Table of Contents
Jersey, Channel Islands | 7389 | 33–0996780 | ||
(State or Other Jurisdiction of Incorporation or Organization) | (Primary Standard Industrial Classification Code Number) | (I.R.S. Employer Identification Number) |
Michael W. Sturrock, Esq. Latham & Watkins LLP 80 Raffles Place #14–20 UOB Plaza 2 Singapore 048624 (65) 6536-1161 | David W. Hirsch, Esq. Cleary Gottlieb Steen & Hamilton LLP Bank of China Tower One Garden Road Hong Kong (852) 2521-4122 |
Proposed maximum | Proposed maximum | |||||||||||
Title of each class of | Amount to be | offering price | aggregate | Amount of | ||||||||
securities to be registered | registered(1) | per share(2) | offering price(2) | registration fee | ||||||||
Ordinary shares, par value 10 pence per share, each represented by one American Depositary Share(3) | 11,989,708 | $20.00 | $239,794,160 | $25,658 | ||||||||
(1) | Includes (i) ordinary shares represented by American Depositary Shares initially offered and sold outside the United States that may be resold from time to time in the United States either as part of their distribution or within 40 days after the later of the effective date of this registration statement and the date the securities are first bona fide offered to the public and (ii) additional ordinary shares represented by American Depositary Shares which may be purchased by the underwriters at their option to cover over-allotments, if any. The ordinary shares are not being registered for the purpose of sales outside the United States. |
(2) | Estimated solely for the purpose of computing the amount of the registration fee in accordance with Rule 457(o). |
(3) | American Depositary Shares evidenced by American Depositary Receipts issuable upon deposit of the ordinary shares registered hereby are being registered pursuant to a separate Registration Statement on Form F-6. |
Table of Contents
The information in this preliminary prospectus is not complete and may be changed. Neither we nor the selling shareholders may sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and is not soliciting offers to buy these securities in any state where the offer or sale is not permitted. |
Per ADS | Total | |||||||
Initial public offering price | $ | $ | ||||||
Underwriting discounts and commissions | $ | $ | ||||||
Proceeds before expenses to WNS (Holdings) Limited | $ | $ | ||||||
Proceeds before expenses to selling shareholders | $ | $ |
Morgan Stanley | Deutsche Bank Securities | Merrill Lynch & Co. |
Citigroup | UBS Investment Bank |
Table of Contents
Page | ||||
1 | ||||
9 | ||||
24 | ||||
25 | ||||
26 | ||||
27 | ||||
28 | ||||
30 | ||||
32 | ||||
35 | ||||
39 | ||||
61 | ||||
77 | ||||
90 | ||||
91 | ||||
96 | ||||
112 | ||||
119 | ||||
122 | ||||
129 | ||||
137 | ||||
137 | ||||
138 | ||||
140 | ||||
F-1 | ||||
F-30 |
i
Table of Contents
1
Table of Contents
2
Table of Contents
• | Offshore business process outsourcing market leadership; |
• | Deep industry expertise; |
• | Experience in transferring operations offshore and running them efficiently; |
• | Diversified client base across multiple industries and geographic locations; |
• | Leadership in human capital development, as recognized by recent awards from neoIT and India’s National Institute of Personnel Managers; |
• | Ability to manage the rapid growth of our organization; and |
• | Experienced management team. |
• | Drive rapid growth through penetration of our existing client base; |
• | Enhance awareness of the WNS brand name; |
• | Reinforce leadership in existing industries and penetrate new industry sectors; and |
• | Broaden industry expertise and enhance growth through selective acquisitions. |
3
Table of Contents
4
Table of Contents
ADSs that we are offering | 4,473,684 ADSs. | |
ADSs that selling shareholders are offering | 5,955,024 ADSs. | |
ADSs to be outstanding immediately after this offering | 10,428,708 ADSs. | |
Number of shares per ADS | One ordinary share. | |
Ordinary shares to be outstanding immediately after this offering | 39,801,857 ordinary shares. | |
The ADSs | Each ADS represents the right to receive one ordinary share. The ADSs will be evidenced by American Depositary Receipts, or ADRs, executed and delivered by Deutsche Bank Trust Company Americas, as Depositary. | |
• The Depositary will be the holder of the ordinary shares underlying your ADSs and you will have rights as provided in the deposit agreement and the ADRs. | ||
• Subject to compliance with the relevant requirements set out herein, you may turn in your ADSs to the Depositary in exchange for ordinary shares underlying your ADSs. | ||
• The Depositary will charge you fees for exchanges. | ||
You should carefully read “Description of American Depositary Shares” to better understand the terms of the ADSs. You should also read the deposit agreement and the form of the ADRs, which are exhibits to the registration statement that includes this prospectus. | ||
Offering price | We currently anticipate that the initial public offering price will be between $18.00 and $20.00 per ADS. | |
Selling shareholders | See “Principal and Selling Shareholders” for information on the selling shareholders in this offering. | |
Over-allotment option | Certain of the selling shareholders have granted to the underwriters an option to purchase up to an additional 1,561,000 ADSs from us and them to cover over-allotments at the initial public offering price less underwriting discounts and commissions. | |
Use of proceeds | Our net proceeds from the sale of 4,473,684 ADSs in this offering will total approximately $73.9 million after deducting underwriting discounts and commissions and estimated offering expenses which are payable by us. We intend to use the net proceeds from this offering for general corporate purposes, including capital expenditures and working capital, and for possible acquisitions of businesses and delivery platforms. | |
The proceeds from the sale of 5,955,024 ADSs in this offering to be sold by the selling shareholders will be paid to those shareholders. We will not receive any of the proceeds from the sale of those ADSs. See “Use of Proceeds.” |
5
Table of Contents
Risk factors | See “Risk Factors” and other information included in this prospectus for a discussion of the risks you should carefully consider before deciding to invest in our ADSs. | |
Payment and settlement | The ADSs are expected to be delivered against payment on , 2006. The ADRs evidencing the ADSs will be deposited with a custodian for, and registered in the name of a nominee of, The Depository Trust Company, or DTC, in New York, New York. In general, beneficial interests in the ADSs will be shown on, and transfers of these beneficial interests will be effected only through, records maintained by DTC and its direct and indirect participants. | |
Listing and trading | We have applied for our ADSs to be listed on the New York Stock Exchange, or NYSE. | |
Proposed NYSE symbol | “WNS.” | |
Depositary | Deutsche Bank Trust Company Americas. | |
Lock-up | We, the selling shareholders, our directors, executive officers and employee shareholders and certain of our other existing shareholders have agreed with the underwriters not to sell, transfer or dispose of any of our ordinary shares or ADSs for a period of 180 days after the date of this prospectus. See “Underwriting.” |
• | assumes an initial public offering price of $19.00 per ADS, the midpoint of the range described above; |
• | excludes (i) 3,899,758 ordinary shares issuable upon exercise of outstanding options and 66,018 ordinary shares reserved for future issuance under our Stock Incentive Plan as of June 20, 2006; and (ii) 3,000,000 ordinary shares reserved for future issuance under our 2006 Incentive Award Plan (including 600,000 ordinary shares issuable upon the exercise of options to be granted effective upon the completion of this offering (of which 320,000 are to be issued to certain of our directors and executive officers and 280,000 are to be issued to other employees) and 300,000 restricted share units to be issued effective upon the completion of this offering (of which 160,000 are to be issued to certain of our directors and executive officers and 140,000 are to be issued to other employees), each under the 2006 Incentive Award Plan). See “Management — Employee Benefit Plans — Stock Incentive Plan” and “Management — Employee Benefit Plans — WNS 2006 Incentive Award Plan”; and |
• | assumes no exercise of the underwriters’ option to purchase up to 1,561,000 additional ADSs to cover over-allotments. If the underwriters exercise this option in full, 11,989,708 ADSs would thereafter be outstanding. See “Underwriting.” |
6
Table of Contents
Year Ended March 31, | |||||||||||||
2006 | 2005 | 2004 | |||||||||||
(US dollars in millions, except share and per | |||||||||||||
share data) | |||||||||||||
Consolidated Statement of Operations Data: | |||||||||||||
Revenue | $ | 202.8 | $ | 162.2 | $ | 104.1 | |||||||
Cost of revenue(1) | 145.7 | 140.3 | 89.7 | ||||||||||
Gross profit | 57.1 | 21.9 | 14.4 | ||||||||||
Operating expenses: | |||||||||||||
Selling, general and administrative expenses(1) | 36.3 | 24.9 | 18.8 | ||||||||||
Amortization of intangible assets | 0.9 | 1.4 | 2.6 | ||||||||||
Operating income (loss) | 19.9 | (4.4 | ) | (7.0 | ) | ||||||||
Other income, net | 0.5 | 0.2 | 0.3 | ||||||||||
Interest expense | (0.4 | ) | (0.5 | ) | (0.1 | ) | |||||||
Income (loss) before income taxes | 19.9 | (4.7 | ) | (6.8 | ) | ||||||||
(Provision) benefit for income taxes | (1.6 | ) | (1.1 | ) | 0.0 | ||||||||
Net income (loss) | $ | 18.3 | (5.8 | ) | (6.7 | ) | |||||||
Income (loss) per share: | |||||||||||||
Basic | $ | 0.56 | $ | (0.19 | ) | $ | (0.22 | ) | |||||
Diluted | $ | 0.52 | $ | (0.19 | ) | $ | (0.22 | ) | |||||
Weighted-average shares outstanding (basic) | 32,874,299 | 30,969,658 | 30,795,888 | ||||||||||
Weighted-average shares outstanding (diluted) | 35,029,766 | 30,969,658 | 30,795,888 |
As of March 31, | ||||||||||||
2006 | 2005 | 2004 | ||||||||||
(US dollars in millions) | ||||||||||||
Consolidated Balance Sheet Data: | ||||||||||||
Cash and cash equivalents | $ | 18.5 | $ | 9.1 | $ | 14.8 | ||||||
Accounts receivable, net | 28.1 | 25.2 | 18.1 | |||||||||
Other current assets | 10.8 | 9.7 | 9.5 | |||||||||
Total current assets | 57.4 | 44.0 | 42.5 | |||||||||
Deposits and deferred tax asset | 4.3 | 2.6 | 1.3 | |||||||||
Goodwill and intangible assets, net | 42.5 | 26.7 | 27.6 | |||||||||
Property and equipment, net | 30.6 | 24.7 | 15.3 | |||||||||
Total assets | 134.8 | 98.0 | 86.6 | |||||||||
Note payable | — | 10.0 | — | |||||||||
Total current liabilities | 53.5 | 54.8 | 39.4 | |||||||||
Deferred tax liabilities — non-current | 2.4 | — | — | |||||||||
Other non-current liabilities | 0.8 | 0.2 | 0.5 | |||||||||
Total shareholders’ equity | 78.2 | 43.0 | 46.7 | |||||||||
Total liabilities and shareholders’ equity | 134.8 | 98.0 | 86.6 |
7
Table of Contents
For the Year Ended March 31, | |||||||||||||
2006 | 2005 | 2004 | |||||||||||
(US dollars in millions, except | |||||||||||||
percentages and employee data) | |||||||||||||
Other Consolidated Financial Data: | |||||||||||||
Revenue | $ | 202.8 | $ | 162.2 | $ | 104.1 | |||||||
Gross profit as a percentage of revenue | 28.1 | % | 13.5 | % | 13.8 | % | |||||||
Operating income (loss) as a percentage of revenue | 9.8 | % | (2.7 | )% | (6.7 | )% | |||||||
Other Unaudited Consolidated Financial and Operating Data: | |||||||||||||
Revenue less repair payments(2) | $ | 147.9 | $ | 99.0 | $ | 49.9 | |||||||
Gross profit as a percentage of revenue less repair payments | 38.6 | % | 22.1 | % | 28.9 | % | |||||||
Operating income (loss) as a percentage of revenue less repair payments | 13.4 | % | (4.4 | )% | (14.1 | )% | |||||||
Number of employees (at period end) | 10,433 | 7,176 | 4,472 |
(1) | Includes the following share-based compensation amounts: |
Cost of revenue | $ | 0.1 | $ | 0.0 | $ | 0.0 | ||||||
Selling, general and administrative expenses | 1.8 | 0.2 | 0.2 |
(2) | Revenue less repair payments is a non-GAAP measure. See the explanation below, as well as “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Overview” and notes to the consolidated financial statements included in this prospectus. The following table reconciles our revenue (a GAAP measure) to revenue less repair payments (a non-GAAP measure): |
For the Year Ended March 31, | ||||||||||||
2006 | 2005 | 2004 | ||||||||||
(US dollars in millions) | ||||||||||||
Revenue | $ | 202.8 | $ | 162.2 | $ | 104.1 | ||||||
Less: Payments to repair centers | $ | 54.9 | $ | 63.2 | $ | 54.2 | ||||||
Revenue less repair payments | $ | 147.9 | $ | 99.0 | $ | 49.9 | ||||||
8
Table of Contents
9
Table of Contents
10
Table of Contents
11
Table of Contents
12
Table of Contents
13
Table of Contents
14
Table of Contents
• | significant currency fluctuations between the US dollar and the pound sterling (in which our revenue is principally denominated) and the Indian rupee (in which a significant portion of our costs are denominated); |
• | legal uncertainty owing to the overlap of different legal regimes, and problems in asserting contractual or other rights across international borders; |
• | potentially adverse tax consequences, such as scrutiny of transfer pricing arrangements by authorities in the countries in which we operate; |
• | potential tariffs and other trade barriers; |
• | unexpected changes in regulatory requirements; |
• | the burden and expense of complying with the laws and regulations of various jurisdictions; and |
• | terrorist attacks and other acts of violence or war. |
15
Table of Contents
16
Table of Contents
17
Table of Contents
• | a classified board of directors with staggered three-year terms; and |
• | the ability of our board of directors to determine the rights, preferences and privileges of our preferred shares and to issue the preferred shares without shareholder approval, which could be exercised by our board of directors to increase the number of outstanding shares and prevent or delay a takeover attempt. |
18
Table of Contents
19
Table of Contents
20
Table of Contents
• | announcements of technological developments; |
• | regulatory developments in our target markets affecting us, our clients or our competitors; |
• | actual or anticipated fluctuations in our quarterly operating results; |
21
Table of Contents
• | changes in financial estimates by securities research analysts; |
• | changes in the economic performance or market valuations of other companies engaged in business process outsourcing; |
• | addition or loss of executive officers or key employees; |
• | sales or expected sales of additional shares or ADSs; and |
• | loss of one or more significant clients. |
22
Table of Contents
23
Table of Contents
• | technological innovation; |
• | telecommunications or technology disruptions; |
• | future regulatory actions and conditions in our operating areas; |
• | our dependence on a limited number of clients in a limited number of industries; |
• | our ability to attract and retain clients; |
• | our ability to expand our business or effectively manage growth; |
• | our ability to hire and retain enough sufficiently trained employees to support our operations; |
• | negative public reaction in the US or the UK to offshore outsourcing; |
• | regulatory, legislative and judicial developments; |
• | increasing competition in the business process outsourcing industry; |
• | political or economic instability in India, Sri Lanka and Jersey; |
• | worldwide economic and business conditions; and |
• | our ability to successfully consummate strategic acquisitions. |
24
Table of Contents
25
Table of Contents
(a) | immediately following the date on which the distribution is proposed to be made, we will be able to discharge our liabilities as they fall due; and |
(b) | having regard to our prospects and to the intentions of our directors with respect to the management of our business and to the amount and character of the financial resources that will in their view be available to us, we will be able to continue to carry on business and we will be able to discharge our liabilities as they fall due until the expiry of the period of one year immediately following the date on which the distribution is proposed to be made or until we are dissolved under Article 150 of the 1991 Law, whichever first occurs. |
26
Table of Contents
• | on an actual basis; and |
• | as adjusted to give effect to the sale by us of 4,473,684 ADSs in this offering at an assumed initial public offering price of $19.00 per ADS, the midpoint of the estimated range of the initial public offering price, after deducting underwriting discounts and commissions, estimated offering expenses payable by us, and further assuming no other change to the number of ADSs sold by us as set forth on the cover page of this prospectus. |
As of | |||||||||
March 31, 2006 | |||||||||
Actual | As adjusted | ||||||||
(US dollars in | |||||||||
thousands, except share | |||||||||
and per share data) | |||||||||
Shareholders’ equity: | |||||||||
Ordinary shares, $0.15 (10 pence) par value; Authorized: 40,000,000(1) shares | |||||||||
Issued and outstanding: 35,321,511 shares, actual, and 39,795,195 as adjusted(2) | $ | 5,290 | 5,961 | ||||||
Additional paid-in-capital | 62,228 | 136,032 | (3)(4) | ||||||
Ordinary shares subscribed | 10 | 10 | |||||||
Retained earnings | 4,104 | 4,104 | |||||||
Deferred share-based compensation | (582 | ) | (582 | ) | |||||
Accumulated other comprehensive income | $ | 7,114 | $ | 7,114 | |||||
Total shareholders’ equity | $ | 78,164 | $ | 152,639 | (3) | ||||
Total capitalization | $ | 78,164 | $ | 152,639 | (3) | ||||
(1) | In May 2006, the authorized number of our ordinary shares was increased to 50,000,000. |
(2) | Excludes (i) 6,662 ordinary shares issued upon exercise of options during the period April 1, 2006 to June 20, 2006; (ii) 3,899,758 ordinary shares issuable upon exercise of outstanding options and 66,018 ordinary shares reserved for future issuance under our Stock Incentive Plan as of June 20, 2006; and (iii) 3,000,000 ordinary shares reserved for future issuance under our 2006 Incentive Award Plan (including 600,000 ordinary shares issuable upon the exercise of options to be granted effective upon the completion of this offering (of which 320,000 are to be issued to certain of our directors and executive officers and 280,000 are to be issued to other employees) and 300,000 restricted share units to be issued effective upon the completion of this offering (of which 160,000 are to be issued to certain of our directors and executive officers and 140,000 are to be issued to other employees), each under the 2006 Incentive Award Plan). See “Management — Employee Benefit Plans — Stock Incentive Plan” and “Management — Employee Benefit Plans — WNS 2006 Incentive Award Plan.” |
(3) | A $1.00 increase (decrease) in the assumed initial public offering price of $19.00 per ADS, would increase (decrease) each of additional paid-in capital, total shareholders’ equity and total capitalization by $4.2 million. |
(4) | Does not reflect the cost of directors and officers’ insurance premiums of $0.6 million related to this offering. |
27
Table of Contents
Assumed initial public offering price per ADS | $ | 19.00 | |||||||
Pro forma net tangible book value per ADS as of March 31, 2006(1) | $ | 1.01 | |||||||
Increase in pro forma net tangible book value attributable to this offering per ADS | $ | 1.76 | |||||||
Pro forma net tangible book value per ADS after this offering | $ | 2.77 | |||||||
Dilution per ADS to new investors(2) | $ | 16.23 | |||||||
(1) | Excludes $1.7 million of deferred offering costs at March 31, 2006 which has been included in determining the increase in pro forma net tangible book value attributable to this offering. |
(2) | If the underwriters’ over-allotment option is exercised in full, the net tangible book value per ADS after this offering would remain at $2.77 and dilution per ADS to new investors would remain at $16.23. |
28
Table of Contents
Average | |||||||||||||||||||||||||
Shares Purchased | Total Consideration | Average | Price | ||||||||||||||||||||||
Price Per | Per | ||||||||||||||||||||||||
Number | Percentage | Amount | Percentage | Share | ADS | ||||||||||||||||||||
Existing shareholders | 35,321,511 | 88.8 | % | $ | 65,092,819 | 43.4 | % | $ | 1.84 | $ | 1.84 | ||||||||||||||
New investors | 4,473,684 | 11.2 | % | $ | 84,999,996 | 56.6 | % | $ | 19.00 | $ | 19.00 | ||||||||||||||
Total | 39,795,195 | 100.0 | % | $ | 150,092,815 | 100.0 | % | $ | 3.77 | $ | 3.77 | ||||||||||||||
29
Table of Contents
Period End(1) | Average(1)(2) | High | Low | ||||||||||||||
Fiscal Year: | |||||||||||||||||
2007 (through June 30, 2006) | Rs.45.87 | Rs.45.32 | Rs.46.25 | Rs.44.39 | |||||||||||||
2006 | 44.48 | 44.21 | 46.26 | 43.05 | |||||||||||||
2005 | 43.62 | 44.86 | 46.45 | 43.27 | |||||||||||||
2004 | 43.40 | 45.96 | 47.46 | 43.40 | |||||||||||||
2003 | 47.53 | 48.43 | 49.07 | 47.53 | |||||||||||||
2002 | 48.83 | 47.71 | 48.91 | 46.58 | |||||||||||||
2001 | 46.85 | 45.74 | 47.47 | 43.63 | |||||||||||||
Month: | |||||||||||||||||
June 2006 | Rs.45.87 | Rs.45.89 | Rs.46.25 | Rs.45.50 | |||||||||||||
May 2006 | 46.22 | 45.20 | 46.22 | 44.69 | |||||||||||||
April 2006 | 44.86 | 44.82 | 45.09 | 44.39 | |||||||||||||
March 2006 | 44.48 | 44.38 | 44.58 | 44.11 | |||||||||||||
February 2006 | 44.21 | 44.23 | 44.54 | 44.10 | |||||||||||||
January 2006 | 43.96 | 44.20 | 44.92 | 43.89 | |||||||||||||
December 2005 | 44.95 | 45.56 | 46.26 | 44.94 | |||||||||||||
November 2005 | 45.87 | 45.63 | 45.87 | 45.02 | |||||||||||||
October 2005 | 45.09 | 44.76 | 45.11 | 44.00 | |||||||||||||
September 2005 | 43.94 | 43.85 | 43.98 | 43.75 | |||||||||||||
August 2005 | 44.00 | 43.55 | 44.00 | 43.36 |
(1) | The noon buying rate at each period end and the average rate for each period may differ from the exchange rates used in the preparation of financial statements included elsewhere in this prospectus. |
(2) | Represents the average of the noon buying rate for all days during the period. |
30
Table of Contents
Period End(1) | Average(1)(2) | High | Low | ||||||||||||||
Fiscal Year: | |||||||||||||||||
2007 (through June 30, 2006) | GBP0.54 | GBP0.55 | GBP0.58 | GBP0.53 | |||||||||||||
2006 | 0.57 | 0.56 | 0.58 | 0.52 | |||||||||||||
2005 | 0.53 | 0.54 | 0.57 | 0.51 | |||||||||||||
2004 | 0.54 | 0.59 | 0.65 | 0.53 | |||||||||||||
2003 | 0.63 | 0.65 | 0.70 | 0.61 | |||||||||||||
2002 | 0.70 | 0.70 | 0.73 | 0.68 | |||||||||||||
2001 | 0.70 | 0.68 | 0.71 | 0.63 | |||||||||||||
Month: | |||||||||||||||||
June 2006 | GBP0.54 | GBP0.54 | GBP0.55 | GBP0.53 | |||||||||||||
May 2006 | 0.53 | 0.54 | 0.55 | 0.53 | |||||||||||||
April 2006 | 0.55 | 0.57 | 0.58 | 0.55 | |||||||||||||
March 2006 | 0.57 | 0.57 | 0.58 | 0.57 | |||||||||||||
February 2006 | 0.57 | 0.57 | 0.58 | 0.56 | |||||||||||||
January 2006 | 0.56 | 0.57 | 0.57 | 0.56 | |||||||||||||
December 2005 | 0.58 | 0.57 | 0.58 | 0.56 | |||||||||||||
November 2005 | 0.58 | 0.58 | 0.58 | 0.56 | |||||||||||||
October 2005 | 0.57 | 0.57 | 0.57 | 0.56 | |||||||||||||
September 2005 | 0.57 | 0.55 | 0.57 | 0.54 | |||||||||||||
August 2005 | 0.56 | 0.56 | 0.57 | 0.55 |
(1) | The noon buying rate at each period end and the average rate for each period may differ from the exchange rates used in the preparation of financial statements included elsewhere in this prospectus. |
(2) | Represents the average of the noon buying rate for all days during the period. |
31
Table of Contents
For the Year Ended March 31, | |||||||||||||||||||||
2006 | 2006 | 2005 | 2004 | 2003 | |||||||||||||||||
(US dollars in millions, except share and per share data) | |||||||||||||||||||||
Unaudited | |||||||||||||||||||||
pro forma | |||||||||||||||||||||
Consolidated Statement of Operations Data: | |||||||||||||||||||||
Revenue | $ | 210.4 | $ | 202.8 | $ | 162.2 | $ | 104.1 | $ | 54.6 | |||||||||||
Cost of revenue(1) | 149.5 | 145.7 | 140.3 | 89.7 | 42.8 | ||||||||||||||||
Gross profit | 60.9 | 57.1 | 21.9 | 14.4 | 11.8 | ||||||||||||||||
Operating expenses: | |||||||||||||||||||||
SG&A(1) | 40.7 | 36.3 | 24.9 | 18.8 | 10.9 | ||||||||||||||||
Amortization of intangible assets | 2.0 | 0.9 | 1.4 | 2.6 | 1.8 | ||||||||||||||||
Operating income (loss) | 18.2 | 19.9 | (4.4 | ) | (7.0 | ) | (0.9 | ) | |||||||||||||
Other income, net | 0.6 | 0.5 | 0.2 | 0.3 | 0.3 | ||||||||||||||||
Interest expense | (0.5 | ) | (0.4 | ) | (0.5 | ) | (0.1 | ) | (0.1 | ) | |||||||||||
Income (loss) before income taxes | 18.3 | 19.9 | (4.7 | ) | (6.8 | ) | (0.7 | ) | |||||||||||||
(Provision) benefit for income taxes | (1.1 | ) | (1.6 | ) | (1.1 | ) | 0.0 | (1.0 | ) | ||||||||||||
Net income (loss) | $ | 17.2 | $ | 18.3 | (5.8 | ) | (6.7 | ) | (1.7 | ) | |||||||||||
Income (loss) per share: | |||||||||||||||||||||
Basic | $ | 0.50 | $ | 0.56 | $ | (0.19 | ) | $ | (0.22 | ) | $ | (0.07 | ) | ||||||||
Diluted | $ | 0.47 | $ | 0.52 | $ | (0.19 | ) | $ | (0.22 | ) | $ | (0.07 | ) | ||||||||
Weighted-average shares outstanding (basic) | 34,230,296 | 32,874,299 | 30,969,658 | 30,795,888 | 26,243,833 | ||||||||||||||||
Weighted-average shares outstanding (diluted) | 36,385,763 | 35,029,766 | 30,969,658 | 30,795,888 | 26,243,833 |
32
Table of Contents
As of March 31, | ||||||||||||||||
2006 | 2005 | 2004 | ||||||||||||||
(US dollars in millions) | ||||||||||||||||
Consolidated Balance Sheet Data: | ||||||||||||||||
Cash and cash equivalents | $ | 18.5 | $ | 9.1 | $ | 14.8 | ||||||||||
Accounts receivable, net | 28.1 | 25.2 | 18.1 | |||||||||||||
Other current assets | 10.8 | 9.7 | 9.5 | |||||||||||||
Total current assets | 57.4 | 44.0 | 42.5 | |||||||||||||
Deposits and deferred tax asset | 4.3 | 2.6 | 1.3 | |||||||||||||
Goodwill and intangible assets, net | 42.5 | 26.7 | 27.6 | |||||||||||||
Property and equipment, net | 30.6 | 24.7 | 15.3 | |||||||||||||
Total assets | 134.8 | 98.0 | 86.6 | |||||||||||||
Note payable | — | 10.0 | — | |||||||||||||
Total current liabilities | 53.5 | 54.8 | 39.4 | |||||||||||||
Deferred tax liabilities — non-current | 2.4 | — | — | |||||||||||||
Other non-current liabilities | 0.8 | 0.2 | 0.5 | |||||||||||||
Total shareholders’ equity | 78.2 | 43.0 | 46.7 | |||||||||||||
Total liabilities and shareholders’ equity | 134.8 | 98.0 | 86.6 |
For the Year Ended March 31, | ||||||||||||||||
2006 | 2005 | 2004 | 2003 | |||||||||||||
(US dollars in millions, except percentages and | ||||||||||||||||
employee data) | ||||||||||||||||
Other Consolidated Financial Data: | ||||||||||||||||
Revenue | $ | 202.8 | $ | 162.2 | $ | 104.1 | $ | 54.6 | ||||||||
Gross profit as a percentage of revenue | 28.1 | % | 13.5 | % | 13.8 | % | 21.6 | % | ||||||||
Operating income (loss) as a percentage of revenue | 9.8 | % | (2.7 | )% | (6.7 | )% | (1.6 | )% | ||||||||
Other Unaudited Consolidated Financial and Operating Data: | ||||||||||||||||
Revenue less repair payments(2) | $ | 147.9 | $ | 99.0 | $ | 49.9 | $ | 25.6 | ||||||||
Gross profit as a percentage of revenue less repair payments | 38.6 | % | 22.1 | % | 28.9 | % | 46.1 | % | ||||||||
Operating income (loss) as a percentage of revenue less repair payments | 13.4 | % | (4.4 | )% | (14.1 | )% | (3.6 | )% | ||||||||
Number of employees (at period end) | 10,433 | 7,176 | 4,472 | 2,348 |
(1) | Includes the following share-based compensation amounts: |
For the Year Ended March 31, | |||||||||||||||||||||
2006 | 2006 | 2005 | 2004 | 2003 | |||||||||||||||||
(US dollars in millions) | |||||||||||||||||||||
Unaudited | |||||||||||||||||||||
pro forma | |||||||||||||||||||||
Cost of revenue | $ | 0.1 | $ | 0.1 | $ | 0.0 | $ | 0.0 | $ | 0.0 | |||||||||||
SG&A | 2.3 | 1.8 | 0.2 | 0.2 | 0.1 |
33
Table of Contents
(2) | Revenue less repair payments is a non-GAAP measure. See the explanation below, as well as “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Overview” and notes to the consolidated financial statements included in this prospectus. The following table reconciles our revenue (a GAAP measure) to revenue less repair payments (a non-GAAP measure): |
For the Year Ended March 31, | ||||||||||||||||
2006 | 2005 | 2004 | 2003 | |||||||||||||
(US dollars in millions) | ||||||||||||||||
Revenue | $ | 202.8 | $ | 162.2 | $ | 104.1 | $ | 54.6 | ||||||||
Less: Payments to repair centers | $ | 54.9 | $ | 63.2 | $ | 54.2 | $ | 29.0 | ||||||||
Revenue less repair payments | $ | 147.9 | $ | 99.0 | $ | 49.9 | $ | 25.6 | ||||||||
34
Table of Contents
35
Table of Contents
Historical Trinity | |||||||||||||||||||||
for the period from | |||||||||||||||||||||
Historical WNS | April 1, 2005 to | Pro forma | |||||||||||||||||||
(Holdings) | November 15, | Pro forma | combined | ||||||||||||||||||
for fiscal 2006 | 2005 | adjustments | Note | for fiscal 2006 | |||||||||||||||||
Revenue | $ | 202.8 | $ | 7.6 | $ | — | $ | 210.4 | |||||||||||||
Cost of revenue | 145.7 | 3.8 | — | 149.5 | |||||||||||||||||
Gross profit | 57.1 | 3.8 | — | 60.9 | |||||||||||||||||
Operating expenses | |||||||||||||||||||||
SG&A | 36.3 | 3.9 | 0.4 | 2.3 | 40.6 | ||||||||||||||||
Amortization of intangible assets | 0.9 | — | 1.2 | 2.4 | 2.1 | ||||||||||||||||
Operating income (loss) | 19.9 | (0.1 | ) | (1.6 | ) | 18.2 | |||||||||||||||
Other income, net | 0.5 | 0.1 | — | 0.6 | |||||||||||||||||
Interest expense | (0.4 | ) | (0.0 | ) | — | (0.5 | ) | ||||||||||||||
Income before income taxes | 19.9 | (0.0 | ) | (1.6 | ) | 18.3 | |||||||||||||||
(Provision) benefit for income taxes | (1.6 | ) | — | 0.5 | 2.5 | (1.1 | ) | ||||||||||||||
Net income | $ | 18.3 | $ | (0.0 | ) | $ | (1.1 | ) | $ | 17.2 | |||||||||||
Basic income per share | $ | 0.56 | $ | 0.50 | |||||||||||||||||
Diluted income per share | $ | 0.52 | $ | 0.47 | |||||||||||||||||
Weighted average shares outstanding | |||||||||||||||||||||
Basic | 32,874,299 | 2.6 | 34,230,296 | ||||||||||||||||||
Diluted | 35,029,766 | 2.6 | 36,385,763 |
36
Table of Contents
1. | Acquisition and Basis of Presentation |
(US dollars in millions) | ||||
Cash | $ | 6.8 | ||
Shares | 12.8 | |||
Transaction costs | 0.2 | |||
Total preliminary purchase price | $ | 19.8 | ||
(US dollars in millions) | ||||
Goodwill | $ | 8.9 | ||
Client-related intangible assets | 9.4 | |||
Net assets acquired and liabilities assumed | 1.5 | |||
Total purchase price allocation | $ | 19.8 | ||
2. | Pro Forma Adjustments |
2.1 | There were no intercompany transactions between WNS Holdings and Trinity Partners for the period of this pro forma condensed combined statement of operations. |
2.2 | The pro forma combined provision for income taxes does not necessarily reflect the amounts that would have resulted had WNS Holdings and Trinity Partners filed consolidated income tax returns, in the relevant income tax jurisdictions, during the period presented. |
37
Table of Contents
2.3 | WNS Holdings granted 104,716 shares to certain selling shareholders of Trinity Partners in connection with their employment contracts. The fair value of such shares amounting to approximately $0.6 million will be recognized as compensation expense over the one year period of the employment contract. The pro forma adjustment reflects the amortization of compensation expense for the period from April 1, 2005 to November 15, 2005 amounting to $0.4 million. For the period from November 16, 2005 to March 31, 2006, the amortization expense is included in the historical statement of operations of WNS Holdings. |
2.4 | Reflects the amortization of the client-related intangible assets for the period from April 1, 2005 to November 15, 2005 amounting to $1.2 million. For the period from November 16, 2005 to March 31, 2006, the amortization is included in the historical statement of operations of WNS Holdings. |
2.5 | The allocation of purchase price included a deferred tax liability related to the difference between the book and tax basis of the intangible assets. Pro forma adjustment reflects the change in such deferred tax liability due to the amortization of the intangible assets. |
2.6 | The basic and diluted weighted average shares outstanding include 2,107,901 shares issued related to the acquisition of Trinity Partners as if such shares had been issued on April 1, 2005. |
38
Table of Contents
Year Ended March 31, | ||||||||||||
2006 | 2005 | 2004 | ||||||||||
(US dollars in millions) | ||||||||||||
Revenue | $ | 202.8 | $ | 162.2 | $ | 104.1 | ||||||
Less: Payments to repair centers | $ | 54.9 | $ | 63.2 | $ | 54.2 | ||||||
Revenue less repair payments | $ | 147.9 | $ | 99.0 | $ | 49.9 | ||||||
39
Table of Contents
• | In fiscal 2003, we acquired Town & Country Assistance Limited (which we subsequently rebranded as WNS Assistance and which constitutes our reportable segment for financial statement purposes, called WNS Auto Claims BPO), a UK-based automobile claims handling company, thereby extending our service portfolio beyond the travel industry to include insurance-based automobile claims processing; |
• | In fiscal 2003, we invested in capabilities to begin providing enterprise services and knowledge services to address the requirements of emerging industry segments in the offshore outsourcing context; |
• | In fiscal 2003 and 2004, we invested in our infrastructure to expand our service portfolio from data-oriented processing to include complex voice and blended data/voice service capabilities, and commenced offering comprehensive processes in the travel and banking, financial services and insurance, or BFSI, industries; |
• | In fiscal 2004, we acquired the health claims management business of Greensnow Inc.; |
• | In fiscal 2005, we opened facilities in Gurgaon, India and Colombo, Sri Lanka, thereby expanding our operating footprint to nine delivery centers across India, Sri Lanka and the UK; and |
• | In fiscal 2006, we acquired Trinity Partners, a provider of business process outsourcing services to financial institutions, focusing on mortgage banking. |
40
Table of Contents
Revenue Less Repair | ||||||||||||||||||||||||
Revenue | Payments | |||||||||||||||||||||||
Year Ended March 31, | Year Ended March 31, | |||||||||||||||||||||||
2006 | 2005 | 2004 | 2006 | 2005 | 2004 | |||||||||||||||||||
Top five clients | 41.0 | % | 40.1 | % | 44.8 | % | 52.8 | % | 56.4 | % | 56.2 | % | ||||||||||||
Top ten clients | 58.5 | % | 61.4 | % | 61.9 | % | 65.5 | % | 68.8 | % | 67.2 | % | ||||||||||||
Top 20 clients | 73.0 | % | 76.1 | % | 73.5 | % | 78.1 | % | 82.3 | % | 80.5 | % |
• | travel; |
• | BFSI (which includes our WNS Auto Claims BPO segment); and |
• | emerging businesses (which includes manufacturing, logistics, retail, utilities and professional services). |
Revenue | Revenue Less Repair Payments | ||||||||||||||||||||||||
Year Ended March 31, | Year Ended March 31, | ||||||||||||||||||||||||
Business units | 2006 | 2005 | 2004 | 2006 | 2005 | 2004 | |||||||||||||||||||
Travel | 30.9 | % | 28.9 | % | 26.4 | % | 42.3 | % | 47.3 | % | 55.2 | % | |||||||||||||
BFSI | 55.6 | % | 61.4 | % | 66.3 | % | 39.1 | % | 36.8 | % | 29.6 | % | |||||||||||||
Emerging businesses | 13.5 | % | 9.7 | % | 7.3 | % | 18.6 | % | 15.9 | % | 15.2 | % | |||||||||||||
Total | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||||||||||||
41
Table of Contents
Revenue | Revenue Less Repair Payments | ||||||||||||||||||||||||
Year Ended March 31, | Year Ended March 31, | ||||||||||||||||||||||||
Locations | 2006 | 2005 | 2004 | 2006 | 2005 | 2004 | |||||||||||||||||||
UK | 62.6 | % | 65.1 | % | 72.1 | % | 49.6 | % | 51.6 | % | 60.7 | % | |||||||||||||
Europe (excluding the UK) | 12.5 | % | 17.1 | % | 17.4 | % | 16.3 | % | 19.2 | % | 17.4 | % | |||||||||||||
North America (primarily the US) | 24.2 | % | 17.3 | % | 9.8 | % | 33.2 | % | 28.3 | % | 20.5 | % | |||||||||||||
Rest of World | 0.7 | % | 0.5 | % | 0.7 | % | 0.9 | % | 0.9 | % | 1.4 | % | |||||||||||||
Total | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | |||||||||||||
• | per full-time equivalent arrangements typically involve billings based on the number of full-time employees (or equivalent) deployed on the execution of the business process outsourced; |
• | per transaction arrangements typically involve billings based on the number of transactions processed (such as the number ofe-mail responses, or airline coupons or insurance claims processed); and |
• | cost-plus arrangements typically involve billing the contractually agreed direct and indirect costs and a fee based on the number of employees deployed under the arrangement. |
42
Table of Contents
• | developing a broad client base which has resulted in limited reliance on any particular client; |
• | seeking to balance our revenue base by targeting industries that offer significant offshore outsourcing potential; |
• | addressing the largest markets for offshore business process outsourcing services, which provide geographic diversity across our client base; and |
• | focusing our service mix on diverse data, voice and analytical processes, resulting in enhanced client retention. |
43
Table of Contents
44
Table of Contents
Weighted | ||||||||||||||||
Weighted | average fair | Weighted average | ||||||||||||||
No of options | average | value | intrinsic value | |||||||||||||
Grants made during the quarter ended | granted | exercise price | per share | per share | ||||||||||||
June 30, 2005 | 160,500 | $ | 5.44 | $ | 5.65 | $ | 0.21 | |||||||||
September 30, 2005 | 828,100 | 6.27 | 6.27 | — | ||||||||||||
December 31, 2005 | 45,479 | 6.07 | 6.07 | — | ||||||||||||
March 31, 2006 | 447,400 | 11.72 | 11.99 | 0.27 |
• | Achievement of major company milestones, such as key new client wins and acquisitions; |
• | Public company comparables and private market transactions for sale of equity; |
• | The absence of a public trading market for our shares; |
• | Our recent operating results at the time of a grant; |
• | The fact that we are majority owned by a single shareholder; and |
• | The likelihood of our company selling our shares to the public in the future. |
45
Table of Contents
46
Table of Contents
Revenue | Revenue Less Repair Payments | ||||||||||||||||||||||||
Year Ended March 31, | Year Ended March 31, | ||||||||||||||||||||||||
2006 | 2005 | 2004 | 2006 | 2005 | 2004 | ||||||||||||||||||||
Unaudited | Unaudited | Unaudited | |||||||||||||||||||||||
Cost of revenue | 71.9 | % | 86.5 | % | 86.2 | % | 61.4 | % | 77.9 | % | 71.1 | % | |||||||||||||
Gross profit | 28.1 | % | 13.5 | % | 13.8 | % | 38.6 | % | 22.1 | % | 28.9 | % | |||||||||||||
Operating expenses: | |||||||||||||||||||||||||
SG&A | 17.9 | % | 15.3 | % | 18.1 | % | 24.6 | % | 25.1 | % | 37.7 | % | |||||||||||||
Amortization of intangible assets | 0.4 | % | 0.9 | % | 2.5 | % | 0.6 | % | 1.4 | % | 5.2 | % | |||||||||||||
Operating income (loss) | 9.8 | % | (2.7 | )% | (6.7 | )% | 13.4 | % | (4.4 | )% | (14.1 | )% | |||||||||||||
Non-operating income (expense), net | 0.0 | % | (0.2 | )% | 0.3 | % | 0.0 | % | (0.3 | )% | 0.5 | % | |||||||||||||
(Provision) benefit for income taxes | (0.8 | )% | (0.7 | )% | (0.0 | )% | (1.1 | )% | (1.1 | )% | (0.1 | )% | |||||||||||||
Net income (loss) | 9.0 | % | (3.6 | )% | (6.5 | )% | 12.3 | % | (5.8 | )% | (13.5 | )% |
Year Ended March 31, | ||||||||||||
2006 | 2005 | 2004 | ||||||||||
Revenue | 100.0 | % | 100.0 | % | 100.0 | % | ||||||
Less: Payments to repair centers | 27.1 | % | 39.0 | % | 52.1 | % | ||||||
Revenue less repair payments | 72.9 | % | 61.0 | % | 47.9 | % | ||||||
47
Table of Contents
48
Table of Contents
49
Table of Contents
50
Table of Contents
Year Ended March 31, | Year Ended March 31, | Year Ended March 31, | ||||||||||||||||||||||
2006 | 2005 | 2004 | ||||||||||||||||||||||
WNS | WNS Auto | WNS | WNS Auto | WNS | WNS Auto | |||||||||||||||||||
Global | Claims | Global | Claims | Global | Claims | |||||||||||||||||||
BPO | BPO | BPO | BPO | BPO | BPO | |||||||||||||||||||
(US dollars in millions) | ||||||||||||||||||||||||
Segment revenue(1) | $ | 125.2 | $ | 79.6 | $ | 78.6 | $ | 85.2 | $ | 37.9 | $ | 67.3 | ||||||||||||
Less: Payments to repair centers | $ | — | $ | 54.9 | $ | — | $ | 63.2 | $ | — | $ | 54.2 | ||||||||||||
Revenue less repair payments(1) | $ | 125.2 | $ | 24.7 | $ | 78.6 | $ | 22.0 | $ | 37.9 | $ | 13.1 | ||||||||||||
Depreciation | $ | 8.7 | $ | 1.8 | $ | 6.9 | $ | 1.5 | $ | 4.3 | $ | 1.0 | ||||||||||||
Other costs | $ | 99.0 | $ | 17.8 | $ | 77.8 | $ | 17.1 | $ | 38.4 | $ | 11.5 | ||||||||||||
Segment operating income (loss) | $ | 17.5 | $ | 5.1 | $ | (6.1 | ) | $ | 3.4 | $ | (4.8 | ) | $ | 0.6 | ||||||||||
(1) | Segment revenue includes inter-segment revenue of $2.0 million for fiscal 2006, $1.6 million for fiscal 2005 and $1.1 million for fiscal 2004. |
51
Table of Contents
Fiscal 2006 | Fiscal 2005 | ||||||||||||||||||||||||||||||||
Three Months Ended | Three Months Ended | ||||||||||||||||||||||||||||||||
Mar 2006(1) | Dec 2005(1) | Sep 2005 | Jun 2005 | Mar 2005 | Dec 2004 | Sep 2004 | Jun 2004 | ||||||||||||||||||||||||||
(US dollars in millions) | |||||||||||||||||||||||||||||||||
Revenue | $ | 52.9 | $ | 49.8 | (2) | $ | 48.9 | $ | 51.2 | (2) | $ | 49.0 | $ | 42.5 | $ | 36.5 | $ | 34.1 | |||||||||||||||
Cost of revenue | 37.3 | 34.1 | 35.6 | 38.7 | 37.1 | (5) | 37.9 | 32.8 | 32.5 | ||||||||||||||||||||||||
Gross profit | 15.6 | 15.7 | 13.4 | 12.4 | 11.9 | (5) | 4.6 | 3.7 | 1.6 | ||||||||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||||||||||||
SG&A | 11.4 | (3) | 9.7 | (4) | 8.2 | 7.1 | 6.8 | 6.3 | 5.7 | 6.1 | |||||||||||||||||||||||
Amortization of intangibles assets | 0.5 | 0.2 | 0.1 | 0.1 | 0.1 | 0.3 | 0.4 | 0.7 | |||||||||||||||||||||||||
Operating income (loss) | 3.7 | (3) | 5.8 | (4) | 5.1 | 5.3 | 5.1 | (5) | (1.9 | ) | (2.3 | ) | (5.2 | ) | |||||||||||||||||||
Non-operating income (expense) | 0.2 | (0.0 | ) | (0.1 | ) | (0.1 | ) | 0.2 | (0.4 | ) | 0.5 | (0.6 | ) | ||||||||||||||||||||
(Provision) benefit for income taxes | (0.3 | ) | 0.1 | (0.5 | ) | (0.9 | ) | (0.6 | ) | (0.4 | ) | (0.1 | ) | (0.1 | ) | ||||||||||||||||||
Net income (loss) | 3.7 | 5.9 | 4.4 | 4.4 | 4.7 | (2.6 | ) | (1.9 | ) | (5.9 | ) |
52
Table of Contents
Fiscal 2006 | Fiscal 2005 | |||||||||||||||||||||||||||||||
Three Months Ended | Three Months Ended | |||||||||||||||||||||||||||||||
Mar 2006(1) | Dec 2005(1) | Sep 2005 | Jun 2005 | Mar 2005 | Dec 2004 | Sep 2004 | Jun 2004 | |||||||||||||||||||||||||
Gross profit (loss) as a percentage of revenue | 29.5 | % | 31.5 | % | 27.3 | % | 24.3 | % | 24.4 | %(5) | 10.9 | % | 10.2 | % | 4.8 | % | ||||||||||||||||
Operating income (loss) as a percentage of revenue | 7.0 | %(3) | 11.6 | %(4) | 10.4 | % | 10.4 | % | 10.3 | %(5) | (4.5 | )% | (6.3 | )% | (15.2 | )% | ||||||||||||||||
Gross profit (loss) as a percentage of revenue less repair payments | 37.6 | % | 40.8 | % | 38.4 | % | 37.5 | % | 39.1 | %(5) | 19.0 | % | 16.1 | % | 7.8 | % | ||||||||||||||||
Operating income (loss) as a percentage of revenue less repair payments | 9.0 | %(3) | 15.0 | %(4) | 14.6 | % | 16.0 | % | 16.5 | %(5) | (7.9 | )% | (10.0 | )% | (24.9 | )% |
Fiscal 2006 | Fiscal 2005 | |||||||||||||||||||||||||||||||
Three Months Ended | Three Months Ended | |||||||||||||||||||||||||||||||
Mar 2006(1) | Dec 2005(1) | Sep 2005 | Jun 2005 | Mar 2005 | Dec 2004 | Sep 2004 | Jun 2004 | |||||||||||||||||||||||||
(US dollars in millions) | ||||||||||||||||||||||||||||||||
Revenue | $ | 52.9 | $ | 49.8 | (2) | $ | 48.9 | $ | 51.2 | (2) | $ | 49.0 | $ | 42.5 | $ | 36.5 | $ | 34.1 | ||||||||||||||
Less: Payments to repair centers | 11.5 | 11.3 | 14.1 | 18.0 | 18.5 | 18.2 | 13.3 | 13.2 | ||||||||||||||||||||||||
Revenue less repair payments | 41.4 | 38.4 | (2) | 34.8 | 33.2 | (2) | 30.6 | 24.3 | 23.2 | 20.9 |
(1) | The financial information for the quarters ended March 2006 and December 2005 reflects the acquisition of Trinity Partners in November 2005. |
(2) | Revenue and revenue less repair payments in the quarters ended December 2005 and June 2005 include $2.4 million and $0.8 million, respectively, of revenue deferred from fiscal 2005. Costs associated with this revenue were however recognized in fiscal 2005. |
(3) | SG&A expenses in the quarter ended March 2006 include $0.7 million for consulting and auditing fees, representing a portion of the professional fees relating to our preparations for becoming a public company. In addition, costs related to a recruitment drive were higher relative to the prior quarters in fiscal 2006. |
(4) | SG&A expenses in the quarter ended December 2005 include share-based compensation cost of $1.4 million, of which $1.2 million related to the repurchase and modification of options. |
(5) | Cost of revenue in the quarter ended March 2005 decreased significantly from levels in the preceding quarters due to completion of payments for client resources located in North America during the transfer period as described in “— Overview — Expenses — Cost of Revenue.” |
53
Table of Contents
54
Table of Contents
Payments Due by Period | |||||||||||||||||||||
Less than | 2-3 | 4-5 | More than | ||||||||||||||||||
Total | 1 Year | Years | Years | 5 Years | |||||||||||||||||
(US dollars in thousands) | |||||||||||||||||||||
Operating leases | $ | 88,036 | $ | 21,091 | $ | 36,731 | $ | 26,369 | $ | 3,845 | |||||||||||
Purchase obligations | 4,309 | 4,309 | — | — | — | ||||||||||||||||
Capital lease obligations | 195 | 193 | 2 | — | — | ||||||||||||||||
Total | $ | 92,540 | $ | 25,593 | $ | 36,733 | $ | 26,369 | $ | 3,845 | |||||||||||
55
Table of Contents
56
Table of Contents
57
Table of Contents
58
Table of Contents
59
Table of Contents
60
Table of Contents
61
Table of Contents
62
Table of Contents
• | established reputation and industry leadership; |
• | demonstrated ability to execute a diverse range of mission-critical and often complex business processes; |
• | capability to scale employees and infrastructure without a diminution in quality of service; and |
• | ability to innovate, add new operational expertise and drive down costs. |
• | NASSCOM named us one of the top two Indian offshore business process outsourcers in 2005 and 2004; |
• | neoIT ranked us as the best performing business process outsourcing company in 2005; and |
• | Global Outsourcing named us the leading insurance outsourcer in India in 2005. |
63
Table of Contents
• | offer a suite of services that can deliver a comprehensive industry-focused business process outsourcing program; |
• | leverage our existing capabilities to win additional clients and identify new industry-specific service offerings; |
• | cultivate client relationships that may involve few processes upon initial engagement to develop deeper engagements ultimately involving a number of integrated processes; and |
• | recruit and retain talented employees by offering them industry-focused career paths. |
64
Table of Contents
65
Table of Contents
66
Table of Contents
• | airlines; |
• | travel intermediaries; and |
• | others such as global distribution systems and network providers. |
• | customer interaction: customer complaint resolution, loyalty program management; |
• | passenger revenue accounting: refunds, fare audit, ticket coupon matching, sales accounting; |
67
Table of Contents
• | cargo operations and accounting: scheduling, booking, flight planning, mail revenue accounting; |
• | revenue management: seat allocation, processing meal requests, yield maximization through inventory management, fare filing, fare construction and quotation; |
• | reporting and analytics: aircraft load factor, costs, market share, revenue and competition reports; and |
• | other miscellaneous services: updating employee records, calculation of medical leave and overtime for staff. |
• | integrated financial institutions; |
• | mortgage banks and investors in mortgage-backed securities; |
• | financial advisory service providers; |
• | life, property and casualty, and health insurers; |
• | insurance brokers and loss assessors; and |
• | self-insured auto fleet owners. |
68
Table of Contents
69
Table of Contents
• | Enterprise Services, focused on finance and accounting, human resource and supply chain management services; and |
• | Knowledge Services, focused on market, business and financial research and analytical services. |
70
Table of Contents
71
Table of Contents
Air Canada | Marsh | |
AVIVA | SITA | |
British Airways | Tesco | |
First Magnus Financial Corporation | Travelocity | |
GfK | Virgin Atlantic Airways | |
IndyMac Bank |
Year Ended March 31, | ||||||||
2006 | 2005 | |||||||
Below $1 million | 109 | 88 | ||||||
$1 million to $5 million | 18 | 15 | ||||||
$5 million to $10 million | 0 | 1 | ||||||
More than $10 million | 4 | 3 |
• | Focused business process outsourcing service companies based in offshore locations like India, such as Genpact and ExlService Holdings Inc.; |
• | Business process outsourcing divisions of numerous information technology service companies located in India such as Progeon, owned by Infosys Technologies Limited, Tata Consultancy Services Limited and Wipro BPO, owned by Wipro Technologies Limited; and |
• | Global companies such as Accenture Ltd, Affiliated Computer Services Inc., Electronic Data Systems or, EDS, and International Business Machines Corporation, or IBM, which provide an array of products |
72
Table of Contents
and services including broad-based information technology, software, consulting and business process outsourcing services. |
73
Table of Contents
Recruiting and Retention |
74
Table of Contents
Space | Number of | Extendable | |||||||||||||||
Location | (square feet) | Workstations/Seats | Lease Expiration(3) | Until(4) | |||||||||||||
India: | |||||||||||||||||
Mumbai | 84,429 | 1,059 | April 30, 2008 | May 15, 2011 | |||||||||||||
15,323 | 177 | April 30, 2008 | April 30, 2008 | ||||||||||||||
99,752 | 1,236 | ||||||||||||||||
Gurgaon | 90,995 | 763 | October 31, 2008 | April 30, 2014 | |||||||||||||
Pune-WNS | 142,800 | 1,778 | December 31, 2006 | March 31, 2010 | |||||||||||||
Pune-NTrance(1) | 66,460 | 900 | March 10, 2007 | March 9, 2014 | |||||||||||||
Nashik | 13,825 | 277 | April 30, 2007 | December 30, 2009 | |||||||||||||
32,686 | 550 | September 30, 2007 | December 30, 2010 | ||||||||||||||
46,511 | 827 | ||||||||||||||||
Pune-WNS(2) | 36,700 | 354 | February 2, 2011 | February 2, 2011 | |||||||||||||
Mumbai(2) | 37,000 | 411 | May 1, 2015 | May 1, 2015 | |||||||||||||
69,811 | 776 | May 30, 2009 | May 30, 2015 | ||||||||||||||
13,770 | 205 | May 1, 2015 | May 1, 2015 | ||||||||||||||
120,581 | 1,392 | ||||||||||||||||
Gurgaon(2) | 51,244 | 661 | September 30, 2010 | March 31, 2015 | |||||||||||||
Sri Lanka:(1) | |||||||||||||||||
Colombo | 30,000 | 376 | July 31, 2007 | July 31, 2007 | |||||||||||||
UK: | |||||||||||||||||
Ipswich | 43,802 | 143 | August 27, 2010 | August 27, 2010 | |||||||||||||
Broadstairs | 7,200 | 120 | December 31, 2007 | December 31, 2007 |
(1) | We use these delivery centers to provide services to one of our major clients. Our contracts with this client provide the client with an option to require us to transfer the relevant project and operations, including these delivery centers to |
75
Table of Contents
that client. See “Risk Factors — Risks Related to Our Business — We may lose some or all of the revenue generated by one of our major clients.” |
(2) | Under construction. Number of workstations/seats is based on our estimates of workstations/seats available upon completion of construction of the respective facilities. |
(3) | In each of our Mumbai and Nashik facilities, we have two separate lease agreements with different expiration/ extension option dates. |
(4) | Reflects the expiration date if each of our applicable extension options are exercised. |
76
Table of Contents
Name | Age | Designation | ||||
Directors | ||||||
Ramesh N. Shah | 57 | Chairman of Board(1)(2) | ||||
Neeraj Bhargava | 42 | Co-Founder of WNS (Holdings) Limited, Director and Group Chief Executive Officer(2) | ||||
Zubin Dubash | 46 | Director and Group Chief Financial Officer(3) | ||||
Pulak Prasad | 37 | Director(2) | ||||
Nitin Sibal | 32 | Director(3) | ||||
Miriam Strouse | 35 | Director(3) | ||||
Jeremy Young | 40 | Director(2) | ||||
Guy Sochovsky | 29 | Director(2) | ||||
Timothy Hammond | 41 | Director(3) | ||||
New Directors | ||||||
Eric B. Herr | 58 | Director(4) | ||||
Deepak S. Parekh | 61 | Director(4) | ||||
Executive Officers(5) | ||||||
David Charles Tibble | 53 | Co-Founder of WNS (Holdings) Limited and Chairman, WNS UK | ||||
Anup Gupta | 34 | Chief Executive Officer — Travel Services | ||||
Edwin Donald Harrell | 41 | Chief Executive Officer — WNS Assistance | ||||
J.J. Selvadurai | 45 | Chief Executive Officer — Enterprise Services | ||||
Other Managers | ||||||
Alan Stephen Dunning | 49 | Co-Founder of WNS (Holdings) Limited, Managing Director, WNS UK | ||||
Lyndon Rodrigues | 45 | Chief Information Officer | ||||
Amit Bhatia | 37 | Chief Executive Officer — Knowledge Services |
(1) | Currently acting as Interim Chief Executive Officer — Banking, Financial Services and Insurance, or BFSI, (excluding WNS Assistance). |
(2) | Individuals who will continue as our directors following the completion of this offering. |
(3) | Individuals who will resign as our directors effective upon the completion of this offering. |
(4) | Individuals who will become our directors effective upon the completion of this offering. |
(5) | Other than executive officers who also are directors. |
77
Table of Contents
78
Table of Contents
79
Table of Contents
80
Table of Contents
• | Class I, whose term will expire at the annual general meeting to be held in 2007; |
• | Class II, whose term will expire at the annual general meeting to be held in 2008; and |
• | Class III, whose term will expire at the annual general meeting to be held in 2009. |
81
Table of Contents
82
Table of Contents
• | to serve as an independent and objective party to monitor our financial reporting process and internal control systems; |
• | to review and appraise the audit efforts of our independent accountants and exercise ultimate authority over the relationship between us and our independent accountants; and |
• | to provide an open avenue of communication among the independent accountants, financial and senior management and the board of directors. |
83
Table of Contents
• | to assist the board of directors by identifying individuals qualified to become board members and members of board committees, to recommend to the board of directors nominees for the next annual meeting of shareholders, and to recommend to the board of directors nominees for each committee of the board of directors; |
• | to monitor our corporate governance structure; and |
• | to periodically review and recommend to the board of directors any proposed changes to the corporate governance guidelines applicable to us. |
84
Table of Contents
Number of Ordinary | ||||||||||||
Shares Underlying | Exercise Price | |||||||||||
Name | Options Outstanding(1) | per Share(2) | Expiration Date | |||||||||
Ramesh N. Shah | 250,000 | £3.50/ $6.14 | July 14, 2015 | |||||||||
Neeraj Bhargava | 220,001 | £1.00/ $1.75 | July 1, 2012 | |||||||||
150,000 | £1.45/ $2.54 | January 1, 2014 | ||||||||||
150,000 | £3.50/ $6.14 | September 1, 2015 | ||||||||||
Zubin Dubash | 200,000 | £1.50/ $2.63 | September 6, 2014 | |||||||||
75,000 | £3.50/ $6.14 | September 1, 2015 | ||||||||||
20,000 | £7.00/ $12.28 | February 21, 2016 | ||||||||||
Pulak Prasad | — | — | — | |||||||||
Nitin Sibal | — | — | — | |||||||||
Miriam Strouse | — | — | — | |||||||||
Jeremy Young | — | — | — | |||||||||
Guy Sochovsky | — | — | — | |||||||||
Timothy Hammond | — | — | — | |||||||||
David Charles Tibble | — | — | — | |||||||||
Anup Gupta | 28,000 | £1.00/ $1.75 | August 1, 2012 | |||||||||
22,000 | £1.40/ $2.46 | July 18, 2013 | ||||||||||
5,000 | £3.00/ $5.26 | April 11, 2015 | ||||||||||
70,000 | £3.50/ $6.14 | September 1, 2015 | ||||||||||
20,000 | £7.00/ $12.28 | February 21, 2016 | ||||||||||
Edwin Donald Harrell | 25,000 | £7.00/ $12.28 | February 21, 2016 | |||||||||
J.J. Selvadurai | 33,333 | £1.45/$2.54 | January 1, 2014 |
(1) | The information in this table excludes the following options and restricted share units to be issued effective upon the completion of this offering to the following directors and executive officers under the WNS 2006 Incentive Award Plan: Ramesh N. Shah — 115,000 options and 57,500 restricted share units, Neeraj Bhargava — 135,000 options and 67,500 restricted share units, Zubin Dubash — 25,000 options and 12,500 restricted share units, Anup Gupta — 20,000 options and 10,000 restricted share units, Edwin Harrell — 5,000 options and 2,500 restricted share units and J.J. Selvadurai — 20,000 options and 10,000 restricted share units. |
(2) | US dollar amounts based on convenience translation of $1.00 = £0.57 as of March 31, 2006. |
85
Table of Contents
86
Table of Contents
87
Table of Contents
• | Options. The plan administrator may grant options on shares. The per share option exercise price of all options granted pursuant to the 2006 Incentive Award Plan will not be less than 100% of the fair market value of a share on the date of grant. No incentive stock option may be granted to a grantee who owns more than 10% of our outstanding shares unless the exercise price is at least 110% of the fair market value of a share on the date of grant. To the extent that the aggregate fair market value of the shares subject to an incentive stock option become exercisable for the first time by any optionee during any calendar year exceeds $100,000, such excess will be treated as a nonqualified option. The plan administrator will determine the methods of payment of the exercise price of an option, which may include cash, shares or other property acceptable to the plan administrator (and may involve a cashless exercise of the option). The term of options granted under the 2006 Incentive Award Plan may not exceed 10 years from the date of grant. However, the term of an incentive stock option granted to a person who owns more than 10% of our outstanding shares on the date of grant may not exceed five years. |
Under the 2006 Incentive Award Plan, our independent directors will each receive an option to purchase 14,000 shares initially and an option to purchase 7,000 shares upon reelection to our board of directors at each annual meeting of shareholders thereafter. The options granted to independent directors will be non-qualified options with a per share exercise price equal to 100% of the fair market value of a share on the date that the option is granted. Options granted to independent directors will become exercisable in cumulative annual installments of 331/3% on each of the first, second and third anniversaries of the date of grant. |
• | Restricted Shares. The plan administrator may grant shares subject to various restrictions, including restrictions on transferability, limitations on the right to vote and/or limitations on the right to receive dividends. |
• | Share Appreciation Rights. The plan administrator may grant share appreciation rights representing the right to receive payment of an amount equal to the excess of the fair market value of a share on the date of exercise over the fair market value of a share on the date of grant. The term of share appreciation rights granted may not exceed ten years from the date of grant. The plan administrator may elect to pay share appreciation rights in cash, in shares or in a combination of cash and shares. |
• | Performance Shares and Performance Shares Units. The plan administrator may grant awards of performance shares denominated in a number of shares and/or awards of performance share units denominated in unit equivalents of shares and/or units of value, including dollar value of shares. These awards may be linked to performance criteria measured over performance periods as determined by the plan administrator. |
• | Share Payments. The plan administrator may grant share payments, including payments in the form of shares or options or other rights to purchase shares. Share payments may be based upon specific performance criteria determined by the plan administrator on the date such share payments are made or on any date thereafter. |
• | Deferred Shares. The plan administrator may grant awards of deferred shares linked to performance criteria determined by the plan administrator. Shares underlying deferred share awards will not be issued until the deferred share awards have vested, pursuant to a vesting schedule or upon the satisfaction of any vesting conditions or performance criteria set by the plan administrator. Recipients of deferred share awards generally will have no rights as shareholders with respect to such deferred shares until the shares underlying the deferred share awards have been issued. |
• | Restricted Share Units. The plan administrator may grant restricted share units, subject to various vesting conditions. On the maturity date, we will transfer to the participant one unrestricted, fully transferable share for each vested restricted share unit scheduled to be paid out on such date. The plan administrator will specify the purchase price, if any, to be paid by the participant for such shares. |
88
Table of Contents
• | Performance Bonus Awards. The plan administrator may grant a cash bonus payable upon the attainment of performance goals based on performance criteria and measured over a performance period determined appropriate by the plan administrator. Any such cash bonus paid to a “covered employee” within the meaning of Section 162(m) of the Internal Revenue Code may be a performance-based award as described below. |
• | Performance-Based Awards. The plan administrator may grant awards other than options and share appreciation rights to employees who are or may be “covered employees,” as defined in Section 162(m) of the Internal Revenue Code, that are intended to be performance-based awards within the meaning of Section 162(m) of the Internal Revenue Code in order to preserve the deductibility of these awards for federal income tax purposes. Participants are only entitled to receive payment for performance-based awards for any given performance period to the extent that pre-established performance goals set by the plan administrator for the period are satisfied. The plan administrator will determine the type of performance-based awards to be granted, the performance period and the performance goals. Generally, a participant will have to be employed by us on the date the performance-based award is paid to be eligible for a performance-based award for any period. |
89
Table of Contents
90
Table of Contents
• | each person who is known to us to have more than 5.0% beneficial share ownership; |
• | each of our directors and executive officers; |
• | all of our directors and executive officers as a group; |
• | all of our employees as a group; and |
• | each selling shareholder. |
Shareholding of WNS (Holdings) Limited | |||||||||||||||||||||||||||||||||
Immediately after the Offering | |||||||||||||||||||||||||||||||||
Shareholding of WNS | Number of Shares | Number of Shares | Excluding Exercise of | Including Exercise of | |||||||||||||||||||||||||||||
(Holdings) Limited as | sold in the | sold in the | the Over-Allotment | the Over-Allotment | |||||||||||||||||||||||||||||
of June 20, 2006 | Offering | Offering | Options | Option | |||||||||||||||||||||||||||||
(excluding | (including | ||||||||||||||||||||||||||||||||
Shareholders’ Name | Shares | Percentage | optional shares) | optional shares) | Shares | Percentage | Shares | Percentage | |||||||||||||||||||||||||
5% or Greater Beneficial Share Owner | |||||||||||||||||||||||||||||||||
Warburg Pincus(1) | 22,856,644 | 64.70 | % | — | 1,490,000 | 22,856,644 | 57.38 | % | 21,366,644 | 53.64 | % | ||||||||||||||||||||||
466 Lexington Avenue | |||||||||||||||||||||||||||||||||
New York, New York 10017 | |||||||||||||||||||||||||||||||||
USA | |||||||||||||||||||||||||||||||||
British Airways plc | 5,160,000 | 14.61 | % | 4,386,000 | 4,386,000 | 774,000 | 1.94 | % | 774,000 | 1.94 | % | ||||||||||||||||||||||
Waterside P.O. Box 365 | |||||||||||||||||||||||||||||||||
Harmondsworth, Middlesex | |||||||||||||||||||||||||||||||||
UK | |||||||||||||||||||||||||||||||||
Theodore Agnew(2) | 1,956,228 | 5.54 | % | 1,075,925 | 1,075,925 | 880,303 | 2.21 | % | 880,303 | 2.21 | % | ||||||||||||||||||||||
85 Gracechurch SV | |||||||||||||||||||||||||||||||||
London EC3V 0AA | |||||||||||||||||||||||||||||||||
UK |
91
Table of Contents
Shareholding of WNS (Holdings) Limited | |||||||||||||||||||||||||||||||||
Immediately after the Offering | |||||||||||||||||||||||||||||||||
Shareholding of WNS | Number of Shares | Number of Shares | Excluding Exercise of | Including Exercise of | |||||||||||||||||||||||||||||
(Holdings) Limited as | sold in the | sold in the | the Over-Allotment | the Over-Allotment | |||||||||||||||||||||||||||||
of June 20, 2006 | Offering | Offering | Options | Option | |||||||||||||||||||||||||||||
(excluding | (including | ||||||||||||||||||||||||||||||||
Shareholders’ Name | Shares | Percentage | optional shares) | optional shares) | Shares | Percentage | Shares | Percentage | |||||||||||||||||||||||||
Directors and Executive Officers(3) | |||||||||||||||||||||||||||||||||
Ramesh N. Shah | 150,000 | 0.42 | % | — | — | 150,000 | 0.37 | % | 150,000 | 0.37 | % | ||||||||||||||||||||||
Neeraj Bhargava | 320,001 | (4) | 0.90 | % | — | 32,000 | 320,001 | 0.80 | % | 288,001 | 0.72 | % | |||||||||||||||||||||
Zubin Dubash | 66,667 | (4) | 0.19 | % | — | — | 66,667 | 0.16 | % | 66,667 | 0.16 | % | |||||||||||||||||||||
Pulak Prasad(5) | 22,856,644 | 64.70 | % | — | 1,490,000 | 22,856,644 | 57.38 | % | 21,366,644 | 53.64 | % | ||||||||||||||||||||||
Nitin Sibal(6) | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||
Miriam Strouse(5) | 22,856,644 | 64.70 | % | — | 1,490,000 | 22,856,644 | 57.38 | % | 21,366,644 | 53.64 | % | ||||||||||||||||||||||
Jeremy Young(5) | 22,856,644 | 64.70 | % | — | 1,490,000 | 22,856,644 | 57.38 | % | 21,366,644 | 53.64 | % | ||||||||||||||||||||||
Guy Sochovsky(6) | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||
Timothy Hammond(7) | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||
David Charles Tibble | 1,088,182 | 3.08 | % | 88,182 | 88,182 | 1,000,000 | 2.51 | % | 1,000,000 | 2.51 | % | ||||||||||||||||||||||
Anup Gupta | 51,667 | (4) | 0.15 | % | — | — | 51,667 | 0.13 | % | 51,667 | 0.13 | % | |||||||||||||||||||||
Edwin Donald Harrell | 75,000 | 0.21 | % | — | — | 75,000 | 0.19 | % | 75,000 | 0.19 | % | ||||||||||||||||||||||
J.J. Selvadurai | 283,333 | 0.80 | % | — | 15,000 | 283,333 | 0.71 | % | 268,333 | 0.68 | % | ||||||||||||||||||||||
All our directors and executive officers as a group (ten persons)(8) | 24,891,494 | 69.56 | % | 88,182 | 1,625,182 | 24,803,312 | 62.27 | % | 23,266,312 | 58.41 | % | ||||||||||||||||||||||
Employees(9) | |||||||||||||||||||||||||||||||||
Employees (excluding our directors and executive officers) | 3,545,327 | 9.64 | % | 130,401 | 169,401 | 3,414,926 | 8.58 | % | 3,375,926 | 8.48 | % | ||||||||||||||||||||||
Selling Shareholders | |||||||||||||||||||||||||||||||||
Warburg Pincus(1) | 22,856,644 | 64.70 | % | — | 1,490,000 | 22,856,644 | 57.38 | % | 21,366,644 | 53.64 | % | ||||||||||||||||||||||
466 Lexington Avenue | |||||||||||||||||||||||||||||||||
New York, | |||||||||||||||||||||||||||||||||
New York 10017 | |||||||||||||||||||||||||||||||||
USA | |||||||||||||||||||||||||||||||||
British Airways plc | 5,160,000 | 14.61 | % | 4,386,000 | 4,386,000 | 774,000 | 1.94 | % | 774,000 | 1.94 | % | ||||||||||||||||||||||
Waterside | |||||||||||||||||||||||||||||||||
P.O. Box 365 | |||||||||||||||||||||||||||||||||
Harmondsworth, | |||||||||||||||||||||||||||||||||
Middlesex | |||||||||||||||||||||||||||||||||
UK | |||||||||||||||||||||||||||||||||
Neeraj Bhargava | 320,001 | (4) | 0.90 | % | — | 32,000 | 320,001 | 0.80 | % | 288,001 | 0.72 | % | |||||||||||||||||||||
93 Chitrakoot Altamount Road Mumbai 400026 India | |||||||||||||||||||||||||||||||||
Theodore Agnew(2) | 1,956,228 | 5.54 | % | 1,075,925 | 1,075,925 | 880,303 | 2.21 | % | 880,303 | 2.21 | % | ||||||||||||||||||||||
85 Gracechurch SV | |||||||||||||||||||||||||||||||||
London EC3V 0AA | |||||||||||||||||||||||||||||||||
UK | |||||||||||||||||||||||||||||||||
Bolton Agnew | 391,241 | 1.11 | % | 215,183 | 215,183 | 176,058 | 0.44 | % | 176,058 | 0.44 | % | ||||||||||||||||||||||
Oulton Hall Norwich Norfolk NR11 6NY UK |
92
Table of Contents
Shareholding of WNS (Holdings) Limited | |||||||||||||||||||||||||||||||||
Immediately after the Offering | |||||||||||||||||||||||||||||||||
Shareholding of WNS | Number of Shares | Number of Shares | Excluding Exercise of | Including Exercise of | |||||||||||||||||||||||||||||
(Holdings) Limited as | sold in the | sold in the | the Over-Allotment | the Over-Allotment | |||||||||||||||||||||||||||||
of June 20, 2006 | Offering | Offering | Options | Option | |||||||||||||||||||||||||||||
(excluding | (including | ||||||||||||||||||||||||||||||||
Shareholders’ Name | Shares | Percentage | optional shares) | optional shares) | Shares | Percentage | Shares | Percentage | |||||||||||||||||||||||||
David Charles Tibble | 1,088,182 | 3.08 | % | 88,182 | 88,182 | 1,000,000 | 2.51 | % | 1,000,000 | 2.51 | % | ||||||||||||||||||||||
Ash House | |||||||||||||||||||||||||||||||||
Fairfield Avenue | |||||||||||||||||||||||||||||||||
Staines | |||||||||||||||||||||||||||||||||
Middlesex TW18 4AN | |||||||||||||||||||||||||||||||||
UK | |||||||||||||||||||||||||||||||||
Vivek Shivpuri | 327,149 | 0.93 | % | — | 14,000 | 327,149 | 0.82 | % | 313,149 | 0.79 | % | ||||||||||||||||||||||
7520, East Placita | |||||||||||||||||||||||||||||||||
Ventana Nayes | |||||||||||||||||||||||||||||||||
Tuscon, Arizona 85750 | |||||||||||||||||||||||||||||||||
USA | |||||||||||||||||||||||||||||||||
Amit Gujral | 314,696 | 0.89 | % | — | 10,000 | 314,696 | 0.80 | % | 304,696 | 0.77 | % | ||||||||||||||||||||||
7563, East Placita De | |||||||||||||||||||||||||||||||||
La Vina | |||||||||||||||||||||||||||||||||
Tuscon, Arizona 85750 | |||||||||||||||||||||||||||||||||
USA | |||||||||||||||||||||||||||||||||
J.J. Selvadurai | 283,333 | 0.80 | % | — | 15,000 | 283,333 | 0.71 | % | 268,333 | 0.67 | % | ||||||||||||||||||||||
31, The Goffs | |||||||||||||||||||||||||||||||||
Eastbourne, | |||||||||||||||||||||||||||||||||
East Sussex | |||||||||||||||||||||||||||||||||
BN21 1HF | |||||||||||||||||||||||||||||||||
UK | |||||||||||||||||||||||||||||||||
John Walker | 130,401 | 0.37 | % | 130,401 | 130,401 | — | 0.00 | % | — | 0.00 | % | ||||||||||||||||||||||
8, Vellyview Drive | |||||||||||||||||||||||||||||||||
Rushmere, St. Andrew | |||||||||||||||||||||||||||||||||
Ipswich, Suffolk | |||||||||||||||||||||||||||||||||
IP4 5UW | |||||||||||||||||||||||||||||||||
UK | |||||||||||||||||||||||||||||||||
Ajay Ratanlal Bohora | 50,000 | 0.14 | % | 50,000 | 50,000 | — | 0.00 | % | — | 0.00 | % | ||||||||||||||||||||||
Bohora Park | |||||||||||||||||||||||||||||||||
Gangapur Road | |||||||||||||||||||||||||||||||||
Nashik 422002 | |||||||||||||||||||||||||||||||||
India | |||||||||||||||||||||||||||||||||
Nicola Casado | 9,333 | 0.03 | % | 9,333 | 9,333 | — | 0.00 | % | — | 0.00 | % | ||||||||||||||||||||||
Calle Constantino | |||||||||||||||||||||||||||||||||
Rodriguez 15 Chalet 6 | |||||||||||||||||||||||||||||||||
Pozuelo de Alarcon | |||||||||||||||||||||||||||||||||
28223, Madrid | |||||||||||||||||||||||||||||||||
Spain |
(1) | The shareholders are Warburg Pincus Private Equity VIII, L.P., or WP VIII, and Warburg Pincus International Partners, L.P., or WPIP, including two affiliated partnerships. Warburg Pincus Partners, LLC, a subsidiary of Warburg Pincus & Co., or WP, is the sole general partner of WP VIII and WPIP. WP VIII and WPIP are managed by Warburg Pincus LLC, or WP LLC. Charles R. Kaye and Joseph P. Landy are Managing General Partners of WP and Managing Members of WP LLC and may be deemed to control the Warburg Pincus entities. Messrs. Kaye and Landy disclaim beneficial ownership of all shares held by the Warburg Pincus entities. |
93
Table of Contents
(2) | Of the 1,956,228 shares held by Theodore Agnew, 1,304,161 are indirectly held via a trust which is controlled by Theodore Agnew, and the remainder are held directly. |
(3) | Does not include 160,000 restricted share units to be issued to certain of our directors and executive officers effective upon the completion of this offering. |
(4) | Options exercisable within 60 days of June 20, 2006. |
(5) | Pulak Prasad, Miriam Strouse and Jeremy Young, directors of our company, are Managing Directors and members of Warburg Pincus LLC. All shares indicated as owned by Pulak Prasad, Miriam Strouse and Jeremy Young are included because of their affiliation with the Warburg Pincus entities. Pulak Prasad, Miriam Strouse and Jeremy Young disclaim beneficial ownership of all shares held by the Warburg Pincus entities. |
(6) | Nitin Sibal and Guy Sochovsky are Vice Presidents of Warburg Pincus LLC. Nitin Sibal and Guy Sochovsky do not have voting or investment discretion with respect to the shares of our company held by Warburg Pincus, and therefore they are not deemed to beneficially own such shares. |
(7) | Timothy Hammond is a senior manager of British Airways. Timothy Hammond does not have voting or investment discretion with respect to the shares of our company held by British Airways, and therefore he is not deemed to beneficially own such shares. |
(8) | Includes the shares beneficially owned by Pulak Prasad, Miriam Strouse and Jeremy Young, nominee directors of Warburg Pincus, because of their affiliation with the Warburg Pincus entities. Pulak Prasad, Miriam Strouse and Jeremy Young disclaim beneficial ownership of all shares held by the Warburg Pincus entities. |
(9) | Does not include 140,000 restricted share units to be issued to our employees effective upon the completion of this offering. See “Management — Outstanding Options.” |
94
Table of Contents
95
Table of Contents
96
Table of Contents
• | increase our authorized or paid up share capital; |
• | consolidate and divide all or any part of our shares into shares of a larger amount; |
• | sub-divide all or any part of our shares into shares of smaller amount than is fixed by our memorandum of association; |
• | convert any of our issued or unissued shares into shares of another class; |
• | convert all our issued par value shares into no par value shares and vice versa; |
• | convert any of ourpaid-up shares into stock, and reconvert any stock into any number ofpaid-up shares of any denomination; |
• | convert any of our issued limited shares into redeemable shares which can be redeemed; |
• | cancel shares which, at the date of passing of the resolution, have not been taken or agreed to be taken by any person, and diminish the amount of the authorized share capital by the amount of the shares so cancelled; |
• | reduce our issued share capital; or |
• | alter our Memorandum or Articles of Association. |
97
Table of Contents
• | the consideration of our annual financial statements and report of our directors and auditors; |
• | the election of directors (if necessary); |
• | the appointment of auditors and the fixing of their remuneration; |
• | the sanction of dividends; and |
• | the transaction of any other business of which notice has been given. |
98
Table of Contents
• | it is in respect of a share which is fully paid up; |
• | it is in respect of only one class of shares; |
• | it is in favor of a single transferee or not more than four joint transferees; |
• | it is duly stamped, if so required; and |
• | it is delivered for registration to our registered office for the time being or another place that we may from time to time determine accompanied by the certificate for the shares to which it relates and any other evidence as we may reasonably require to prove the right of the transferor or person renouncing to make the transfer or renunciation. |
99
Table of Contents
100
Table of Contents
101
Table of Contents
102
Table of Contents
103
Table of Contents
104
Table of Contents
105
Table of Contents
• | controlling possible conflicts of interests between us and our directors, such as loans by us or directors, and contracts between us and our directors other than a duty on directors to disclose an interest in any transaction to be entered into by us or any of our subsidiaries which to a material extent conflicts with our interest; |
• | specifically requiring particulars to be shown in our accounts of the amount of loans to officers or directors’ emoluments and pensions, although these would probably be required to be shown in our accounts in conformity to the requirement that accounts must be prepared in accordance with generally accepted accounting principles; |
• | requiring us to file details of charges other than charges of Jersey realty; or |
• | as regards statutory preemption provisions in relation to further issues of shares. |
Corporate Law Issue | Delaware Law | Jersey Law | ||
Special Meetings of Shareholders | Shareholders of a Delaware corporation generally do not have the right to call meetings of shareholders unless that right is granted in the certificate of incorporation or by-laws. However, if a corporation fails to hold its annual meeting within a period of 30 days after the date designated for the annual meeting, or if no date has been designated for a period of 13 months after its last annual meeting, the Delaware Court of Chancery may order a meeting to be held upon the application of a shareholder. | Under the 1991 Law, directors shall, notwithstanding anything in a Jersey company’s articles of association, call a general meeting on a members’ requisition. A members’ requisition is a requisition of members holding not less than one-tenth of the total voting rights of the members of the company who have the right to vote at the meeting requisitioned. Failure to call an annual general meeting in accordance with the requirements of the 1991 Law is a criminal offense on the part of a Jersey company and its directors. The JFSC may, on the application of any officer, secretary or member call, or direct the calling of, an annual general meeting. | ||
Interested Director Transactions | Interested director transactions are not voidable if (i) the material facts as to the interested director’s relationship or interests are disclosed or are known to the board of directors and the board in good faith authorizes the transaction by | A director of a Jersey company who has an interest in a transaction entered into or proposed to be entered into by the company or by a subsidiary which conflicts or may conflict with the interests of the company and of which the |
106
Table of Contents
Corporate Law Issue | Delaware Law | Jersey Law | ||
the affirmative vote of a majority of the disinterested directors, (ii) the material facts are disclosed or are known to the shareholders entitled to vote on such transaction and the transaction is specifically approved in good faith by vote of the majority of shares entitled to vote on the matter or (iii) the transaction is fair as to the corporation as of the time it is authorized, approved or ratified by the board of directors, a committee or the shareholders. | director is aware, must disclose the interest to the company. Failure to disclose an interest entitles the company or a member to apply to the court for an order setting aside the transaction concerned and directing that the director account to the company for any profit. A transaction is not voidable and a director is not accountable notwithstanding a failure to disclose if the transaction is confirmed by special resolution and the nature and extent of the director’s interest in the transaction are disclosed in reasonable detail in the notice calling the meeting at which the resolution is passed. Without prejudice to its power to order that a director account for any profit, a court shall not set aside a transaction unless it is satisfied that the interests of third parties who have acted in good faith thereunder would not thereby be unfairly prejudiced and the transaction was not reasonable and fair in the interests of the company at the time it was entered into. | |||
Cumulative Voting | Delaware law does not require that a Delaware corporation provide for cumulative voting. However, the certificate of incorporation of a Delaware corporation may provide that shareholders of any class or classes or of any series may vote cumulatively either at all elections or at elections under specified circumstances. | There are no provisions in the 1991 Law relating to cumulative voting. | ||
Approval of Corporate Matters by Written Consent | Unless otherwise specified in a Delaware corporation’s certificate of incorporation, action required or permitted to be taken by shareholders at an annual or special meeting may be taken by shareholders without a meeting, without notice and without a vote, if consents, in writing, setting forth the action, are signed by | Insofar as the memorandum or articles of a Jersey company do not make other provision in that behalf, anything which may be done at a meeting of the company (other than remove an auditor) or at a meeting of any class of its members may be done by a resolution in writing signed by or on behalf of each member |
107
Table of Contents
Corporate Law Issue | Delaware Law | Jersey Law | ||
shareholders with not less than the minimum number of votes that would be necessary to authorize the action at a meeting. All consents must be dated. No consent is effective unless, within 60 days of the earliest dated consent delivered to the corporation, written consents signed by a sufficient number of holders to take action are delivered to the corporation. | who, at the date when the resolution is deemed to be passed, would be entitled to vote on the resolution if it were proposed at a meeting. A resolution shall be deemed to be passed when the instrument, or the last of several instruments, is last signed or on such later date as is specified in the resolution. | |||
Business Combinations | With certain exceptions, a merger, consolidation or sale of all or substantially all the assets of a Delaware corporation must be approved by the board of directors and a majority of the outstanding shares entitled to vote thereon. | A sale or disposal of all or substantially all the assets of a Jersey company must be approved by the board of directors and, only if the Articles of Association of the company require, by the shareholders in general meeting. A merger between two or more Jersey companies must be documented in a merger agreement which must be approved by special resolution of each of the companies merging. | ||
Limitations on Directors Liability | A Delaware corporation may include in its certificate of incorporation provisions limiting the personal liability of its directors to the corporation or its shareholders for monetary damages for many types of breach of fiduciary duty. However, these provisions may not limit liability for any breach of the duty of loyalty, acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law, the authorization of unlawful dividends, shares repurchases or shares barring redemptions, or any transaction from which a director derived an improper personal benefit. Moreover, these provisions would not be likely to bar claims arising under US federal securities laws. | The 1991 Law does not contain any provisions permitting Jersey companies to limit the liability of directors for breach of fiduciary duty. Any provision, whether contained in the articles of association of, or in a contract with, a Jersey company or otherwise, whereby the company or any of its subsidiaries or any other person, for some benefit conferred or detriment suffered directly or indirectly by the company, agrees to exempt any person from, or indemnify any person against, any liability which by law would otherwise attach to the person by reason of the fact that the person is or was an officer of the company is void (subject to what is said below). |
108
Table of Contents
Corporate Law Issue | Delaware Law | Jersey Law | ||
Indemnification of Directors and Officers | A Delaware corporation may indemnify a director or officer of the corporation against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred in defense of an action, suit or proceeding by reason of his or her position if (i) the director or officer acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the corporation and (ii) with respect to any criminal action or proceeding, the director or officer had no reasonable cause to believe his or her conduct was unlawful. | The prohibition referred to above does not apply to a provision for exempting a person from or indemnifying the person against (a) any liabilities incurred in defending any proceedings (whether civil or criminal) (i) in which judgment is given in the person’s favor or the person is acquitted, (ii) which are discontinued otherwise than for some benefit conferred by the person or on the person’s behalf or some detriment suffered by the person, or (iii) which are settled on terms which include such benefit or detriment and, in the opinion of a majority of the directors of the company (excluding any director who conferred such benefit or on whose behalf such benefit was conferred or who suffered such detriment), the person was substantially successful on the merits in the person’s resistance to the proceedings, (b) any liability incurred otherwise than to the company if the person acted in good faith with a view to the best interests of the company, (c) any liability incurred in connection with an application made to the court for relief from liability for negligence, default, breach of duty or breach of trust under Article 212 of the 1991 Law in which relief is granted to the person by the court or (d) any liability against which the company normally maintains insurance for persons other than directors. | ||
Appraisal Rights | A shareholder of a Delaware corporation participating in certain major corporate transactions may, under certain circumstances, be entitled to appraisal rights pursuant to which the shareholder may receive cash in the amount of the fair value of the shares held by that shareholder (as determined by a court) in lieu | The 1991 Law does not confer upon shareholders any appraisal rights. |
109
Table of Contents
Corporate Law Issue | Delaware Law | Jersey Law | ||
of the consideration the shareholder would otherwise receive in the transaction. | ||||
Shareholder Suits | Class actions and derivative actions generally are available to the shareholders of a Delaware corporation for, among other things, breach of fiduciary duty, corporate waste and actions not taken in accordance with applicable law. In such actions, the court has discretion to permit the winning party to recover attorneys’ fees incurred in connection with such action. | Under Article 141 of the 1991 Law, a shareholder may apply to court for relief on the ground that a company’s affairs are being conducted or have been conducted in a manner which is unfairly prejudicial to the interests of its members generally or of some part of its members (including at least the member making the application) or that an actual or proposed act or omission by the company (including an act or omission on its behalf) is or would be so prejudicial. There may also be common law personal actions available to shareholders. | ||
Under Article 143 of the 1991 Law (which sets out the types of relief a court may grant in relation to an action brought under Article 141 of the 1991 Law), the court may make an order regulating the affairs of a company, requiring a company to refrain from doing or continuing to do an act complained of, authorizing civil proceedings and providing for the purchase of shares by a company or by any of its other shareholders. | ||||
Inspection of Books and Records | All shareholders of a Delaware corporation have the right, upon written demand, to inspect or obtain copies of the corporation’s shares ledger and its other books and records for any purpose reasonably related to such person’s interest as a shareholder. | The register of members and books containing the minutes of general meetings or of meetings of any class of members of a Jersey company must during business hours be open to the inspection of a member of the company without charge. The register of directors and secretaries must during business hours (subject to such reasonable restrictions as the company may by its articles or in general meeting impose, but so that not less than two hours in each business day be allowed for inspection) be open to the |
110
Table of Contents
Corporate Law Issue | Delaware Law | Jersey Law | ||
inspection of a member or director of the company without charge. | ||||
Amendments to Charter | Amendments to the certificate of incorporation of a Delaware corporation require the affirmative vote of the holders of a majority of the outstanding shares entitled to vote thereon or such greater vote as is provided for in the certificate of incorporation; a provision in the certificate of incorporation requiring the vote of a greater number or proportion of the directors or of the holders of any class of shares than is required by Delaware corporate law may not be amended, altered or repealed except by such greater vote. | The Memorandum and Articles of Association of a Jersey company may only be amended by special resolution (being a two-thirds majority) passed by members in general meeting or by written resolution signed by all the members entitled to vote. |
111
Table of Contents
112
Table of Contents
• | we do not timely request that the rights be distributed to you or we request that the rights not be distributed to you; |
• | we fail to deliver satisfactory documents to the depositary bank; or |
• | it is not reasonably practicable to distribute the rights. |
113
Table of Contents
• | we do not timely request that the property be distributed to you or if we ask that the property not be distributed to you; |
• | we do not deliver satisfactory documents to the depositary bank; or |
• | the depositary bank determines that all or a portion of the distribution to you is not reasonably practicable. |
• | the ordinary shares are duly authorized, validly issued, fully paid, non-assessable and legally obtained; |
• | all preemptive (and similar) rights, if any, with respect to such ordinary shares have been validly waived or exercised; |
114
Table of Contents
• | you are duly authorized to deposit the ordinary shares; |
• | the ordinary shares presented for deposit are free and clear of any lien, encumbrance, security interest, charge, mortgage or adverse claim, and are not, and the ADSs issuable upon such deposit will not be, “restricted securities” (as defined in the deposit agreement); and |
• | the ordinary shares presented for deposit have not been stripped of any rights or entitlements. |
• | during temporary delays that may arise because (i) the transfer books for the ordinary shares or ADSs are closed, or (ii) ordinary shares are immobilized on account of a shareholders’ meeting or a payment of dividends; |
• | when obligations to pay fees, taxes and similar charges are due; and |
• | when restrictions are imposed because of laws or regulations applicable to ADSs or the withdrawal of the securities on deposit. |
115
Table of Contents
Service | Fees | |
Issuance of ADSs | Up to $0.05 per ADS issued | |
Cancellation of ADSs | Up to $0.05 per ADS canceled | |
Distribution of ADSs | Up to $0.05 per ADS issued | |
Distribution of cash dividends or other cash distribution | Up to $0.02 per ADS held | |
Annual servicing fee (payable only to the extent no fee for the distribution of cash dividends or other cash distribution is payable) | Currently no fee, but may in future be up to $0.02 per ADS held |
• | fees for the transfer and registration of ordinary shares (i.e., upon deposit and withdrawal of ordinary shares); |
• | expenses incurred for converting foreign currency into US dollars; |
• | expenses for cable, telex and fax transmissions and for delivery of securities; and |
• | taxes and duties upon the transfer of securities (i.e., when ordinary shares are deposited or withdrawn from deposit). |
116
Table of Contents
• | For a period of six months after termination, you will be able to request the cancellation of your ADSs and the withdrawal of the ordinary shares represented by your ADSs and the delivery of all other property held by the depositary bank in respect of those ordinary shares on the same terms as prior to the termination. During such six months’ period the depositary bank will continue to collect all distributions received on the ordinary shares on deposit (i.e., dividends) but will not distribute any such property to you until you request the cancellation of your ADSs. |
• | After the expiration of such six months’ period, the depositary bank may sell the securities held on deposit. The depositary bank will hold the proceeds from such sale and any other funds then held for the holders of ADSs in a non-interest bearing account. At that point, the depositary bank will have no further obligations to holders other than to account for the funds then held for the holders of ADSs still outstanding. |
• | We and the depositary bank are obligated only to take the actions specifically stated in the deposit agreement. The depositary bank shall have no liability to us or the holders of the ADSs in the absence of gross negligence or willful misconduct. |
• | The depositary bank disclaims any liability for any failure to carry out voting instructions, for any manner in which a vote is cast or for the effect of any vote, provided it acts in good faith and in accordance with the terms of the deposit agreement. |
• | The depositary bank disclaims any liability for any failure to determine the lawfulness or practicality of any action, for the content of any document forwarded to you on our behalf or for the accuracy of any translation of such a document, for the investment risks associated with investing in ordinary shares, for the validity or worth of the ordinary shares, for any tax consequences that result from the ownership of ADSs, for the credit worthiness of any third party, for allowing any rights to lapse under the terms of the deposit agreement, for the timeliness of any of our notices or for our failure to give notice. |
• | We and the depositary bank will not be obligated to perform any act that is inconsistent with the terms of the deposit agreement. |
• | We and the depositary bank disclaim any liability if we are prevented or forbidden from acting on account of any law or regulation, any provision of our Articles of Association or Memorandum of Association, any provision of any securities on deposit or by reason of any act of God or war or other circumstances beyond our control. |
• | We and the depositary bank disclaim any liability by reason of any exercise of, or failure to exercise, any discretion provided for the deposit agreement or in our Articles of Association or Memorandum of Association or in any provisions of securities on deposit. |
117
Table of Contents
• | We and the depositary bank further disclaim any liability for any action or inaction in reliance on the advice or information received from legal counsel, accountants, any person presenting ordinary shares for deposit, any holder of ADSs or authorized representative thereof, or any other person believed by either of us in good faith to be competent to give such advice or information. |
• | We and the depositary bank also disclaim liability for the inability by a holder to benefit from any distribution, offering, right or other benefit which is made available to holders of ordinary shares but is not, under the terms of the deposit agreement, made available to you. |
• | We and the depositary bank may rely without any liability upon any written notice, request or other document believed to be genuine and to have been signed or presented by the proper parties. |
• | We and the depositary bank also disclaim liability for any consequential or punitive damages for any breach of the terms of the deposit agreement. |
• | distribute the foreign currency to holders for whom the distribution is lawful and practicable; or |
• | hold the foreign currency (without liability for interest) for the applicable holders. |
118
Table of Contents
119
Table of Contents
• | offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of directly or indirectly, any shares, or any securities convertible into or exercisable or exchangeable for ordinary shares or ADSs; |
• | request or demand that we file a registration statement related to the ordinary shares or ADSs; or |
• | enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of ordinary shares or ADSs; |
• | the sale of shares or ADSs to the underwriters; |
• | transactions by any person other than us relating to share, ADSs or other securities acquired in open market transactions after the completion of this offering of the ordinary shares or ADSs; |
• | the issuance by us of shares upon the exercise of an option or a warrant or the conversion of a security outstanding on the date of this prospectus of which the underwriters have been advised in writing; |
• | the issuance by us of shares, or options to purchase shares, pursuant to our Stock Incentive Plan or our 2006 Incentive Award Plan; |
• | the issuance by us of shares in connection with our acquisition of or merger with or into any other company (providedthat the amount of shares issued in connection with any such transaction does not in the aggregate exceed 10% of our total shares outstanding at the time of this offering); |
• | the filing by us of any registration statement on Form S-8 relating to the offering of securities pursuant to the terms of a stock incentive plan in effect on the date of the underwriting agreement; |
• | transfers by a selling shareholder of shares or any security convertible into shares as abona fidegift; and |
• | distributions by a selling shareholder of shares or any security convertible into shares to limited partners or stockholders of the selling shareholder. |
120
Table of Contents
121
Table of Contents
122
Table of Contents
• | banks; |
• | certain financial institutions; |
• | insurance companies; |
• | broker dealers; |
• | traders that elect tomark-to-market; |
123
Table of Contents
• | tax-exempt entities; |
• | persons liable for alternative minimum tax; |
• | real estate investment trusts; |
• | regulated investment companies; |
• | US expatriates; |
• | persons holding ADSs or ordinary shares as part of a straddle, hedging, conversion or integrated transaction; |
• | persons that actually or constructively own 10% or more of our voting stock; or |
• | persons holding ADSs or ordinary shares through partnerships or other pass-through entities. |
• | a citizen or resident of the US; |
• | a corporation (or other entity taxable as a corporation) organized under the laws of the US, any State thereof or the District of Columbia; |
• | an estate whose income is subject to US federal income taxation regardless of its source; or |
• | a trust that (1) is subject to the supervision of a court within the US and the control of one or more US persons or (2) has a valid election in effect under applicable US Treasury regulations to be treated as a US person. |
124
Table of Contents
125
Table of Contents
• | at least 75% of its gross income is passive income, or |
• | under the PFIC asset test at least 50% of the value of its assets (determined on the basis of a quarterly average) is attributable to assets that produce or are held for the production of passive income. |
• | the excess distribution or gain will be allocated ratably over your holding period for the ADSs or ordinary shares, |
• | the amount allocated to the current taxable year, and any taxable year prior to the first taxable year in which we became a PFIC, will be treated as ordinary income, and |
126
Table of Contents
• | the amount allocated to each other year will be subject to tax at the highest tax rate in effect for that year and the interest charge normally applicable to underpayments of tax will be imposed on the resulting tax attributable to each such year. |
127
Table of Contents
128
Table of Contents
Number of | |||||
Name | ADSs | ||||
Morgan Stanley & Co. International Limited | |||||
Deutsche Bank Securities Inc. | |||||
Merrill Lynch, Pierce, Fenner & Smith Incorporated | |||||
Citigroup Global Markets Inc. | |||||
UBS Securities LLC | |||||
Total | 10,428,708 | ||||
129
Table of Contents
• | offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any shares or ADSs, or any securities convertible into or exercisable or exchangeable for shares or ADSs; |
• | request or demand that we file a registration statement related to the ordinary shares or the ADSs; or |
• | enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of shares or ADSs; |
• | the sale of shares or ADSs to the underwriters; or |
• | transactions by any person other than us relating to shares, ADSs or other securities acquired in open market transactions after the completion of the offering of the ADSs; |
• | the issuance by us of shares upon the exercise of an option or a warrant or the conversion of a security outstanding on the date of this prospectus of which the underwriters have been advised in writing; |
• | the issuance by us of shares, or options to purchase shares, pursuant to our Stock Incentive Plan or our 2006 Incentive Award Plan; |
• | the issuance by us of shares in connection with our acquisition of or merger with or into any other company (providedthat the amount of shares issued in connection with any such transaction does not in the aggregate exceed 10% of our total shares outstanding at the time of this offering); |
• | the filing by us of any registration statement on Form S-8 relating to the offering of securities pursuant to the terms of a stock incentive plan in effect on the date of the underwriting agreement; |
• | transfers by a selling shareholder of shares or any security convertible into shares as abona fidegift; and |
• | distributions by a selling shareholder of shares or any security convertible into shares to limited partners or stockholders of the selling shareholder. |
130
Table of Contents
131
Table of Contents
132
Table of Contents
(a) | to legal entities which are authorized or regulated to operate in the financial markets or, if not so authorized or regulated, whose corporate purpose is solely to invest in securities; |
(b) | to any legal entity which has two or more of (1) an average of at least 250 employees during the last financial year; (2) a total balance sheet of more than€43,000,000 and (3) an annual net turnover of more than€50,000,000, as shown in its last annual or consolidated accounts; |
(c) | by the underwriters to fewer than 100 natural or legal persons (other than qualified investors as defined in the Prospectus Directive) subject to obtaining the prior consent of Morgan Stanley & Co. International Limited, Deutsche Bank Securities Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated; or |
(d) | in any other circumstances falling within Article 3(2) of the Prospectus Directive. |
(a) | it is a qualified investor within the meaning of the law in that Relevant Member State implementing Article 2(1)(e) of the Prospectus Directive; and |
(b) | in the case of any ADSs acquired by it as a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive, (i) the ADSs acquired by it in the offer have not been acquired on behalf of, nor have they been acquired with a view to their offer or resale to, persons in any Relevant Member State other than qualified investors, as that term is defined in the Prospectus Directive, or in circumstances in which the prior consent of Morgan Stanley & Co. International Limited, Deutsche Bank Securities Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated has been given to the offer or resale; or (ii) where ADSs have been acquired by it on behalf of persons in any Relevant Member State other than qualified investors, the offer of those ADSs to it is not treated under the Prospectus Directive as having been made to such persons. |
133
Table of Contents
(a) | has not offered or sold and will not offer or sell in Hong Kong, by means of any document, any of the ADSs other than (a) to “professional investors” as defined in the Securities and Futures Ordinance (Cap. 571) of Hong Kong and any rules made under that Ordinance; or (b) in other circumstances which do not result in the document being a “prospectus” as defined in the Companies Ordinance (Cap. 32) of Hong Kong or which do not constitute an offer to the public within the meaning of that Ordinance; and |
(b) | has not issued or does not have in its possession for the purposes of issue, and will not issue or have in its possession for the purposes of issue, whether in Hong Kong or elsewhere, any advertisement, invitation or document relating to the ADSs, which is directed at or the contents of which are likely to be accessed or read by, the public of Hong Kong (except if permitted to do so under the securities laws of Hong Kong) other than with respect of the ADSs which are or are intended to be disposed of only to persons outside Hong Kong or only to “professional investors” as defined in the Securities and Futures Ordinance (Cap. 571) of Hong Kong and any rules made under that Ordinance. |
• | in accordance with any exemption from the registration requirements of the Korean Securities and Exchange Law, and |
• | in compliance with applicable provisions of South Korean law, including, without limitation, the Foreign Exchange Transaction Law and Regulations. |
134
Table of Contents
(a) | a corporation (which is not an accredited investor) the sole business of which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an accredited investor; or |
(b) | a trust (where the trustee is not an accredited investor) whose sole purpose is to hold investments and each beneficiary is an accredited investor, |
(1) | to an institutional investor under Section 274 of the SFA or to a relevant person, or any person pursuant to Section 275(1A), and in accordance with the conditions, specified in Section 275 of the SFA; |
(2) | where no consideration is given for the transfer; or |
(3) | by operation of law. |
(a) | is a person whose ordinary activities involve it in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of its business and (ii) has not offered or sold and will not offer or sell the ADSs other than to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of their business or who it is reasonable to expect will acquire, hold, manage or dispose of investments (as principal or agent) for the purposes of their businesses where the issue of the ADSs would otherwise constitute a contravention of Section 19 of the FSMA by us; |
135
Table of Contents
(b) | has only communicated or caused to be communicated and will only communicate or cause to be communicated an invitation or inducement to engage in investment activity (within the meaning of Section 21 of the FSMA) received by it in connection with the issue or sale of the ADSs in circumstances in which Section 21(1) of the FSMA does not apply to us; and |
(c) | has complied and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to the ADSs in, from or otherwise involving the UK. |
136
Table of Contents
137
Table of Contents
• | the court which pronounced the judgment has jurisdiction to entertain the case according to the principles recognized by Jersey law with reference to the jurisdiction of the US courts; |
• | the judgment is final and conclusive — it cannot be altered by the courts which pronounced it; |
• | there is payable pursuant to the judgment a sum of money, not being a sum payable in respect of tax or other charges of a like nature or in respect of a fine or other penalty; |
• | the courts of the US have jurisdiction in the circumstances of the case; |
• | the judgment can be enforced by execution in the jurisdiction in which the judgment is given; |
• | the person against whom the judgment is given does not benefit from immunity under the principles of public international law; |
• | there is no earlier judgment in another court between the same parties on the same issues as are dealt with in the judgment to be enforced; |
• | the judgment was not obtained by fraud, duress and was not based on a clear mistake of fact; and |
• | the recognition and enforcement of the judgment is not contrary to public policy in Jersey, including observance of the principles of natural justice which require that documents in the US proceeding were properly served on the defendant and that the defendant was given the right to be heard and represented by counsel in a free and fair trial before an impartial tribunal. |
138
Table of Contents
• | recognize or enforce judgments of US courts obtained against us or our directors or officers predicated upon the civil liability provisions of the securities laws of the US or any state in the US; or |
• | entertain original actions brought in each respective jurisdiction against us or our directors or officers predicated upon the securities laws of the US or any state in the US. |
• | where the judgment has not been pronounced by a court of competent jurisdiction; |
• | where the judgment has not been given on the merits of the case; |
• | where the judgment appears on the face of the proceedings to be founded on an incorrect view of international law or a refusal to recognize the law of India in cases where such law is applicable; |
• | where the proceedings in which the judgment was obtained were opposed to natural justice; |
• | where the judgment has been obtained by fraud; or |
• | where the judgment sustains a claim founded on a breach of any law in force in India. |
139
Table of Contents
140
Table of Contents
141
Table of Contents
Consolidated Financial Statements | ||||
F-2 | ||||
F-3 | ||||
F-4 | ||||
F-5 | ||||
F-6 | ||||
F-7 |
F-1
Table of Contents
F-2
Table of Contents
March 31, | ||||||||||
2006 | 2005 | |||||||||
ASSETS | ||||||||||
Current assets | ||||||||||
Cash and cash equivalents | $ | 18,549 | $ | 9,099 | ||||||
Accounts receivable, net of allowance of $373 and $284, respectively | 25,976 | 22,702 | ||||||||
Accounts receivable — related parties | 2,105 | 2,533 | ||||||||
Funds held for clients | 3,047 | 4,222 | ||||||||
Employee receivables | 922 | 779 | ||||||||
Prepaid expenses | 1,225 | 1,317 | ||||||||
Prepaid income taxes | 2,488 | 2,374 | ||||||||
Deferred tax assets | 353 | 432 | ||||||||
Other current assets | 2,730 | 536 | ||||||||
Total current assets | 57,395 | 43,994 | ||||||||
Goodwill | 33,774 | 26,550 | ||||||||
Intangible assets, net | 8,713 | 151 | ||||||||
Property and equipment, net | 30,623 | 24,670 | ||||||||
Deposits | 2,990 | 1,892 | ||||||||
Deferred tax assets | 1,308 | 722 | ||||||||
TOTAL ASSETS | $ | 134,803 | $ | 97,979 | ||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||
Current liabilities | ||||||||||
Accounts payable | $ | 22,238 | $ | 22,392 | ||||||
Accounts payable — related parties | 836 | 574 | ||||||||
Note payable | — | 10,000 | ||||||||
Accrued employee costs | 11,336 | 3,707 | ||||||||
Deferred revenue | 8,994 | 11,478 | ||||||||
Income taxes payable | 726 | 301 | ||||||||
Obligation under capital leases — current | 184 | 315 | ||||||||
Deferred tax liabilities | 368 | 317 | ||||||||
Other current liabilities | 8,781 | 5,744 | ||||||||
Total current liabilities | 53,463 | 54,828 | ||||||||
Obligation under capital leases — non current | 2 | 200 | ||||||||
Deferred rent | 824 | — | ||||||||
Deferred tax liabilities — non current | 2,350 | — | ||||||||
Commitments and contingencies | ||||||||||
Shareholders’ equity | ||||||||||
Ordinary shares, $0.15 (10 pence) par value Authorized: 40,000,000 shares, | ||||||||||
Issued and outstanding: 35,321,511 and 31,194,553 shares, respectively | 5,290 | 4,585 | ||||||||
Additional paid-in-capital | 62,228 | 43,522 | ||||||||
Ordinary shares subscribed: 4,346 and 82,333 shares, respectively | 10 | 157 | ||||||||
Retained earnings (accumulated deficit) | 4,104 | (14,225 | ) | |||||||
Deferred share-based compensation | (582 | ) | (288 | ) | ||||||
Accumulated other comprehensive income | 7,114 | 9,200 | ||||||||
Total shareholders’ equity | 78,164 | 42,951 | ||||||||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 134,803 | $ | 97,979 | ||||||
F-3
Table of Contents
Year ended March 31, | ||||||||||||||
2006 | 2005 | 2004 | ||||||||||||
Revenue | ||||||||||||||
Third parties | $ | 186,500 | $ | 144,666 | $ | 86,805 | ||||||||
Related parties | 16,309 | 17,507 | 17,253 | |||||||||||
202,809 | 162,173 | 104,058 | ||||||||||||
Cost of revenue (a)(b) | 145,730 | 140,254 | 89,659 | |||||||||||
Gross profit | 57,079 | 21,919 | 14,399 | |||||||||||
Operating expenses | ||||||||||||||
Selling, general and administrative expenses (a)(b) | 36,347 | 24,887 | 18,825 | |||||||||||
Amortization of intangible assets | 856 | 1,416 | 2,600 | |||||||||||
Operating income (loss) | 19,876 | (4,384 | ) | (7,026 | ) | |||||||||
Other income, net (a) | 456 | 172 | 324 | |||||||||||
Interest expense | (429 | ) | (496 | ) | (59 | ) | ||||||||
Income (loss) before income taxes | 19,903 | (4,708 | ) | (6,761 | ) | |||||||||
(Provision) benefit for income taxes | (1,574 | ) | (1,068 | ) | 41 | |||||||||
Net income (loss) | $ | 18,329 | $ | (5,776 | ) | $ | (6,720 | ) | ||||||
Basic income (loss) per share | $ | 0.56 | $ | (0.19 | ) | $ | (0.22 | ) | ||||||
Diluted income (loss) per share | 0.52 | (0.19 | ) | (0.22 | ) | |||||||||
(a) | Includes the following related party amounts: | |||||||||||||
Cost of revenue | $ | 1,250 | $ | 1,756 | $ | 1,279 | ||||||||
Selling, general and administrative expenses | 481 | 402 | 291 | |||||||||||
Other income | 250 | — | — | |||||||||||
(b) | Includes the following share-based compensation amounts: | |||||||||||||
Cost of revenue | $ | 127 | $ | 35 | $ | 34 | ||||||||
Selling, general and administrative expenses | 1,795 | 204 | 171 |
F-4
Table of Contents
Retained | Accumulated | ||||||||||||||||||||||||||||||||
Ordinary shares | Additional | Ordinary | earnings | Deferred | other | Total | |||||||||||||||||||||||||||
paid-in- | shares | (accumulated | share-based | comprehensive | shareholders’ | ||||||||||||||||||||||||||||
Number | Par value | capital | subscribed | deficit) | compensation | income | equity | ||||||||||||||||||||||||||
Balance at April 1, 2003 | 30,795,888 | $ | 4,510 | $ | 42,447 | $ | — | $ | (1,729 | ) | $ | (290 | ) | $ | 2,481 | $ | 47,419 | ||||||||||||||||
Stock options exercised | — | — | — | 233 | — | — | — | 233 | |||||||||||||||||||||||||
Stock options forfeited | — | — | (14 | ) | — | — | 14 | — | — | ||||||||||||||||||||||||
Amortization of deferred share-based compensation | — | — | — | — | — | 188 | — | 188 | |||||||||||||||||||||||||
Comprehensive loss: | |||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | (6,720 | ) | — | — | (6,720 | ) | |||||||||||||||||||||||
Foreign currency translation | — | — | — | — | — | — | 5,540 | 5,540 | |||||||||||||||||||||||||
Comprehensive loss | (1,180 | ) | |||||||||||||||||||||||||||||||
Balance at March 31, 2004 | 30,795,888 | 4,510 | 42,433 | 233 | (8,449 | ) | (88 | ) | 8,021 | 46,660 | |||||||||||||||||||||||
Shares issued for exercised options | 398,665 | 75 | 667 | (233 | ) | — | — | — | 509 | ||||||||||||||||||||||||
Stock options exercised | — | — | — | 157 | — | — | — | 157 | |||||||||||||||||||||||||
Stock options forfeited | — | — | (7 | ) | — | — | 7 | — | — | ||||||||||||||||||||||||
Deferred share-based compensation | — | — | 429 | — | — | (429 | ) | — | — | ||||||||||||||||||||||||
Amortization of deferred share-based compensation | — | — | — | — | — | 222 | — | 222 | |||||||||||||||||||||||||
Comprehensive loss: | |||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | (5,776 | ) | — | — | (5,776 | ) | |||||||||||||||||||||||
Foreign currency translation | — | — | — | — | — | — | 1,179 | 1,179 | |||||||||||||||||||||||||
Comprehensive loss | (4,597 | ) | |||||||||||||||||||||||||||||||
Balance at March 31, 2005 | 31,194,553 | 4,585 | 43,522 | 157 | (14,225 | ) | (288 | ) | 9,200 | 42,951 | |||||||||||||||||||||||
Shares issued for exercised options | 1,710,936 | 286 | 2,901 | (157 | ) | — | — | — | 3,030 | ||||||||||||||||||||||||
Shares issued to a Director | 150,000 | 26 | 876 | — | — | — | — | 902 | |||||||||||||||||||||||||
Shares issued for acquisition of Trinity Partners Inc. | 2,266,022 | 393 | 13,354 | — | — | (635 | ) | — | 13,112 | ||||||||||||||||||||||||
Stock options exercised | — | — | — | 10 | — | — | — | 10 | |||||||||||||||||||||||||
Stock options forfeited | — | — | (51 | ) | — | — | 51 | — | — | ||||||||||||||||||||||||
Deferred share-based compensation | — | — | 166 | — | — | (166 | ) | — | — | ||||||||||||||||||||||||
Purchase of immature shares and modification of options | — | — | 1,460 | — | — | — | — | 1,460 | |||||||||||||||||||||||||
Amortization of deferred share-based compensation | — | — | — | — | — | 456 | — | 456 | |||||||||||||||||||||||||
Comprehensive income: | |||||||||||||||||||||||||||||||||
Net income | — | — | — | — | 18,329 | — | — | 18,329 | |||||||||||||||||||||||||
Foreign currency translation | — | — | — | — | — | — | (2,086 | ) | (2,086 | ) | |||||||||||||||||||||||
Comprehensive income | — | — | — | — | — | — | — | 16,243 | |||||||||||||||||||||||||
Balance at March 31, 2006 | 35,321,511 | $ | 5,290 | $ | 62,228 | $ | 10 | $ | 4,104 | $ | (582 | ) | $ | 7,114 | $ | 78,164 | |||||||||||||||||
F-5
Table of Contents
Year ended March 31, | ||||||||||||||||
2006 | 2005 | 2004 | ||||||||||||||
Cash flows from operating activities | ||||||||||||||||
Net income (loss) | $ | 18,329 | $ | (5,776 | ) | $ | (6,720 | ) | ||||||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||||||||||||||
Depreciation and amortization | 11,308 | 9,857 | 7,949 | |||||||||||||
Share-based compensation | 1,922 | 239 | 205 | |||||||||||||
Amortization of deferred financing cost | 125 | 15 | — | |||||||||||||
Allowance for doubtful accounts | 101 | 69 | (104 | ) | ||||||||||||
Gain on sale of property and equipment | (32 | ) | — | (76 | ) | |||||||||||
Deferred income taxes | (1,028 | ) | (71 | ) | (324 | ) | ||||||||||
Changes in operating assets and liabilities, net of effect of acquisition: | ||||||||||||||||
Accounts receivable | (2,976 | ) | (8,687 | ) | (4,859 | ) | ||||||||||
Other current assets | 628 | (503 | ) | (2,813 | ) | |||||||||||
Deposits | (1,067 | ) | (779 | ) | (569 | ) | ||||||||||
Accounts payable | (290 | ) | (1,990 | ) | 12,221 | |||||||||||
Deferred revenue | (2,193 | ) | 5,887 | 5,012 | ||||||||||||
Other current liabilities | 10,019 | 3,560 | 1,675 | |||||||||||||
Net cash provided by operating activities | 34,846 | 1,821 | 11,597 | |||||||||||||
Cash flows from investing activities | ||||||||||||||||
Acquisition, net of cash acquired | (3,862 | ) | — | (778 | ) | |||||||||||
Purchase of property and equipment (See Note 12) | (14,893 | ) | (18,267 | ) | (8,735 | ) | ||||||||||
Proceeds from sale of property and equipment | 77 | — | 88 | |||||||||||||
Net cash used in investing activities | (18,678 | ) | (18,267 | ) | (9,425 | ) | ||||||||||
Cash flows from financing activities | ||||||||||||||||
Ordinary shares issued and subscribed | 3,942 | 666 | 233 | |||||||||||||
Principal payments under capital leases | (299 | ) | (372 | ) | (296 | ) | ||||||||||
Proceeds from note payable, net of financing cost | — | 9,860 | — | |||||||||||||
Repayment of note payable | (10,000 | ) | — | — | ||||||||||||
Net cash (used in) provided by financing activities | (6,357 | ) | 10,154 | (63 | ) | |||||||||||
Effect of exchange rate changes on cash and cash equivalents | (361 | ) | 566 | 651 | ||||||||||||
Net change in cash and cash equivalents | 9,450 | (5,726 | ) | 2,760 | ||||||||||||
Cash and cash equivalents at beginning of year | 9,099 | 14,825 | 12,065 | |||||||||||||
Cash and cash equivalents at end of year | $ | 18,549 | $ | 9,099 | $ | 14,825 | ||||||||||
Supplemental disclosure of cash flow information: | ||||||||||||||||
Cash paid for interest | $ | 440 | $ | 424 | $ | 4 | ||||||||||
Cash paid (refund) for income taxes | 2,288 | (749 | ) | 988 | ||||||||||||
Assets acquired under capital leases | — | 115 | 598 | |||||||||||||
Shares issued for the acquisition of Trinity Partners Inc. | 13,747 | — | — |
F-6
Table of Contents
1. | ORGANIZATION AND DESCRIPTION OF BUSINESS |
2. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
Basis of preparation |
Use of estimates |
Foreign currency translation |
Revenue recognition |
F-7
Table of Contents
F-8
Table of Contents
Year ended March 31, | ||||||||||||
2006 | 2005 | 2004 | ||||||||||
Balance at the beginning of the year | $ | 284 | $ | 210 | $ | 277 | ||||||
Charged to operations | 134 | 217 | 123 | |||||||||
Write-off, net of collections | (20 | ) | (83 | ) | (227 | ) | ||||||
Reversal | (13 | ) | (65 | ) | — | |||||||
Translation adjustment | (12 | ) | 5 | 37 | ||||||||
Balance at the end of the year | $ | 373 | $ | 284 | $ | 210 | ||||||
F-9
Table of Contents
Asset description | Asset life (in years) | |
Computers and software | 3 | |
Furniture, fixtures and office equipment | 4-5 | |
Vehicles | 3 | |
Leasehold improvements | Lesser of estimated useful life or lease term |
Goodwill and intangible assets |
Asset description | Asset life (in months) | |||
Customer related intangibles | 24-60 | |||
Know-how | 24 | |||
Covenant not-to-compete | 24 |
F-10
Table of Contents
Income taxes |
Employee benefits |
Defined contribution plans |
F-11
Table of Contents
Year ended March 31, | |||||||||||||
2006 | 2005 | 2004 | |||||||||||
Numerator: | |||||||||||||
Net income (loss) | $ | 18,329 | $ | (5,776 | ) | $ | (6,720 | ) | |||||
Denominator: | |||||||||||||
Basic weighted average ordinary shares outstanding | 32,874,299 | 30,969,658 | 30,795,888 | ||||||||||
Dilutive impact of stock options | 2,155,467 | — | — | ||||||||||
Diluted weighted average ordinary shares outstanding | 35,029,766 | 30,969,658 | 30,795,888 | ||||||||||
F-12
Table of Contents
Year ended March 31, | |||||||||||||
2006 | 2005 | 2004 | |||||||||||
Net income (loss) as reported | $ | 18,329 | $ | (5,776 | ) | $ | (6,720 | ) | |||||
Add: Share-based employee compensation expense included in reported net income (loss), net of related tax effects | 1,709 | 239 | 205 | ||||||||||
Less: Share-based employee compensation expense determined based on the fair value of the options, net of related tax effects | (1,422 | ) | (1,229 | ) | (812 | ) | |||||||
Pro forma net income (loss) | $ | 18,616 | $ | (6,766 | ) | $ | (7,327 | ) | |||||
Basic income (loss) per share: | |||||||||||||
As reported | $ | 0.56 | $ | (0.19 | ) | $ | (0.22 | ) | |||||
Pro forma | 0.57 | (0.22 | ) | (0.24 | ) | ||||||||
Diluted income (loss) per share: | |||||||||||||
As reported | $ | 0.52 | $ | (0.19 | ) | $ | (0.22 | ) | |||||
Pro forma | 0.53 | (0.22 | ) | (0.24 | ) |
Year ended March 31, | ||||||||||||
2006 | 2005 | 2004 | ||||||||||
Risk free interest rate | 7 | % | 7 | % | 7 | % | ||||||
Dividend yield | — | — | — | |||||||||
Expected life in years | 6 | 5 | 5 |
F-13
Table of Contents
3. | ACQUISITION OF TRINITY PARTNERS INC. |
F-14
Table of Contents
Amount | ||||
Cash | $ | 2,952 | ||
Accounts receivable | 1,494 | |||
Other assets | 365 | |||
Property and equipment | 1,285 | |||
Customer contracts | 7,080 | |||
Customer relationships | 2,340 | |||
Deferred tax asset | 858 | |||
Goodwill | 8,889 | |||
Current liabilities | (1,718 | ) | ||
Deferred tax liabilities | (3,768 | ) | ||
Total purchase price | $ | 19,777 | ||
F-15
Table of Contents
Year ended March 31, | |||||||||
2006 | 2005 | ||||||||
Revenue | |||||||||
As reported | $ | 202,809 | $ | 162,173 | |||||
Pro forma | 210,356 | 167,684 | |||||||
Net income (loss) | |||||||||
As reported | $ | 18,329 | $ | (5,776 | ) | ||||
Pro forma | 17,168 | (8,296 | ) | ||||||
Basic income (loss) per share | |||||||||
As reported | $ | 0.56 | $ | (0.19 | ) | ||||
Pro forma | 0.50 | (0.25 | ) | ||||||
Diluted income (loss) per share | |||||||||
As reported | $ | 0.52 | $ | (0.19 | ) | ||||
Pro forma | 0.47 | (0.25 | ) |
4. | PROPERTY AND EQUIPMENT |
March 31, | ||||||||
2006 | 2005 | |||||||
Computers and software | $ | 27,021 | $ | 23,295 | ||||
Furniture, fixtures and office equipment | 19,915 | 14,472 | ||||||
Vehicles | 1,012 | 717 | ||||||
Leasehold improvements | 9,857 | 8,564 | ||||||
Capital work-in-progress | 1,874 | 613 | ||||||
59,679 | 47,661 | |||||||
Accumulated depreciation and amortization | (29,056 | ) | (22,991 | ) | ||||
Property and equipment, net | $ | 30,623 | $ | 24,670 | ||||
F-16
Table of Contents
5. | GOODWILL AND INTANGIBLES |
March 31, 2006 | ||||||||||||
Accumulated | ||||||||||||
Gross | amortization | Net | ||||||||||
Customer contracts | $ | 12,945 | $ | 6,396 | $ | 6,549 | ||||||
Customer relationships | 2,340 | 176 | 2,164 | |||||||||
Know-how | 310 | 310 | — | |||||||||
Covenant not-to-compete | 100 | 100 | — | |||||||||
$ | 15,695 | $ | 6,982 | $ | 8,713 | |||||||
March 31, 2005 | ||||||||||||
Accumulated | ||||||||||||
Gross | amortization | Net | ||||||||||
Customer contracts | $ | 6,181 | $ | 6,116 | $ | 65 | ||||||
Know-how | 315 | 249 | 66 | |||||||||
Covenant not-to-compete | 100 | 80 | 20 | |||||||||
$ | 6,596 | $ | 6,445 | $ | 151 | |||||||
Year ending March 31 | Amount | |||
2007 | $ | 1,884 | ||
2008 | 1,884 | |||
2009 | 1,884 | |||
2010 | 1,884 | |||
2011 | 1,177 | |||
$ | 8,713 | |||
F-17
Table of Contents
WNS | WNS Auto | ||||||||||||
Global BPO | Claims BPO | Total | |||||||||||
Balance at April 1, 2003 | $ | 3,604 | $ | 18,774 | $ | 22,378 | |||||||
Goodwill arising on acquisition | 209 | — | 209 | ||||||||||
Foreign currency translation | 302 | 3,084 | 3,386 | ||||||||||
Balance at March 31, 2004 | 4,115 | 21,858 | 25,973 | ||||||||||
Foreign currency translation | 17 | 560 | 577 | ||||||||||
Balance at March 31, 2005 | 4,132 | 22,418 | 26,550 | ||||||||||
Goodwill arising on acquisition | 8,889 | — | 8,889 | ||||||||||
Foreign currency translation | (65 | ) | (1,600 | ) | (1,665 | ) | |||||||
Balance at March 31, 2006 | $ | 12,956 | $ | 20,818 | $ | 33,774 | |||||||
6. | INCOME TAXES |
March 31, | ||||||||||||
2006 | 2005 | 2004 | ||||||||||
Current taxes | ||||||||||||
Domestic taxes | $ | — | $ | — | $ | — | ||||||
Foreign taxes | (2,602 | ) | (1,139 | ) | (283 | ) | ||||||
(2,602 | ) | (1,139 | ) | (283 | ) | |||||||
Deferred taxes | ||||||||||||
Domestic taxes | — | — | — | |||||||||
Foreign taxes | 1,028 | 71 | 324 | |||||||||
1,028 | 71 | 324 | ||||||||||
$ | (1,574 | ) | $ | (1,068 | ) | $ | 41 | |||||
Year ended March 31, | ||||||||||||
Jurisdiction | 2006 | 2005 | 2004 | |||||||||
India | $ | 16,053 | $ | (7,416 | ) | $ | (6,632 | ) | ||||
United States | (1,163 | ) | 420 | 289 | ||||||||
United Kingdom | 5,821 | 1,653 | (546 | ) | ||||||||
Other | (808 | ) | 635 | 128 | ||||||||
Income (loss) before income taxes | $ | 19,903 | $ | (4,708 | ) | $ | (6,761 | ) | ||||
F-18
Table of Contents
Year ended March 31, | |||||||||||||
2006 | 2005 | 2004 | |||||||||||
Net income (loss) before taxes | $ | 19,903 | $ | (4,708 | ) | $ | (6,761 | ) | |||||
Enacted tax rates in Jersey | 0 | % | 0 | % | 0 | % | |||||||
Statutory income tax | — | — | — | ||||||||||
(Provision) benefit due to: | |||||||||||||
Foreign minimum alternative taxes and state taxes | — | (8 | ) | (63 | ) | ||||||||
Differential foreign tax rates | (1,454 | ) | (1,036 | ) | 102 | ||||||||
Other | (120 | ) | (24 | ) | 2 | ||||||||
(Provision) benefit for income taxes | $ | (1,574 | ) | $ | (1,068 | ) | $ | 41 | |||||
March 31, | |||||||||
2006 | 2005 | ||||||||
Deferred tax assets: | |||||||||
Property and equipment | $ | 1,047 | $ | 722 | |||||
Net operating loss carry forward | 1,418 | 555 | |||||||
Accruals deductible on actual payment | 262 | 105 | |||||||
Share-based compensation | 207 | — | |||||||
Other | 156 | 46 | |||||||
Total deferred tax assets | 3,090 | 1,428 | |||||||
Less: valuation allowances | (246 | ) | (265 | ) | |||||
Deferred tax assets, net of valuation allowances | 2,844 | 1,163 | |||||||
Deferred tax liabilities: | |||||||||
Property and equipment | (48 | ) | (9 | ) | |||||
Intangibles | (3,485 | ) | — | ||||||
Tax on undistributed profits of a subsidiary | (368 | ) | (317 | ) | |||||
Total deferred tax liabilities | (3,901 | ) | (326 | ) | |||||
Net deferred tax (liabilities) assets | $ | (1,057 | ) | $ | 837 | ||||
F-19
Table of Contents
March 31, | |||||||||
2006 | 2005 | ||||||||
Current | |||||||||
Deferred tax assets | $ | 353 | $ | 432 | |||||
Deferred tax liabilities | (368 | ) | (317 | ) | |||||
Net current deferred tax (liabilities) assets | (15 | ) | 115 | ||||||
Non current | |||||||||
Deferred tax assets | 1,554 | 996 | |||||||
Less: valuation allowance | (246 | ) | (265 | ) | |||||
1,308 | 731 | ||||||||
Deferred tax liabilities | (2,350 | ) | (9 | ) | |||||
Net non current deferred tax (liabilities) assets | $ | (1,042 | ) | $ | 722 | ||||
7. | DEFERRED REVENUE |
March 31, | ||||||||
2006 | 2005 | |||||||
Claims handling | $ | 1,025 | $ | 2,693 | ||||
Advance billings | 6,989 | 6,026 | ||||||
Minimum commitment received | — | 1,547 | ||||||
Other | 980 | 1,212 | ||||||
$ | 8,994 | $ | 11,478 | |||||
F-20
Table of Contents
8. | RETIREMENT BENEFITS |
Defined contribution plans |
Year ended March 31, | ||||||||||||
2006 | 2005 | 2004 | ||||||||||
Provident fund — India | $ | $1,839 | $ | 968 | $ | 716 | ||||||
Pension scheme — UK | 404 | 445 | 261 | |||||||||
401(k) plan — US | 225 | 191 | 106 | |||||||||
$ | 2,468 | $ | 1,604 | $ | 1,083 | |||||||
Defined benefit plan — gratuity |
Year ended March 31, | ||||||||||||
2006 | 2005 | 2004 | ||||||||||
Change in projected benefit obligations | ||||||||||||
Obligation at beginning of the year | $ | 494 | $ | 384 | $ | 221 | ||||||
Translation adjustment | (9 | ) | (9 | ) | 37 | |||||||
Service cost | 205 | 143 | 91 | |||||||||
Interest cost | 35 | 24 | 17 | |||||||||
Benefits paid | (65 | ) | (47 | ) | (48 | ) | ||||||
Business combination | 26 | — | — | |||||||||
Actuarial (gain) loss | 73 | (1 | ) | 66 | ||||||||
Benefit obligation at end of the year | $ | 759 | $ | 494 | $ | 384 | ||||||
Change in plan assets | ||||||||||||
Plan assets at beginning of the year | $ | 333 | $ | 336 | $ | 221 | ||||||
Translation adjustment | (6 | ) | (10 | ) | 31 | |||||||
Actual return | 35 | (26 | ) | (20 | ) | |||||||
Actual contributions | 154 | 23 | 112 | |||||||||
Actual benefits | (65 | ) | (47 | ) | (48 | ) | ||||||
Gain (loss) | — | 57 | 40 | |||||||||
Plan assets at end of the year | $ | 451 | $ | 333 | $ | 336 | ||||||
Funded status | $ | (308 | ) | $ | (161 | ) | $ | (48 | ) | |||
Unrecognized net loss | 145 | 75 | 102 | |||||||||
Accrued liabilities | $ | (163 | ) | $ | (86 | ) | $ | 54 | ||||
Accumulated benefit obligation at end of the year | $ | 528 | $ | 346 | $ | 262 | ||||||
F-21
Table of Contents
Year ended March 31, | ||||||||||||
2006 | 2005 | 2004 | ||||||||||
Net periodic gratuity cost | ||||||||||||
Service cost | $ | 205 | $ | 143 | $ | 91 | ||||||
Interest cost | 35 | 24 | 17 | |||||||||
Expected return on plan asset | (27 | ) | (26 | ) | (20 | ) | ||||||
Amortization | 8 | 20 | 3 | |||||||||
Net periodic gratuity cost for the year | $ | 221 | $ | 161 | $ | 91 | ||||||
Year ended March 31, | ||||||||||||
2006 | 2005 | 2004 | ||||||||||
Discount rate | 8.0% | 8.0% | 7.0% | |||||||||
Rate of increase in compensation levels | 9%-11% for 5 years and 7%-9% thereafter | 9.0% for 5 years and 7.0% thereafter | 9.0% for 5 years and 7.0% thereafter | |||||||||
Rate of return on plan assets | 7.5% | 7.0% | 7.5% |
Year ending March 31 | Amount | |||
2007 | $ | 173 | ||
2008 | 194 | |||
2009 | 274 | |||
2010 | 391 | |||
2011 | 514 | |||
2012-2016 | 1,466 | |||
$ | 3,012 | |||
9. | NOTE PAYABLE |
F-22
Table of Contents
10. | SHAREHOLDERS’ EQUITY |
11. | STOCK OPTIONS |
Year ended March 31, | ||||||||||||||||||||||||
2006 | 2005 | 2004 | ||||||||||||||||||||||
Shares arising | Weighted-average | Shares arising | Weighted-average | Shares arising | Weighted-average | |||||||||||||||||||
from options | exercise price | from options | exercise price | from options | exercise price | |||||||||||||||||||
Outstanding at beginning of the year | 4,466,245 | $ | 2.12 | 4,119,167 | $ | 1.94 | 2,316,500 | $ | 1.57 | |||||||||||||||
Granted | 1,481,479 | 7.83 | 889,744 | 2.76 | 1,868,000 | 2.40 | ||||||||||||||||||
Forfeited | (298,384 | ) | 2.45 | (144,001 | ) | 2.47 | (65,333 | ) | 1.87 | |||||||||||||||
Exercise of options | (1,710,936 | ) | 1.80 | (398,665 | ) | 1.53 | — | — | ||||||||||||||||
Outstanding at end of the year | 3,938,404 | $ | 4.39 | 4,466,245 | $ | 2.12 | 4,119,167 | $ | 1.94 | |||||||||||||||
Weighted-average | ||||||||||||||||
Range of | Weighted-average | remaining | ||||||||||||||
exercise prices | Shares | exercise price | contractual life | |||||||||||||
Options outstanding | $ 1.53-$2.23 | 140,670 | $ | 2.22 | 7.54 years | |||||||||||
2.37-$3.19 | 777,798 | 2.71 | 8.16 years | |||||||||||||
5.65-$6.31 | 1,043,079 | 6.17 | 9.42 years | |||||||||||||
12.26-$12.26 | 412,400 | 12.26 | 9.91 years | |||||||||||||
Options vested and exercisable | 1.53-$2.23 | 906,292 | 1.82 | 6.76 years | ||||||||||||
2.37-$3.19 | 658,165 | 2.60 | 7.91 years | |||||||||||||
3,938,404 | $ | 4.39 | 8.29 years | |||||||||||||
F-23
Table of Contents
Weighted | Weighted | Weighted | ||||||||||||||
No. of | average | average fair | average | |||||||||||||
options | exercise | value per | intrinsic value | |||||||||||||
Grants made during the quarter ended | granted | price | share | per share | ||||||||||||
June 30, 2005 | 160,500 | $ | 5.44 | $ | 5.65 | $ | 0.21 | |||||||||
September 30, 2005 | 828,100 | 6.27 | 6.27 | — | ||||||||||||
December 31, 2005 | 45,479 | 6.07 | 6.07 | — | ||||||||||||
March 31, 2006 | 447,400 | 11.72 | 11.99 | 0.27 |
12. | RELATED PARTY TRANSACTIONS |
Name of the related party | Relationship | |
Warburg Pincus | Principal shareholder | |
British Airways Plc. | Principal shareholder and significant customer | |
Flovate Technologies Limited (“Flovate”) | A company of which a member of management is a principal shareholder. | |
Datacap Software Pvt Ltd. (“Datacap”) | A company of which a member of management is a principal shareholder. |
F-24
Table of Contents
Amount receivable | |||||||||||||||||||||
(payable) at | |||||||||||||||||||||
Year ended March 31, | March 31, | ||||||||||||||||||||
Nature of transaction/related party | 2006 | 2005 | 2004 | 2006 | 2005 | ||||||||||||||||
Revenue | |||||||||||||||||||||
British Airways | $ | 14,663 | $ | 16,369 | $ | 16,335 | $ | 1,530 | $ | 2,424 | |||||||||||
Warburg Pincus and its affiliates | 1,646 | 1,138 | 918 | 288 | 109 | ||||||||||||||||
Cost of revenue | |||||||||||||||||||||
Flovate | 1,216 | 1,745 | 1,278 | — | (17 | ) | |||||||||||||||
Datacap | 34 | 11 | 1 | — | — | ||||||||||||||||
Selling, general and administrative expense | |||||||||||||||||||||
Warburg Pincus affiliate | 193 | 19 | 43 | — | (8 | ) | |||||||||||||||
Flovate | 288 | 383 | 248 | — | — | ||||||||||||||||
Property and equipment additions | |||||||||||||||||||||
Warburg Pincus affiliate | 559 | 1,859 | — | (53 | ) | (25 | ) | ||||||||||||||
Flovate | 1,552 | 1,161 | 1,460 | (783 | ) | (524 | ) | ||||||||||||||
Other Income | |||||||||||||||||||||
Flovate | 250 | — | — | 287 | — |
13. | OTHER INCOME, NET |
Year ended March 31, | ||||||||||||
2006 | 2005 | 2004 | ||||||||||
Foreign exchange (loss) gain, net | $ | (402 | ) | $ | (102 | ) | $ | 25 | ||||
Interest income | 439 | 264 | 210 | |||||||||
Gain on sale of property and equipment | 32 | — | 76 | |||||||||
Other (See Note 12) | 387 | 10 | 13 | |||||||||
$ | 456 | $ | 172 | $ | 324 | |||||||
14. | SEGMENTS |
F-25
Table of Contents
Year ended March 31, 2006 | ||||||||||||||||
WNS | WNS Auto | Inter | ||||||||||||||
Global BPO | Claims BPO | segments (a) | Total | |||||||||||||
Revenue from external customers | $ | 123,226 | $ | 79,583 | $ | — | $ | 202,809 | ||||||||
Segment revenue | 125,229 | 79,583 | (2,003 | ) | 202,809 | |||||||||||
Payments to repair centers | — | 54,904 | — | 54,904 | ||||||||||||
Revenue less repair payments | 125,229 | 24,679 | (2,003 | ) | 147,905 | |||||||||||
Depreciation | 8,677 | 1,775 | — | 10,452 | ||||||||||||
Other costs | 99,040 | 17,762 | (2,003 | ) | 114,799 | |||||||||||
Segment operating income | 17,512 | 5,142 | — | 22,654 | ||||||||||||
Unallocated share-based compensation expense | (1,922 | ) | ||||||||||||||
Amortization of intangible assets | (856 | ) | ||||||||||||||
Other income | 456 | |||||||||||||||
Interest expense | (429 | ) | ||||||||||||||
Income before income taxes | 19,903 | |||||||||||||||
Provision for income taxes | (1,574 | ) | ||||||||||||||
Net income | $ | 18,329 | ||||||||||||||
Capital expenditure | $ | 12,689 | $ | 2,204 | $ | — | $ | 14,893 | ||||||||
Segment assets, net of eliminations as at March 31, 2006 | $ | 92,415 | $ | 42,388 | $ | — | $ | 134,803 | ||||||||
F-26
Table of Contents
Year ended March 31, 2005 | ||||||||||||||||
WNS Global | WNS Auto | Inter | ||||||||||||||
BPO | Claims BPO | segments (a) | Total | |||||||||||||
Revenue from external customers | $ | 76,982 | $ | 85,191 | $ | — | $ | 162,173 | ||||||||
Segment revenue | 78,595 | 85,191 | (1,613 | ) | 162,173 | |||||||||||
Payment to repair centers | — | 63,186 | — | 63,186 | ||||||||||||
Revenue less repair payments | 78,595 | 22,005 | (1,613 | ) | 98,987 | |||||||||||
Depreciation | 6,905 | 1,536 | — | 8,441 | ||||||||||||
Other costs ((b)) | 77,772 | 17,116 | (1,613 | ) | 93,275 | |||||||||||
Segment operating income (loss) | (6,082 | ) | 3,353 | — | (2,729 | ) | ||||||||||
Unallocated share-based compensation expense | (239 | ) | ||||||||||||||
Amortization of intangible assets | (1,416 | ) | ||||||||||||||
Other income | 172 | |||||||||||||||
Interest expense | (496 | ) | ||||||||||||||
Loss before income taxes | (4,708 | ) | ||||||||||||||
Provision for income taxes | (1,068 | ) | ||||||||||||||
Net loss | $ | (5,776 | ) | |||||||||||||
Capital expenditure | $ | 16,343 | $ | 1,924 | $ | — | $ | 18,267 | ||||||||
Segment assets, net of eliminations as at March 31, 2005 | $ | 48,709 | $ | 49,270 | $ | — | $ | 97,979 | ||||||||
F-27
Table of Contents
Year ended March 31, 2004 | ||||||||||||||||
WNS | WNS Auto | Inter | ||||||||||||||
Global BPO | Claims BPO | segments (a) | Total | |||||||||||||
Revenue from external customers | $ | 36,750 | $ | 67,308 | $ | — | $ | 104,058 | ||||||||
Segment revenue | 37,881 | 67,308 | (1,131 | ) | 104,058 | |||||||||||
Payments to repair centers | — | 54,164 | — | 54,164 | ||||||||||||
Revenue less repair payments | 37,881 | 13,144 | (1,131 | ) | 49,894 | |||||||||||
Depreciation | 4,326 | 1,023 | — | 5,349 | ||||||||||||
Other costs ((b)) | 38,383 | 11,514 | (1,131 | ) | 48,766 | |||||||||||
Segment operating income (loss) | (4,828 | ) | 607 | — | (4,221 | ) | ||||||||||
Unallocated share-based compensation expense | (205 | ) | ||||||||||||||
Amortization of intangible assets | (2,600 | ) | ||||||||||||||
Other income | 324 | |||||||||||||||
Interest expense | (59 | ) | ||||||||||||||
Loss before income taxes | (6,761 | ) | ||||||||||||||
Benefit for income taxes | 41 | |||||||||||||||
Net loss | $ | (6,720 | ) | |||||||||||||
Capital expenditure | $ | 6,126 | $ | 2,609 | $ | — | $ | 8,735 | ||||||||
Segment assets, net of eliminations as at March 31, 2004 | $ | 40,582 | $ | 45,990 | $ | — | $ | 86,572 | ||||||||
Year ended March 31, | ||||||||||||
2006 | 2005 | 2004 | ||||||||||
UK | $ | 126,866 | $ | 105,552 | $ | 75,044 | ||||||
US | 49,134 | 28,004 | 10,199 | |||||||||
Europe (excludes UK) | 25,421 | 27,730 | 18,104 | |||||||||
Other | 1,388 | 887 | 711 | |||||||||
$ | 202,809 | $ | 162,173 | $ | 104,058 | |||||||
F-28
Table of Contents
March 31, | ||||||||
2006 | 2005 | |||||||
UK | $ | 23,720 | $ | 26,194 | ||||
India | 29,324 | 23,595 | ||||||
US | 18,621 | 641 | ||||||
Other | 1,445 | 941 | ||||||
$ | 73,110 | $ | 51,371 | |||||
15. | COMMITMENTS AND CONTINGENCIES |
Leases |
Capital | Operating | |||||||
Year ending March 31, | leases | leases | ||||||
2007 | $ | 193 | $ | 21,091 | ||||
2008 | 2 | 19,021 | ||||||
2009 | — | 17,710 | ||||||
2010 | — | 17,252 | ||||||
2011 | — | 9,117 | ||||||
Thereafter | — | 3,845 | ||||||
Total minimum lease payments | $ | 195 | $ | 88,036 | ||||
Amounts representing interest | (9 | ) | ||||||
Present value of net minimum lease payments | $ | 186 | ||||||
Obligation under capital leases: | ||||||||
Long term | 2 | |||||||
Current | 184 | |||||||
$ | 186 | |||||||
Bank guarantees and other |
F-29
Table of Contents
Consolidated Financial Statements | ||||
F-31 | ||||
F-32 | ||||
F-33 | ||||
F-34 | ||||
F-35 | ||||
F-36 | ||||
Unaudited Condensed Consolidated Financial Statements | ||||
F-45 | ||||
F-46 | ||||
F-47 | ||||
F-48 |
F-30
Table of Contents
F-31
Table of Contents
ASSETS | |||||
Current assets | |||||
Cash and cash equivalents | $ | 3,729 | |||
Accounts receivable | 24 | ||||
Accounts receivable — related parties | 137 | ||||
Unbilled receivables | 21 | ||||
Unbilled receivables — related parties | 717 | ||||
Prepaid expenses | 121 | ||||
Other current assets | 56 | ||||
Total current assets | 4,805 | ||||
Property and equipment, net | 2,174 | ||||
Deposits | 192 | ||||
TOTAL ASSETS | $ | 7,171 | |||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||
Current liabilities | |||||
Accounts payable | $ | 130 | |||
Accrued employee costs | 490 | ||||
Deferred revenue | 484 | ||||
Current portion of long term debt | 13 | ||||
Other accrued expenses and current liabilities | 171 | ||||
Total current liabilities | 1,288 | ||||
Long term debt, net of current portion | 27 | ||||
Commitments and contingencies | |||||
Stockholders’ equity | |||||
Series A Preferred stock, $0.01 par value — 3,367,000 shares authorized, issued and outstanding with liquidation preference of $3,367 | 34 | ||||
Series B Preferred stock, $0.01 par value — 5,555,550 shares authorized, issued and outstanding with liquidation preference of $5,556 | 56 | ||||
Common stock, $0.01 par value — 9,806,388 shares authorized; Nil shares issued and outstanding | — | ||||
Additional paid-in-capital | 9,284 | ||||
Promissory notes | (372 | ) | |||
Deferred stock-based compensation | (609 | ) | |||
Accumulated deficit | (2,546 | ) | |||
Accumulated other comprehensive income | 9 | ||||
Total stockholders’ equity | 5,856 | ||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 7,171 | |||
F-32
Table of Contents
Revenue | |||||
Third Parties | $ | 54 | |||
Related Parties | 5,376 | ||||
Revenue | 5,430 | ||||
Cost of revenue | 2,574 | ||||
Gross profit | 2,856 | ||||
Operating expenses | |||||
Selling, general and administrative expenses | 3,781 | ||||
Operating loss | (925 | ) | |||
Interest income | 91 | ||||
Interest expense | (1 | ) | |||
Foreign exchange gain, net | — | ||||
Loss before income taxes | (835 | ) | |||
Provision for income taxes | — | ||||
Net loss | $ | (835 | ) | ||
F-33
Table of Contents
Series A preferred | Series B preferred | ||||||||||||||||||||||||||||||||||||||||
stock | stock | Accumulated | |||||||||||||||||||||||||||||||||||||||
Additional | Deferred | other | Total | ||||||||||||||||||||||||||||||||||||||
Par | Par | paid-in- | Promissory | stock-based | Accumulated | comprehensive | stockholders’ | ||||||||||||||||||||||||||||||||||
Number | value | Number | value | capital | notes | compensation | deficit | income | equity | ||||||||||||||||||||||||||||||||
Balance at April 1, 2004 | 3,367,000 | $ | 34 | 5,555,550 | $ | 56 | $ | 9,193 | $ | (522 | ) | $ | (2,023 | ) | $ | (1,711 | ) | $ | 6 | $ | 5,033 | ||||||||||||||||||||
Comprehensive loss: | |||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | — | — | (835 | ) | — | (835 | ) | |||||||||||||||||||||||||||||
Translation adjustment | — | — | — | — | — | — | — | — | 3 | 3 | |||||||||||||||||||||||||||||||
Comprehensive loss | (832 | ) | |||||||||||||||||||||||||||||||||||||||
Stock-based compensation: | |||||||||||||||||||||||||||||||||||||||||
Stock incentive plan | — | — | — | — | — | — | 210 | — | — | 210 | |||||||||||||||||||||||||||||||
Series A preferred stock | — | — | — | — | — | — | 1,204 | — | — | 1,204 | |||||||||||||||||||||||||||||||
Series B preferred stock | — | — | — | — | 91 | — | — | — | — | 91 | |||||||||||||||||||||||||||||||
Amount waived under promissory notes | — | — | — | — | — | 50 | — | — | — | 50 | |||||||||||||||||||||||||||||||
Payment received against promissory notes | — | — | — | — | — | 100 | — | — | — | 100 | |||||||||||||||||||||||||||||||
Balance at March 31, 2005 | 3,367,000 | $ | 34 | 5,555,550 | $ | 56 | $ | 9,284 | $ | (372 | ) | $ | (609 | ) | $ | (2,546 | ) | $ | 9 | $ | 5,856 | ||||||||||||||||||||
F-34
Table of Contents
Cash flows from operating activities | ||||||
Net loss | $ | (835 | ) | |||
Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||
Depreciation and amortization | 280 | |||||
Stock-based compensation | 1,555 | |||||
Changes in operating assets and liabilities: | ||||||
Accounts receivable and unbilled receivables | (634 | ) | ||||
Prepaid expenses and other current assets | (162 | ) | ||||
Deposits | (118 | ) | ||||
Deferred revenue | 142 | |||||
Accounts payable and other current liabilities | 521 | |||||
Net cash provided by operating activities | 749 | |||||
Cash flows from investing activities | ||||||
Purchase of property and equipment | (1,864 | ) | ||||
Net cash used in investing activities | (1,864 | ) | ||||
Cash flows from financing activities | ||||||
Debt repayment | (11 | ) | ||||
Payments received against promissory note | 100 | |||||
Net cash provided by financing activities | 89 | |||||
Effect of exchange rate changes on cash and cash equivalents | (33 | ) | ||||
Net decrease in cash and cash equivalents | (1,059 | ) | ||||
Cash and cash equivalents at beginning of year | 4,788 | |||||
Cash and cash equivalents at end of year | $ | 3,729 | ||||
Supplemental disclosure of cash flow information: | ||||||
Income taxes paid | $ | 28 | ||||
Interest paid | 1 |
F-35
Table of Contents
1. | ORGANIZATION AND DESCRIPTION OF BUSINESS |
2. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
Basis of preparation |
Use of estimates |
Foreign currency translation |
Revenue recognition |
Cost of revenue |
F-36
Table of Contents
Asset description | Asset life (in years) | |
Computers | 3-5 | |
Furniture, fixtures and office equipment | 3-4 | |
Software | 3 | |
Vehicles | 5 | |
Leasehold improvements | Lesser of estimated useful life or lease term |
F-37
Table of Contents
Net loss as reported | $ | (835 | ) | |
Add: Stock-based compensation expense included in reported net loss | 210 | |||
Less: Stock-based compensation expense determined under the fair value method | (219 | ) | ||
Pro forma net loss | $ | (844 | ) | |
Risk free interest rate | 4 | % | ||
Dividend yield | — | |||
Expected life in years | 5 |
F-38
Table of Contents
Fair value of financial instruments |
Concentration of risk |
3. | PROPERTY AND EQUIPMENT |
Computers | $ | 1,075 | ||
Furniture, fixtures and office equipment | 267 | |||
Software | 160 | |||
Vehicles | 74 | |||
Leasehold improvements | 48 | |||
Capital work-in-progress | 852 | |||
2,476 | ||||
Accumulated depreciation and amortization | (302 | ) | ||
$ | 2,174 | |||
F-39
Table of Contents
4. | INCOME TAXES |
Deferred tax asset | ||||
Net operating loss carry forward | $ | 362 | ||
Deferred tax liability | ||||
Property and equipment | (47 | ) | ||
Net deferred tax asset | 315 | |||
Less: Valuation allowance | (315 | ) | ||
Net deferred tax asset | — | |||
5. | RETIREMENT BENEFITS |
Defined contribution plan |
Defined benefit plan — gratuity |
Change in projected benefit obligations | ||||
Obligation at beginning of the year | — | |||
Translation adjustment | — | |||
Service cost | (2 | ) | ||
Interest cost | — | |||
Benefits paid | — | |||
Actuarial loss | (5 | ) | ||
Benefit obligation at end of the year (A) | $ | (7 | ) | |
Plan assets at the end of year (B) | — | |||
Funded status (B-A) | $ | (7 | ) | |
Unrecognized net loss | 5 | |||
Accrued gratuity cost | $ | (2 | ) | |
F-40
Table of Contents
Net periodic gratuity cost | ||||
Service cost | $ | 2 | ||
Interest cost | — | |||
Expected return on plan asset | — | |||
Net actuarial loss recognized | — | |||
Net periodic gratuity cost for the year | $ | 2 | ||
6. | DEBT |
7. | STOCKHOLDERS’ EQUITY |
Common stock |
Preferred stock |
F-41
Table of Contents
8. | EMPLOYEES’ STOCK INCENTIVE PLAN |
Weighted- | ||||||||
Shares arising | average exercise | |||||||
from options | price | |||||||
Outstanding at the beginning of the year | 480,507 | $ | 0.10 | |||||
Exercised | — | — | ||||||
Granted | — | — | ||||||
Outstanding at the end of the year | 480,507 | $ | 0.10 | |||||
Weighted- | ||||||||||||
average | ||||||||||||
Exercise | remaining | |||||||||||
prices | Shares | contractual life | ||||||||||
Options outstanding | $ | 0.10 | 344,854 | 8.82 | ||||||||
Options vested and exercisable | $ | 0.10 | 135,653 | 8.81 | ||||||||
480,507 | 8.82 | |||||||||||
9. | RELATED-PARTY TRANSACTIONS |
Relationship | Name of the party | |
Significant stockholder | First Magnus Financial Corporation (“FMFC”) First Magnus Consulting LLC | |
Founders and Key Managerial Personnel | Vivek Shivpuri Amit Gujral Arvind Srivastava |
F-42
Table of Contents
Amount | |||||||||
Nature of transaction/ | receivable | ||||||||
related party | Amount | (payable) | |||||||
Revenue | |||||||||
FMFC | $ | 5,036 | $ | 581 | |||||
Affiliates of FMFC | 444 | 273 | |||||||
Purchase of property and equipment | |||||||||
FMFC | 86 | — | |||||||
Reimbursement of expenses paid on behalf of the party | |||||||||
FMFC | 50 | — | |||||||
Waiver of Promissory notes | |||||||||
Vivek Shivpuri | 50 | — | |||||||
Promissory notes (repaid in October, 2005) | |||||||||
Vivek Shivpuri | — | 68 | |||||||
Amit Gujral | — | 152 | |||||||
Arvind Srivastava | — | 152 |
10. | COMMITMENT AND CONTINGENCIES |
Operating leases |
Year ending March 31, | Amount | |||
2006 | $ | 643 | ||
2007 | 146 | |||
2008 | 146 | |||
2009 | 148 | |||
2010 | 150 |
Bank guarantees |
F-43
Table of Contents
11. | SUBSEQUENT EVENT |
F-44
Table of Contents
November 15, | March 31, | ||||||||
2005 | 2005 | ||||||||
ASSETS | |||||||||
Current assets | |||||||||
Cash and cash equivalents | $ | 2,952 | $ | 3,729 | |||||
Accounts receivable | 59 | 24 | |||||||
Account receivable — related parties | 803 | 137 | |||||||
Unbilled receivables | 23 | 21 | |||||||
Unbilled receivables — related parties | 610 | 717 | |||||||
Prepaid expenses | 106 | 121 | |||||||
Other current assets | 35 | 56 | |||||||
Total current assets | 4,588 | 4,805 | |||||||
Property and equipment, net | 1,365 | 2,174 | |||||||
Deposits | 224 | 192 | |||||||
TOTAL ASSETS | $ | 6,177 | $ | 7,171 | |||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||
Current liabilities | |||||||||
Accounts payable | $ | 864 | $ | 130 | |||||
Accrued employee costs | 307 | 490 | |||||||
Deferred revenue | 482 | 484 | |||||||
Current portion of long term debt | 13 | 13 | |||||||
Other accrued expenses and current liabilities | 312 | 171 | |||||||
Total current liabilities | 1,978 | 1,288 | |||||||
Long term debt, net of current portion | 17 | 27 | |||||||
Stockholders’ equity | |||||||||
Series A Preferred stock, $0.01 par value — 3,367,000 shares authorized, issued and outstanding with liquidation preference of $3,367 | 34 | 34 | |||||||
Series B Preferred stock, $0.01 par value — 5,555,550 shares authorized, issued and outstanding with liquidation preference of $5,556 | 56 | 56 | |||||||
Common stock, $0.01 par value — 9,806,388 shares authorized; 883,838 shares issued and outstanding at November 15, 2005 and nil shares issued and outstanding at March 31, 2005 | 9 | — | |||||||
Additional paid-in-capital | 10,010 | 9,284 | |||||||
Promissory notes | — | (372 | ) | ||||||
Deferred stock-based compensation | (784 | ) | (609 | ) | |||||
Accumulated deficit | (5,064 | ) | (2,546 | ) | |||||
Accumulated other comprehensive (loss) income | (79 | ) | 9 | ||||||
Total Stockholders’ equity | 4,182 | 5,856 | |||||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 6,177 | $ | 7,171 | |||||
F-45
Table of Contents
Period from April 1 | |||||||||
to November 15 | |||||||||
2005 | 2004 | ||||||||
Revenue | |||||||||
Third parties | $ | 242 | $ | 24 | |||||
Related parties | 7,346 | 2,720 | |||||||
Revenue | 7,588 | 2,744 | |||||||
Cost of revenue | 3,751 | 1,169 | |||||||
Gross profit | 3,837 | 1,575 | |||||||
Operating expenses | |||||||||
Selling, general and administrative expenses | 3,287 | 2,280 | |||||||
Transaction costs related to acquisition by WNS (Holdings) Limited | 628 | — | |||||||
Operating loss | (78 | ) | (705 | ) | |||||
Interest income | 47 | 57 | |||||||
Interest expense | (1 | ) | (1 | ) | |||||
Foreign exchange income (loss), net | 14 | (15 | ) | ||||||
Loss before income taxes | (18 | ) | (664 | ) | |||||
Provision for income taxes | — | — | |||||||
Net loss | $ | (18 | ) | $ | (664 | ) | |||
F-46
Table of Contents
Period from April 1 | |||||||||
to November 15 | |||||||||
2005 | 2004 | ||||||||
Cash flows from operating activities | |||||||||
Net cash provided by operating activities | $ | 920 | $ | 899 | |||||
Cash flows from investing activities | |||||||||
Purchases of property and equipment | 419 | (559 | ) | ||||||
Net cash provided by (used in) investing activities | 419 | (559 | ) | ||||||
Cash flows from financing activities | |||||||||
Debt repayment | (9 | ) | (5 | ) | |||||
Payments received against promissory note | 348 | 100 | |||||||
Dividends paid during the period | (2,500 | ) | — | ||||||
Proceeds from stock options exercised | 88 | — | |||||||
Net cash (used in) provided by financing activities | (2,073 | ) | 95 | ||||||
Effect of exchange rate changes on cash and cash equivalents | (43 | ) | 10 | ||||||
Net (decrease) increase in cash and cash equivalents | (777 | ) | 445 | ||||||
Cash and cash equivalents at beginning of period | 3,729 | 4,788 | |||||||
Cash and cash equivalents at end of period | $ | 2,952 | $ | 5,233 | |||||
F-47
Table of Contents
1. | BASIS OF PRESENTATION |
2. | CAPITAL STRUCTURE |
3. | COMPREHENSIVE LOSS |
Period from | ||||||||
April 1 to | ||||||||
November 15 | ||||||||
2005 | 2004 | |||||||
Net loss | $ | (18 | ) | $ | (664 | ) | ||
Foreign currency translation adjustment | (88 | ) | (4 | ) | ||||
Total comprehensive loss | $ | (106 | ) | $ | (668 | ) | ||
4. | RETIREMENT BENEFITS |
Defined contribution plan |
F-48
Table of Contents
Period from | ||||||||
April 1 to | ||||||||
November 15 | ||||||||
2005 | 2004 | |||||||
Net periodic gratuity cost | ||||||||
Service cost | $ | 9 | $ | 1 | ||||
Interest cost | — | — | ||||||
Expected return on plan asset | — | — | ||||||
Recognized net actuarial loss | 1 | — | ||||||
Net periodic gratuity cost for the period | $ | 10 | $ | 1 | ||||
5. | STOCK-BASED COMPENSATION |
Period from | ||||||||
April 1 to | ||||||||
November 15 | ||||||||
2005 | 2004 | |||||||
Net loss as reported | $ | (18 | ) | $ | (664 | ) | ||
Add: Stock-based employee compensation expense included in reported net loss | 94 | 146 | ||||||
Less: Stock-based employee compensation expense determined under the fair value method | (96 | ) | (152 | ) | ||||
Pro forma net loss | $ | (20 | ) | $ | (670 | ) | ||
6. | SUBSEQUENT EVENT — ACQUISITION BY WNS (HOLDINGS) LIMITED |
F-49
Table of Contents
Table of Contents
Morgan Stanley | Deutsche Bank Securities | Merrill Lynch & Co. |
Citigroup | UBS Investment Bank |
Table of Contents
ITEM 6. | INDEMNIFICATION OF DIRECTORS AND OFFICERS. |
(a) | any liabilities incurred in defending any proceedings (whether civil or criminal): |
(i) | in which judgment is given in his favor or he is acquitted, or |
(ii) | which are discontinued otherwise than for some benefit conferred by him or on his behalf or some detriment suffered by him, or |
(iii) | which are settled on terms which include such benefit or detriment and, in the opinion of a majority of the directors of the company, he was substantially successful on the merits in his resistance to the proceedings; or |
(b) | any liability incurred otherwise than to the company if he acted in good faith with a view to the best interests of the company; or |
(c) | any liability incurred in connection with an application made under Article 212 of the 1991 Law in which relief is granted to him by the court; or |
(d) | any liability against which the company normally maintains insurance for persons other than directors. |
ITEM 7. | RECENT SALES OF UNREGISTERED SECURITIES |
Aggregate | ||||||||||||
Date of Sale | Number of | Consideration in GBP/ | ||||||||||
Purchaser | or Issuance | Ordinary Shares | (US dollars) millions(1)(2) | |||||||||
Warburg Pincus Private Equity VIII, L.P. | May 20, 2002 | 6,020,000 | £6.00/$10.35 | |||||||||
July 4, 2002 | 5,214,917 | £5.20/$8.97 | ||||||||||
Warburg Pincus International Partners, L.P. | May 20, 2002 | 5,779,200 | £5.76/$9.93 | |||||||||
July 4, 2002 | 5,006,321 | £4.99/$8.61 |
II-1
Table of Contents
Aggregate | ||||||||||||
Date of Sale | Number of | Consideration in GBP/ | ||||||||||
Purchaser | or Issuance | Ordinary Shares | (US dollars) millions(1)(2) | |||||||||
Warburg Pincus Netherlands International Partners I, CV | May 20, 2002 | 144,480 | £0.14/$0.25 | |||||||||
July 4, 2002 | 125,158 | £0.12/$0.22 | ||||||||||
Warburg Pincus Netherlands International Partners II, CV | May 20, 2002 | 96,320 | £0.10/$0.17 | |||||||||
July 4, 2002 | 83,439 | £0.08/$0.14 | ||||||||||
British Airways plc | May 20, 2002 | 5,160,000 | £5.16/$8.90 | |||||||||
David Charles Tibble | May 20, 2002 | 400,000 | £0.40/$0.69 | |||||||||
July 4, 2002 | 130,401 | £0.18/$0.31 | ||||||||||
August 15, 2002 | 157,781 | £0.16/$0.27 | ||||||||||
June 8, 2004 | 133,333 | £0.13/$0.23 | ||||||||||
November 30, 2004 | 133,333 | £0.13/$0.23 | ||||||||||
August 16, 2005 | 133,334 | £0.13/$0.23 | ||||||||||
Bolton Agnew | July 4, 2002 | 391,241 | £0.54/$0.93 | |||||||||
Theodore Thomas More Agnew | July 4, 2002 | 652,067 | £0.90/$1.55 | |||||||||
Theodore Agnew and Bolton Agnew ATO Theodore Agnew Personal Settlement | July 4, 2002 | 1,304,161 | £1.80/$3.10 | |||||||||
First Magnus Financial Corporation | November 16, 2005 | 596,154 | £2.10/ $3.60 | |||||||||
First Magnus Consulting LLC | November 16, 2005 | 620,487 | £2.17/ $3.74 | |||||||||
Executive officers and other managers: | ||||||||||||
July 4, 2002 | 130,401 | £0.18/$0.31 | ||||||||||
May 4, 2005 | 83,333 | £0.08/$0.14 | ||||||||||
September 27, 2005 | 50,496 | £0.05/$0.09 | ||||||||||
October 25, 2005 | 132,837 | £0.13/$0.23 | ||||||||||
October 25, 2005 | 75,000 | £0.07/ $0.13 | ||||||||||
October 25, 2005 | 400,000 | £0.40/ $0.69 | ||||||||||
October 25, 2005 | 175,000 | £0.17/ $0.30 | ||||||||||
October 25, 2005 | 16,666 | £0.02/ $0.42 | ||||||||||
November 28, 2005 | 150,000 | £0.53/ $0.91 | ||||||||||
Employees: | ||||||||||||
May 24, 2005 | 52,779 | £0.056/$0.099 | ||||||||||
August 5, 2005 | 33,333 | £0.05/$0.09 | ||||||||||
September 27, 2005 | 66,666 | £0.10/$0.17 | ||||||||||
October 25, 2005 | 48,000 | £0.05/$0.08 | ||||||||||
October 25, 2005 | 4,666 | £0.007/ $0.012 | ||||||||||
October 25, 2005 | 14,000 | £0.01/ $0.02 | ||||||||||
October 25, 2005 | 14,000 | £0.01/ $0.02 | ||||||||||
October 25, 2005 | 14,000 | £0.01/ $0.02 | ||||||||||
October 25, 2005 | 14,000 | £0.01/ $0.02 | ||||||||||
November 16, 2005 | 327,149 | £1.15/ $1.97 | ||||||||||
November 16, 2005 | 314,696 | £1.10/ $1.90 | ||||||||||
November 16, 2005 | 314,696 | £1.10/ $1.90 | ||||||||||
November 16, 2005 | 90,606 | £0.32/ $0.55 | ||||||||||
December 21, 2005 | 16,666 | £0.02/ $0.04 | ||||||||||
January 13, 2006 | 666 | £0.001/$0.0018 | ||||||||||
January 16, 2006 | 16,666 | £0.02/$0.35 | ||||||||||
February 7, 2006 | 66,666 | £0.10/$0.17 |
II-2
Table of Contents
Aggregate | ||||||||||||
Date of Sale | Number of | Consideration in GBP/ | ||||||||||
Purchaser | or Issuance | Ordinary Shares | (US dollars) millions(1)(2) | |||||||||
March 10, 2006 | 667 | £0.001/$0.0018 | ||||||||||
March 31, 2006 | 3,700 | £0.004/$0.007 | ||||||||||
May 3, 2006 | 3,000 | £0.003/$0.005 | ||||||||||
June 13, 2006 | 1,666 | £0.002/$0.004 | ||||||||||
Ex-employees: | ||||||||||||
September 24, 2004 | 2,666 | £0.003/$0.005 | ||||||||||
November 26, 2004 | 9,333 | £0.009/$0.02 | ||||||||||
February 11, 2005 | 120,000 | £0.12/$0.21 | ||||||||||
May 24, 2005 | 20,696 | £0.029/$0.051 | ||||||||||
June 10, 2005 | 8,991 | £0.01/$0.02 | ||||||||||
October 19, 2005 | 193,334 | £0.27/$0.47 | ||||||||||
November 16, 2005 | 2,234 | £0.008/ $0.01 | ||||||||||
December 21, 2005 | 3,000 | £0.002/ $0.005 | ||||||||||
January 13, 2006 | 50,000 | £0.07/$0.1207 | ||||||||||
March 10, 2006 | 1,775 | £0.003/$0.005 | ||||||||||
April 10, 2006 | 1,996 | £0.003/$0.005 |
(1) | No underwriting discount was provided or no commission was paid in relation to these sales or issuances. |
(2) | US dollar amounts based on convenience translation of £0.57 = $1.00 as of March 31, 2006. |
Aggregate Number of options granted | Aggregate Number of options granted(1) | |||
Fiscal 2003 | 2,455,500 | |||
Fiscal 2004 | 1,868,000 | |||
Fiscal 2005 | 889,744 | |||
Fiscal 2006 | 1,481,479 | |||
Fiscal 2007 (through June 20, 2006) | Nil |
(1) | Includes 678,699 options which were cancelled post grant. |
ITEM 8. | EXHIBITS AND FINANCIAL STATEMENT SCHEDULES |
ITEM 9. | UNDERTAKINGS |
II-3
Table of Contents
(1) | For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective. |
(2) | For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and this offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
II-4
Table of Contents
WNS (Holdings) Limited |
By: | /s/ Ramesh N. Shah |
Name: Ramesh N. Shah | |
Title: Chairman |
Signature | Title | |||
/s/ Ramesh N. Shah | Chairman of Board | |||
/s/ Neeraj Bhargava | Director and Group Chief Executive Officer (principal executive officer) | |||
/s/ Zubin Dubash | Director and Group Chief Financial Officer (principal financial officer and principal accounting officer) | |||
/s/ Pulak Prasad | Director | |||
/s/ Nitin Sibal | Director | |||
/s/ Miriam Strouse | Director |
II-5
Table of Contents
Signature | Title | |||
/s/ Jeremy Young | Director | |||
/s/ Guy Sochovsky | Director | |||
/s/ Timothy Hammond | Director | |||
By: | /s/ Ramesh N. Shah | Authorized Representative in the US |
II-6
Table of Contents
No. | Description | |||
1 | .1 | Form of underwriting agreement.* | ||
3 | .1 | Memorandum of Association of WNS (Holdings) Limited, as amended. | ||
3 | .2 | Articles of Association of WNS (Holdings) Limited, as amended. | ||
4 | .1 | Form of Deposit Agreement among WNS (Holdings) Limited, Deutsche Bank Trust Company Americas, as Depositary, and the holders and beneficial owners of American Depositary Shares evidenced by American Depositary Receipts issued thereunder. | ||
4 | .2 | Form of American Depositary Receipt (included in Exhibit 4.1). | ||
4 | .3 | Specimen Ordinary Share Certificate. | ||
5 | .1 | Opinion of Mourant du Feu & Jeune. | ||
8 | .1 | Opinion of Mourant du Feu & Jeune as to certain Jersey tax matters (see Exhibit 5.1). | ||
8 | .2 | Opinion of Latham & Watkins LLP as to certain US tax matters. | ||
10 | .1 | Stock Purchase Agreement dated November 8, 2005, by and among WNS (Holdings) Limited, First Magnus Financial Corporation, First Magnus Consulting LLC, Mr. Vivek Shivpuri, Mr. Amit Gujral, Mr. Arvind Srivastava, Mr. Francesco Paolo and Trinity Partners Incorporated. | ||
10 | .2 | Lease Deed dated March 10, 2005 between M/s DLF Cyber City and WNS Global Services (P) Ltd. | ||
10 | .3 | Leave and Licence Agreement dated October 18, 2002 between Godrej & Boyce Manufacturing Company Ltd. and World Network Services Pvt. Ltd. | ||
10 | .4 | Leave and Licence Agreement dated March 17, 2004 between Sofotel Software Services Private Limited and WNS Global Services Private Limited. | ||
10 | .5 | Leave and Licence Agreement dated November 10, 2005 between Godrej & Boyce Manufacturing Company Ltd. and WNS Global Services Private Limited with respect to Plant 10. | ||
10 | .6 | Form of director and executive officer indemnification agreement. | ||
10 | .7 | Registration Rights Agreement, dated May 20, 2002, among Warburg Pincus Private Equity VIII, L.P., Warburg Pincus International Partners, L.P., Warburg Pincus Netherlands International Partners I, CV, Warburg Pincus Netherlands International Partners II, CV, British Airways PLC and WNS (Holdings) Limited. | ||
10 | .8 | Framework Agreement relating to the Supply of Services Agreement dated 21 May 2002, by and among British Airways PLC, WNS (UK) Limited and WNS (Holdings) Limited. # | ||
10 | .9 | Letter of Intent dated May 18, 2006 relating to the Framework Agreement between British Airways PLC and WNS Global Services (UK) Ltd. # | ||
10 | .10 | WNS (Holdings) Limited 2002 Stock Incentive Plan. | ||
10 | .11 | Form of WNS (Holdings) Limited 2006 Incentive Award Plan. | ||
10 | .12 | Leave and Licence Agreement dated May 31, 2006 between Godrej & Boyce Manufacturing Company Ltd. and WNS Global Services Private Limited with respect to Plant 11. | ||
21 | .1 | List of subsidiaries of WNS (Holdings) Limited. | ||
23 | .1 | Consent of Mourant du Feu & Jeune (see Exhibit 5.1). | ||
23 | .2 | Consent of Latham & Watkins LLP (see Exhibit 8.2). | ||
23 | .3 | Consent of Ernst & Young, registered public accounting firm with respect to WNS (Holdings) Limited. |
II-7
Table of Contents
No. | Description | |||
23 | .4 | Consent of Ernst & Young, independent auditors with respect to Trinity Partners Inc. | ||
23 | .5 | Consent of Amarchand & Mangaldas & Suresh A. Shroff & Co. | ||
23 | .6 | Consent of Eric B. Herr to be named as a director nominee. | ||
23 | .7 | Consent of Deepak S. Parekh to be named as a director nominee. | ||
24 | .1 | Power of Attorney (contained on signature page) |
* | To be filed by amendment. |
# | Certain portions of this exhibit have been omitted pursuant to a request for confidential treatment filed with the Commission. The omitted portions have been filed with the Commission. |
II-8