during Fiscal Year 2001 totaled approximately $190,000.
FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES
No fees other than those described above under the caption "Audit
Fees" and those described below under the caption "All Other Fees" were billed
to the Company by the Company's independent auditors for professional services
in fiscal year 2001.
15
ALL OTHER FEES
The aggregate fees billed by Arthur Andersen LLP for professional
services rendered other than as stated under the captions Audit Fees and
Financial Information Systems Design and Implementation Fees above were
approximately $421,500. The Audit Committee of the Board of Directors considers
the provision of these services to be compatible with maintaining the
independence of Arthur Andersen LLP.
PROPOSAL 2
AMENDMENT TO THE STOCK INCENTIVE PLAN
Up to 11,017,358 shares of our Common Stock, less any shares issued
under our LLC Option Plan, are currently authorized for issuance under the
Manhattan Associates, Inc. Stock Incentive Plan (the "Plan"). As of April 1,
2002, 4,016,090 shares have been issued upon the exercise of options granted
under the Plan and the LLC Option Plan, and there were outstanding options to
purchase approximately 4,917,145 shares of Common Stock under the Plan and
outstanding options to purchase 838,135 shares of Common Stock under our LLC
Option Plan. As of April 1, 2002, there were 1,245,988 shares available for
issuance pursuant to future grants of options.
In April 2002, our Board of Directors adopted, subject to the approval
by the shareholders, an amendment to the Plan to increase the number of shares
authorized under the Plan. This amendment would increase the number of shares
reserved for issuance thereunder to 12,017,358 shares, an increase of 1,000,000
shares. Following adoption and approval of the amendment, there will be
2,245,988 shares available for future grants of options.
The text of the proposed amendment to the Plan is set forth in "Annex
A" to this Proxy Statement. The Plan is described above under "Proposal
1-Election of Directors-Stock Option Plans" and is qualified in its entirety by
reference to the text of the Plan.
The proposed amendment to the Plan will be adopted upon receiving the
affirmative vote of holders of a majority of the shares present or represented
by proxy at the Annual Meeting. Proxies will be voted in accordance with the
specifications marked thereon, and if no specifications are made, will be voted
"FOR" adoption of the proposed amendment to the Plan. The Board has determined
that the amendment to the Plan is in the best interest of the Company and our
shareholders. The proposed amendment would provide a stable pool of additional
shares for grant to our officers, directors, consultants and key employees. The
Board believes that grants of stock options are an effective method to attract
and retain officers, directors, consultants and key employees and have been an
important factor in the Company's past success, and that the availability of
shares for future grants under the Plan is important to our business prospects
and operations.
The Board of Directors recommends a vote FOR the approval of the
amendment to the Plan.
SHAREHOLDER PROPOSALS
Rules of the Securities and Exchange Commission require that any
proposal by a shareholder of the Company for consideration at the 2003 Annual
Meeting of Shareholders must be received by the Company no later than December
27, 2002 if any such proposal is to be eligible for inclusion in the Company's
proxy materials for its 2003 Annual Meeting. Under such rules, the Company is
not required to include shareholder proposals in its proxy materials unless
certain other conditions specified in such rules are met.
In order for a shareholder to bring any business or nominations before
the Annual Meeting of Shareholders, certain conditions set forth in Sections
2.14 and 3.8 of the Company's Bylaws must be complied with, including, but not
limited to, delivery of notice to the Company not less than 30 days prior to
the meeting as originally scheduled.
16
OTHER MATTERS
Management of the Company is not aware of any other matter to be
presented for action at the Annual Meeting other than those mentioned in the
Notice of Annual Meeting of Shareholders and referred to in this Proxy
Statement. However, should any other matter requiring a vote of the
shareholders arise, the representatives named on the accompanying Proxy will
vote in accordance with their best judgment as to the interests of the Company
and shareholders.
BY ORDER OF THE BOARD OF DIRECTORS,
/s/ David K. Dabbiere
David K. Dabbiere
Secretary
17
ANNEX A
TEXT OF PROPOSED AMENDMENT NO. 6 TO
MANHATTAN ASSOCIATES, INC. STOCK INCENTIVE PLAN
The Manhattan Associates, Inc. Stock Incentive Plan (the "Plan") is
hereby amended as follows:
1. Increase in Authorized Shares. Section 3 of the Plan is hereby
amended by deleting "10,659,453" in the first sentence thereof and substituting
"12,017,358" in its place, so that the first sentence reads: "The initial
number of Shares reserved for issuance under this Plan shall be 12,017,358, as
adjusted pursuant to Section 11, less the number of Shares subject to options
issued under the Manhattan Associates, LLC Option Plan."
2. Effective Date. The effective date of this Amendment shall be
April 12, 2002, provided, the shareholders of the Company approve this Amendment
within 12 months after such effective date. Any Stock Incentives granted under
the Plan as amended hereby before the date of such approval automatically shall
be granted subject to such approval.
The shares represented by this Proxy will be voted as directed by the
Shareholder. If no direction is given when the duly executed Proxy is returned,
such shares will be voted "FOR" all nominees in Proposal 1 and
"FOR" Proposal 2. I PLAN TO ATTEND MEETING [ ]
-----------------------------------------------------------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR ALL NOMINEES" IN PROPOSAL 1 AND "FOR" PROPOSAL 2.
-----------------------------------------------------------------------------------------------------------------------------------
Proposal 1 - Election of the following Nominees as Directors:
FOR all Nominees listed at right WITHHELD NOMINEES: ALAN J. DABBIERE BRIAN J. CASSIDY
(except as marked to the contrary) For all Nominees listed at right
[ ] [ ] (INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY
INDIVIDUAL NOMINEE, STRIKE A LINE THROUGH THE
NOMINEE'S NAME ABOVE.)
-----------------------------------------------------------------------------------------------------------------------------------
Proposal 2 - Approval of the amendment to the Company's Stock Incentive Plan:
For Against Abstain
[ ] [ ] [ ]
-----------------------------------------------------------------------------------------------------------------------------------
PLEASE MARK YOUR CHOICE LIKE THIS X IN BLUE OR BLACK INK.
Date
-----------------------------------------------
Signature
-------------------------------------------
Signature if held jointly
--------------------------
Please mark, date and sign as your name appears
above and return in the enclosed envelope.
MANHATTAN ASSOCIATES, INC.
2300 WINDY RIDGE PARKWAY
SUITE 700
ATLANTA, GEORGIA 30339
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Alan J. Dabbiere and David K. Dabbiere,
Esq. and each of them, with full power of substitution, as Proxy, to represent
and vote all the shares of Common Stock of Manhattan Associates, Inc. held of
record by the undersigned on April 1, 2002, at the annual meeting of
Shareholders to be held on May 17, 2002 or any adjournment thereof, as
designated on the reverse side hereof and in their discretion as to other
matters.
Please sign exactly as your name appears on the reverse side. When
shares are held by joint tenants, both should sign. When signing as attorney,
executor, administrator, trustee or guardian, please give full title as such. If
a corporation, please sign in full corporate name by President or other
authorized officer. If a partnership, please sign in partnership name by
authorized person.
(Please date and sign on reverse)
(Continued on reverse side)