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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): NOVEMBER 29, 1996
HNC SOFTWARE INC.
(Exact name of Registrant as Specified in its Charter)
DELAWARE
(State or Other Jurisdiction of Incorporation)
0-26146 33-0248788
(Commission File Number) (I.R.S. Employer Identification Number)
5930 CORNERSTONE COURT WEST, SAN DIEGO, CA 92121
(Address of Principal Executive Offices)
(619) 546-8877
(Registrant's Telephone Number, Including Area Code)
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ITEM 2: ACQUISITION OR DISPOSITION OF ASSETS
On November 29, 1996, HNC Software Inc., a Delaware corporation ("HNC"
or the "COMPANY"), acquired all the outstanding stock of Retek Distribution
Corporation, a privately held British Virgin Islands corporation ("RETEK"),
pursuant to an exchange of HNC Common Stock and options to purchase HNC Common
Stock for all the outstanding stock and stock options of Retek (the "EXCHANGE").
The Exchange made Retek a wholly-owned subsidiary of the Company and was
effected pursuant to an Exchange Agreement dated as of October 25, 1996 (the
"EXCHANGE AGREEMENT"), among HNC, Retek, the Mulberry Trust and the Kulmor Trust
(the shareholders of Retek), and pursuant to related Option Exchange Agreements
among HNC and all the holders of outstanding options to purchase shares of
Retek. The Company intends to account for the Exchange as a "pooling of
interests" transaction for accounting purposes.
Prior to the Exchange, Retek was engaged in the business of developing
and marketing client-server based merchandise management software, focusing on
retail supply chain management. The Company currently plans to continue and
augment Retek's historical business. Retek's assets include software products
that perform merchandise management, financial controls and inventory controls
functions for large retailers. Retek's flagship product, the Merchandise
Management System, is designed to address the needs of department stores, mass
merchandisers and specialty chains in a multi-store, multi-warehouse environment
and allows for both centralized or distributed processing. Following the
Exchange, Retek will continue to operate out of its Minneapolis, Minnesota
headquarters and through its foreign subsidiaries with offices in Canada, the
United Kingdom, and Australia.
Pursuant to the Exchange, HNC issued (i) 1,367,196 shares of its Common
Stock to the shareholders of Retek in exchange for their Retek shares; and (ii)
options to purchase up to 155,864 shares of HNC Common Stock to the option
holders of Retek in exchange for their Retek stock options. The 1,367,196 shares
of HNC Common Stock that were issued in exchange for all outstanding Retek Stock
represented approximately 7.19% of HNC's outstanding stock immediately after the
closing of the Exchange. Under the Exchange Agreement, each share of Retek stock
("RETEK STOCK") that was outstanding immediately prior to the closing of the
Exchange was assigned and transferred to HNC in exchange for approximately
13,671.9670 shares of HNC Common Stock, and each option to purchase Retek Stock
that was outstanding immediately prior to the closing of the Exchange (a "RETEK
OPTION") was exchanged for an option to purchase that number of shares of HNC
Common Stock equal to the number of shares of Retek Stock subject to such Retek
Option multiplied by 13,671.9670 (the same conversion rate at which each share
of Retek Stock was converted into HNC Common Stock in the Exchange), at an
exercise price per share of HNC Common Stock equal to the exercise price per
share of Retek Stock that was in effect for such Retek Option divided by
13,671.9670. Pursuant to the Exchange Agreement, the Company, Retek, the
shareholders of Retek and an escrow agent entered into an Escrow Agreement,
pursuant to which 10% of the shares of HNC Common Stock that were issued
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in the Exchange to the Retek shareholders were placed in an escrow account to
secure and collateralize certain indemnification obligations of the former Retek
shareholders to HNC.
The shares of HNC Common Stock and the options to purchase HNC Common Stock
issued to the former Retek security holders in the Exchange have not been
registered under the Securities Act of 1933, as amended (the "1933 Act"), in
reliance upon the exemption from registration provided by Section 4(2) thereof
and/or Rule 506 promulgated under Regulation D. In January 1997, HNC intends to
register the issuance of the shares of its Common Stock that are issuable upon
the exercise of the HNC stock options that were issued to the former Retek
option holders in the Exchange on a Form S-8 Registration Statement.
In addition, the Company and the Retek shareholders have entered into a
Registration Rights Agreement, pursuant to which HNC granted these shareholders
certain registration rights on Form S-3 in connection with the resale of shares
of HNC Common Stock issued to the former Retek shareholders in the Exchange (the
"Exchange Shares"). Under the terms of the Registration Rights Agreement, during
the two (2) year period following the Company's public release of a report
including the combined financial results of HNC and Retek for a period of at
least thirty (30) days of post-Exchange combined operations, HNC is to maintain
effective a shelf registration on Form S-3 pursuant to Rule 415 under the 1933
Act covering the resale by the former Retek shareholders of Exchange Shares held
by such former Retek shareholders during specified permitted time periods.
ITEM 7: FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial Statements of Business Acquired.
None required under Rule 3-05(b) of Regulation S-X.
(b) Pro Forma Financial Information.
None required under Rule 3-05(b) of Regulation S-X.
(c) Exhibits.
The following exhibits are filed herewith:
2.01 Exchange Agreement dated as of October 25, 1996 by and among
registrant, Retek Distribution Corporation and the
shareholders of Retek. Pursuant to Item 601(b)(2) of
Regulation of S-K, certain schedules have been omitted but
will be furnished supplementally to the Commission upon
request.
2.02 Form of Option Exchange Agreement between registrant and each
person who held outstanding options to purchase shares of
Retek Distribution
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Corporation on November 29, 1996. Pursuant to Item 601(b)(2)
of Regulation of S-K, certain schedules have been omitted but
will be furnished supplementally to the Commission upon
request.
4.01 Registration Rights Agreement dated as of October 25, 1996 by
and among registrant and the former shareholders of Retek
Distribution Corporation.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: December 12, 1996
HNC SOFTWARE INC.
By:/s/ RAYMOND V. THOMAS
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Raymond V. Thomas,
Chief Financial Officer
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INDEX TO EXHIBITS
Exhibit No. Description of Exhibit
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2.01 Exchange Agreement dated as of October 25, 1996 by
and among registrant, Retek Distribution Corporation and
the shareholders of Retek Distribution Corporation.
2.02 Form of Option Exchange Agreement between registrant and
each person who held outstanding options to purchase
shares of Retek Distribution Corporation on November 29,
1996.
4.01 Registration Rights Agreement dated as of October 25, 1996
by and among registrant and the former shareholders of
Retek Distribution Corporation.