-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QAouIizJOIXhfq6lbVBTHWlJjd4LszBke/qP5hr3arR6eQmKxlE8yvCrS7lxPdwi tByKEX5zfslZMgeCMI6cog== 0000950135-96-004138.txt : 19961024 0000950135-96-004138.hdr.sgml : 19961024 ACCESSION NUMBER: 0000950135-96-004138 CONFORMED SUBMISSION TYPE: 10-K405 PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 19960630 FILED AS OF DATE: 19960927 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: HYPERION SOFTWARE CORP CENTRAL INDEX KEY: 0000878594 STANDARD INDUSTRIAL CLASSIFICATION: 7372 IRS NUMBER: 133360138 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10-K405 SEC ACT: 1934 Act SEC FILE NUMBER: 000-19538 FILM NUMBER: 96636231 BUSINESS ADDRESS: STREET 1: 777 LONG RIDGE RD CITY: STAMFORD STATE: CT ZIP: 06902 BUSINESS PHONE: 2033213500 MAIL ADDRESS: STREET 1: 777 LONG RIDGE ROAD CITY: STAMFORD STATE: CT ZIP: 06902 10-K405 1 HYPERION SOFTWARE CORPORATION 1 - - -------------------------------------------------------------------------------- UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 --------------- FORM 10-K X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF --- THE SECURITIES EXCHANGE ACT OF 1934 (FEE REQUIRED) FOR THE FISCAL YEAR ENDED JUNE 30, 1996 OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) --- OF THE SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED) For the transition period from ____________to _____________. -------------------------------- COMMISSION FILE NUMBER 0-19538 HYPERION SOFTWARE CORPORATION (Exact name of registrant as specified in its charter) DELAWARE 06-1326879 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 900 LONG RIDGE ROAD, STAMFORD, CONNECTICUT 06902 (Address of principal executive offices, including zip code) Registrant's telephone number, including area code: (203) 703-3000 Securities registered pursuant to Section 12(b) of the Act: NONE Securities registered pursuant to Section 12(g) of the Act: COMMON STOCK, PAR VALUE $.01 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES X NO ----- ----- Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. /X/ As of September 18, 1996, there were 17,093,360 shares of the registrant's Common Stock, $.01 par value, outstanding. The aggregate market value of the registrant's voting stock held by non-affiliates as of September 18, 1996 was approximately $226 million. DOCUMENTS INCORPORATED BY REFERENCE Portions of the registrant's Proxy Statement for its 1996 Annual Meeting of Stockholders, scheduled to be held on November 13, 1996, are incorporated by reference in Part III hereof. - - -------------------------------------------------------------------------------- 2 PART I ITEM 1. BUSINESS GENERAL Founded in 1981, Hyperion Software Corporation (the "company") develops, markets and supports complete financial management and accounting solutions for large, multinational corporations. The company's client/server products facilitate the accounting, budgeting, multisource consolidation and business analysis processes, giving users fast, dynamic access to and querying capabilities of interrelated financial information. A common set of delivery technologies enable superior reporting, spreadsheet analysis, data entry and intranet information access. INDUSTRY BACKGROUND Large corporations generate significant amounts of accounting, manufacturing, human resources, sales and marketing data. To be useful to senior executives, managers and analysts, such transactional data must be retrieved from a variety of financial and operational systems, then summarized and organized into meaningful business information that is consistent and easily accessible. The process of integrating the data is complicated because most large corporations use multiple accounting systems and transactional databases, conduct business in numerous locations and have diverse information requirements across functions and throughout the management hierarchy. Historically, corporations have attempted to collect, summarize, organize and present information from fragmented computer systems and transactional data sources in a number of ways. In many instances, business information reports are assembled manually with the aid of spreadsheets and by using data from general ledgers and other operational systems. Additionally, many corporations have sought to automate business information systems through the use of mainframe, minicomputer or PC software developed by their internal management information systems ("MIS") departments. Hyperion Software believes that these systems are becoming increasingly obsolete because they are usually rigid in structure, complex to create, expensive to maintain, and difficult to update when information requirements change. In addition, growing corporate competition has increased the demand for more comprehensive and timely business information that is accessible throughout the corporation. Continuing advances in computer and networking technology increasingly enable business information processing at large corporations to be moved to client/server architectures running on local area networks ("LANs") of personal computers. Client/server computing takes advantage of the power of personal computers by appropriately segregating user interface and application processing tasks between separate client and server machines. This trend in down-sizing corporate computing has gained momentum as a result of improvements in PC processing speeds and memory capacity and the widespread acceptance of LANs and wide area networks (WANs). Local area and wide area networks have significantly increased the ability to share information among users throughout an organization. While MIS departments were initially slow to adopt network technology, they now view networked PCs as a strategic element of information management. LAN-based solutions are now accepted as an important means of decreasing computing costs while improving the flow, accessibility and usefulness of corporate information. Additionally, the flexibility and power of new client/server architectures have led to MIS adoption of new technologies at a faster pace. -2- 3 The need for better business information, combined with the acceptance of PCs and network computing, including new client/server architectures, has created a significant market opportunity for a new class of information software designed to operate on this platform. Most financial analysts, accountants and many executives rely on personal computer spreadsheets for analysis and forecasting. While spreadsheets and other PC software tools have been used to perform some corporate business information tasks, they have limited capability for information sharing and lack the necessary controls to ensure corporate consistency. Existing custom or packaged software for mainframes or minicomputers is impractical to modify for network computing because it is based on operating systems and architectures which are incompatible with PCs and client/server technology and lack the ease of use of PC software. Since 1981, the company's experience in developing and marketing corporate financial software applications for PCs and networks has positioned it well for this market. STRATEGY The company's objective is to be the leading provider of client/server financial management and accounting solutions to large, multidivision or multilocation companies worldwide. Hyperion Software focuses on designing network-based applications that are easy to implement and operate and which facilitate the redesign of financial and accounting processes. The applications are designed to be flexible, easy to maintain, cost-efficient, fast and functionally complete, using an architecture based on connectivity and openness to other best-of-class applications. The company will continue to extend and enhance its complete suite of integrated client/server products. The company believes that its multisource consolidation, budgeting and reporting solutions are well established in the financial and corporate offices of multinational enterprises. Accordingly, as the accounting product line is expanded and enhanced, Hyperion Software believes it is well positioned to participate in this emerging client/server, accounting applications market. Integrated across these financial and accounting processes, Hyperion provides complete reporting and business analysis capabilities, designed to support the way people access, deliver and analyze results. The company believes that client/server and networked personal computing has become a standard direction for the largest and best known companies in the world. These technologies, when coupled with software that reflects applications expertise, produce clear and immediate benefits to an organization. The company's strategy to achieve its objective includes the following elements: Increase Penetration of Multisource Consolidation and Budgeting Markets. The company believes that a minority of potential customers has purchased network-based, Windows multisource consolidation (the management of financial information across multiple accounting and planning systems, operational data sources and geographies) and budgeting software. The company intends to further its penetration in this market and continue its leadership position by enhancing its current products and dedicating significant resources to sales, marketing, support and product development. Leverage Existing Market Leadership Position. The company believes that the complementary set of budgeting, accounting, multisource consolidation and business analysis applications provides the complete, consistent results executives need to run their businesses. The quick, secure access of this interrelated information, in a common set of user tools, supports ad hoc analysis and reporting requirements. The company believes that its established strength in providing solutions places it in a strong position to market its complete application suite to both new and existing customers, including the latest offerings, Hyperion OLAP for business analysis; Hyperion's Spider-Man, a web-based business information access solution for an organization's global user community; and the accounting product line. -3- 4 Focus on Leading Network and Software Technologies. Hyperion Software is committed to the development of network-based software for business information applications. The company's solutions are designed to run in the Microsoft Windows environment, and all are compatible with widely-used LANs. The company intends to enhance its existing products and develop new products linked to client/server software standards, including Windows 95, Windows NT, Sybase SQL Server and Oracle databases, as well as the emerging intranet technologies. Design Applications for Specific Corporate Information Needs. The company's product line is designed specifically for the collection, accounting, reporting and interactive analysis of business data. Hyperion's applications fit business processes, with financial intelligence and preprogrammed functionality. This orientation to specific tasks serves to reduce implementation time and results in superior processing speed for fast data compilation and data access. The company is also committed to a combination of integrated, industry standard SQL and application specific databases. Design for Ease of Implementation and Ease of Use. The company's products are designed for an end-user role in maintenance, with minimal training. Application expertise is built into products and is also provided by the company through consulting services. Following implementation, customers are able to operate self-sufficiently with trained administrators at headquarters locations and independent end-users at headquarters and at remote sites. Maintain Direct Sales and Support Relationships. Unlike many other PC software companies, the company licenses its products throughout the world primarily through a direct sales force. In certain territories outside of North America, products are licensed through independent distributors, including major accounting firms. Hyperion Software often provides installation and post-sale consulting support to build long-term customer relationships. Generate Follow-on Revenues. The company generates revenues from existing customers through licensing for additional users, the introduction of new products and license renewal fees. In addition, sales of training and consulting services to existing customers represents a significant portion of the company's total service revenues. Follow-on revenues leverage sales and marketing resources and strengthen the company's relationships with its customers. PRODUCTS AND SERVICES The company's product line provides executives, managers, analysts and accountants with the capability to collect, process, report and analyze business information. The company's Hyperion Enterprise products consolidate and report financial and other business data; Hyperion Pillar is used for corporate budgeting and financial planning; Hyperion OLAP provides multidimensional analysis and reporting capabilities regarding complex, high-volume business data; the accounting products are used for corporate accounting; Hyperion's Spider-Man is a web-based business information access solution for the global user community of an organization; and Hyperion OnTrack is a complete Visual Information Access product. The company also offers installation, training, consulting and support services. -4- 5 PRODUCTS Hyperion Enterprise. Hyperion Enterprise, released in July 1991 and now in its fourth major release, is an advanced business information consolidation and reporting product designed to take advantage of the capabilities of the Microsoft Windows graphical operating environment. The company began development of Hyperion Enterprise in mid-1988 as a new product that combines powerful consolidation and reporting capabilities with an open architecture and administrative ease of use made possible through the graphical user interface of Windows. Hyperion Enterprise reflects the company's fourteen years of experience in financial and business information software. The company derived approximately 62%, 61% and 50% of its worldwide total revenues from Hyperion Enterprise licenses and related services during fiscal 1996, 1995 and 1994, respectively. A Hyperion Enterprise headquarters site license is priced at $150,000 ($175,000 for the SQL version), with administrative and reporting site licenses priced at $30,000 and $6,000, respectively, or less, depending on the number of sites. Hyperion Pillar. Hyperion Pillar is a complete solution for corporate planning needs. It facilitates the collaborative, iterative process of enterprise-wide budgeting and forecasting. Hyperion Pillar helps give the corporate plan greater credibility by allowing for line managers to assume full accountability for their budgets. The software enables users to build up their budgets from a series of line items the way they think--in units, rates and/or amounts. Product security features ensure that planning managers have complete control over which users have access to what data. Hyperion Pillar is a Windows-based solution with flexible import/export capabilities for interaction with virtually all financial software systems. The product easily allows for changes in corporate structure or reporting lines, making it easy to change the plan as the company evolves. Hyperion Pillar is typically licensed to user groups of 10 or more, priced at $45,000 for 10 end users. Hyperion's accounting products, initially released in March 1995, allow an enterprise to control the detailed collection and reporting of day-to-day business transactions. The accounting products are designed for fast installation and easy maintenance. Superior integration among modules allows users to drill-down from ledger information to supporting subsystem transactions. Hyperion Ledger. Hyperion Ledger is a Windows-based, general ledger accounting system for large, corporate client/server environments. Hyperion Ledger controls the management of a full range of advanced accounting functions, including flexible account structures, intercompany transaction control, multicurrency processing, and complex consolidation processing. A Hyperion Ledger headquarters site license is priced at $120,000 per server. Hyperion Reporting. Hyperion Reporting supports corporate requirements for graphical, production reports. Users can easily design and customize reports to deliver financial results using advanced formatting and rules. A Hyperion Reporting headquarters site license is priced at $30,000 per server. Hyperion Tools. Hyperion Tools is an object-oriented development environment that runs under Microsoft Windows. It allows an organization to customize Hyperion Software applications or build complementary applications to extend its corporate systems. A Hyperion Tools headquarters site license is priced at $45,000 per server. Hyperion Admin. Hyperion Admin provides system control for the accounting installation. User-defined parameter settings allow customers to tailor security and processes to meet unique business requirements. Benefits of Hyperion Admin include reduced maintenance and increased system integrity. Simplified set-up functions and predefined values allow for quicker installation. A Hyperion Admin headquarters site license is priced at $60,000 per server. -5- 6 Hyperion Payables. Hyperion Payables is an accounts payable system that allows the user to control the management of its organization's cash disbursement function. Vendor invoices are paid in the system using system generated checks, manual checks and electronic funds transfer payments. Hyperion Payables is also capable of tracking data for 1099 vendors, facilitating bank account reconciliations and maintaining the periods and years of data in the system through periodic processing. A Hyperion Payables headquarters site license is priced at $90,000 per server. Hyperion Receivables. Hyperion Receivables is a full featured credit and receivables management solution. It provides the flexibility and power to manage credit risk and monitor customer performance. Navigation through and retrieval of data is efficient and simple, allowing credit professionals, customer service and accounting personnel easy access to view customer balance data and gather other information on-line. A Hyperion Receivables headquarters site license is priced at $90,000 per server. Hyperion Assets. Hyperion Assets is a fixed asset system that provides tools to make searching for and analyzing asset data and activity efficient and powerful. Capital accountants and tax preparers have ready access to asset information, eliminating wasted time searching for answers to end user or management questions. A Hyperion Assets headquarters site license is priced at $70,000 per server. Hyperion OLAP. Hyperion OLAP, released in April 1996, provides powerful multidimensional analysis and reporting capabilities to support complex, high-volume business issues such as customer or product line profitability. Hyperion OLAP combines built-in financial intelligence with a high performance, on-line analytical processing (OLAP) engine and superior information access capabilities. Continuing to leverage the company's experience in financial and business information software, Hyperion OLAP complements the overall integrated Hyperion solution. Smart dimensions for accounting, currency and time series intelligence facilitate complex query and "what-if" analysis. A Hyperion OLAP site license is priced at $60,000 per server, including 10 users. The company offers several complementary modules integrated across the product line: Hyperion's Spider-Man. Hyperion's Spider-Man, released in August 1996, is a web-based server application, a gateway into the Hyperion solution for the global user community of a corporation. It provides all users, around the world, with an intelligent view of the reports within each application--accounting, budgeting, multisource consolidation, business analysis. It allows users to navigate through a consistent set of current corporate data, as well as information from any other Internet source. Hyperion Analyst. Hyperion Analyst, released in April 1996, provides multidimensional, on-line analysis capabilities tailored specifically to working with financial and accounting data. Hyperion Analyst allows users to "slice and dice" information seamlessly from our financial applications directly within a Microsoft Excel or Lotus 1-2-3 spreadsheet. Hyperion Schedules. Hyperion Schedules, released in November 1995, provides schedule-based data entry within our financial processes to capture corporate financial information. Hyperion Schedules provides complete control and customization of data entry screens. -6- 7 Hyperion OnTrack. Hyperion OnTrack, introduced in 1989 and now in its third major release, is a Windows-based, Visual Information Access product. Hyperion OnTrack provides senior executives, managers and analysts with access to business information through an attractive, intuitive user interface. Presentation of information from a variety of sources, which may include one of the company's financial reporting software products, is easily accomplished through a set of Windows-based system administration facilities. Information from mainframe or network-based systems, such as marketing, sales, human resources or production data, and external information, such as stock price quotations or economic data, may also be incorporated. Graphics and spreadsheets are easily integrated. A key benefit to Hyperion OnTrack is greatly reduced development and maintenance effort in comparison to traditional mainframe-based systems. A headquarters site license for OnTrack is priced at $85,000, with administrative and reporting site licenses priced at $10,000 and $5,000, respectively, or less, depending on the number of sites. SERVICES The company provides design consulting and implementation support for its products and their operation on local or wide area networks and offers a range of administrator and end-user courses at its training facilities or at the customer's site. Implementation, consulting and training services are not included in software license fees, but are provided on a time and materials basis. This allows the customer to determine the level of support appropriate to its needs and permits the company to provide high quality services on a profitable basis. Under the terms of the company's standard license agreement, customers, at their option, pay a license renewal and maintenance fee annually. The annual fee charged to a customer is generally a fixed percentage of the then-current list prices for the licensed software used by the customer. This fee entitles customers to support, including a user hotline and electronic bulletin board, and to any updates and enhancements provided for their software. The company's product support function provides a hotline, collects and evaluates requests for enhancement of products and, together with the product management and planning group, coordinates the design, development and release of new products and product enhancements. An active user group, including a steering committee, works closely with the company in helping to define product enhancement priorities and directions. A user conference is held annually. This year's conference, in Dallas, was attended by over 2,000 people from more than 700 companies. Regional user meetings and product-specific focus groups are also scheduled periodically, including an annual European user conference. -7- 8 CUSTOMERS AND APPLICATIONS The company markets its products worldwide to multidivisional and/or multilocational organizations which have extensive operations and significant information management requirements. Examples of the use of Hyperion Software products by the company's clients include the following: - A leading international home appliance manufacturer and marketer has implemented Hyperion Enterprise as part of its global financial information process reengineering initiative. Operating in more than 120 countries, sites from around the world were previously faxing data to corporate headquarters, where the data was manually entered into spreadsheets. The entire process was "extremely tedious and prone to error," according to the customer. Now, Hyperion Enterprise is addressing the customer's expanding global information requirements, providing easy access to data, direct links to spreadsheets and easy system maintenance, all within a Microsoft Windows-based computing environment. - A healthcare company eliminated tedious re-keying of data and dramatically reduced manual input by using Hyperion Enterprise for its worldwide financial information requirements. An expanding presence in Europe and the addition of a new line of over-the-counter products required that the customer keep track of an extensive amount of product data on a global basis. Essential business data of the customer includes knowing where and when sales are made, products are introduced, and whether budgets are being achieved. Hyperion Enterprise's flexible reporting, dynamic links to spreadsheet products, speed, and access to both detail and top-level data for more than 500 products is the cornerstone for this data. - A leading, worldwide, personal computer manufacturer using Hyperion Pillar has reduced its budget roll-up process from three days to three hours. According to the computer company's finance group, it now spends 80 percent of its time on analysis and 20 percent on mechanics. Prior to installing Hyperion Pillar, the customer used a spreadsheet-based system and applied as much as 80 percent of its time verifying numbers. - One of the world's largest producers of denim and decorative fabrics was experiencing the typical drawbacks of a mainframe general ledger system that no longer fit the needs of a growing organization. Slow response time, reporting inflexibility, tedious manual keying of data, cumbersome maintenance, poor vendor support, and a difficult to use interface were all factors that led this international company to choose Hyperion's accounting products. Now, with Hyperion's client/server accounting system, the customer has been able to shorten its quarterly closing cycle and get better and more timely access to financial information. According to the customer's accounting team, its users can now select the accounting period and cost center and run their own summary level reports. They can view data by plant or division and see up to five years of history in just minutes. -8- 9 The company has licensed its software to nearly 3,000 corporate headquarters customers. In the past three fiscal years, no one customer accounted for more than 10% of total revenues. The company's customers include the following:
Abbey National Hong Kong Shanghai Bank Aetna Life & Casualty HSBC Holdings Ahold ICI AIG Life International Paper Aluminum Company of America ITT Hartford Allied Domecq Johnson & Johnson Allied Signal Commercial Avionics Systems Kimberly-Clark American Express Kmart American Home Products KNP-BT Ameritech LVMH Amoco McDonnell Douglas Asia Pacific Breweries MCI Telecomm. Corp., Network Services AT&T GIS McKesson Water Products Bass Merck & Co. B.A.T. Industries Microsoft Bayer Corporation Mobil Oil Bell Atlantic Motorola, Inc. BellSouth Corporation National Australia Bank Limited Berjaya Group Berhad National Westminster Bancorp Boots Company Nokia Bristol-Myers Squibb Norsk Hydro British Petroleum NYNEX BTR Pacific Dunlop Limited Chevron PepsiCo Ciba-Geigy Philip Morris Coca Cola Amatil Price Costco Columbia/HCA Information Services The Prudential Insurance Company of America Daimler Benz Interservices Prudential Corporation Digital Equipment PT Astra E.I. DuPont de Nemours Rabobank Eastman Kodak Company Rockwell International First Pacific Company Ltd. Sara Lee Corporation Ford Motor Credit SBC Communications, Inc. Fortis - AG Siemens Foster's Brewing Group Limited Singapore Technologies Glaxo Sprint Goodyear Tire & Rubber Texaco Inc. Grand Metropolitan The Travelers Hanson Industries United Parcel Service Heineken Zeneca
-9- 10 SALES AND MARKETING The company has a direct sales force comprised of 185 sales personnel as of June 30, 1996. The company supports its sales force with lead generation and marketing programs which include telemarketing, public relations, direct mail, advertising, seminars, trade shows and ongoing customer communication programs and third-party alliances. The company has sales offices at its headquarters in Stamford, Connecticut and in: Amsterdam, Atlanta, Austin, Baltimore, Boston, Brussels, Calgary, Chicago, Copenhagen, Dallas, Denver, Detroit, Frankfurt, Houston, Linz, London, Los Angeles, Madrid, Manchester, Milan, Milwaukee, Minneapolis, Montreal, Munich, Newark, Ottawa, Paris, Philadelphia, Rome, Sacramento, San Francisco, Sao Paulo, Seattle, Singapore, St. Louis, Stockholm, Syracuse, Tokyo, Toronto and Washington, DC. Product support and training are available as well through many of these locations. The company markets its products outside of North America through a combination of subsidiaries and independent distributors. These distributors are managed through the company's operations facilities in Milan and Singapore, which are staffed by 33 company personnel. The company has license and distribution agreements with independent distributors in: Australia, Finland, Israel, Japan, Mexico, New Zealand, Poland, South Africa and Switzerland. The company's distributors include affiliates of Arthur Andersen & Co. in Japan and Switzerland, and of KPMG Peat Marwick in Australia and New Zealand. The distributors generally maintain sales and service personnel dedicated solely to the company's products. The distribution agreements between the company and its distributors generally provide for the exclusive right to offer the company's products within a territory, in return for royalties typically equal to 50% of license and license renewal fees. In each of its 1996, 1995 and 1994 fiscal years, approximately 33.2%, 28.1% and 26.7%, respectively, of the company's total revenues were derived from sources outside of the United States. Because the company generally ships its products shortly after license agreements are signed, the company's software licensing backlog typically is small. PRODUCT DEVELOPMENT To date, all of the company's principal products have been developed by its internal staff except for Hyperion Pillar, which was acquired in connection with the company's acquisition of Pillar Corporation (November 1994), and portions of Hyperion OLAP and Hyperion OnTrack. When developing a new product or enhancement, the company works closely with current and prospective customers to determine their requirements. A user product enhancement committee, comprised of representatives of certain of the company's customers, meets quarterly and advises the company of its priorities for product development and enhancement, as well as product support service. The company's current product development efforts are primarily focused on the accounting products, and on maintaining the competitiveness of its current product line, including development of the next releases of Hyperion Enterprise, Hyperion Pillar, Hyperion OLAP and Hyperion's Spider-Man. As of June 30, 1996, the company's product development was performed by 249 employees primarily located at its Stamford, Connecticut headquarters. During fiscal 1996, 1995 and 1994, the company's product development expense, which is net of capitalized development costs, was $26.8 million, $21 million and $12.8 million, or 15.5% (16.7% including purchased research and development), 15.3% and 13.5% of total revenues, respectively. In accordance with Statement of Financial Accounting Standards No. 86, the company capitalizes certain development costs. During fiscal 1996, 1995 and 1994, the company capitalized $5.8 million, $5.2 million and $4 million, respectively, or 17.8%, 19.9% and 23.9% of total product development expenditures (excluding purchased research and development). -10- 11 COMPETITION The company operates in an intensely competitive market which demands product quality, functionality, performance, reliability, ease of use, customer satisfaction, service, price, vendor reputation and financial stability. The company believes that its products currently compete favorably with respect to such factors, although it may be at a competitive disadvantage against companies with greater financial, technological, marketing, service and support resources. The company experiences competition from a variety of business application software vendors and software tool vendors, as well as from software developed by IS departments of potential customers. Many of the company's existing and potential customers utilize legacy software developed internally for mainframes or minicomputers. The market for client/server corporate financial software is still an emerging one. As markets develop for the company's products, additional competitors may enter or expand into those markets and competition may intensify. PROPRIETARY RIGHTS AND LICENSES The company depends upon a combination of trade secret, copyright and trademark laws, license agreements, nondisclosure and other contractual provisions and technical measures to protect its proprietary rights in its products. In addition, the company attempts to protect its trade secrets and other proprietary information through agreements with employees and consultants. Despite these precautions, it may be possible for unauthorized third parties to copy aspects of the company's products or to obtain information that the company regards as proprietary. The company also seeks to protect the source code of its products as a trade secret. The company distributes its products under software license agreements which grant customers a nonexclusive, nontransferable license to the company's products and contain terms and conditions prohibiting the unauthorized reproductions or transfer of the company's products. The company does not provide licensees with the source code for its products. Customers are billed an initial license fee for the software upon delivery and, subsequently, are billed an annual renewal and maintenance fee entitling them to routine support and product updates. This fee is typically calculated at a fixed percentage of the then-current price of all licensed software used by the customer. The annual maintenance fee is optional; however, without payment, the licensee is entitled only to use the software in its then current form, without receiving future updates or product support. See "Services." Hyperion, Hyperion Software, Hyperion Financials, Pillar, Micro Control, IMRS, Financial Intelligence, and Business Intelligence are registered trademarks and Hyperion Enterprise, Hyperion Pillar, Hyperion Analyst, Hyperion OLAP, Hyperion Retrieve, Hyperion Reporting, Hyperion Forms, Hyperion OnTrack, Hyperion Ledger, Hyperion Payables, Hyperion Admin, Hyperion Tools, Hyperion Purchasing, Hyperion Receivables, Hyperion Assets, Conversion Catalyst and LedgerLink are trademarks of Hyperion Software Operations Inc., a wholly-owned subsidiary of Hyperion Software Corporation. Marvel Comics, Spider-Man: [Trademark] & [Copyright] 1996 Marvel Characters, Inc. All rights reserved. All other trademarks and company names mentioned are the property of their respective owners. -11- 12 EMPLOYEES As of July 31, 1996, the company employed a total of 1,046 employees, including 250 in marketing and sales, 685 in product development, support and technical services, and 111 in management, administration and finance. None of the company's employees is represented by a labor union. The company has experienced no work stoppages and believes that its employee relations are good. The executive officers of the company are as follows:
Name Age Position ---- --- -------- James A. Perakis....................52 Chief Executive Officer and Chairman Peter F. DiGiammarino...............43 President, Chief Operating Officer and Director Lucy Rae Ricciardi..................54 Senior Vice President and Chief Financial Officer David M. Sample.....................48 Senior Vice President Craig M. Schiff.....................41 Senior Vice President and Corporate Secretary
Mr. Perakis is Chairman of the Board of Directors and Chief Executive Officer of the company. Mr. Perakis has served as Chief Executive Officer and as a director of the company since September 1985. From December 1987 to May 1996, Mr. Perakis also served as President of the company. From 1983 to September 1985, Mr. Perakis served as Senior Vice President and General Manager of Chase Decision Systems, a division of Interactive Data Corporation, a developer and marketer of mainframe software for planning and financial applications. From 1979 to 1983, Mr. Perakis was Chief Financial Officer of Interactive Data Corporation, a supplier of data and software to financial and corporate markets. Mr. DiGiammarino was appointed President and Chief Operating Officer, as well as a member of the board of directors of the company, in May 1996. Prior to joining Hyperion Software, Mr. DiGiammarino was Vice President and Business Area Manager at American Management Systems (AMS), Inc., a consulting and systems development firm. Mr. DiGiammarino also served as a member of AMS's operating group. Mr. DiGiammarino joined AMS in 1977. Ms. Ricciardi has served as Senior Vice President and Chief Financial Officer of the company since July 1995. From February 1990 to July 1995, Ms. Ricciardi served as Vice President - Finance and Chief Financial Officer of the company. From February 1988 to February 1990, Ms. Ricciardi served as Director of Finance of the company. Prior to 1988, Ms. Ricciardi was associated with Dun & Bradstreet, most recently in its Acquisitions Analysis Group. Mr. Sample has served as Senior Vice President of the company since July 1993. From July 1986 to July 1993, Mr. Sample served as Vice President - Sales of the company. From 1978 to July 1986, Mr. Sample was associated with the Business Information Services Division of Control Data Corporation, most recently as a District Sales Manager. Mr. Schiff was appointed Senior Vice President and Corporate Secretary of the company in May 1996. From July 1985 to May 1996, Mr. Schiff served as Vice President -- Products and Services and Corporate Secretary of the company. Mr. Schiff originally joined the company in July 1983. Prior to July 1983, Mr. Schiff served in a variety of customer service and support positions with General Electric Information Services. -12- 13 ITEM 2. PROPERTIES The company's principal administrative, marketing and product development and support functions are located in Stamford, Connecticut, where the company owns and occupies approximately 230,000 square feet of office space. The Stamford facilities permit future expansion of up to 300,000 square feet of additional space. The company also leases regional office space for its local sales and service needs. ITEM 3. LEGAL PROCEEDINGS From time to time, in the normal course of business, various claims are made against the company. At this time, in the opinion of management, there are no pending claims the outcome of which is expected to result in a material adverse effect on the financial position of the company. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS During the fourth quarter of the fiscal year covered by this report, no matter was submitted to a vote of security holders through the solicitation of proxies or otherwise. -13- 14 PART II ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS The company's common stock trades on The Nasdaq Stock Market under the symbol HYSW. The following table sets forth, for the periods indicated, the high and low sales prices of the common stock as reported on The Nasdaq Stock Market.
---------------------------------------------------------------------- Fiscal 1995: High Low ---------------------------------------------------------------------- First quarter $18 3/4 $10 5/8 Second quarter 20 1/8 16 Third quarter 24 7/8 17 3/8 Fourth quarter 24 1/2 15 5/8 ---------------------------------------------------------------------- FISCAL 1996: HIGH LOW ---------------------------------------------------------------------- First quarter $28 3/8 $22 Second quarter 28 1/4 18 1/4 Third quarter 23 14 Fourth quarter 22 9 3/4 ---------------------------------------------------------------------- FISCAL 1997: HIGH LOW ---------------------------------------------------------------------- First quarter (through September 18th) $14 5/8 $10 1/2
The stock prices have been adjusted to give retroactive effect to the two-for-one stock split effected in the form of a 100% stock dividend paid in December 1995. As of September 18, 1996, the company had 215 stockholders of record and approximately 7,300 beneficial holders of its common stock. The company has never declared or paid any cash dividends on its capital stock. The company currently intends to retain all earnings to finance future growth and, therefore, does not anticipate paying any cash dividends in the foreseeable future. The company's credit agreement with its lender contains covenants that restrict the company regarding the payment of dividends. -14- 15 ITEM 6. SELECTED CONSOLIDATED FINANCIAL DATA (in thousands, except per share data)
YEAR ENDED JUNE 30 --------------------------------------------------------- 1996 1995 1994 1993 1992 --------------------------------------------------------- STATEMENT OF INCOME DATA (a) REVENUES Software licenses $ 90,304 $ 77,985 $51,687 $35,801 $28,609 License renewals and services 82,520 59,156 42,575 30,844 20,242 --------------------------------------------------------- Total revenues 172,824 137,141 94,262 66,645 48,851 COSTS AND EXPENSES Cost of revenues: Software licenses 4,780 4,454 2,820 1,841 1,309 License renewals and services 53,258 36,443 24,921 18,541 12,249 Sales and marketing 55,484 44,324 30,036 21,325 17,504 Product development 26,839 20,980 12,767 9,196 6,944 Purchased research and development 2,000 2,600 General and administrative 16,443 11,302 9,703 8,407 5,790 Merger and integration 1,000 --------------------------------------------------------- 158,804 118,503 80,247 61,910 43,796 --------------------------------------------------------- OPERATING INCOME 14,020 18,638 14,015 4,735 5,055 Interest income 1,480 1,620 851 605 569 Interest expense (243) (119) (117) (137) (439) --------------------------------------------------------- INCOME BEFORE INCOME TAXES 15,257 20,139 14,749 5,203 5,185 Provision for income taxes 5,800 8,000 6,140 2,860 2,750 --------------------------------------------------------- NET INCOME $ 9,457 $ 12,139 $ 8,609 $ 2,343(c) $ 2,435 ========================================================= EARNINGS PER SHARE (b) Primary $.53 $.70 $.52 $.15(c) $.17 Fully diluted $.53 $.69 $.52 $.15(c) $.17 AVERAGE NUMBER OF SHARES OUTSTANDING (b) Primary 17,875 17,316 16,584 15,500 14,106 Fully diluted 17,933 17,480 16,600 15,904 14,246 JUNE 30 --------------------------------------------------------- 1996 1995 1994 1993 1992 --------------------------------------------------------- BALANCE SHEET DATA (a) Working capital $ 27,449 $ 37,306 $34,829 $25,839 $24,590 Total assets 179,448 146,158 94,715 67,358 52,670 Total long-term debt 8,336 8,910 Stockholders' equity 90,003 71,706 53,661 40,683 32,894 (a) Includes Pillar Corporation (see Note B to the accompanying financial statements). (b) All share and per share data have been retroactively adjusted to reflect a two-for-one stock split effected in the form of a 100% stock dividend paid in December 1995. (c) Includes a one-time charge relating to the fiscal 1993 purchase of research and development, which had the effect of reducing net income by approximately $1.6 million or $.10 per share.
-15- 16 ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS - - -------------------------------------------------------------------------------- Hyperion Software Corporation derives revenues from licensing its software products and providing related product installation, support and training services. Customers are billed an initial fee for the software upon delivery. A license renewal fee entitling customers to routine support and product updates is billed annually. Hyperion Software licenses its products throughout the world primarily through a direct sales force. In certain territories outside of North America, products are licensed through independent distributors, including major accounting firms. The company includes in revenues its net share of revenues generated by distributors. FISCAL 1996 COMPARED TO FISCAL 1995 REVENUES
1996 CHANGE 1995 - - ------------------------------------------------------------------------- (dollars in thousands) Software licenses $90,304 15.8% $77,985 Percentage of total revenues 52.3% 56.9% - - ------------------------------------------------------------------------- License renewals and services $82,520 39.5% $59,156 Percentage of total revenues 47.7% 43.1% - - -------------------------------------------------------------------------
Software license revenues rose primarily as a result of an increase in the number of licenses sold (unit volume) versus, for example, price increases. While the growth was led by demand for the company's enterprise financial reporting and budgeting products, management believes that a slower than planned orientation of its sales force to a multiproduct, complete financial solution approach, together with delays in the commercial release of certain products, were the reasons for the decline in sales growth as compared to prior years. The increase in license renewal and service revenue is mainly attributable to the year-to-year growth of the company's installed customer base. Revenues generated from markets outside the United States for fiscal 1996 and 1995 were $57.4 million and $38.5 million, or 33.2% and 28.1% of total revenues, respectively. Revenue growth was particularly strong in Canada, certain territories of Asia, and in Europe, most notably in the Netherlands. COST OF REVENUES
1996 CHANGE 1995 - - ------------------------------------------------------------------------- (dollars in thousands) Software licenses $ 4,780 7.3% $ 4,454 Gross profit percentage 94.7% 94.3% - - ------------------------------------------------------------------------- License renewals and services $53,258 46.1% $36,443 Gross profit percentage 35.5% 38.4% - - -------------------------------------------------------------------------
Cost of software license revenues consists primarily of the cost of product packaging and documentation materials, amortization of capitalized software costs, amortization of certain intangible assets related to business acquisitions, and royalty expenses. The increase in the cost of software license revenues principally reflects the associated increase in the amortization of capitalized costs related to new products and product enhancements. The amortization of capitalized software costs begins upon the general release of the software to customers. The increase in the cost of license renewal and service revenues was due primarily to additional staffing expense for both installation and ongoing support services. The professional services staff includes new members dedicated to the company's recently released (March 1995) set of accounting products. -16- 17 ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED) OPERATING EXPENSES
1996 CHANGE 1995 - - ---------------------------------------------------------------------------- (dollars in thousands) Sales and marketing $55,484 25.2% $44,324 Percentage of total revenues 32.1% 32.3% - - ---------------------------------------------------------------------------- Product development $26,839 27.9% $20,980 Percentage of total revenues 15.5% 15.3% - - ---------------------------------------------------------------------------- General and administrative $16,443 45.5% $11,302 Percentage of total revenues 9.5% 8.2% - - ----------------------------------------------------------------------------
The increase in sales and marketing expenses is primarily due to a net increase in sales-marketing personnel. The increase in product development expenses reflects additional personnel and third-party development costs associated with expanded research and development activities. In fiscal 1996 and 1995, the company capitalized $5.8 million and $5.2 million of software development costs, respectively, in accordance with Statement of Financial Accounting Standards No. 86, "Accounting for the Costs of Computer Software to be Sold, Leased, or Otherwise Marketed." The amounts capitalized primarily relate to the company's development of enterprise-wide financial management and accounting solutions for client/server environments and represented 17.8% and 19.9% of total product development expenditures (excluding purchased research and development). Capitalized software costs are amortized over the estimated economic life of the product, but generally not more than four years. In the second quarter of fiscal 1996, the company concluded two strategic acquisitions involving application technologies and an important European client base. Specifically, in December 1995, the company acquired certain assets and application technologies, and assumed certain obligations of Trust Consult s.a., a Brussels-based financial solutions provider. Along with over 130 customers, Hyperion gained significant European statutory consolidation and reporting expertise and technology. In November 1995, the company acquired certain rights from Sinper Corporation to its powerful database engine, TM/1, technology. The new technology was used in the development of Hyperion OLAP (On-Line Analytical Processing), a solution for customers' most complex and high volume multidimensional analysis needs, such as product profitability and sales analysis. Hyperion OLAP became commercially available in April 1996. The acquisitions, which amounted to $3.6 million, were accounted for as purchase transactions and, accordingly, $2 million was allocated to purchased research and development and $1.6 million was allocated to identifiable intangible assets based on their estimated fair values. The purchased research and development is reflected as a one-time charge in the company's operating results. The increase in general and administrative expenses resulted from increases in personnel and professional services costs incurred to support the growth of the company's overall operations and, to a lesser extent, the effect of currency exchange rate changes and an increase in the provision for doubtful accounts. In November 1994, the company completed a merger with Pillar Corporation, which develops, markets and supports client/server corporate budgeting and planning solutions. In connection with the acquisition, which was accounted for as a pooling of interests, the company charged $1 million to operations in fiscal 1995 for nonrecurring merger and integration costs incurred. -17- 18 ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED) NONOPERATING INCOME AND EXPENSE
1996 CHANGE 1995 - - ------------------------------------------------------------------------------- (dollars in thousands) Interest income $1,480 8.6% $1,620 - - ------------------------------------------------------------------------------- Interest expense $ (243) 104.2% $ (119) - - -------------------------------------------------------------------------------
The slight decline in interest income, for the most part, was due to the decrease in cash available for investment which resulted from a higher level of funds reinvested in the business. PROVISION FOR INCOME TAXES The company's effective income tax rate decreased from 39.7% to 38%. The change in the effective rate primarily relates to the nondeductible merger costs incurred in fiscal 1995. NET INCOME As a result of the above factors (including the nonrecurring charges), net income for 1996 decreased to $9.5 million, or by 22.1%, from $12.1 million for 1995. To date, the overall impact of inflation on the company has not been material. In 1995, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards ("SFAS") No. 121, "Accounting for the Impairment of Long-Lived Assets to Be Disposed Of." The company will adopt SFAS No. 121 in fiscal 1997, and the impact, if any, is not expected to be material. The company accounts for stock option grants in accordance with Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees." The company generally prices its stock options at fair market value on the date of grant and, therefore, no compensation expense is recognized for the stock options granted. In fiscal 1997, the company intends to adopt the disclosure provisions of SFAS No. 123, "Accounting for Stock-Based Compensation." FISCAL 1995 COMPARED TO FISCAL 1994 REVENUES
1995 CHANGE 1994 - - ------------------------------------------------------------------------- (dollars in thousands) Software licenses $77,985 50.9% $51,687 Percentage of total revenues 56.9% 54.8% - - ------------------------------------------------------------------------- License renewals and services $59,156 38.9% $42,575 Percentage of total revenues 43.1% 45.2% - - -------------------------------------------------------------------------
Software license revenues rose primarily as a result of an increase in the number of licenses sold versus, for example, price increases. Demand for the company's Microsoft Windows-based enterprise financial reporting and budgeting products continues to be strong. Windows-based product licenses comprise more than 90% of the company's total software license revenues. The increase in license renewal and service revenue is mainly attributable to the year-to-year growth of the company's installed customer base. Revenues generated from markets outside the United States for fiscal 1995 and 1994 were $38.5 million and $25.1 million, or 28.1% and 26.7% of total revenues, respectively. -18- 19 ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED) COST OF REVENUES
1995 CHANGE 1994 - - ------------------------------------------------------------------------- (dollars in thousands) Software licenses $ 4,454 57.9% $ 2,820 Gross profit percentage 94.3% 94.5% - - ------------------------------------------------------------------------- License renewals and services $36,443 46.2% $24,921 Gross profit percentage 38.4% 41.5% - - -------------------------------------------------------------------------
Cost of software license revenues consists primarily of the cost of product packaging and documentation materials, amortization of capitalized software costs, amortization of certain intangible assets related to business acquisitions, and royalty expenses. The increase in the cost of software license revenues principally reflects the associated increase in the number of software licenses sold and the amortization of capitalized costs ($1 million) related to new products and product enhancements. The amortization of capitalized software costs commences upon the general release of the software to customers. The increase in the cost of license renewal and service revenues was due primarily to additional staffing expense for both installation and ongoing support services. The professional services staff includes new members dedicated to the company's newly released (March 1995) set of accounting products. OPERATING EXPENSES
1995 CHANGE 1994 - - ------------------------------------------------------------------------------ (dollars in thousands) Sales and marketing $44,324 47.6% $30,036 Percentage of total revenues 32.3% 31.9% - - ------------------------------------------------------------------------------ Product development $20,980 64.3% $12,767 Percentage of total revenues 15.3% 13.5% - - ------------------------------------------------------------------------------ General and administrative $11,302 16.5% $ 9,703 Percentage of total revenues 8.2% 10.3% - - ------------------------------------------------------------------------------
The increase in sales and marketing expenses is primarily due to a net increase in sales-marketing personnel, an increase in commission costs directly associated with the significant increase in software license revenues and, to a lesser extent, greater overall marketing initiatives. The increase in product development expenses reflects additional personnel and third-party development costs associated with expanded research and development activities. In fiscal 1995 and 1994, the company capitalized $5.2 million and $4 million of software development costs, respectively, in accordance with Statement of Financial Accounting Standards No. 86, "Accounting for the Costs of Computer Software to be Sold, Leased, or Otherwise Marketed." The amounts capitalized primarily relate to the company's development of Microsoft Windows-based financial management and accounting applications for client/server environments and represented 19.9% and 23.9% of total product development expenditures. Capitalized software costs are amortized over the estimated economic life of the product, but generally not more than four years. The increase in general and administrative expenses resulted from increases in personnel and professional services costs incurred to support the growth of the company's overall operations, partially offset by a decrease in the provision for doubtful accounts from the requirement of the prior year. -19- 20 ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED) On November 29, 1994, the company issued 1,141,592 shares of its common stock (including 146,970 shares underlying options and warrants assumed by Hyperion Software) in connection with the merger with Pillar Corporation. Pillar, based in California, develops, markets and supports client/server corporate budgeting and planning solutions. Pillar generated revenues of approximately $10 million for its year ended September 30, 1994. The acquisition has been accounted for as a pooling of interests and, accordingly, the financial statements have been restated for all prior periods to include Pillar. Further, all common share and per share data have been restated for prior periods. In connection with the acquisition, the company charged $1 million to operations in fiscal 1995 for nonrecurring merger and integration costs incurred. For further details, see Note B to the accompanying financial statements. NONOPERATING INCOME AND EXPENSE
1995 CHANGE 1994 - - ---------------------------------------------------------------------------- (dollars in thousands) Interest income $1,620 90.4% $ 851 - - ---------------------------------------------------------------------------- Interest expense $ (119) 1.7% $(117) - - ----------------------------------------------------------------------------
Interest income increased due to a general rise in interest rates and the increase in cash available for investment which resulted from operations. PROVISION FOR INCOME TAXES The company's effective income tax rate decreased from 41.6% to 39.7%, as a greater portion of the company's earnings arose in certain jurisdictions where the income tax rates are lower, offset 1.9% by nondeductible merger costs. NET INCOME As a result of the above factors, net income for 1995 increased to $12.1 million, or by 41%, from $8.6 million for 1994. RISK FACTORS AND QUARTERLY FINANCIAL INFORMATION The company operates with a minimal software licensing backlog. Therefore, quarterly revenues and operating results are quite dependent on the volume and timing of the signing of licensing agreements and product deliveries during the quarter, which are difficult to forecast. The company's future operating results may fluctuate due to these and other factors, such as customer buying patterns, the deferral and/or realization of deferred software license revenues according to contract terms, the timing of new product introductions and product upgrade releases, the company's hiring plans, the scheduling of sales and marketing programs, new product development by the company or its competitors and currency exchange rate movements. A significant portion of the company's quarterly software licensing agreements is concluded in the last month of the fiscal quarter, generally with a concentration of such revenues earned in the final ten business days of that month. The company generally has realized lower revenues in its first (September) and third (March) fiscal quarters than in the immediately following quarters. The company believes that these revenue fluctuations are caused by customer buying patterns, including traditionally slow purchase activity in the summer months and low purchase activity in the corporate financial applications market during the March quarter, as many potential customers are busy with their year-end closing and financial reporting. In any case, due to the relatively fixed nature of certain costs, including personnel and facilities expenses, a decline or shortfall in quarterly and/or annual revenues typically results in lower profitability or may result in losses. -20- 21 ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED) Except for the historical information contained in this report on Form 10-K, the matters discussed herein are forward looking statements that involve risks and uncertainties. The company's future results may vary significantly based on a number of factors, such as those discussed in the preceding paragraph, as well as other risks as detailed in the company's registration statement on Form S-3 declared effective January 18, 1995, particularly under "Investment Considerations." The following table sets forth certain unaudited operating results for each of the company's eight most recent fiscal quarters. This information has been prepared by the company on the same basis as its audited financial statements appearing elsewhere in this Annual Report and includes all adjustments (consisting only of normal recurring adjustments) necessary to present fairly this information when read in conjunction with the company's audited financial statements and notes thereto. The company's operating results for any one quarter or series of quarters are not necessarily indicative of results for any future period.
Quarter Ended ---------------------------------------------------------------------------------- June 30, March 31, Dec. 31, Sept. 30, June 30, March 31, Dec. 31, Sept. 30, 1996 1996 1995 1995 1995 1995 1994 1994 ---------------------------------------------------------------------------------- (in thousands, except per share data) (unaudited) Total revenues $58,610 $36,856 $40,725 $36,633 $50,676 $30,082 $30,055 $26,328 Operating income 8,423 383 2,032(a) 3,182 10,868 1,941 3,009(b) 2,820 Net income 5,351 369 1,521(a) 2,216 6,860 1,397 2,011(b) 1,871 Earnings per share .30 .02 .08(a) .12 .39 .08 .12(b) .11 (a) Includes one-time charges relating to purchases of research and development, which had the effect of reducing operating income by $2 million and net income by approximately $1.3 million or $.07 per share. (b) Includes nonrecurring merger and integration charges relating to the acquisition of Pillar Corporation, which had the effect of reducing operating and net income by approximately $1 million or $.05 per share.
-21- 22 ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED) LIQUIDITY AND CAPITAL RESOURCES - - -------------------------------------------------------------------------------- To date, the company has financed its business principally through positive cash flow from operations and sales of its common stock. For fiscal years 1996, 1995, and 1994, the company generated positive cash flow from operations of $34.1 million, $28.9 million and $19.7 million, respectively. Cash used by investing activities amounted to $41.8 million for fiscal 1996, including $15.5 million for office facilities in progress, $16.7 million for leasehold improvements and purchases of equipment and software, $5.8 million for product development costs and $3.2 million for business acquisitions, as described above, and to reacquire company product distribution and service rights for certain territories of Europe. Financing activities in fiscal 1996, including stock options exercised by employees and payment of indebtedness, generated cash of $4.8 million. In connection with the stock options exercised by certain of its employees (for a total of 984,560 common shares), the company recognized (as a credit to additional paid-in capital) an income tax benefit of $3.4 million for the year ended June 30, 1996. As of June 30, 1996, the company had cash and cash equivalents of $42.4 million and working capital of $27.4 million, no long-term debt other than the mortgage loan (currently at an interest rate of 3.06%) for the Stamford, Connecticut office facility, and its ratio of current assets to current liabilities was 1.4 to 1. Cash equivalents are comprised primarily of investment grade U.S. state and political subdivision obligations with varying terms of three months or less. The company has long-term credit availability of $25 million under a revolving credit facility. For further details of the credit facility, see Note E of the company's financial statements. The company anticipates capital expenditures of approximately $35 million for its 1997 fiscal year. In July 1996, the company acquired a client base and the exclusive distribution and service rights to its corporate budgeting product in Belgium, France and the United Kingdom for $7.6 million. The company intends to continue to review potential acquisitions that it believes would enhance its growth and profitability. From time to time, in the normal course of business, various claims are made against the company. At this time, in the opinion of management, there are no pending claims the outcome of which is expected to result in a material adverse effect on the financial position of the company. The company believes that funds generated from operations, existing cash balances and its available credit facility will be sufficient to finance the company's operations for at least the next two years. -22- 23 ITEM 8. REPORT OF INDEPENDENT AUDITORS FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA -23- 24 REPORT OF INDEPENDENT AUDITORS Board of Directors and Stockholders Hyperion Software Corporation We have audited the accompanying consolidated balance sheet of Hyperion Software Corporation and subsidiaries as of June 30, 1996 and 1995, and the related consolidated statements of income, stockholders' equity, and cash flows for each of the three years in the period ended June 30, 1996. Our audits also included the financial statement schedule listed in the index at Item 14(a). These financial statements and schedule are the responsibility of the company's management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Hyperion Software Corporation and subsidiaries at June 30, 1996 and 1995 and the consolidated results of their operations and their cash flows for each of the three years in the period ended June 30, 1996, in conformity with generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, present fairly in all material respects the information set forth therein. Stamford, Connecticut July 19, 1996 -24- 25 ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA Hyperion Software Corporation Consolidated Balance Sheet (in thousands, except for share data)
JUNE 30, 1996 1995 -------------------- ASSETS Current assets: Cash and cash equivalents $ 42,361 $ 45,494 Accounts receivable--net of allowances of $4,900 and $2,500 55,674 48,006 Prepaid expenses and other current assets 3,925 4,124 Deferred income taxes 3,349 2,059 -------------------- TOTAL CURRENT ASSETS 105,309 99,683 Property and equipment--at cost, less accumulated depreciation and amortization of $21,063 and $13,570 54,606 32,093 Product development costs--at cost, less accumulated amortization of $7,818 and $4,604 11,985 9,401 Goodwill and other intangible assets--at cost, less accumulated amortization of $5,784 and $4,337 6,087 3,007 Deposits and other assets 1,461 1,974 -------------------- Total assets $179,448 $146,158 ==================== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable and accrued expenses $ 20,728 $ 13,050 Accrued employee compensation and benefits 15,380 14,879 Income taxes payable 4,215 3,108 Deferred revenue 36,832 30,599 Notes payable 705 741 -------------------- TOTAL CURRENT LIABILITIES 77,860 62,377 Mortgage payable 8,336 8,910 Deferred income taxes 3,249 3,165 COMMITMENTS AND CONTINGENCIES - Note H Stockholders' equity: Preferred stock--$.01 par value; authorized--1,000,000 shares; none issued Common stock--$.01 par value; authorized--100,000,000 shares; issued-- 21,362,626 and 20,378,066 shares 214 204 Additional paid-in capital 73,440 64,262 Retained earnings 30,116 20,659 Currency translation adjustments (534) (386) Treasury stock, at cost--4,329,464 and 4,320,840 shares (13,233) (13,033) -------------------- TOTAL STOCKHOLDERS' EQUITY 90,003 71,706 -------------------- Total liabilities and stockholders' equity $179,448 $146,158 ====================
See accompanying notes. -25- 26 Hyperion Software Corporation Consolidated Statement of Income (in thousands, except per share data)
YEAR ENDED JUNE 30, 1996 1995 1994 -------------------------------- REVENUES Software licenses $ 90,304 $ 77,985 $51,687 License renewals and services 82,520 59,156 42,575 -------------------------------- Total revenues 172,824 137,141 94,262 COSTS AND EXPENSES Cost of revenues: Software licenses 4,780 4,454 2,820 License renewals and services 53,258 36,443 24,921 Sales and marketing 55,484 44,324 30,036 Product development 26,839 20,980 12,767 Purchased research and development 2,000 General and administrative 16,443 11,302 9,703 Merger and integration 1,000 -------------------------------- 158,804 118,503 80,247 -------------------------------- OPERATING INCOME 14,020 18,638 14,015 Interest income 1,480 1,620 851 Interest expense (243) (119) (117) -------------------------------- INCOME BEFORE INCOME TAXES 15,257 20,139 14,749 Provision for income taxes 5,800 8,000 6,140 -------------------------------- NET INCOME $ 9,457 $ 12,139 $ 8,609 ================================ EARNINGS PER SHARE Primary $.53 $.70 $.52 Fully diluted $.53 $.69 $.52 AVERAGE NUMBER OF SHARES OUTSTANDING Primary 17,875 17,316 16,584 Fully diluted 17,933 17,480 16,600
See accompanying notes. -26- 27 Hyperion Software Corporation Consolidated Statement of Stockholders' Equity (in thousands, except for share data)
Common Stock ----------------- Additional Currency Par Paid-in Retained Translation Treasury Shares Value Capital Earnings Adjustments Stock ---------------------------------------------------------------------- Balance at June 30, 1993 9,509,684 $ 95 $53,267 $ 927 $(573) $(13,033) Two-for-one stock split 9,509,684 95 (95) ---------------------------------------------------------------------- As restated 19,019,368 190 53,172 927 (573) (13,033) Exercise of stock options/ sale of shares 562,942 6 3,026 Income tax benefit from exercise of stock options 1,200 Currency translation effect 137 Net income 8,609 ---------------------------------------------------------------------- Balance at June 30, 1994 19,582,310 196 57,398 9,536 (436) (13,033) Charge reflecting change in Pillar Corporation's fiscal year (1,016) Exercise of stock options 795,756 8 3,669 Income tax benefit from exercise of stock options 3,195 Currency translation effect 50 Net income 12,139 ---------------------------------------------------------------------- Balance at June 30, 1995 20,378,066 204 64,262 20,659 (386) (13,033) Exercise of stock options 984,560 10 5,790 (200) Income tax benefit from exercise of stock options 3,388 Currency translation effect (148) Net income 9,457 ---------------------------------------------------------------------- BALANCE AT JUNE 30, 1996 21,362,626 $214 $73,440 $30,116 $(534) $(13,233) ======================================================================
See accompanying notes. -27- 28 Hyperion Software Corporation Consolidated Statement of Cash Flows (in thousands)
YEAR ENDED JUNE 30, 1996 1995 1994 --------------------------------- OPERATING ACTIVITIES Net income $ 9,457 $ 12,139 $ 8,609 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 14,032 8,338 5,347 Accounts receivable allowance provisions 4,229 1,667 2,029 Deferred income taxes (1,206) 210 2,312 Charge reflecting change in Pillar Corporation's fiscal year (1,016) Changes in operating assets and liabilities: Accounts receivable (11,897) (15,843) (12,126) Prepaid expenses and other assets 235 (2,463) 161 Accounts payable and accrued expenses 8,492 11,286 3,898 Income taxes payable 4,495 5,074 448 Deferred revenue 6,233 9,544 9,029 --------------------------------- Cash provided by operating activities 34,070 28,936 19,707 INVESTING ACTIVITIES Office facilities in progress (15,492) (14,308) Leasehold improvements and purchases of furniture, equipment and software (16,726) (12,880) (5,740) Product development costs (5,798) (5,207) (4,009) Deposits and intangible assets (636) (1,921) Business acquisitions (3,183) --------------------------------- Cash used by investing activities (41,835) (34,316) (9,749) FINANCING ACTIVITIES Notes payable--proceeds (payments), net (610) (309) 309 Mortgage payable--proceeds 9,500 Exercise of stock options by employees/sale of common stock 5,390 3,720 2,989 --------------------------------- Cash provided by financing activities 4,780 12,911 3,298 Effect of exchange rate changes (148) 50 137 --------------------------------- INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (3,133) 7,581 13,393 Cash and cash equivalents at beginning of year 45,494 37,913 24,520 --------------------------------- CASH AND CASH EQUIVALENTS AT END OF YEAR $ 42,361 $ 45,494 $ 37,913 ================================= SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION Cash paid during the year for: Income taxes $2,511 $2,716 $2,170 Interest ($266 and $243 capitalized in 1996 and 1995) 497 311 69
See accompanying notes. -28- 29 Hyperion Software Corporation Notes to Consolidated Financial Statements BUSINESS Hyperion Software Corporation (the "company") develops, markets and supports complete financial management and accounting solutions for large, multinational corporations. The company's client/server products facilitate the accounting, budgeting, multisource consolidation and business analysis processes, giving users fast, dynamic access to and querying capabilities of interrelated financial information. A common set of delivery technologies enable superior reporting, spreadsheet analysis, data entry and intranet information access. A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation The consolidated financial statements include the accounts of the company and its subsidiaries, all of which are wholly owned. All significant intercompany accounts and transactions have been eliminated. Assets and liabilities denominated in foreign currencies are translated at the exchange rate on the balance sheet date. The related revenues, costs and expenses are translated at average rates of exchange prevailing during the reporting period. Translation adjustments resulting from this process are charged or credited to stockholders' equity. Use of Estimates The preparation of financial statements in accordance with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. Revenue Recognition Software license revenues are recognized upon execution of the license agreement and delivery of the software. In all cases, however, collection of any related receivable must be probable and no significant post-contract obligations of the company shall be remaining. License renewal fees for routine support and product updates are recognized ratably over the term of the license agreement. Current Assets and Liabilities The company considers highly liquid investment instruments with remaining terms of three months or less at the time of acquisition to be cash equivalents. Cash equivalents are comprised primarily of investment grade U.S. state and political subdivision obligations. All current assets and liabilities, because of their short-term nature, are stated at cost, which approximates market value. Long-Lived Assets In 1995, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards ("SFAS") No. 121, "Accounting for the Impairment of Long-Lived Assets to Be Disposed Of." The company will adopt SFAS No. 121 in fiscal 1997, and the impact, if any, is not expected to be material. -29- 30 Hyperion Software Corporation Notes to Consolidated Financial Statements (continued) A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Product Development Costs The company begins capitalizing product development costs, principally wages and contractor fees, only after establishing commercial and technical viability. Product development costs are stated at the lower of cost or net realizable value. Annual amortization of these costs represents the greater of the amount computed using (i) the ratio that current gross revenues for the product(s) bear to the total current and anticipated future gross revenues for the product(s), or (ii) the straight-line method over the remaining estimated economic life of the product(s); generally such deferred costs are amortized over four years. Amortization commences when the product is available for general release to customers. Amortization expense totaled $3.2 million for 1996, $2.2 million for 1995 and $1.3 million for 1994. Depreciation/Amortization Depreciation and amortization are computed principally using the straight-line method over the estimated useful lives of the applicable assets. Income Taxes The company provides for taxes based on current taxable income and the future tax consequences of temporary differences between the financial reporting and income tax carrying values of its assets and liabilities. Earnings Per Share Earnings per share ("EPS") are calculated by dividing net income by the weighted average number of common and common equivalent shares outstanding during the period after giving effect to the two-for-one stock split and merger with Pillar Corporation (see Note B). For primary EPS, common equivalent shares are shares which would be issuable upon the exercise of outstanding stock options, reduced by the number of shares assumed to be purchased by the company with the proceeds obtained therefrom at the average market price during the period. For the fully diluted EPS calculation, shares are assumed to be purchased by the company at the higher of the average or period-end market price and, therefore, this calculation may include additional equivalent shares. All share and per share data have been retroactively adjusted to reflect a two-for-one stock split effected in the form of a 100% stock dividend paid in December 1995. The stock dividend resulted in a retroactively applied transfer of approximately $.1 million (par value of $.01 per share) from additional paid-in capital to common stock. Equity Based Compensation The company accounts for stock option grants in accordance with Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees." The company generally prices its stock options at fair market value on the date of grant and, therefore, no compensation expense is recognized for the stock options granted. In fiscal 1997, the company intends to adopt the disclosure provisions of SFAS No. 123, "Accounting for Stock-Based Compensation." B. ACQUISITIONS In July 1996, the company acquired a client base and the exclusive distribution and service rights to its corporate budgeting product in Belgium, France and the United Kingdom for $7.6 million. The acquisition will be accounted for as a purchase transaction in fiscal 1997 and, accordingly, the purchase price will be allocated to identifiable intangible assets based on their estimated fair values. -30- 31 Hyperion Software Corporation Notes to Consolidated Financial Statements (continued) B. ACQUISITIONS (CONTINUED) During the quarter ended December 1995, the company concluded two strategic acquisitions, described below, involving application technologies and an important European client base. The acquisitions, which amounted to $3.6 million, were accounted for as purchase transactions and, accordingly, $2 million was allocated to purchased research and development and $1.6 million was allocated to identifiable intangible assets based on their estimated fair values. The purchased research and development is reflected as a one-time charge in the company's operating results. The charge had the effect of reducing net income for fiscal 1996 by approximately $1.3 million or $.07 per share. In December 1995, the company acquired certain assets and application technologies, and assumed certain obligations of Trust Consult s.a., a Brussels-based financial solutions provider. Along with over 130 customers, Hyperion gained significant European statutory consolidation and reporting expertise and technology. The net operating results of the acquired business from the date of purchase are included in the accompanying statement of income. Pro forma statement of income data as if the acquisition had occurred on July 1, 1993 is not shown, as it would not differ significantly from reported results. In November 1995, the company acquired certain rights from Sinper Corporation to its powerful database engine, TM/1, technology. The new technology was used in the development of Hyperion OLAP (On-Line Analytical Processing), a solution for customers' most complex and high volume multidimensional analysis needs, such as product profitability and sales analysis. Hyperion OLAP became commercially available in April 1996. On November 29, 1994, the company issued 1,141,592 shares of its common stock (including 146,970 shares underlying options and warrants assumed by Hyperion Software) in connection with the merger with Pillar Corporation ("Pillar"). Pillar, based in California, develops, markets and supports client/server corporate budgeting and planning solutions. The acquisition has been accounted for as a pooling of interests. Accordingly, the financial statements have been restated for all prior periods to include Pillar. Further, all common share and per share data have been restated for prior periods. For the pre-merger periods indicated, revenues and net income of the company and Pillar are as follows, in thousands:
Three months ended Year ended September 30, 1994 June 30, 1994 - - ------------------------------------------------------------------------------ (unaudited) REVENUES Hyperion Software $22,470 $84,384 Pillar 3,858 9,878 - - ------------------------------------------------------------------------------ $26,328 $94,262 ============================================================================== NET INCOME Hyperion Software $ 1,225 $ 8,470 Pillar 1,016 139 adjustment(a) (370) - - ------------------------------------------------------------------------------ $ 1,871 $ 8,609 ============================================================================== (a) To adjust the provision for income taxes to reflect, on a combined company basis, the annual effective tax rate.
-31- 32 Hyperion Software Corporation Notes to Consolidated Financial Statements (continued) B. ACQUISITIONS (CONTINUED) Pillar previously used the fiscal year ended September 30 for its financial reporting. Pillar's operating results for the year ended September 30, 1994 are included in the accompanying statement of income in the column headed June 30, 1994. The statement of income's comparative 1996 and 1995 results reflect the operations of Hyperion Software and Pillar for the years ended June 30, 1996 and 1995. Accordingly, the duplication of Pillar's net income, for the three months ended September 30, 1994, in retained earnings has been adjusted by a $1 million charge to retained earnings in fiscal 1995. In connection with the acquisition, the company charged $1 million to operations for nonrecurring merger and integration costs (principally professional fees) incurred. C. PROPERTY, EQUIPMENT AND RELATED MORTGAGE LOAN Property and equipment consists of the following at June 30:
Depreciation/ Amortization 1996 1995 Period -------------------------------------------------------------------------------------------- (in thousands) (years) Land $ 3,800 $ 3,800 Office facilities in progress 26,000 10,508 39 Furniture, equipment and software 43,866 29,106 3 to 7 Leasehold improvements 2,003 2,249 lease term* ----------------------------------------------------------------------------- 75,669 45,663 Less accumulated depreciation and amortization 21,063 13,570 ----------------------------------------------------------------------------- $54,606 $32,093 ============================================================================= * Leasehold improvements are amortized over the lesser of the remaining life of the lease or the useful life of the improvements.
Depreciation and amortization of these assets totaled $9.4 million, $5.4 million and $3.2 million for 1996, 1995 and 1994, respectively. On January 20, 1995, the company completed the purchase of an office facility in Stamford, Connecticut for $11.4 million. The purchase price was financed by the Connecticut Development Authority ("CDA," an agency of the State of Connecticut) through a $9.5 million mortgage loan, with company funds used for the balance. In the interest of Connecticut-based jobs, the CDA agreed to such financing over a 15-year period at LIBOR minus 2%, subject to, among other things: (i) the creation of a specified number of new Connecticut-based jobs, (ii) a 10-year residency in the state, and (iii) the payment of the remaining unpaid principal at the end of year ten. Violations of certain such requirements, if any, would result in additional interest charges and/or a penalty payment. -32- 33 Hyperion Software Corporation Notes to Consolidated Financial Statements (continued) D. GOODWILL AND OTHER INTANGIBLE ASSETS Components of intangible assets, which relate primarily to business acquisitions, are as follows at June 30:
Amortization 1996 1995 Period ------------------------------------------------------------------------------- (in thousands) (years) Goodwill $ 3,648 $2,687 4 to 20 Software/technology 2,489 2,089 2 to 6 Customer base 2,219 1,019 3 to 5 Product distribution and service rights 1,570 809 3 to 7 Noncompete agreements 529 476 3 Copyrights, trademarks and other 1,416 264 4 to 6 ---------------------------------------------------------------- 11,871 7,344 Less accumulated amortization 5,784 4,337 ---------------------------------------------------------------- $ 6,087 $3,007 ================================================================
The carrying value of intangible assets will be reviewed by management if the facts and circumstances suggest that the value(s) may be impaired. If this review indicates that the carrying amount(s) will not be recoverable, as determined based on the undiscounted cash flows attributable to such asset(s) over the remaining amortization period, management will reduce the carrying amount by the estimated shortfall of cash flows. E. AVAILABLE CREDIT FACILITY The company may borrow up to $25 million under an amended and restated credit facility (the "Facility") with The Bank of New York. Key provisions of the Facility are as follows: (i) the maturity date is June 30, 2000, (ii) the interest rate is the bank's base rate plus .25% or, at the company's option, LIBOR plus 1.5%, (iii) a commitment fee is charged based on any unused credit, at the rate of .25% per annum, and (iv) borrowings under the Facility are limited to the sum of (a) 85% of eligible accounts receivable, as defined, from debtors located in the United States, plus (b) 75% of eligible accounts receivable, as defined, from debtors located outside of the United States. Other significant terms of the Facility restrict the company regarding the payment of dividends, capital expenditures and acquisitions, and additional indebtedness, including other fiscal commitments, and require the company to maintain minimum net worth and working capital ratios and to meet certain profitability criteria, as defined. Except for its office facilities (see Note C), substantially all of the company's assets have been pledged as security under terms of the Facility. -33- 34 Hyperion Software Corporation Notes to Consolidated Financial Statements (continued) F. INCOME TAXES Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and their tax bases. Significant components of deferred tax assets and liabilities at June 30 are as follows:
1996 1995 -------------------------------------------------------------------------------- (in thousands) Deferred income tax assets: Net operating loss carryforwards $ 4,054 $ 5,143 Deferred revenue 1,510 1,777 Accounts receivable, allowances 1,893 795 Other intangible assets, amortization 1,418 347 Tax credit carryforwards 876 675 Accrued expenses 310 103 Other 167 237 -------------------------------------------------------------------------------- 10,228 9,077 Less valuation allowance 4,944 5,985 -------------------------------------------------------------------------------- 5,284 3,092 -------------------------------------------------------------------------------- Deferred income tax liabilities: Product development costs 4,914 3,855 Property and equipment, depreciation 270 325 Other 18 -------------------------------------------------------------------------------- 5,184 4,198 -------------------------------------------------------------------------------- Net deferred income tax asset (liability) $ 100 $(1,106) ================================================================================
The provision for income taxes consists of the following charges (credits):
1996 1995 1994 -------------------------------------------------------------------------------- (in thousands) Current: U.S. $ 4,214 $5,211 $2,271 State 1,419 1,709 957 Other countries 1,373 870 600 -------------------------------------------------------------------------------- 7,006 7,790 3,828 -------------------------------------------------------------------------------- Deferred: U.S. (800) 252 1,766 State (379) 588 Other countries (27) (42) (42) -------------------------------------------------------------------------------- (1,206) 210 2,312 -------------------------------------------------------------------------------- $ 5,800 $8,000 $6,140 ================================================================================
The effective income tax rate varied from the statutory U.S. federal tax rate as follows:
1996 1995 1994 -------------------------------------------------------------------------------- Statutory U.S. tax rate 35.0% 35.0% 35.0% State income taxes, net of U.S. tax benefit 4.5 5.6 6.9 Tax exempt interest (1.9) (1.9) (1.3) Export sales (2.8) (2.4) (.9) Other--net 3.2 3.4 1.9 -------------------------------------------------------------------------------- Effective income tax rate 38.0% 39.7% 41.6% ================================================================================
-34- 35 Hyperion Software Corporation Notes to Consolidated Financial Statements (continued) F. INCOME TAXES (CONTINUED) The company has U.S. federal, state and foreign net operating loss (NOL) carryforwards of $12 million and U.S. federal and state tax credit carryforwards of $1.1 million, which expire as follows:
NOL Tax Credit Year Carryforwards Carryforwards ------------------------------------------------------------------------------ (in thousands) 1999 $ 547 2000 663 2001 160 2003 1,512 $ 55 2004 3,879 138 2005 and thereafter 2,712 326 No expiration date 2,525 549 ------------------------------------------------------------------------------ $11,998 $1,068 ==============================================================================
The company's utilization of NOL and tax credit carryforwards, acquired through the merger with Pillar Corporation (see Note B), is subject to annual limitations as prescribed by Sections 382 and 383 of the Internal Revenue Code and similar state authority. G. STOCK OPTION AND EMPLOYEE SAVINGS PROGRAMS Under the company's stock option plans and its employee stock purchase plan ("Plans") and under certain employee compensation arrangements, 5,779,956 (1,374,776 under the employee stock purchase plan) shares of common stock are reserved for issuance to eligible participants at June 30, 1996. Changes in outstanding options were as follows:
Price Range Shares ----------------------------------------------------------------------------------- Outstanding, June 30, 1993 $ .21 - $19.55 2,981,934 Options granted: Plans 1.57 - 15.64 810,958 Options exercised: Plans .75 - 9.75 (288,774) Compensation arrangements .38 - 2.75 (213,444) Options forfeited: Plans .98 - 9.13 (21,542) ----------------------------------------------------------------------------------- Outstanding, June 30, 1994 .21 - 19.55 3,269,132 ----------------------------------------------------------------------------------- Options granted: Plans 4.69 - 23.50 609,254 Options exercised: Plans .21 - 14.25 (435,956) Compensation arrangements .38 - 2.75 (359,800) Options forfeited: Plans .98 - 19.55 (28,942) ----------------------------------------------------------------------------------- Outstanding, June 30, 1995 .38 - 23.50 3,053,688 ----------------------------------------------------------------------------------- Options granted: Plans 7.25 - 23.88 1,756,081 Options exercised: Plans .38 - 19.55 (687,060) Compensation arrangements 1.88 - 2.75 (297,500) Options forfeited/exchanged: Plans .98 - 23.88 (765,458) ----------------------------------------------------------------------------------- OUTSTANDING, JUNE 30, 1996 $ .38 - $23.75 3,059,751 ===================================================================================
-35- 36 Hyperion Software Corporation Notes to Consolidated Financial Statements (continued) G. STOCK OPTION AND EMPLOYEE SAVINGS PROGRAMS (CONTINUED) Generally, options under the stock option plans expire 10 years after the date of grant, are granted at prices not less than fair market value and become exercisable over two- to four-year periods. Under the employee stock purchase plan, shares of the company's common stock may be purchased at six-month intervals at 85% of the lower of the fair market value on the first or the last business day of each six-month period. Employees may purchase shares having a value not exceeding 10% of their gross compensation, up to 1,000 shares, during an offering period. Options granted under employee compensation arrangements become exercisable and expire over various periods. At June 30, 1996, 1,663,658 options outstanding for common stock were exercisable and the average option price for all outstanding options was $9.67 per share. Outstanding options expire on various dates beginning August 29, 1996 and ending on June 18, 2006. The company maintains an employee savings plan that qualifies as a cash or deferred salary arrangement under Section 401(k) of the Internal Revenue Code. Under the plan, participating U.S. employees may defer up to 15% of their pre-tax compensation, but not more than $9,500 per calendar year. The company contributes to the plan, annually, up to a maximum of $1,000 per participant. Similar savings plans are maintained with respect to certain non-U.S. employees. In fiscal 1996, 1995 and 1994, the company contributed $1 million, $.7 million and $.5 million, respectively, to the savings plans. H. COMMITMENTS AND CONTINGENCIES The company leases office facilities and certain equipment under various operating lease agreements. The leases expire at various times through the year 2002. Future minimum lease payments under all operating leases with noncancellable terms in excess of one year amount to $12.6 million as follows (in millions): $4 in 1997, $3.2 in 1998, $2.5 in 1999, $1.9 in 2000 and $1 in 2001 and thereafter. Certain of the office leases provide as well for contingent payments based on building operating expenses. Rental expense for the years ended June 30, 1996, 1995 and 1994 under all lease agreements was $5.1 million, $4.4 million and $2.9 million, respectively. From time to time, in the normal course of business, various claims are made against the company. At this time, in the opinion of management, there are no pending claims the outcome of which is expected to result in a material adverse effect on the financial position of the company. I. STOCKHOLDER RIGHTS PLAN In November 1995, the company adopted a stockholder rights plan (the "Rights Plan") in which preferred stock rights were distributed as a rights dividend at the rate of one right for each share of common stock held as of the close of business on December 1, 1995. The Rights Plan is designed to deter coercive or unfair takeover tactics and to prevent an acquirer from gaining control of the company without offering a fair price to all of the company's stockholders. The plan is intended to protect the interests of stockholders in the event the company is confronted in the future with coercive or unfair takeover tactics. Each right will entitle holders of company common stock to buy one share of Series A Junior Participating Preferred Stock of the company at an exercise price of $150. The rights will be exercisable only if a person or group acquires more than 15% of the common stock, or announces a tender or exchange offer which would result in its ownership of 15% or more of the common stock, or a person owning 10% or more of the common stock is determined by the board to be an Adverse Person, as defined in the Rights Plan. -36- 37 Hyperion Software Corporation Notes to Consolidated Financial Statements (continued) I. STOCKHOLDER RIGHTS PLAN (CONTINUED) If any person or group becomes the beneficial owner of 20% or more of the common stock except pursuant to a tender offer for all shares at a price that a majority of the independent directors determines to be fair; a more-than-15% stockholder engages in a merger with the company in which the company survives and its common stock remains outstanding and unchanged; certain other self-dealing events involving the company and a more-than-15% stockholder occur; or, under certain circumstances, the board determines a 10% or more stockholder to be an Adverse Person (collectively "Flip-In Events"), each right not owned by such person or related parties will entitle its holder to purchase, at the then current exercise price of the right, common stock of the company having a value of twice the right's exercise price (or, in certain circumstances, a combination of cash, property, common stock or other securities or a reduction in the exercise price having an aggregate value equal to the value of the common stock otherwise purchasable). After the occurrence of a Flip-In Event and before any person or affiliated group becomes the owner of 50% or more of the then outstanding common stock, the company may also exchange one share of common stock for each right outstanding. In addition, if the company is involved in a merger or other business combination transaction with another person in which its common stock is changed or converted, or sells or transfers more than 50% of its assets or earning power to another person, each right that has not previously been exercised will entitle its holder to purchase, at the then current exercise price of the right, shares of common stock of such other person having a value of twice the right's exercise price. The company can, in certain circumstances, redeem the rights at $.01 per right. The rights will expire on November 17, 2005, unless earlier redeemed or exchanged. -37- 38 Hyperion Software Corporation Notes to Consolidated Financial Statements (continued) J. FINANCIAL DATA BY GEOGRAPHIC AREA
Other U.S. U.K. International Operations Operations Operations Eliminations Consolidated ------------------------------------------------------------------------------------------------- (in thousands) 1996 Revenues: Customers $140,888 $13,623 $18,313 $172,824 Intercompany 6,092 7,428 $(13,520) ------------------------------------------------------------------------------------------------- Total 146,980 13,623 25,741 $(13,520) 172,824 ================================================================================================= Operating income 12,579 921 520 14,020 ================================================================================================= Identifiable assets $150,977 $10,093 $18,378 $179,448 ================================================================================================= 1995 Revenues: Customers $115,284 $13,290 $ 8,567 $137,141 Intercompany 6,212 3,935 $(10,147) ------------------------------------------------------------------------------------------------- Total 121,496 13,290 12,502 $(10,147) 137,141 ================================================================================================= Operating income (loss) 23,120 928 (5,410) 18,638 ================================================================================================= Identifiable assets $128,033 $ 9,781 $ 8,344 $146,158 ================================================================================================= 1994 Revenues: Customers $ 82,581 $ 9,070 $ 2,611 $ 94,262 Intercompany 2,900 3,913 $ (6,813) ------------------------------------------------------------------------------------------------- Total 85,481 9,070 6,524 $ (6,813) 94,262 ================================================================================================= Operating income (loss) 14,174 667 (826) 14,015 ================================================================================================= Identifiable assets $ 86,132 $ 5,413 $ 3,170 $ 94,715 =================================================================================================
"Other International Operations" relate primarily to subsidiaries in Austria, Belgium, Canada, France, Germany, Italy, Netherlands, Singapore, Spain and Sweden. Operating income (loss) from operations outside the United States approximates income (loss) before income taxes of such operations. Intercompany revenues between geographic areas are accounted for at prices representative of unaffiliated party transactions of a similar nature. Revenues from markets outside the United States were as follows (dollars in thousands):
1996 1995 1994 ---------------------------------------------------------------------- U.K. operations $13,623 $13,290 $ 9,070 Other international operations 18,313 8,567 2,611 Export 25,439 16,614 13,455 ---------------------------------------------------------------------- $57,375 $38,471 $25,136 ====================================================================== Percentage of total revenues 33% 28% 27% ======================================================================
The majority of "Export" revenues, some of which are generated through independent distributors, results from product licenses and services sold to customers throughout Europe. -38- 39 Hyperion Software Corporation Notes to Consolidated Financial Statements (continued) K. QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) The following is a tabulation of the unaudited quarterly results of operations for the two years ended June 30, 1996 (in thousands, except per share data):
------------------------------------------------------------------------------ FISCAL 1996 SEPT. 30 DEC. 31 MARCH 31 JUNE 30 ------------------------------------------------------------------------------ Total revenues $36,633 $40,725 $36,856 $58,610 Gross profit 24,199 26,845 22,473 41,269 Net income 2,216 1,521(a) 369 5,351 Earnings per share .12 .08(a) .02 .30 ------------------------------------------------------------------------------ Fiscal 1995 Sept. 30 Dec. 31 March 31 June 30 ------------------------------------------------------------------------------ Total revenues $26,328 $30,055 $30,082 $50,676 Gross profit 17,924 20,993 20,291 37,036 Net income 1,871 2,011(b) 1,397 6,860 Earnings per share .11 .12(b) .08 .39 (a) Includes one-time charges relating to purchases of research and development, which had the effect of reducing net income by approximately $1.3 million or $.07 per share. (b) Includes nonrecurring merger and integration charges relating to the acquisition of Pillar Corporation, which had the effect of reducing net income by approximately $1 million or $.05 per share.
-39- 40 PART II (CONTINUED) ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None. PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT See the sections entitled "Election of Directors" and "Section 16(a) Beneficial Ownership Reporting Compliance," which are incorporated herein by reference to the company's Proxy Statement for its 1996 Annual Meeting of Stockholders. See also the section entitled "Employees" appearing in Part I hereof. ITEM 11. EXECUTIVE COMPENSATION See the section entitled "Compensation Information Concerning Directors and Officers," which is incorporated herein by reference to the company's Proxy Statement for its 1996 Annual Meeting of Stockholders. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT See the section entitled "Principal Holders of Voting Securities," which is incorporated herein by reference to the company's Proxy Statement for its 1996 Annual Meeting of Stockholders. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS. See the section entitled "Certain Transactions," which is incorporated herein by reference to the company's Proxy Statement for its 1996 Annual Meeting of Stockholders. -40- 41 PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K (a) The following documents are filed as part of this report: (1) The consolidated financial statements of Hyperion Software Corporation are included in Item 8: Consolidated Balance Sheet as of June 30, 1996 and 1995 Consolidated Statement of Income for the years ended June 30, 1996, 1995 and 1994 Consolidated Statement of Stockholders' Equity for the years ended June 30, 1996, 1995 and 1994 Consolidated Statement of Cash Flows for the years ended June 30, 1996, 1995 and 1994 Notes to Consolidated Financial Statements (2) Financial statement schedule, which is included at the end of this report: Schedule VIII - Valuation and Qualifying Accounts All other schedules have been omitted since they are not required, not applicable or the information has been included in the consolidated financial statements or the notes thereto. (3) Exhibits: Exhibit No. Description ----------- ----------- 3.1 (b) - Restated Certificate of Incorporation of the company 3.2 (b) - By-laws, as amended and restated, of the company 10.1 (b) - 1985 Incentive Stock Option Plan 10.2 (b) - 1989 Stock Option Plan 10.3 (b) - 1991 Stock Plan 10.4 (b) - 1991 Employee Stock Purchase Plan 10.5 (b) - 1991 Non-Employee Director Stock Option Plan 10.6 (b) - Sub-Lease Agreement with Amstar Corporation for the lease of premises located at 777 Long Ridge Road, Stamford, CT 10.7 (b) - Sub-Lease Agreement with Citicorp North America, Inc. for the lease of premises located at 777 Long Ridge Road, Stamford, CT 10.8 (b) - Sub-Lease Agreement with National Reinsurance Corporation for the lease of premises located at 777 Long Ridge Road, Stamford, CT 10.9 (c) - Amended and Restated Credit Agreement with The Bank of New York and the signatory banks thereto, dated as of May 1, 1992 (including forms of guaranty and security agreement, and pledge agreement) 10.10 (b) - Registration Rights Agreement among the company and certain holders of Common Stock of the company, dated as of August 9, 1991 -41- 42 Exhibit No. Description ----------- ----------- 10.11 (f) - Employment Agreement with James A. Perakis, dated as of August 1, 1993 10.12 (f) - Employment Agreement with David M. Sample, dated as of July 1, 1994 10.13 (f) - Employment Agreement with Lucy Rae Ricciardi, dated as of July 1, 1994 10.14 (f) - Employment Agreement with Craig M. Schiff, dated as of July 1, 1994 10.15 (f) - Employment Agreement with John N. Adinolfi, dated as of July 1, 1994 10.16 (f) - Employment Agreement with Gordon O. Rapkin, dated as of July 1, 1994 10.17 (b) - Agreement with Marco Arese Lucini, dated as of October 1, 1990 10.18 (b) - Stock Option Agreement with Harry S. Gruner, dated as of December 22, 1989 10.19 (b) - Employment Agreement with Thomas Bell, dated as of July 1, 1994 10.20 (b) - Form of Software License Agreement 10.21 (b) - Consulting Agreement with Natcom Consulting Services Ltd., dated as of January 1, 1988 10.22 (b) - Consulting Agreement with Natcom Consulting Services Ltd., dated as of January 1, 1991, and amendments thereto 10.23 (b) - Software Development License Agreement with Teknedata S.R.L. 10.24 (b) - Lease with 1033 Washington Blvd. Associates, dated as of December 23, 1985 and amended thereto 10.25 (h) - Purchase and Sale Agreement with Combustion Engineering, Inc., dated January 20, 1995, regarding the purchase of an office facility 10.26 (h) - Loan Agreement with the Connecticut Development Authority, dated January 20, 1995, regarding the financing of an office facility (including related Promissory Note and Mortgage Deed) 10.27 (b) - License Agreement with KPMG Peat Marwick Hungerfords Managements Consultants dated as of June 8, 1989 10.28 (b) - Trademark and Tradename License Agreement with KPMG of Hong Kong 10.29 (b) - License Agreement with IMRS Nordic dated as of January 1, 1989 10.30 (b) - License Agreement with Prologic Decision Support (PTY) Ltd. dated as of March 28, 1991 10.31 (b) - License Agreement with Arthur Andersen Japan dated as of December 17, 1990 10.32 (a) - Software Development and License Agreement with Channel Computing, Inc., dated February 27, 1992 10.33 (b) - License Agreement with Arthur Andersen AG dated as of November 2, 1989 10.34 [Reserved] 10.35 [Reserved] 10.36 (a) - Distributor Agreement with Arthur Andersen Auditors, S.A. dated March 1, 1992 10.37 (a) - Distributor Agreement with Austrian Industries Informatics Ges.m.b.H dated July 1, 1992 10.38 (c) - Amendment to the Termination of the License Agreement with Sema Group Systems Limited, Government and Commerce Division, dated March 31, 1992 10.39 (c) - Exclusive Sales Agency Agreement with Sema Group Systems Limited, Government and Commerce Division, dated April 1, 1992 10.40 (c) - Business Purchase and Sale Agreement with Sema Group Systems Limited, Government and Commerce Division, dated March 31, 1992, effective July 1, 1992 -42- 43 Exhibit No. Description ----------- ----------- 10.41 (d) - Asset Purchase and Sale Agreement between Columbia Software, Inc. and IMRS Inc., dated January 21, 1993 10.42 (d) - Asset Purchase and Sale Agreement between MAI Systems Corporation and IMRS Inc., dated February 12, 1993 10.43 (e) - Letter Agreement with Arthur Andersen AG, dated as of May 19, 1993, regarding distribution of company products in Switzerland and Liechtenstein 10.44 (i) - Waiver and Amendment No. 2 to Amended and Restated Credit Agreement with The Bank of New York and signatory banks thereto, dated as of June 30, 1995 10.45 (e) - Employment Agreement with Terence W. Rogers, dated as of July 16, 1993 10.46 (f) - Distributor Agreement with Consultores de Integracion de Sistemas S.A. de C.V. 10.47 (f) - Distributor Agreement with Delteq Systems Pte Ltd. 10.48 (g) - Agreement and Plan of Reorganization dated as of November 7, 1994 by and among IMRS Inc., IP Merger, Inc., Pillar Corporation and American Stock Transfer & Trust Company, as escrow Agent 10.49 (g) - Agreement and Plan of Merger dated as of November 29, 1994 among IMRS Inc., IP Merger, Inc. and Pillar Corporation 10.50 - Employment Agreement with Peter F. DiGiammarino, dated as of May 29, 1996 (filed herewith) 11.1 - Statement Re: Computation of Earnings Per Share (filed herewith) 22.1 - Subsidiaries of the company (filed herewith) 23.1 - Consent of Ernst & Young LLP, independent auditors (filed herewith) - - ----------------- (a) Incorporated by reference to the exhibits to the registrant's Registration Statement on Form S-1 File No. 33-50694) (b) Incorporated by reference to the exhibits to the registrant's Registration Statement on Form S-1 File No. 33-42855) (c) Incorporated by reference to the exhibits to the registrant's Quarterly Report on Form 10-Q for the quarter ended March 31, 1992 (d) Incorporated by reference to the exhibits to the registrant's Quarterly Report on Form 10-Q for the quarter ended December 31, 1992 (e) Incorporated by reference to the exhibits to the registrant's Annual Report on Form 10-K for the year ended June 30, 1993 (f) Incorporated by reference to the exhibits to the registrant's Annual Report on Form 10-K for the year ended June 30, 1994 (g) Incorporated by reference to the exhibits to the registrant's Current Report on Form 8-K, dated November 29, 1994, which was filed on December 14, 1994 (h) Incorporated by reference to the exhibits to the registrant's Quarterly Report on Form 10-Q for the quarter ended December 31, 1994 (i) Incorporated by reference to the exhibits to the registrant's Annual Report on Form 10-K for the year ended June 30, 1995 (b) Reports on Form 8-K: No reports on Form 8-K were filed or were required to be filed by the registrant during the fourth quarter of the fiscal year ended June 30, 1996. -43- 44 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Date: September 20, 1996 Hyperion Software Corporation (Registrant) By: /s/ James A. Perakis ------------------------------------ James A. Perakis Chief Executive Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
SIGNATURE TITLE DATE - - --------- ----- ---- /s/ James A. Perakis Chief Executive Officer and Chairman September 20, 1996 - - --------------------------------- James A. Perakis /s/ Peter F. DiGiammarino President, Chief Operating Officer and Director September 20, 1996 - - --------------------------------- Peter F. DiGiammarino /s/ Gary G. Greenfield Director September 23, 1996 - - --------------------------------- Gary G. Greenfield /s/ Harry S. Gruner Director September 21, 1996 - - --------------------------------- Harry S. Gruner /s/ William W. Helman IV Director September 24, 1996 - - --------------------------------- William W. Helman IV /s/ Marco Arese Lucini Director September 23, 1996 - - --------------------------------- Marco Arese Lucini /s/ Aldo Papone Director September 24, 1996 - - --------------------------------- Aldo Papone /s/ Robert W. Thomson Director September 22, 1996 - - --------------------------------- Robert W. Thomson /s/ Lucy Rae Ricciardi Senior Vice President and Chief Financial Officer September 20, 1996 - - --------------------------------- Lucy Rae Ricciardi /s/ Michael A. Manto Vice President and Corporate Controller September 20, 1996 - - --------------------------------- Michael A. Manto
-44- 45 ITEM 14(a)(2) AND ITEM 14(d). FINANCIAL STATEMENT SCHEDULE HYPERION SOFTWARE CORPORATION SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS (in thousands) ============================================================================================================
Additions ------------------------------ Charged Balance at Charged to to Other Balance Beginning Costs and Accounts Deductions- at End Description of Period Expenses - Describe (a) Describe of Period ----------- --------------------------------------------------------------------- For the year ended June 30, 1994 Allowance for doubtful accounts, returns and discounts $1,216 1,118 911 1,605 (b) $1,640 Valuation allowance for deferred tax assets 5,810 153 181 (c) 5,782 For the year ended June 30, 1995 Allowance for doubtful accounts, returns and discounts $1,640 320 1,347 807 (b) $2,500 Valuation allowance for deferred tax assets 5,782 567 364 (c) 5,985 For the year ended June 30, 1996 Allowance for doubtful accounts, returns and discounts $2,500 1,159 3,070 1,829 (b) $4,900 Valuation allowance for deferred tax assets 5,985 486 1,527 (c) 4,944 (a) Charged to revenues (b) Write-offs, returns and discounts, net of recoveries (c) Recognition and adjustments
EX-10.50 2 EMPLOYMENT AGREEMENT WITH PETER F. DIGIAMMARINO 1 Exhibit 10.50 EMPLOYMENT AGREEMENT EMPLOYMENT AGREEMENT (hereinafter referred to as "Agreement") made as of the May 29, 1996, between Peter DiGiammarino, of McLean, Virginia (hereinafter referred to as the "Employee") and Hyperion Software Operations Inc., a Delaware corporation with offices at 900 Long Ridge Road, Stamford, Connecticut 06902 (hereinafter referred to as the "Corporation"). WHEREAS, the Corporation desires to employ the Employee, and the Employee desires to serve as an employee of the Corporation on the terms and conditions hereinafter set forth. NOW THEREFORE, in consideration of the mutual covenants and promises of the parties hereto, the Corporation and the Employee agree as follows: 1. EMPLOYMENT: The Corporation hereby agrees to employ the Employee as President and Chief Operating Officer ("COO") of Hyperion Software Corporation to perform managerial and executive functions of the Corporation, and the Employee hereby agrees to perform such services for the Corporation on the terms and conditions hereinafter stated, subject to the directives of the Board of Directors of the Corporation. The Employee will report to the Chairman of the Board ("COB"), and his duties will include those normally associated with a COO position, but for at least the first six months, an emphasis will be placed on developing an in-depth understanding of the business. The Employee will be working cooperatively with the COB in the day to day management of the business, with all functions of the Corporation reporting directly to the Employee. The Employee will be located at the Corporation's headquarters in Stamford, Connecticut. By virtue of this Agreement, and subject to formal action by the Board of Directors at the next Board Meeting, the Employee shall be elected to a seat on the Board of Directors. Promotion to Chief Executive Officer is currently expected within two years and will be subject to approval of the Board of Directors. 2. TERM OF EMPLOYMENT: The Employee's employment shall begin as of the date of execution of this Agreement, which shall be the Employee's date of hire for purposes of this Agreement. The initial term of the Employee's employment shall begin on the date the Employee begins working at the Stamford office (the "Start Date"), which shall be on or before July 15, 1996 and shall continue until the third anniversary of the Start Date, provided, however, the Employee's employment shall be automatically renewed from year to year thereafter for successive one (1) year terms unless terminated by either party on written notice sent not later than sixty (60) days prior to the expiration of the initial three (3) year term or any renewal year, unless sooner terminated as provided herein. 2 3. COMPENSATION: (a) The Corporation shall pay the Employee an annual base salary ("Base Salary") for the first year of this Agreement equal to TWO HUNDRED AND FIFTY THOUSAND DOLLARS ($250,000) per annum, payable at the rate of TEN THOUSAND FOUR HUNDRED AND SIXTEEN AND 67/100 DOLLARS ($10,416.67) on the 15th and last day of each month. This Base Salary may be increased effective twelve months from the hire date and annually thereafter in an amount to be determined by the Board of Directors in its sole discretion. (b) As additional compensation, the Corporation, as determined by the Board of Directors and COB, shall pay to the Employee an annual performance bonus based upon achievement of a set of targets mutually agreed on among the Board of Directors, the COB and Employee. The determination of whether the Employee has achieved or exceeded any qualitative targets or objectives shall be made by the Board of Directors and COB in their reasonable discretion. Each fiscal year during the term hereof, the Employee shall, prior to July 15, submit such targets to the Board of Directors for its review. In reviewing the targets, the Board of Directors shall take into consideration, among other factors, the Corporation's progress in achieving the strategic goals established in the annual business plan and the Corporation's profitability, software revenue growth and total revenue growth as projected in such plan. After the first year's bonus, the Employee must be actively employed by the Corporation as of June 30th of any fiscal year in order to be eligible to receive a bonus. Without limiting the generality of the foregoing, the Employee's annual performance bonus for the first year of the term hereof shall be guaranteed at 50% of the Employee's Base Salary for such year, although for performance above target, up to an additional 50% of Base Salary may be earned. This additional 50% will vary based on the extent to which targets are exceeded, with agreement on the targets for that incremental bonus to be determined by October 31, 1996. Bonus payments under Section 3(b) are payable at such time after the end of the fiscal year as other bonus payments are made. 4. STOCK OPTION: As further consideration for the Employee's employment hereunder and pursuant to the resolution of the Stock Option Committee of the Board of Directors, the Employee will be granted an option to purchase 300,000 shares of Common Stock, par value of $.01 per share, at the closing market price per share as reported on the NASDAQ Stock Market as of the date of hire, under the Corporation's 1991 Stock Plan, and a separate agreement thereunder, which Option shall be a "Non-Qualified Option" within the meaning of the 1991 Stock Plan. The Option shall become exercisable at the rate of 75,000 shares of stock on the first, second, third and fourth year anniversaries of Hire Date, in accordance with the terms of the Option Agreement. 3 The Corporation agrees, subject to the approval of the Stock Option Committee of the Board of Directors and Employee's continued employment in good standing at a senior executive level at the Corporation, to grant an additional Stock Option to purchase Common Stock in the amount of 100,000 shares (also under the 1991 Stock Plan). This Option would be granted at the earlier of (1) twelve months from hire date or (2) Employee's promotion to Chief Executive Officer, and would be subject to the Corporation's standard four year vesting, and would be priced at the then fair market value of Common Stock at the time of grant. 4a. Sign-on Awards: Upon hire, Employee will receive an advance of $250,000, one twenty-fourth of which will be forgiven with each full month of employment. However, if the Employee's employment is terminated by the Corporation (other than pursuant to Section 9(c), (d) or (e) hereof) the entire remaining amount will be forgiven. Also upon hire, Employee will receive a fully vested Option to purchase 25,000 shares of Common Stock at the fair market share price at hire date as described in Section 4. This Option share shall be granted under the 1991 Stock Plan. 5. Relocation Package: (a) The Corporation will provide Employee with the services of a relocation company at the Corporation's expense. These services will be limited to pre-marketing of Employee's house, the payment of reasonable settlement fees and real estate commission, transfer taxes and actual moving expenses; the total not to exceed $150,000 without prior written approval from the Corporation. Every reasonable effort will be made to minimize Employee's tax exposure with regard to these expenses, but to the extent required by law, the expenses will be taxable to Employee. Should Employee voluntarily leave the Corporation's employ before one year, Employee will be required to reimburse the Corporation for expenses it has incurred relating to Employee's relocation. (b) In addition, the Corporation will pay reasonable and necessary temporary living expenses for the Employee up to a maximum of $2,000 per month. Such payments shall cease upon Employee establishing a permanent housing arrangement in Connecticut. If and to the extent that any payments made pursuant to this paragraph 5(b) are includable in Employee's income and not deductible for purposes of applicable federal, state and local income taxes, the Corporation shall pay the Employee an amount equal to the additional amount of taxes Employee incurs as a result of such payments. 6. FRINGE BENEFITS: In addition to the benefits received by other non-officer employees, Employee is entitled to the following: (a) During the term hereof, the Corporation shall (i) provide the Employee with reimbursement of the employee contribution for medical, dental and hospitalization insurance, (ii) reimburse the Employee and his immediate family for dental expenses incurred each year in excess of $200, including but 4 not limited to orthodontics for the Employee's children under the age of twenty-one (21) years only, provided that the aggregate amount of such reimbursement in any year shall not exceed $4,000 (such reimbursement shall be in addition to any dental insurance provided to the Employee and his immediate family under any dental plan from time to time maintained by the Corporation), (iii) reimburse the Employee on an annual basis for expenses incurred in connection with the purchase by Employee of fitness or exercise equipment or membership in a fitness or exercise program reasonably acceptable to the Corporation in an aggregate amount equal to the lesser of (x) seventy-five (75%) percent of all such expenses or (y) $500, (iv) reimburse the Employee for the reasonable and customary cost of an annual physical examination, (v) provide to Employee long-term disability insurance in an amount reasonably determined by the insurer based on the Employee's total earned income and personal financial circumstances (provided such insurance is available at reasonable cost), or, in the alternative, (and at the Employee's election) reimburse the Employee on an annual basis in an amount not to exceed $10,000 per year for the purchase by the Employee of long-term disability insurance, in either event, the cost of such coverage to be reported by the Corporation as compensation for income tax purposes on the Employee's Form W-2 each year, (vi) provide life insurance in an amount equal to three times (3X) Employee's annual base salary (also provided such insurance is available at reasonable cost), and (vii) participation in any future benefit plans available to all officers of the Corporation which are not duplicative of the above benefits. (b) The Employee is authorized to incur on behalf of the Corporation only such reasonable expenses (including travel and entertainment) in connection with the business of the Corporation as are in conformity with the Corporation's published guidelines. The Corporation shall reimburse Employee for all such reasonable expenses incurred in connection with the business of the Corporation upon the presentation by the Employee, from time to time, of an itemized account of such expenditures, which account shall be in form and substance in conformity with the rules and regulations of the Internal Revenue Service. Any single expenditure in excess of $10,000 shall require the prior approval of the COB. (c) During the term hereof, the Corporation shall provide Employee with an automobile expense allowance equal to $800 per month. 7. DUTIES AND EXTENT OF SERVICES: The Employee shall exert his best efforts and shall devote his full time and attention to the affairs of the Corporation. During the Employee's employment, the Employee shall not, directly or indirectly, alone or as a member of a partnership (in the capacity of a general partner) or limited liability company (in the capacity of a manager), or as an officer, director, significant shareholder (i.e., owning or holding beneficially or of record 5% or more of the voting shares of an entity), or employee of any other corporation or entity, be engaged in or concerned with any other duties or pursuits whatsoever for pecuniary gain requiring his personal services without the prior written consent of the Corporation. 5 8. VACATION: During each year of the Employee's employment, the Employee shall be entitled to four (4) weeks vacation, in accordance with the Corporation's vacation policy and subject to the prior approval of the COB. 9. TERMINATION: Unless renewed as provided herein, the Employee's employment hereunder shall terminate on the third anniversary of the Start Date, or sooner upon the occurrence of any of the following events: (a) The Employee's death; (b) The Corporation's decision, at its option, to be exercised by written notice from the Corporation to the Employee, upon the Employee's incapacity or inability, as defined in the Corporation's group long-term disability insurance policy. The Employee's base salary during any period of incapacity shall be reduced by the amount of disability insurance payments received by the Employee pursuant to any disability insurance plan or policy maintained by, or paid for by, the Corporation; or (c) The Corporation's decision, at its option, to be exercised by written notice from the Corporation to the Employee in the event the Employee fails or refuses to perform his duties or commits any misconduct with respect to the Corporation's affairs and such failure or refusal or misconduct shall not be cured for a period of fifteen (15) days after the Corporation shall have given the Employee written notice specifying such failure or refusal or misconduct. (d) In the event that the Employee commits an act constituting embezzlement, fraud or misuse of funds, or if he commits any crime, which could reasonably be expected to have an adverse impact on the Corporation, its business or assets. (e) In the event that the Employee should fail (otherwise than on account of illness or other incapacity) or refuse to carry out the reasonable directives of the COB or Board of Directors of the Corporation, and such failure or refusal shall not be cured for a period of fifteen (15) days after the Corporation shall have given the Employee written notice specifying such directives and wherein the Employee has failed or refused to carry out the same. (f) Complete cessation of the Corporation's business other than through merger or acquisition of the Corporation. (g) On thirty (30) days' written notice (i) from the Corporation, (ii) from the Employee if there is a material and significant diminution in the nature or scope of Employee's authority, duties and responsibilities, or (iii) from the Employee if, during the twelve-month period following a Change in Control (as defined herein), the Employee has Good Reason (as defined herein) to terminate his employment. In 6 addition, if the Employee has not been promoted to the position of Chief Executive Officer on or before the second anniversary of the Start Date, the Employee may, during the thirty (30) day period following the second anniversary of the Start Date, terminate his employment by providing the Corporation thirty (30) days' written notice of his intention to so terminate. If the Corporation terminates the Employee's employment pursuant to this Section 9(g) or by giving notice of nonrenewal pursuant to section 2, or if the Employee terminates his employment pursuant to this Section 9(g), then the Corporation shall pay to Employee as severance pay a total amount equal to (i) his then current annual base salary, payable in twelve (12) equal consecutive monthly installments (without interest) beginning one (1) month after such termination, plus (ii) medical and dental insurance as set forth in this Agreement for himself and his dependents for the twelve (12) month period commencing on the effective date of such termination, and (iii) if, and only if, the Employee's employment is terminated by the Company pursuant to this Section 9(g) effective between May 1 and June 30 of any year, the Employee shall also receive, at such time as bonuses are generally paid by the Corporation, a pro rata portion of any bonus earned pursuant to Section 3(b) hereof based upon achievement of targets for the year of termination. Notwithstanding the above, if the Termination occurs in the first year of employment, Employee will receive the remainder of his base salary for that year, in addition to the severance payments and benefits described above. Upon a termination by either party pursuant to this Section 9(g) or by the Corporation pursuant to Section 2, the portion of Employee's common stock options described in section 4, which are due to vest during the fourteen-month period following the date of such termination, will automatically accelerate and become vested as if such termination had occurred at the end of that fourteen-month period. Employee expressly understands that payment of such severance pay and benefits or the accelerated vesting of stock options described above represent liquidated damages in full and final settlement of any and all amounts owed by Corporation to Employee under this Agreement or otherwise except for the accrued portion, if any, of any bonus, stock option, commission, vacation or other benefit to which Employee is expressly entitled pursuant to any formal, written plan or agreement maintained by the Corporation. (h) As used in this Agreement, the following terms have the meanings set forth below: (i) "Change in Control" means the occurrence of any of the following events: (a) the direct or indirect sale or exchange by the stockholders of the Corporation of the stock of the Corporation, in a single or series of related transactions, after which sale or exchange the stockholders of the Corporation immediately prior to such transactions do not retain, directly or indirectly, at least a majority of the 7 beneficial interest in the voting stock of the Corporation; (b) a merger in which the Corporation is a party after which merger the stockholders of the Corporation immediately before such merger do not retain, directly or indirectly, at least a majority of the beneficial interest in the voting stock of the surviving company; or (c) the sale, exchange or transfer of all or substantially all of the Corporation's assets (other than a sale, exchange or transfer to one or more entities where the stockholders of the Corporation immediately before such sale, exchange or transfer retain, directly or indirectly, at least a majority of the beneficial interest in the voting stock of the entities to which the assets were transferred). (ii) "Corporation" includes any successor to all or substantially all of the business or assets of the Corporation. (iii) "Good Reason" means that, following a Change in Control and without Employee's written consent, (A) there has been a material and significant adverse change in the nature or scope of Employee's authority, duties or responsibilities in effect immediately prior to the Change in Control; (B) there has been a reduction in Employee's annual base salary in effect immediately prior to the Change in Control or an adverse change in Employee's total compensation such that Employee's compensation and benefits in the aggregate are not materially comparable to his aggregate compensation and benefits in effect immediately prior to the Change in Control; or (C) the principal place of Employee's employment is relocated to a place that is more than 50 miles from the principal place of Employee's employment immediately prior to the Change in Control or Employee is required to be away from his office in the course of discharging his duties and responsibilities materially and significantly more than was required prior to the Change in Control. (i) In the event of any termination provided for under this Agreement (other than by the Corporation or the Employee pursuant to Section 9(g) or by nonrenewal by the Corporation pursuant to Section 2), the Corporation shall pay to the Employee only such portion of his annual base salary payable to the date such termination becomes effective (reduced by any amount payable pursuant to any disability insurance policies), and thereafter the Employee shall have no claim for any further compensation hereunder, provided, however, that in the event of the Employee's death, his death shall be deemed to have occurred on the last day of the month in which he dies. Upon any termination, Employee shall also receive all the benefits to which he is entitled under applicable State and Federal law. 8 10. RESTRICTIONS ON THE EMPLOYEE: During the period commencing on the date hereof and ending two (2) years after the termination of the Employee's employment for any reason, the Employee shall not directly or indirectly induce or attempt to induce any of the employees of the Corporation to leave the employ of Corporation. If this Agreement is terminated by the Corporation pursuant to Section 9(g) hereof, the foregoing two (2) year period shall be reduced to one (1) year. 11. COVENANT NOT TO COMPETE: During the period commencing on the date the Employee begins working at the Corporation's Stamford offices, and ending one (1) year after the termination of the Employee's employment for any reason, the Employee shall not, except as a passive investor in publicly held companies, engage in, or own or control any interest in, or act as principal, director, officer or employee of, or consultant to, any firm or corporation which is in competition with the Corporation. 12. Proprietary Information: ----------------------- (a) For purposes of this Agreement, "proprietary information" shall mean any proprietary information relating to the business of the Corporation or any entity in which the Corporation has a controlling interest that has not previously been publicly released by duly authorized representatives of the Corporation and shall include (but shall not be limited to) information encompassed in all proposals, marketing and sales plans, financial information, costs, pricing information, computer programs (including without limitation source code, object code, algorithms and models), customer information, customer lists, and all methods, concepts, know- how or ideas in or reasonably related to the business of Corporation or any entity in which the Corporation has a controlling interest. The Employee agrees to regard and preserve as confidential all proprietary information, whether he has such information in his memory or in writing or other tangible or intangible form. The Employee will not, without written authority from the Corporation to do so, directly or indirectly, use for his benefit or purposes, nor disclose to others, either during the term of this employment hereunder or thereafter, any proprietary information except as required by the conditions of his employment hereunder or pursuant to court order (in which case Employee shall give the Corporation prompt written notice [not less than 24 hours] so that the Corporation may seek a protective order or other appropriate remedy and/or waive compliance with the provisions of this Agreement. The Employee agrees not to remove from the premises of the Corporation or any subsidiary or affiliate of the Corporation, except as an employee of the Corporation in pursuit of the business of the Corporation or any of its subsidiaries, affiliates or any entity in which the Corporation has a controlling interest, or except as specifically permitted in writing by the Corporation, any document or object containing or reflecting any proprietary information. The Employee recognizes that all such documents and objects, whether developed by him or by someone else, are the exclusive property of the Corporation. 9 (b) All proprietary information and all of the Employee's interest in trade secrets, trademarks, computer programs, customer information, customer lists, employee lists, products, procedures, copyrights, patents and developments hereafter to the end of the period of employment hereunder developed by the Employee as a result of, or in connection with, his employment hereunder, shall belong to the Corporation; and without further compensation, but at the Corporation's expense, forthwith upon request of the Corporation, Employee shall execute any and all such assignments and other documents and take any and all such other action as Corporation may reasonably request in order to vest in Corporation all the Employee's rights, title and interests to and in all of the aforesaid items, free and clear of liens, charges and encumbrances. 13. The Employee expressly agrees that the covenants set forth in Sections 10, 11 and 12 of this Agreement are being given to Corporation in connection with the employment of the Employee by Corporation and that such covenants are intended to protect Corporation, within the terms stated, to the fullest extent deemed reasonable and permitted in law and equity. In the event that the foregoing limitations upon the conduct of the Employee are beyond those permitted by law, such limitations, both as to time and geographical area, shall be, and be deemed to be, reduced in scope and effect to the maximum extent permitted by law. 14. INJUNCTIVE RELIEF: The Employee acknowledges that the injury to the Corporation resulting from any violation by him of any of the covenants contained in this Agreement will be of such a character that it cannot be adequately compensated by money damages, and, accordingly, the Corporation may, in addition to pursuing its other remedies, obtain an injunction from any court having jurisdiction of the matter restraining any such violation. 15. REPRESENTATION OF EMPLOYEE: The Employee represents and warrants that neither the execution and delivery of this Agreement nor the performance of his duties hereunder violates the provisions of any other agreement to which he is a party or by which he is bound. 16. PARTIES; NONASSIGNABILITY: As used herein, the term "Corporation" shall mean and include the Corporation, and any subsidiary thereof and any successor thereto unless the context indicates otherwise. This Agreement and all rights hereunder are personal to the Employee and shall not be assignable by him and any purported assignment shall be null and void and shall not be binding to the Corporation. 17. ENTIRE AGREEMENT: This Agreement contains the entire agreement between the parties hereto with respect to the transactions contemplated herein and supersedes all previous representations, negotiations, commitments, and writing with respect thereto. 18. AMENDMENT OR ALTERATION: No amendment or alteration of the terms of this Agreement shall be valid unless made in writing and signed by all of the parties hereto. 19. CHOICE OF LAW: This Agreement shall be governed by the laws of the State of Connecticut. 10 20. ARBITRATION: Except as provided in Section 14, any controversy, claim, or breach arising out of or relating to this Agreement or the breach thereof shall be settled by arbitration in Stamford, Connecticut in accordance with the rules of the American Arbitration Association and the judgment upon the award rendered shall be entered by consent in any court having jurisdiction thereof. 21. NOTICES: Any notices required or permitted to be given under this Agreement shall be sufficient if in writing, and if sent by registered mail to the residence of the Employee, or to the principal office of the Corporation, respectively. 22. WAIVER OF BREACH: The waiver by any party hereto of a breach of any provision of this Agreement shall not operate or be construed as a waiver of any subsequent breach by any of the parties hereto. 23. BINDING EFFECT: The terms of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective personal representatives, heirs, administrators, successors, and permitted assigns. 24. GENDER: Pronouns in any gender shall be construed as masculine, feminine, or neuter as the context requires in this Agreement. IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written. CORPORATION: Hyperion Software Operations Inc. By /s/ James A. Perakis ------------------------------------------- James A. Perakis, Its Chairman and Chief Executive Officer EMPLOYEE: /s/ Peter DiGiammarino ------------------------------------------- Peter DiGiammarino EX-11.1 3 STATEMENT RE: COMPUTATION OF EARNINGS PER SHARE 1 Hyperion Software Corporation Exhibit (11.1) - Statement Re: Computation of Earnings Per Share (in thousands, except per share amounts)
YEAR ENDED JUNE 30, 1996 1995 1994 ---------------------------------------- PRIMARY Weighted average number of common shares outstanding 16,622 15,644 15,080 Weighted average number of common equivalent shares outstanding 1,253 1,672 1,504 ---------------------------------------- 17,875 17,316 16,584 ======================================== Net income $ 9,457 $12,139 $ 8,609 ======================================== Per share amount $ .53 $ .70 $ .52 ======================================== FULLY DILUTED Weighted average number of common shares outstanding 16,622 15,644 15,080 Weighted average number of common equivalent shares outstanding 1,311 1,836 1,520 ---------------------------------------- 17,933 17,480 16,600 ======================================== Net income $ 9,457 $12,139 $ 8,609 ======================================== Per share amount $ .53 $ .69 $ .52 ========================================
EX-22.1 4 SUBSIDIARIES OF THE REGISTRANT 1 Hyperion Software Corporation Exhibit (22.1) - Subsidiaries of the Company Name Jurisdiction of Incorporation - - ---- ----------------------------- Hyperion Software Operations Inc. .............. Delaware Hyperion Software Corporation of Canada, Ltd. .. Ontario Hyperion Software Europe S.r.l. ................ Italy Hyperion Software Italia S.r.l. ................ Italy Hyperion Software Foreign Sales Corp. .......... Barbados Hyperion Software (UK) plc. .................... United Kingdom Hyperion Software Deutschland GmbH ............. Germany Hyperion Softwarevertribs-Gesellschaft MbH...... Austria Hyperion Software France S.A. .................. France Hyperion Software BeLux S.A. ................... Belgium Hyperion Software Nederland, B.V. .............. The Netherlands Hyperion Software Asia Pte. Ltd. ............... Singapore IMRS Hyperion Software Iberica, S.A. ........... Spain Hyperion Software Nordic AB..................... Sweden Hyperion KK..................................... Japan EX-23.1 5 CONSENT OF ERNST & YOUNG 1 EXHIBIT 23.1 CONSENT OF INDEPENDENT AUDITORS We consent to the incorporation by reference, in the Registration Statement (Form S-8 No. 33-44127) pertaining to the 1985 Incentive Stock Option Plan of Hyperion Software Corporation, 1989 Stock Option Plan of Hyperion Software Corporation, the Hyperion Software Corporation 1991 Employee Stock Purchase Plan, the Hyperion Software Corporation 1991 Non-Employee Director Stock Option Plan, the Hyperion Software Corporation 1991 Stock Plan and to Stock Options Granted Pursuant to Employment, Consulting and Option Agreements, in the Registration Statement (Form S-8 No. 33-57143) pertaining to the Pillar Corporation 1988 Stock Option Plan and to the Pillar Corporation 1992 Long Term Equity Incentive Plan, in the Registration Statements (Form S-8 Nos. 33-57145 and 33-65475) pertaining to the Hyperion Software Corporation 1991 Stock Plan and in the Registration Statement (Form S-3 No. 33-56989) pertaining to the registration of 514,585 shares of Hyperion Software Corporation common stock, of our report dated July 19, 1996, with respect to the consolidated financial statements and schedule of Hyperion Software Corporation included in the Annual Report (Form 10-K) for the year ended June 30, 1996. /s/ Ernst & Young LLP Stamford, Connecticut September 25, 1996 EX-27 6 FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE CONSOLIDATED FINANCIAL STATEMENTS OF HYPERION SOFTWARE CORPORATION FOR THE YEAR ENDED JUNE 30, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1,000 U.S.DOLLARS YEAR JUN-30-1996 JUL-01-1995 JUN-30-1996 1 42,361 0 60,574 4,900 0 105,309 75,669 21,063 179,448 77,860 0 214 0 0 89,789 179,448 172,824 172,824 58,038 158,804 100,766 0 243 15,257 5,800 0 0 0 0 9,457 .53 .53
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