AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 17, 1997
REGISTRATION NO. 333-__________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
---------------
FAIR, ISAAC AND COMPANY, INCORPORATED
(Exact name of registrant as specified in its charter)
Delaware 94-1499887
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
120 North Redwood Drive
San Rafael, California 94903
(415) 472-2211
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
PETER L. McCORKELL
SENIOR VICE PRESIDENT AND GENERAL COUNSEL
FAIR, ISAAC AND COMPANY, INCORPORATED
120 North Redwood Drive
San Rafael, California 94903
(415) 472-2211
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
COPIES TO:
DAVID R. LAMARRE
Pillsbury Madison & Sutro LLP
P.O. Box 7880
San Francisco, California 94120
---------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE
TO THE PUBLIC: From time to time after this
Registration Statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. |_|
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. |X|
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering.
|_| ______
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. |_| ______
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. |_|
CALCULATION OF REGISTRATION FEE
====================================================================================================================================
PROPOSED PROPOSED
MAXIMUM MAXIMUM
TITLE OF EACH CLASS OF SECURITIES TO BE AMOUNT TO BE OFFERING PRICE AGGREGATE AMOUNT OF
REGISTERED REGISTERED PER SHARE(1) OFFERING PRICE(1) REGISTRATION FEE
- ------------------------------------------------------------------------------------------------------------------------------------
Common Stock, $0.01 par value......... 210,508 shares $39.97 $8,414,004.76 $2,482.14
====================================================================================================================================
(1) Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(c) based upon the average of the high
and low prices of the Company's Common Stock on the New York Stock Exchange on December 15, 1997.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
================================================================================
+++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+ +
+ INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+ REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH +
+ THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD +
+ NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION +
+ STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER +
+ TO SELL OR THE SOLICITATION OF ANY OFFER TO BUY NOR SHALL THERE BE ANY +
+ SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR +
+ SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE +
+ SECURITIES LAWS OF ANY SUCH STATE. +
+ +
+++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED DECEMBER 17, 1997
PROSPECTUS
210,508 SHARES
FAIR, ISAAC AND COMPANY, INCORPORATED
COMMON STOCK
--------------
This Prospectus covers 210,508 shares (the "Shares") of Common Stock,
$0.01 par value (the "Common Stock"), of Fair, Isaac and Company, Incorporated
(the "Company") offered for the account of certain stockholders of the Company
(the "Selling Stockholders"). The Shares may be offered by the Selling
Stockholders from time to time in transactions on the New York Stock Exchange,
in negotiated transactions, through a combination of such methods of sale, or
otherwise, at fixed prices that may be changed, at market prices prevailing at
the time of sale, at prices related to prevailing market prices, or at
negotiated prices. The Selling Stockholders may effect such transactions by
selling the Shares to or through broker-dealers, who may receive compensation in
the form of discounts, concessions or commissions from the Selling Stockholders
and/or the purchasers of the Shares for whom such broker-dealers may act as
agents or to whom they may sell as principals, or both (which compensation as to
a particular broker-dealer might be in excess of customary commissions). The
Company will not receive any of the proceeds from the sale of the Shares by the
Selling Stockholders. The Company has agreed to bear all expenses of
registration of the Shares, but all selling expenses incurred by a Selling
Stockholder will be borne by that Selling Stockholder.
The Selling Stockholders and any broker-dealers, agents or underwriters
that participate with the Selling Stockholders in the distribution of the Shares
may be deemed to be "underwriters" within the meaning of the Securities Act of
1933, as amended (the "Securities Act"), and any commissions paid or any
discounts or concessions allowed to any such persons, and any profits received
on the resale of the Shares purchased by them may be deemed to be underwriting
commissions or discounts under the Securities Act.
See "Selling Stockholders" and "Plan of Distribution."
The Common Stock is traded on the New York Stock Exchange ("NYSE") under
the symbol "FIC."
On December 16, 1997, the closing price of the Common Stock as reported on
the NYSE was $40.32 per share.
---------------
THE COMMON STOCK OFFERED HEREBY INVOLVES A HIGH
DEGREE OF RISK. SEE "RISK FACTORS" BEGINNING
ON PAGE 3.
---------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE
COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A
CRIMINAL OFFENSE.
---------------
No person has been authorized to give any information or to make any
representations other than those contained or incorporated by reference in this
Prospectus and, if given or made, such information or representations must not
be relied upon as having been authorized by the Company. This Prospectus does
not constitute an offer to sell or a solicitation of any offer to buy any
security other than the shares of Common Stock offered by this Prospectus, nor
does it constitute an offer to sell or solicitation of any offer to buy the
shares of Common Stock by anyone in any jurisdiction in which such offer or
solicitation is not authorized, or in which the person making such offer or
solicitation is not qualified to do so or to any person to whom it is unlawful
to make such offer or solicitation. Neither the delivery of this Prospectus nor
any sale made hereunder shall, under any circumstances, create any implication
that the information contained herein is correct as of any time subsequent to
the date hereof.
The date of this Prospectus is December __, 1997
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy and information statements, and other
information with the Securities and Exchange Commission (the "Commission"). Such
reports, proxy and information statements, and other information filed by the
Company can be inspected and copied at the public reference facilities
maintained by the Commission at 450 Fifth Street, N.W., Washington, D.C., as
well as the regional offices of the Commission located at Citicorp Center, 500
West Madison Street, Suite 1400, Chicago, Illinois, and 7 World Trade Center,
Suite 1300, New York, New York. Copies of such material can be obtained from the
Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549 at prescribed rates. The Commission maintains a World
Wide Web site that contains reports, proxy and information statements, and other
information that are filed through the Commission's Electronic Data Gathering,
Analysis and Retrieval System. This Web site can be accessed at
http://www.sec.gov. The Company's Common Stock is traded on the NYSE. Reports,
proxy statements and other information can be inspected at the offices of the
New York Stock Exchange, Inc., 20 Broad Street, New York, New York 10005.
The Company has filed with the Commission a Registration Statement on
Form S-3 (together with all amendments and exhibits thereto, the "Registration
Statement") under the Securities Act of 1933, as amended (the "Securities Act"),
with respect to the Common Stock offered hereby. This Prospectus does not
contain all of the information set forth in the Registration Statement and the
exhibits and schedules thereto, certain parts of which are omitted in accordance
with the rules and regulations of the Commission. For further information with
respect to the Company and the Common Stock, reference is made to the
Registration Statement and the exhibits and schedules thereto. Statements
contained in this Prospectus as to the contents of any contract or other
document are not necessarily complete and, in each instance, reference is made
to the copy of such contract or document filed as an exhibit to the Registration
Statement, each such statement being qualified in all respects by such
reference. Copies of the Registration Statement, including all exhibits thereto,
may be obtained from the Commission's principal office in Washington, D.C. upon
payment of the fees prescribed by the Commission, or may be examined without
charge at the offices of the Commission described above.
DOCUMENTS INCORPORATED BY REFERENCE
The following documents previously filed with the Commission are hereby
incorporated by reference into this Prospectus: (i) the Company's Annual Report
on Form 10-K for the year ended September 30, 1996; (ii) the Company's Quarterly
Reports on Form 10-Q for the quarters ended December 31, 1996, March 31, 1997
and June 30, 1997; (iii) the Company's Current Reports on Form 8-K filed on
April 25, 1997, June 30, 1997, December 11, 1997 and December 16, 1997 and (iv)
the description of the Common Stock contained in the Company's Registration
Statement on Form 8-A filed under the Exchange Act on April 9, 1996. All
documents subsequently filed by the Company pursuant to Section 13(a), 13(c), 14
or 15(d) of the Exchange Act prior to the termination of the offering to which
this Prospectus relates shall be deemed to be incorporated by reference into
this Prospectus and to be part of this Prospectus from the date of filing
thereof.
Any statement contained in a document incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this Prospectus and
the Registration Statement of which it is a part to the extent that a statement
contained herein or in any other subsequently filed document which also is
incorporated herein modifies or replaces such statement. Any statement so
modified or superseded shall not be deemed, in its unmodified form, to
constitute a part of this Prospectus or such Registration Statement. The Company
will provide without charge to each person to whom a copy of the Prospectus has
been delivered, and who makes a written or oral request, a copy of any and all
of the foregoing documents incorporated by reference in the Registration
Statement (other than exhibits unless such exhibits are specifically
incorporated by reference into such documents). Requests should be submitted in
writing or by telephone to the Corporate Secretary, Fair, Isaac and Company,
Incorporated, 120 North Redwood Drive, San Rafael, California 94903, telephone
(415) 472-2211.
2
THE COMPANY
Fair, Isaac and Company, Incorporated (NYSE: FIC) is a leading developer
of data management and decision systems and services for the financial services,
consumer credit, personal lines insurance and direct marketing industries. The
Company employs various tools such as database enhancement software, predictive
modeling, adaptive control, and systems automation to help its clients use data
to make better decisions about their customers and prospects.
Established in 1956, the Company pioneered the credit risk scoring
technologies now employed by most major U.S. consumer credit grantors. Its
rule-based decision management systems, originally developed to screen consumer
credit applicants, are now routinely employed in all phases of the credit
account cycle: direct mail solicitation (credit cards, lines of credit, etc.),
application processing, card reissuance, on-line credit authorization and
collection.
The Company's executive offices are located at 120 North Redwood Drive,
San Rafael, California 94903 and its telephone number is (415) 472-2211.
RISK FACTORS
THE SECURITIES OFFERED HEREBY INVOLVE A HIGH DEGREE OF RISK. THE
FOLLOWING FACTORS SHOULD BE CONSIDERED CAREFULLY IN EVALUATING AN INVESTMENT IN
THE SHARES OF COMMON STOCK OFFERED HEREBY.
DEPENDENCE ON KEY ALLIANCES. Revenues derived from alliances with credit
bureaus and credit card processors have accounted for approximately one half of
the Company's total revenues in each of the past three fiscal years. Revenues
generated through the Company's alliances with the three major credit bureaus,
Equifax, Inc., Experian Information Solutions, Inc. (formerly TRW Information
Systems & Services) ("Experian") and Trans Union Corporation, each accounted for
approximately eight to eleven percent of the Company's total revenues in fiscal
1995, 1996 and 1997.
While the Company has been successful in extending or renewing the
agreements with its alliance partners in the past, and believes it will
generally be able to do so in the future, the loss of one or more such
agreements or an adverse change in terms could have a material adverse effect on
the Company's revenues and operating margin. In 1996, Experian was acquired by
C.C.N. Systems Limited ("CCN"). CCN is the Company's largest competitor,
worldwide, in the area of credit scoring. Experian has offered scoring products
developed by CCN in competition with those of the Company for several years.
Since its acquisition by CCN, Experian has continued to cooperate with the
Company with respect to the Company products previously covered by the
companies' agreement and has also added a new product of the Company. However,
there can be no assurance that the Company's alliance with Experian will not be
materially adversely affected by the acquisition of Experian by CCN. The loss or
adverse change in terms of this alliance could have a material adverse effect on
the Company's future revenues and operating margin.
REGULATION OF THE CONSUMER CREDIT AND INSURANCE INDUSTRIES. The consumer
credit and insurance industries are subject to extensive regulation at the
federal and state levels and a significant number of the Company's clients
operate subject to such regulation. No assurance can be made that changes in
current or future laws or regulations governing the consumer credit or insurance
industries adopted at the local, state or federal levels would not have a
material adverse effect on the Company's business. In addition, the Company
believes that enacted or proposed state regulation has had a negative impact on
its efforts to sell insurance risk scores through credit reporting agencies.
Similarly, foreign privacy regulations might have adverse effects on the
Company's overseas businesses.
DEPENDENCE ON KEY PERSONNEL AND SKILLED EMPLOYEES. The Company's growth
and ability to develop and produce its products and services is limited by the
rate at which it can recruit and absorb additional professional staff. The
Company seeks personnel with a high degree of expertise in several separate
disciplines, including operations research, mathematical statistics,
computer-based systems design, programming and data processing. The Company has
experienced difficulties in recruiting such qualified personnel and expects a
continuing need to expend
3
considerable resources in recruiting and training such personnel in order to
meet its plans. In addition, the loss of certain of the Company's senior
officers or a significant number of its sales or technical employees would
adversely affect its business.
LIMITED ABILITY TO EXPAND BUSINESS IN NORTH AMERICAN CREDIT INDUSTRY;
UNCERTAINTY OF EXPANSION IN NEW INDUSTRIES IN OVERSEAS MARKETS. The Company
believes that it holds the major share of the mature North American credit
scoring and account management markets. The Company believes that its long-term
growth prospects will thus rest, among other factors, on the Company's ability
to increase its penetration of established or emerging credit markets outside
the United States and Canada and to expand in new industries worldwide. The
percentage of the Company's revenues derived from customers outside the United
States was approximately 17 percent in fiscal 1997, 17 percent in fiscal 1996
and 14 percent in fiscal 1995, with Canada, the United Kingdom and Germany being
the largest international market segments. While the Company is actively
pursuing new international users, there can be no assurance that the Company
will be able to attract additional overseas customers for its products and
services on acceptable terms or develop a substantially expanded international
business that is sustainably profitable.
UNCERTAINTY OF PROTECTION OF PATENTS AND PROPRIETARY RIGHTS. The
Company's business and competitive position are dependent in part on the
Company's ability to protect its proprietary information and software
technology. Despite the Company's efforts to protect its proprietary information
and software technology, unauthorized parties may attempt to obtain and use
information that the Company regards as proprietary. The Company relies upon the
laws protecting trade secrets and upon contractual non-disclosure safeguards,
including its employee non-disclosure agreements and restrictions on
transferability that are incorporated into its customer agreements, to protect
its software and proprietary interests in its product methodology and know-how.
There can be no assurance, however, that these agreements will provide
meaningful protection for the Company's trade secrets or other proprietary
information in the event of unauthorized use or disclosure of such information.
The Company currently has one patent application pending but does not
otherwise have patent protection for any of its programs or algorithms, nor does
it believe that the law of copyrights affords any significant protection for its
proprietary software. The Company instead relies principally upon such factors
as the knowledge, ability and experience of its personnel, new products,
frequent product enhancements and name recognition for its success and growth.
The Company retains title to and protects the suite of algorithms and software
used to develop scoring algorithms as a trade secret and has never distributed
its source code. In spite of these precautions, there can be no assurance that
others will not independently develop substantially equivalent proprietary
information and techniques or otherwise gain access to the Company's proprietary
information, that such information will not be disclosed or that the Company can
effectively protect its rights to unpatented trade secrets. In addition, the
laws of some foreign countries do not protect the Company's proprietary rights
to the same extent as do the laws of the United States.
COMPETITION AND TECHNOLOGICAL CHANGES. As credit scoring, automated
application processing, behavioral scoring algorithms and account management
systems have become standard tools for credit providers, competition has emerged
from five sectors: scoring algorithm builders, providers of automated
application processing services, data vendors, neural network developers and
artificial intelligence system builders. It is likely that a number of new
entrants will be attracted to the market, including both large and small
companies. In-house analytic and systems developers are also a significant
source of competition for the Company. The Company will need to continue to
enhance its existing products and services and meet increasing demands for
competitive pricing, service quality and availability of new or enhanced product
offerings if it is to maintain a competitive position in its existing markets
and in any additional markets that the Company may enter. Many of the Company's
present and potential competitors have substantially greater financial,
managerial, marketing and technological resources than the Company.
The Company competes with data vendors in the market for its credit
bureau scoring services including PreScore(R) and ScoreNetSM. In the past
several years, data vendors, including all of the major credit card bureaus,
have expanded their services to include evaluation of the raw data they provide.
All of the major credit bureaus offer competing prescreening and credit bureau
scoring services developed, in some cases, in conjunction with the Company's
primary scoring algorithm competitor, CCN. See "--Dependence on Key Alliances."
4
Competitive pressures in the markets for credit scoring and credit
account management systems, marketing, data processing and database maintenance
and enterprise-wide risk management systems, could result in reduced market
share for the Company, lower margins and increased expenditures on marketing,
product development and systems support, each of which could adversely affect
the Company's financial condition and operating results.
CHANGING CONDITIONS IN THE CONSUMER CREDIT INDUSTRY; GENERAL ECONOMIC
AND MARKET CONDITIONS. The Company's success depends primarily on continued
demand by companies in the consumer credit industry for the Company's products
and services. The Company's operations may in the future be subject to
substantial period-to-period fluctuations as a consequence of economic downturns
experienced by consumer credit companies that lead to reduced credit
solicitation, general domestic and foreign economic conditions affecting the
timing of orders from major customers, the current market-driven pressures on
companies to consolidate and reduce costs and other factors affecting demand for
the Company's products and services, including a decrease in the interest rate
spread available to credit grantors and oversaturation of consumer credit
markets. There can be no assurance that such factors will not have a material
adverse effect on the Company's business, operating results and financial
condition.
FLUCTUATIONS IN OPERATING RESULTS. The Company's operating results may
fluctuate significantly in the future as a result of a variety of factors,
including changes in the demand for the Company's products and services, the
nature, pricing and timing of the Company's products and services provided to
the Company's customers, changes in the level of credit solicitation by the
Company's customers and potential customers and the introduction of competing
products or services. The need for continued investment in development of the
Company's products and services and for extensive customer support capabilities
results in significant fixed expenses. If revenue in a particular period does
not meet expectations, the Company would not be able to adjust significantly its
level of expenditures in such period, which would have an adverse effect on the
Company's operating results. The Company believes that quarterly comparisons of
its financial results will not necessarily be meaningful and should not be
relied on as an indication of future performance.
FORWARD-LOOKING STATEMENTS. Prospective investors are cautioned that the
statements in this Prospectus or in documents incorporated by reference herein
that are not descriptions of historical facts may be forward-looking statements
that are subject to risks and uncertainties. Actual results could differ
materially from those currently anticipated because of a number of factors,
including those identified herein under "Risk Factors" and elsewhere in this
Prospectus or in documents incorporated by reference herein.
MARKET VOLATILITY. The market for the Company's stock is highly
volatile. The trading price of the Company Common Stock has been and will
continue to be subject to fluctuations in response to operating and financial
results, announcements of technological innovations, new products or customer
contracts by the Company or its competitors, changes in the Company's or its
competitors' product mix or product direction, changes in the Company's revenue
mix and revenue growth rates, changes in expectations of growth for the industry
in which the Company's operations, as well as other events or factors.
Statements or changes in opinions, ratings or earnings estimates made by
brokerage firms and industry analysts relating to the market in which the
Company does business, companies with which the Company competes or relating to
the Company specifically could have an immediate and adverse effect on the
market price of the Company's stock. In addition, the stock market has from time
to time experienced extreme price and volume fluctuations that have particularly
affected the market price for many high-technology companies and that often have
been unrelated to the operating performance of these companies. These broad
market fluctuations may adversely affect the market price of the Company's
Common Stock.
USE OF PROCEEDS
The Company will not receive any proceeds from the sale of the Shares by
the Selling Stockholders.
5
SELLING STOCKHOLDERS
The following table sets forth certain information as of December 5,
1997 regarding the beneficial ownership of Common Stock by each of the Selling
Stockholders and the Shares offered hereby by such Selling Stockholders.
Shares Shares
Beneficially Number of Beneficially
Owned Prior Shares Owned After
to Offering(1)(2) Being Offered Offering(1)(2)(3)
------------------- ------------- -------------------
Number Percent Number Percent
------ ------- ------ -------
Lloyd Jefferson Braswell................. 186,478 1.4 12,854 173,624 1.3
James T. Fan............................. 95,992 * 9,000 86,992 *
Robert Ferguson.......................... 178,969 1.3 46,368 132,601 *
David M. LaCross (4)..................... 351,968 2.6 25,000 326,968 2.4
Leland Prussia........................... 43,392 * 5,000 38,392 *
Software Alliance LLC.................... 249,526 1.9 112,286 137,240 1.0
- -------------
* Less than 1%.
(1) Information with respect to beneficial ownership is based upon
information obtained from the Selling Stockholders, has been computed in
accordance with Rule 13d-3 promulgated under the Exchange Act and is
based upon 13,507,887 shares of Common Stock outstanding as of December
5, 1997. Includes shares held in escrow pursuant to an Escrow Agreement
dated as of June 23, 1997 among the Company, the Selling Stockholders
and First Trust of California, N.A., as escrow agent.
(2) Includes shares of Common Stock which may be acquired pursuant to the
exercise of options exercisable on December 5, 1997 or within 60 days
thereafter, as follows: Mr. Braswell, 136,668; Mr. Fan, 74,301; Mr.
Ferguson, 75,928; and Mr. LaCross, 129,613.
(3) Assumes the sale of all Shares offered hereby and no other purchases or
sales of Common Stock. See "Plan of Distribution."
(4) Includes 222,355 shares held by the David M. LaCross & Kathleen O.
LaCross Trust UA dated April 2, 1997 (the "LaCross Trust"), of which
David M. LaCross and Kathleen O. LaCross are trustees. As such, each of
David M. LaCross and Kathleen O. LaCross is deemed beneficially to own
the number of shares held by the LaCross Trust.
All of the Selling Stockholders received their respective shares of
Common Stock in connection with the acquisition by the Company in 1997 of Risk
Management Technologies ("RMT"), of which the Selling Stockholders were
shareholders. Prior to the acquisition of RMT by the Company, David LaCross was
Chief Executive Officer and a director of RMT. Mr. LaCross is currently
President, Chief Executive Officer and a director of RMT. Prior to the
acquisition of RMT by the Company, L. Jefferson Braswell was President and a
director of RMT. Mr. Braswell is currently Chief Technology Officer and
a director of RMT. Prior to the acquisition of RMT by the Company, James Fan was
a Vice President of RMT and Robert Ferguson was a Vice President and a director
of RMT.
PLAN OF DISTRIBUTION
Sales of the Shares may be effected by or for the account of the Selling
Stockholders from time to time in transactions on the NYSE (either in ordinary
brokerage transactions or in block transactions), in negotiated transactions,
through a combination of such methods of sale, or otherwise, at fixed prices
that may be changed, at market prices prevailing at the time of sale, at prices
related to prevailing market prices, or at negotiated prices. The consideration
for the Shares may be in the form of cash or securities or such other form of
consideration as may be
6
acceptable to the Selling Stockholders. The Selling Stockholders may effect such
transactions by selling the Shares directly to purchasers, through
broker-dealers acting as agents for the Selling Stockholders, or to
broker-dealers who may purchase Shares as principals and thereafter sell the
Shares from time to time in transactions on the NYSE, in negotiated
transactions, through a combination of such methods of sale, or otherwise. In
effecting sales, broker-dealers engaged by a Selling Stockholders may arrange
for other broker-dealers to participate. Such broker-dealers, if any, may
receive compensation in the form of discounts, concessions or commissions from
the Selling Stockholders and/or the purchasers of the Shares for whom such
broker-dealers may act as agents or to whom they may sell as principals, or both
(which compensation as to a particular broker-dealer might be in excess of
customary commissions).
The Selling Stockholders and any broker-dealers, agents or underwriters
that participate with the Selling Stockholders in the distribution of the Shares
may be deemed to be "underwriters" within the meaning of the Securities Act. Any
commissions paid or any discounts or concessions allowed to any such persons,
and any profits received on the resale of the Shares purchased by them may be
deemed to be underwriting commissions or discounts under the Securities Act.
The Company has agreed to bear all expenses of registration of the
Shares (other than fees and expenses, if any, of counsel or other advisors to
the Selling Stockholders). Any commissions, discounts, concessions or other
fees, if any, payable to broker-dealers in connection with any sale of the
Shares will be borne by the Selling Stockholder selling such Shares.
LEGAL MATTERS
Certain legal matters with respect to the validity of Common Stock
offered hereby are being passed upon for the Company by Peter L. McCorkell,
Senior Vice President and General Counsel for the Company.
EXPERTS
The financial statements and schedule of the Company as of September 30,
1996 and 1995, and for each of the years in the three-year period ended
September 30, 1996, have been incorporated by reference herein and in the
registration statement in reliance upon the report of KPMG Peat Marwick LLP,
independent certified public accountants, incorporated by reference herein, and
upon the authority of said firm as experts in accounting and auditing.
7
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the various expenses payable by the
Registrant in connection with the sale and distribution of the securities being
registered hereby. Normal commission expenses and brokerage fees are payable
individually by the Selling Stockholders. All amounts are estimated except the
Securities and Exchange Commission registration fee.
Amount
------
SEC registration fee................ $ 2,482.14
Accounting fees and expenses........ 2,000.00
Legal fees and expenses............. 5,000.00
--------
Total...................... $ 9,482.14
=========
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the Delaware General Corporation Law provides for the
indemnification of officers, directors, and other corporate agents in terms
sufficiently broad to indemnify such persons under certain circumstances for
liabilities (including reimbursement for expenses incurred) arising under the
Securities Act of 1933, as amended (the "Act"). Article 6 of the Registrant's
Restated Certificate of Incorporation (Exhibit 3.1 to the Registrant's Annual
Report on Form 10-K for the year ended September 30, 1996) provides for
indemnification of the Registrant's directors, officers, employees and other
agents to the extent and under the circumstances permitted by the Delaware
General Corporation Law. The Registrant has also entered into agreements with
its directors and officers that will require the Registrant, among other things,
to indemnify them against certain liabilities that may arise by reason of their
status or service as directors or officers to the fullest extent not prohibited
by law.
ITEM 16. EXHIBITS
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
------ -----------------------
5.1 Opinion of Peter L. McCorkell, Senior Vice
President and General Counsel of the Registrant,
as to the legality of the securities being
registered.
23.1 Consent of KPMG Peat Marwick LLP.
23.2 Consent of Peter L. McCorkell, Senior Vice
President and General Counsel of the Registrant
(included in his opinion filed as Exhibit 5.1 to
this Registration Statement).
24.1 Power of Attorney (see page II-3).
ITEM 17. UNDERTAKINGS
Insofar as indemnification for liabilities arising under the Act, may be
permitted to directors, officers and controlling persons of the Registrant
pursuant to the foregoing provisions, or otherwise, the Registrant has been
II-1
advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
The undersigned Registrant hereby undertakes:
(1) To file during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Act;
(ii) to reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in this Registration Statement; and
(iii) to include any material information with respect to the
plan of distribution not previously disclosed in this Registration
Statement or any material change to such information in this
Registration Statement;
provided, however, that paragraphs (i) and (ii) do not apply if the
information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by the
Registrant pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") that are
incorporated by reference in this Registration Statement.
(2) That, for the purpose of determining any liability under the
Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at
the termination of the offering.
(4) That, for purposes of determining any liability under the
Act, each filing of the Registrant's annual report pursuant to Section
13(a) or Section 15(d) of the Exchange Act that is incorporated by
reference in this Registration Statement shall be deemed to be a new
registration statement relating to the securities offered herein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
II-2
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3, and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of San Rafael, State of California, on December 17,
1997.
FAIR, ISAAC AND COMPANY, INCORPORATED
By /s/ PETER L. McCORKELL
---------------------------------------
Peter L. McCorkell
Senior Vice President, Secretary
and General Counsel
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints PETER L. McCORKELL his or her
attorney-in-fact with full power of substitution, for him or her in any and all
capacities, to sign any amendments to this Registration Statement on Form S-3
and to file the same, with exhibits thereto and other documents in connection
therewith, with the Securities and Exchange Commission, hereby ratifying and
confirming all that each of said attorney-in-fact, or his substitute or
substitutes may do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this report has been signed below by the following persons on behalf of the
registrants and in capacities and on the dates indicated.
Name Title Date
---- ----- ----
/s/ LARRY E. ROSENBERGER President, Chief Executive
- ------------------------ Officer (Principal Executive
Larry E. Rosenberger Officer) and Director December 17, 1997
/s/ PATRICIA COLE Senior Vice President, Chief
- ------------------------ Financial Officer and
Patricia Cole Controller (Principal Financial
and Accounting Officer) December 17, 1997
/s/ A. GEORGE BATTLE
- ------------------------
A. George Battle Director December 17, 1997
/s/ BRYANT J. BROOKS
- ------------------------
Bryant J. Brooks Director December 17, 1997
/s/ H. ROBERT HELLER
- ------------------------
H. Robert Heller Director December 17, 1997
/s/ GUY R. HENSHAW
- ------------------------
Guy R. Henshaw Director December 17, 1997
/s/ DAVID S. P. HOPKINS
- ------------------------
David S. P. Hopkins Director December 17, 1997
/s/ ROBERT M. OLIVER
- ------------------------
Robert M. Oliver Director December 17, 1997
/s/ ROBERT D. SANDERSON
- ------------------------
Robert D. Sanderson Director December 17, 1997
II-3
Name Title Date
---- ----- ----
/s/ JOHN D. WOLDRICH
- ------------------------
John D. Woldrich Director December 17, 1997
II-4
EXHIBIT INDEX
EXHIBIT NUMBER DESCRIPTION OF DOCUMENT
- -------------- -----------------------
5.1 Opinion of Peter L. McCorkell, Senior Vice President and
General Counsel of the Registrant, as to the legality of the
securities being registered.
23.1 Consent of KPMG Peat Marwick LLP.
23.2 Consent of Peter L. McCorkell, Senior Vice President and
General Counsel of the Registrant (included in his opinion
filed as Exhibit 5.1 to this Registration Statement).
24.1 Power of Attorney (see page II-3).
EXHIBIT 5.1
[FAIR, ISAAC AND COMPANY, INCORPORATED LETTERHEAD]
December 17, 1997
Fair, Isaac and Company, Incorporated
120 North Redwood Drive
San Rafael, CA 94903
Re: Registration Statement on Form S-3
Ladies and Gentlemen:
I am General Counsel of Fair, Isaac and Company, Incorporated, a
Delaware corporation (the "Company"). In that capacity I have reviewed the
Registration Statement on Form S-3 to be filed by the Company with the
Securities and Exchange Commission under the Securities Act of 1933, as amended,
with respect to 210,508 shares of the Company's common stock, par value $0.01
per share (the "Common Stock"), to be offered and sold by certain stockholders
of the Company (the "Selling Stockholders"). As General Counsel, I am familiar
with the Company's Certificate of Incorporation and its By-Laws, as amended to
date. I have also examined such other documents, corporate records and
instruments as I have deemed necessary or appropriate for the purpose of this
opinion.
Based upon the foregoing, I am of the opinion that such shares of
Common Stock of the Company to be offered and sold by the Selling Stockholders
have been duly authorized and legally issued and are fully paid and
nonassessable.
I hereby consent to the filing of this opinion with the Securities and
Exchange Commission as Exhibits 5.1 and 23.2 and to the use of my name under the
caption "Legal Matters" in the Registration Statement and in the Prospectus
included therein.
Very truly yours,
/s/ Peter L. McCorkell
Peter L. McCorkell
Senior Vice President and
General Counsel
EXHIBIT 23.1
CONSENT OF KPMG PEAT MARWICK LLP, INDEPENDENT AUDITORS
The Board of Directors
Fair, Isaac and Company, Incorporated:
We consent to incorporation by reference in the registration statement
on Form S-3 of Fair, Isaac and Company, Incorporated and subsidiaries of our
reports dated October 23, 1996, except as to note 16, which is as of November 4,
1996, relating to the consolidated balance sheets of Fair, Isaac and Company,
Incorporated and subsidiaries as of September 30, 1996 and 1995, and the related
statements of income, stockholders' equity, and cash flows and the related
financial schedule for each of the years in the three-year period ended
September 30, 1996, which reports appear in the September 30, 1996 annual report
on Form 10-K of Fair, Isaac and Company, Incorporated and subsidiaries. We also
consent to the reference to our Firm under the heading "Experts" in the
registration statement.
KPMG PEAT MARWICK LLP
San Francisco, California
December 15, 1997
