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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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SCHEDULE 13D
EVOLVE SOFTWARE, INC.
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(Name of Issuer)
Common Stock, $0.001 Par Value
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(Title of Class of Securities)
30049P104
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(CUSIP Number)
Scott A. Arenare, Esq.
Vice President and General Counsel
Warburg Pincus LLC
466 Lexington Avenue
New York, New York 10017
(212) 878-0600
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(Name, Address and Telephone Number of
Person Authorized to Receive Notices
and Communications)
Copies to:
Francis S. Currie, Esq.
Davis Polk & Wardwell
1600 El Camino Real
Menlo Park, California 94025
(650) 752-2000
September 23, 2001
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(Date of Event which Requires Filing of this Statement)
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If the filing person has previously filed a statement on Schedule 13G to
report the acquisition that is the subject of this Schedule 13D, and is filing
this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the
following box [ ].
Note. Schedules filed in paper format shall include a signed original and
five copies of the schedule, including all exhibits. See Rule 13d-7 for other
parties to whom copies are to be sent.
* The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which would
alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
(Continued on following pages)
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CUSIP No. 30049P104 13D
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1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Warburg Pincus Private Equity VIII, L.P. I.R.S. #13-416869
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
WC
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
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7 SOLE VOTING POWER
0
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NUMBER OF SHARES 8 SHARED VOTING POWER
BENEFICIALLY OWNED BY EACH 60,773,430(1)
REPORTING PERSON WITH -----------------------------------------
9 SOLE DISPOSITIVE POWER
0
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10 SHARED DISPOSITIVE POWER
50,003,298(2)
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
60,773,430(1)
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
67.4%(3)
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14 TYPE OF REPORTING PERSON*
PN
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[*SEE INSTRUCTIONS BEFORE FILLING OUT!]
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(1) Includes 50,000,000 shares of Common Stock that may be acquired within
60 days pursuant to the Purchase Agreement (discussed in Items 3-5), 10,770,132
shares of Common Stock held by certain other stockholders of the issuer that
are subject to the Voting Agreement (discussed in Item 6) and 3,298 shares of
Common Stock owned by a Member and Managing Director of Warburg Pincus LLC and
Partner of Warburg Pincus & Co.
(2) Includes 50,000,000 shares of Common Stock that may be acquired within
60 days pursuant to the Purchase Agreement and 3,298 shares of Common Stock
owned by a Member and Managing Director of Warburg Pincus LLC and Partner of
Warburg Pincus & Co.
(3) Calculated in accordance with Rule 13d-3 under the Exchange Act, based
upon the number of shares of Common Stock outstanding as of August 31, 2001 (as
represented by the issuer in the Purchase Agreement) and including shares
issuable within 60 days to the Reporting Persons.
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CUSIP No. 30049P104 13D
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1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Warburg Pincus & Co. I.R.S. #13-6358475
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)[ ]
(b)[X]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
N/A
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
New York
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7 SOLE VOTING POWER
0
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NUMBER OF SHARES 8 SHARED VOTING POWER
BENEFICIALLY OWNED BY EACH 60,773,430(1)
REPORTING PERSON WITH -----------------------------------------
9 SOLE DISPOSITIVE POWER
0
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10 SHARED DISPOSITIVE POWER
50,003,298(2)
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
60,773,430(1)
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
67.4%(3)
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14 TYPE OF REPORTING PERSON*
PN
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[*SEE INSTRUCTIONS BEFORE FILLING OUT!]
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(1) Includes 50,000,000 shares of Common Stock that may be acquired within
60 days pursuant to the Purchase Agreement (discussed in Items 3-5), 10,770,132
shares of Common Stock held by certain other stockholders of the issuer that
are subject to the Voting Agreement (discussed in Item 6) and 3,298 shares of
Common Stock owned by a Member and Managing Director of Warburg Pincus LLC and
Partner of Warburg Pincus & Co.
(2) Includes 50,000,000 shares of Common Stock that may be acquired within
60 days pursuant to the Purchase Agreement and 3,298 shares of Common Stock
owned by a Member and Managing Director of Warburg Pincus LLC and Partner of
Warburg Pincus & Co.
(3) Calculated in accordance with Rule 13d-3 under the Exchange Act, based
upon the number of shares of Common Stock outstanding as of August 31, 2001 (as
represented by the issuer in the Purchase Agreement) and including shares
issuable within 60 days to the Reporting Persons.
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CUSIP No. 30049P104 13D
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1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Warburg Pincus LLC I.R.S. #13-3536050
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [X]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
N/A
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
New York
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7 SOLE VOTING POWER
0
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NUMBER OF SHARES 8 SHARED VOTING POWER
BENEFICIALLY OWNED BY EACH 60,773,430(1)
REPORTING PERSON WITH -----------------------------------------
9 SOLE DISPOSITIVE POWER
0
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10 SHARED DISPOSITIVE POWER
50,003,298(2)
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
60,773,430(1)
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
67.4%(3)
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14 TYPE OF REPORTING PERSON*
OO
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[*SEE INSTRUCTIONS BEFORE FILLING OUT!]
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(1) Includes 50,000,000 shares of Common Stock that may be acquired within
60 days pursuant to the Purchase Agreement (discussed in Items 3-5), 10,770,132
shares of Common Stock held by certain other stockholders of the issuer that
are subject to the Voting Agreement (discussed in Item 6) and 3,298 shares of
Common Stock owned by a Member and Managing Director of Warburg Pincus LLC and
Partner of Warburg Pincus & Co.
(2) Includes 50,000,000 shares of Common Stock that may be acquired within
60 days pursuant to the Purchase Agreement and 3,298 shares of Common Stock
owned by a Member and Managing Director of Warburg Pincus LLC and Partner of
Warburg Pincus & Co.
(3) Calculated in accordance with Rule 13d-3 under the Exchange Act, based
upon the number of shares of Common Stock outstanding as of August 31, 2001 (as
represented by the issuer in the Purchase Agreement) and including shares
issuable within 60 days to the Reporting Persons.
Page 4 of 12
This Schedule 13D is being filed on behalf of Warburg Pincus Private
Equity VIII, L.P., a Delaware limited partnership ("WP VIII"), Warburg Pincus
LLC, a New York limited liability company ("WP LLC") and Warburg, Pincus & Co.,
a New York general partnership ("WP," and together with WP VIII and WP LLC, the
"Reporting Persons").
The Reporting Persons are making this single, joint filing because they
may be deemed to constitute a "group" within the meaning of Section 13(d)(3) of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The
agreement among the Reporting Persons to file jointly (the "Joint Filing
Agreement") is attached hereto as Exhibit 1. Unless the context otherwise
requires, references herein to the "Common Stock" are to shares of common
stock, par value $0.001 per share of Evolve Software, Inc., a Delaware
corporation (the "Company"). Each Reporting Person disclaims beneficial
ownership of all shares of Common Stock, other than those reported herein as
being owned by it.
Item 1. Security and Issuer.
This statement on Schedule 13D relates to the Common Stock, and is being
filed pursuant to Rule 13d-1 of the Exchange Act. The address of the principal
executive offices of the Company is 1400 65th Street, Suite 100, Emeryville,
California 94608.
Item 2. Identity and Background.
(a) This statement is filed by the Reporting Persons. The Reporting
Persons are deemed to be a group within the meaning of Rule 13d-5. The sole
general partner of WP VIII is WP. WP LLC manages WP VIII. Lionel I. Pincus is
the managing partner of WP and the managing member of WP LLC and may be deemed
to control both WP and WP LLC. The general partners of WP and the members of WP
LLC, and their respective business addresses and principal occupations are set
forth on Schedule I hereto.
(b) The address of the principal business and principal office of each of
the Reporting Persons is 466 Lexington Avenue, New York, New York 10017.
(c) The principal business of WP VIII is that of making venture capital
and related investments. The principal business of WP is acting as general
partner of WP VIII, Warburg, Pincus Equity Partners, L.P., Warburg Pincus
International Partners, L.P., Warburg, Pincus Ventures International, L.P.,
Warburg, Pincus Ventures, L.P. and Warburg, Pincus Investors, L.P. and certain
related funds. The principal business of WP LLC is acting as manager of WP
VIII, Warburg, Pincus Equity Partners, L.P., Warburg Pincus International
Partners, L.P., Warburg, Pincus Ventures International L.P., Warburg, Pincus
Ventures, L.P., Warburg, Pincus Investors, L.P. and certain related funds.
(d) None of the Reporting Persons, nor, to the best of their knowledge,
any of the directors, executive officers, control persons, general partners or
members referred to in paragraph (a) above has, during the last five years,
been convicted in a criminal proceeding (excluding traffic violations or
similar misdemeanors).
(e) None of the Reporting Persons, nor, to the best of their knowledge,
any of the directors, executive officers, control persons, general partners or
members referred to in paragraphs (a) and (d) above has, during the last five
years, been a party to a civil proceeding of a judicial or administrative body
of competent jurisdiction and as a result of such proceeding was or is subject
to a judgment, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, federal or state securities
laws or finding any violation with respect to such laws.
(f) Except as otherwise indicated above or on Schedule I hereto, each of
the individuals referred to in paragraphs (a) and (d) above is a United States
citizen.
Page 1 of 6
Item 3. Source and Amount of Funds or Other Consideration.
Pursuant to the Series A Preferred Stock Purchase Agreement (the "Purchase
Agreement") attached hereto as Exhibit 2, dated as of September 23, 2001, by
and between WP VIII, the Company and certain other investors named in the
Schedule of Purchasers to the Purchase Agreement, (1) WP VIII agreed to
purchase 1,000,000 shares of the Company's Series A Preferred Stock (the
"Series A Preferred Stock") at a price of $10 per share, with the purchase
price to be paid in cash at the Closing, as defined in the Purchase Agreement;
(2) upon the Closing, the Company will issue to WP VIII warrants to purchase up
to an aggregate of 1,000,000 additional shares of Series A Preferred Stock at a
price of $10 per share in cash, which warrants are exercisable for up to one
year after the Closing in certain circumstances, in the forms attached hereto
as Exhibit 3 ("Preferred Stock Warrants"); (3) upon the Closing, the Company
will issue to WP VIII a warrant to purchase up to 5,000,000 shares of Common
Stock at a price of $1.00 per share in the form attached hereto as Exhibit 4
("Common Stock Warrant") and (4) the Company agreed to grant to WP VIII
additional Common Stock Warrants to purchase that number of shares of Common
Stock equal to 25% of the number of shares of Common Stock into which the
shares of Series A Preferred Stock issued upon exercise of the Preferred Stock
Warrants are convertible, at the time such Preferred Stock Warrants are
exercised. Each share of Series A Preferred Stock will be convertible into
Common Stock at an initial conversion price of $0.50, or at an initial
conversion rate of 20 shares of Common Stock for each share of Series A
Preferred Stock converted, subject to certain adjustments as set forth in the
Certificate of Designation of Series A Preferred Stock of the Company, attached
hereto as Exhibit 5 (the "Certificate of Designation").
The total amount of funds required to purchase the Series A Preferred
Stock at the Closing pursuant to the Purchase Agreement will be $10,000,000 and
will be furnished from the working capital of WP VIII. If WP VIII elects to
exercise the Preferred Stock Warrants in full, the total amount of funds that
will be required to purchase the additional shares of Series A Preferred Stock
issuable upon such exercise will be $10,000,000, which will be furnished from
the working capital of WP VIII. If WP VIII elects to exercise the Common Stock
Warrants in full for cash, the total amount of funds that will be required to
purchase the Common Stock pursuant to such warrants will be $5,000,000
($10,000,000 if the Preferred Stock Warrants are exercised in full), which will
be provided from the working capital of WP VIII. However, the Common Stock
Warrants provide WP VIII the option to convert such warrants on a cashless
basis by electing to have the Company withhold a number of shares otherwise
issuable upon exercise of the Warrants that is equal in value at the time of
conversion to the aggregate exercise price of the Common Stock Warrants. WP
VIII has not made any determination as to whether it would exercise the Common
Stock Warrants, if at all, either for cash or on a cashless basis. Except as
otherwise expressly stated, all shares are reported on a common stock
equivalent basis, assuming that all warrants issued or issuable pursuant to the
Purchase Agreement are exercised in full for cash.
Item 4. Purpose of Transaction.
The transactions described herein are being effected because of the
Reporting Persons' belief that the Company represents an attractive investment
based on the Company's business prospects and strategy. Depending on prevailing
market, economic and other conditions, the Reporting Persons may from time to
time acquire additional shares of the Company or engage in discussions with the
Company concerning further acquisitions of shares of the Company or further
investments by them in the Company. The Reporting Persons intend to review
their investment in the Company on a continuing basis and, depending upon the
price and availability of shares of Common Stock, subsequent developments
affecting the Company, the Company's business and prospects, other investment
and business opportunities available to the Reporting Persons, general stock
market and economic conditions, tax considerations and other factors considered
relevant may decide at any time to increase or to decrease the size of their
investment in the Company.
WP VIII entered into the Purchase Agreement pursuant to which the Company
agreed to issue and sell and WP VIII agreed to purchase the number of shares of
Series A Preferred Stock at the Closing and the Company agreed to issue to
Page 2 of 6
WP VIII at the Closing the Preferred Stock Warrants and Common Stock Warrants,
all as described in Item 3 above. The Series A Preferred Stock and Common Stock
Warrants contain adjustment provisions pursuant to which, in certain
circumstances, WP VIII may be entitled to acquire additional shares of the
Company's Common Stock. In addition, the number of shares of Common Stock into
which the Preferred Stock is convertible will increase at the rate of 8.00% per
year from the date of issue. As a condition to closing under the Purchase
Agreement, the Company will file the Certificate of Designation, which provides
that the Series A Preferred Stock shall have dividend, liquidation, conversion
and voting rights in preference to the Common Stock. Descriptions of such
rights contained herein are qualified in their entirety by reference to the
Form of Certificate of Designation attached as Exhibit 5 hereto.
Conversion of Series A Preferred Stock. Pursuant to the Certificate of
Designation, the Company may cause all of the shares of Series A Preferred
Stock to be automatically converted into Common Stock at any time after the
fifth anniversary of the date of initial issuance of such shares, provided that
the Company may only cause such automatic conversion if the closing price per
share of Common Stock for thirty (30) consecutive trading days ending within
ten (10) days of the date on which notice of such automatic conversion is given
to the holders of the Series A Preferred Stock shall have been at least $5.00,
as adjusted for any stock splits, stock dividends and similar events. All
shares of the Series A Preferred Stock will also automatically convert into
Common Stock at the election of the holders of a majority of the outstanding
shares of Series A Preferred Stock. The Series A Preferred Stock may also be
converted at any time at the election of each holder.
Voting. As set forth in the Certificate of Designation, holders of Series
A Preferred Stock are entitled to vote such stock on an as converted basis,
together with the holders of Common Stock as a single class with respect to all
matters, except under specified circumstances described below under "Board
Representation" with respect to the election of directors and under "Change of
Control," with respect to certain Change of Control transactions. In addition,
the Company will not, without the affirmative vote of the holders of a majority
of the outstanding Shares, (i) amend or repeal the provisions of the
Certificate of Designation; (ii) authorize or issue any shares of a class or
series senior to the Series A Preferred Stock or any bonds, debentures, notes
or other obligations convertible into or exchangeable for, or having option
rights to purchase, any shares of stock senior to the Series A Preferred Stock;
(iii) issue any bonds, debentures or notes or incur similar debt obligations,
other than trade debt in the ordinary course of business; (iv) pay any dividend
on any shares of stock junior to the Series A Preferred Stock or repurchase or
redeem any such shares of stock junior to the Series A Preferred Stock, except
for repurchases of unvested shares of stock at cost from employees, directors,
consultants and other service providers; (v) repurchase any outstanding shares
of stock, except for repurchase of shares held by employees pursuant to
repurchase agreements approved by the board of directors and redemption of
shares of Series A Preferred Stock; (vi) amend the bylaws to increase the
authorized number of directors of the Company to more than eight; or (vii)
authorize or issue any shares of any class or series of stock on parity with
the Series A Preferred Stock or any bonds, debentures, notes or other
obligations convertible into or exchangeable for, or having option rights to
purchase, any shares of stock on parity with the Series A Preferred Stock
unless Preferred Stock Warrants are not exercised to purchase 500,000 or more
shares of Series A Preferred Stock prior to the six-month anniversary of the
date of first issuance of Series A Preferred Stock.
Board Representation. The terms of the Series A Preferred Stock, as set
forth in the Certificate of Designation, provide for holders of the Series A
Preferred Stock to elect three members to the Board, voting separately as a
class. Except as described in the next sentence, this provision remains in
effect for so long as at least 75% of the shares of Series A Preferred Stock
issued by the Company remain outstanding. If less than 75% but at least 50% of
the shares of Series A Preferred Stock issued by the Company remain
outstanding, or if WP VIII does not exercise Preferred Stock Warrants to
purchase at least 500,000 shares of Series A Preferred Stock, the number of
directors to be elected by holders of Series A Preferred Stock voting
separately shall be reduced to two. If less than 50% but at least 25% of the
shares of Series A Preferred Stock issued by the Company remain outstanding,
the number of directors to be elected by holders of the Series A Preferred
Stock voting separately shall be reduced to one. If less than 25% of the shares
of Series A Preferred Stock issued by the Company remain outstanding, the
holders of Series A Preferred Stock will no longer have the right to elect any
members of the board of directors voting separately. All other directors will
be elected by the holders of the Common Stock and the Series A Preferred Stock
voting as a single class. The initial designees of the holders of Series A
Preferred Stock, Cary Davis, Nancy Martin and Gayle Crowell, will be appointed
to the Board effective as of the Closing. Mr. Davis and Ms. Martin are Members
and Managing Directors of WP LLC and are Partners of WP. Ms. Crowell is a
full-time adviser of WP LLC.
Page 3 of 6
Change of Control. Under the Certificate of Designation, the Company may
not consummate any Change of Control Transaction, as defined the Certificate of
Designation, without the affirmative vote of holders of a majority of the
outstanding shares of Series A Preferred Stock, unless such transaction would
result in aggregate consideration paid in respect of such Series A Preferred
Stock equal to the original purchase price thereof, plus an internal rate of
return equal to at least 50%. In addition, in the event of any Change of
Control Transaction, holders of Common Stock Warrants will have the right to
deliver such warrants to the Company in exchange for payments equal to the
Black-Scholes value of such warrants at the time of such transaction, payable
in cash or, subject to certain conditions, Common Stock of the Company.
Preemptive Rights. Effective as of the closing under the Purchase
Agreement and subject to certain exceptions, the Company will grant to the
purchasers of Series A Preferred Stock rights to maintain their percentage
ownership in the Company in the event of future equity issuances by the
Company. A copy of the Preemptive Rights Agreement providing for such rights is
attached as Exhibit 6 hereto.
Registration of Shares of Common Stock for Resale. Pursuant to the terms
of the Purchase Agreement, subject to certain condtions, the Company has agreed
to prepare and file with the SEC, upon request of the Purchasers of Series A
Preferred after June 1, 2002, registration statements to enable the resale of
the shares of Common Stock issued or issuable upon conversion of the Series A
Preferred Stock (including Series A Preferred Stock issuable upon exercise of
the Preferred Stock Warrants) and upon exercise or conversion of the Common
Stock Warrants.
The foregoing summary of the Purchase Agreement and the agreements and
transactions contemplated thereby is qualified in its entirety by reference to
the Purchase Agreement, the Preferred Stock Warrants, the Common Stock
Warrants, the Certificate of Designation and the Preemptive Rights Agreement,
copies of which are set forth as Exhibits 2-6 and are incorporated herein by
reference.
Except as set forth above in this statement, and in Item 6 below, none of
the Reporting Persons nor, to the best of their knowledge, any person listed on
Schedule I hereto or in Item 1(a) or (d) above, has any plans or proposals that
relate to or would result in: (a) the acquisition by any person of additional
securities of the Company, or the disposition of securities of the Company; (b)
an extraordinary corporate transaction, such as a merger, reorganization or
liquidation, involving the Company or any of its subsidiaries; (c) a sale or
transfer of a material amount of assets of the Company or any of its
subsidiaries; (d) any change in the present Board of Directors or management of
the Company, including any plans or proposals to change the number or term of
directors or to fill any existing vacancies on the board; (e) any material
change in the present capitalization or dividend policy of the Company; (f) any
other material change in the Company's business or corporate structure; (g)
changes in the Company's charter, by-laws or instruments corresponding thereto
or other actions which may impede the acquisition of control of the Company by
any person; (h) causing a class of securities of the Company to be delisted
from a national securities exchange or to cease to be authorized to be quoted
in an inter-dealer quotation system of a registered national securities
association; (i) a class of equity securities of the Company becoming eligible
for termination of registration pursuant to Section 12(g)(4) of the Exchange
Act; or (j) any action similar to any of those enumerated above.
Item 5. Interest in Securities of the Issuer.
(a) As of September 23, 2001, the Reporting Persons disclaim beneficial
ownership of any shares of Common Stock. After the closing under the Purchase
Agreement, and assuming (i) exercise of all Preferred Stock Warrants issued to
WP VIII; (ii) full conversion of the shares of Series A Preferred Stock
issuable to WP VIII at the closing and pursuant to the Preferred Stock Warrants
and (iii) full exercise for cash of all Common Stock Warrants issuable to WP
VIII at the closing and upon exercise of the Preferred Stock Warrants, WP VIII
may be deemed to beneficially own 50,000,000 shares of Common Stock,
representing approximately 55.5% of the outstanding shares of Common Stock,
based on the 40,166,616 shares of Common Stock outstanding as of August 31,
2001 (which number was represented by the Company in the Purchase Agreement to
be outstanding on that date), calculated in accordance with Rule 13d-3 under
the Exchange Act. By reason of their respective relationships with WP VIII and
each other, each of the other Reporting Persons may also be deemed under Rule
13d-3 under the Exchange Act to
Page 4 of 6
own beneficially 50,000,000 shares of Common Stock, representing approximately
55.5% of the outstanding Common Stock.
One Member and Managing Director of WP LLC and Partner of WP owns
approximately 3,298 shares of Common Stock. The Reporting Persons expressly
disclaim beneficial ownership of these shares.
In addition, and as described in Item 6, WP VIII has entered into voting
agreements with holders of 10,770,132 shares of Common Stock (the "Voting
Agreement Shares"), pursuant to which WP VIII may be deemed a beneficial owner
of such shares. Taking into account the Voting Agreement Shares, together with
the Common Stock issuable upon conversion of Series A Preferred Stock and
exercise of Common Stock Warrants issuable to WP VIII and held by the Member
and Managing Director of WP LLC and Partner of WP, WP VIII may be deemed the
beneficial owner of an aggregate of 60,773,430 shares of Common Stock, or 67.4%
of the Company's Common Stock, calculated in accordance with Rule 13d-3. WP
VIII expressly disclaims beneficial ownership of the Voting Agreement Shares.
(b) WP and WP LLC share with WP VIII the power to vote or to direct the
vote and to dispose or to direct the disposition of the 60,773,430 shares of
Common Stock it may be deemed to beneficially own.
The Reporting Persons are making this single, joint filing because they
may be deemed to constitute a "group" within the meaning of Section 13(d)(3) of
the Exchange Act. Each Reporting Person disclaims beneficial ownership of all
shares of Common Stock, other than those reported herein as being owned by it.
(c) Other than as set forth in Item 4 hereof, no transactions in the
Common Stock were effected during the last sixty days by the Reporting Persons
or any of the persons set forth on Schedule I or in Item 2(d) hereto.
(d) Except as set forth in this Item 5, no person other than each
respective record owner referred to herein of securities is known to have the
right to receive or the power to direct the receipt of dividends from, or the
proceeds from the sale of, such securities.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships With Respect
to the Securities of the Issuer.
Pursuant to Rule 13d-1(k) promulgated under the Exchange Act, the
Reporting Persons have entered into an agreement attached hereto as Exhibit 1,
with respect to the joint filing of this statement and any amendment or
amendments hereto.
As an inducement to WP VIII to enter into the Purchase Agreement, on
September 23, 2001, Sierra Ventures Group, John P. Bantleman, James J. Bozzini,
John Oltman, Kurt Heikkinen, Joseph A. Fuca, Jeff Drazan, Paul Rochester,
Judith Hamilton, Kenneth J. Bozzini, David Hsieh and Ian Reay (the
"Stockholders") of the Company, who collectively owned 10,770,132 shares of the
Company's Common Stock entered into a voting agreement (the "Voting Agreement")
with WP VIII in the form attached hereto as Exhibit 7. Pursuant to the Voting
Agreement, each of the stockholders agreed to vote (or cause to be voted) all
of the shares of the Company's stock owned or acquired by them at any meeting
of the stockholders of the Company, and in any action by written consent of the
stockholders of the Company, (i) in favor of the approval of the transactions
contemplated by the Purchase Agreement including the issuance of capital stock
of the Company pursuant thereto, (ii) in favor, to the extent it is necessary,
of an increase in the number of authorized, but unissued, shares of Company
Common Stock, in an amount determined by the Company's Board of Directors,
(iii) in favor, if proposed by the Company's Board of Directors, of a reverse
stock split of the Company's Common Stock, and (iv) in favor of any other
matter directly relating to and in furtherance of consummation of the
transactions contemplated by the Purchase Agreement. The Voting Agreement will
terminate upon the earliest to occur of the approval by the Company's
stockholders of each of the matters described above, the termination of the
Purchase Agreement according to its terms and the termination of the Voting
Agreement by mutual consent of the parties. This summary of the Voting
Agreement is qualified in its entirety by reference to the form of Voting
Agreement attached as Exhibit 7 hereto.
In addition to their outstanding shares of common stock, the Reporting
Persons have been advised by the Company that the stockholders have rights to
acquire an aggregate of 5,384,164 shares of common stock within 60 days of
the date of this filing. Any shares of common stock acquired by any stockholder
after the date hereof and prior to the termination of the Voting Agreement
would be subject to the Voting Agreement.
Page 5 of 6
The Purchase Agreement and the agreements, contemplated thereby were
entered into as of September 23, 2001 and is described in Item 3, Item 4 and
Item 5 above.
Except as described above, there are no contracts, arrangements,
understandings or relationships (legal or otherwise) among the persons named in
Item 2 above or between such persons and any other person with respect to any
securities of the Company.
Item 7. Material to be Filed as Exhibits
1. Joint Filing Agreement
2. Series A Preferred Stock Purchase Agreement, dated as of September
23, 2001, by and between the Company, WP VIII and certain other
persons.
3. Form of Form A Subscription Warrant and Form of Form B Subscription
Warrant.
4. Form of Warrant to Purchase Shares of Common Stock.
5. Form of Certificate of Designation of Series A Preferred Stock of
Evolve Software, Inc.
6. Form of Preemptive Rights Agreement between the Company, WP VIII and
certain other persons.
7. Form of Voting Agreement between WP VIII and certain stockholders of
the Company.
8. Power of Attorney.
Page 6 of 6
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: October 1 , 2001 WARBURG PINCUS PRIVATE EQUITY VIII, L.P.
By: Warburg, Pincus & Co.,
General Partner
By: /s/ Scott Arenare
---------------------------------
Name: Scott Arenare
Title: Attorney in Fact
Dated: October 1 , 2001 WARBURG PINCUS & Co.
By: /s/ Scott Arenare
---------------------------------
Name: Scott Arenare
Title: Attorney in Fact
Dated: October 1 , 2001 WARBURG PINCUS LLC
By: /s/ Scott Arenare
---------------------------------
Name: Scott Arenare
Title: Vice President
SCHEDULE I
Set forth below is the name, position and present principal occupation of
each of the general partners of Warburg, Pincus & Co. ("WP") and members of
Warburg Pincus LLC ("WP LLC"). The sole general partner of Warburg, Pincus
Private Equity VIII ("WP VIII") is WP. WP VIII, WP, and WP LLC are hereinafter
collectively referred to as the "Reporting Entities". Except as otherwise
indicated, the business address of each of such persons is 466 Lexington
Avenue, New York, New York 10017, and each of such persons is a citizen of the
United States.
GENERAL PARTNERS OF WP
PRESENT PRINCIPAL OCCUPATION IN ADDITION TO
POSITION WITH WP, AND POSITIONS WITH THE
NAME REPORTING ENTITIES
Joel Ackerman Partner of WP; Member and Managing Director of WP LLC
Gregory Back Partner of WP; Member and Managing Director of WP LLC
David Barr Partner of WP; Member and Managing Director of WP LLC
Harold Brown Partner of WP; Member and Managing Director of WP LLC
Sean D. Carney Partner of WP; Member and Managing Director of WP LLC
Timothy J. Curt Partner of WP; Member and Managing Director of WP LLC
W. Bowman Cutter Partner of WP; Member and Managing Director of WP LLC
Cary J. Davis Partner of WP; Member and Managing Director of WP LLC
Stephen Distler Partner of WP; Member and Managing Director of WP LLC
Stewart K. P. Gross Partner of WP; Member and Senior Managing Director of WP LLC
Patrick T. Hackett Partner of WP; Member and Managing Director of WP LLC
Jeffrey A. Harris Partner of WP; Member and Senior Managing Director of WP LLC
William H. Janeway Partner of WP; Member and Vice Chairman of WP LLC
Charles R. Kaye Partner of WP; Member and Executive Managing Director of WP LLC
Henry Kressel Partner of WP; Member and Senior Managing Director of WP LLC
Joseph P. Landy Partner of WP; Member and Executive Managing Director WP LLC
Sidney Lapidus Partner of WP; Member and Managing Director of WP LLC
Kewsong Lee Partner of WP; Member and Managing Director of WP LLC
Jonathan S. Leff Partner of WP; Member and Managing Director of WP LLC
Reuben S. Leibowitz Partner of WP; Member and Managing Director of WP LLC
David E. Libowitz Partner of WP; Member and Managing Director of WP LLC
Nancy Martin Partner of WP; Member and Managing Director of WP LLC
Edward J. McKinley Partner of WP; Member and Managing Director of WP LLC
Rodman W. Moorhead III Partner of WP; Member and Managing Director of WP LLC
James Neary Partner of WP; Member and Managing Director of WP LLC
Howard H. Newman Partner of WP; Member and Vice Chairman of WP LLC
Gary D. Nusbaum Partner of WP; Member and Managing Director of WP LLC
Dalip Pathak Partner of WP; Member and Managing Director of WP LLC
Lionel I. Pincus Managing Partner of WP; Managing Member, Chairman of the Board
and Chief Executive Officer of WP LLC
John D. Santoleri Partner of WP; Member and Managing Director of WP LLC
Steven G. Schneider Partner of WP; Member and Managing Director of WP LLC
PRESENT PRINCIPAL OCCUPATION IN ADDITION TO
POSITION WITH WP, AND POSITIONS WITH THE
NAME REPORTING ENTITIES
Barry Taylor Partner of WP; Member and Managing Director of WP LLC
John L. Vogelstein Partner of WP; Member, and President of WP LLC
Elizabeth H. Weatherman Partner of WP; Member and Managing Director of WP LLC
David Wenstrup Partner of WP; Member and Managing Director of WP LLC
Pincus & Co.(1)
NL & Co.(2)
--------
(1) New York limited partnership; primary activity is ownership interest
in WP and WP LLC
(2) New York limited partnership; primary activity is ownership interest
in WP.
MEMBERS OF WP LLC
PRESENT PRINCIPAL OCCUPATION IN ADDITION TO
POSITION WITH WP LLC, AND POSITIONS WITH THE
NAME REPORTING ENTITIES
Joel Ackerman Member and Managing Director of WP LLC; Partner of WP
Gregory Back Member and Managing Director of WP LLC; Partner of WP
David Barr Member and Managing Director of WP LLC; Partner of WP
Frank M. Brochin (1) Member and Managing Director of WP LLC
Harold Brown Member and Managing Director of WP LLC; Partner of WP
Sean D. Carney Member and Managing Director of WP LLC; Partner of WP
Timothy J. Curt Member and Managing Director of WP LLC; Partner of WP
W. Bowman Cutter Member and Managing Director of WP LLC; Partner of WP
Cary J. Davis Member and Managing Director of WP LLC; Partner of WP
Stephen Distler Member and Managing Director of WP LLC; Partner of WP
Tetsuya Fukagawa (2) Member and Managing Director of WP LLC
Makoto Fukuhara (2) Member and Managing Director of WP LLC
Stewart K. P. Gross Member and Senior Managing Director of WP LLC; Partner of WP
Alf Grunwald (3) Member and Managing Director of WP LLC
Patrick T. Hackett Member and Managing Director of WP LLC; Partner of WP
Jeffrey A. Harris Member and Senior Managing Director of WP LLC; Partner of WP
Sung-Jin Hwang (4) Member and Managing Director of WP LLC
Roberto Italia (5) Member and Managing Director of WP LLC
William H. Janeway Member and Vice Chairman of WP LLC; Partner of WP
Charles R. Kaye Member and Executive Managing Director of WP LLC; Partner of WP
Rajesh Khanna (6) Member and Managing Director of WP LLC
Henry Kressel Member and Senior Managing Director of WP LLC; Partner of WP
Rajiv B. Lall (6) Member and Managing Director of WP LLC
Joseph P. Landy Member and Executive Managing Director of WP LLC; Partner of WP
Sidney Lapidus Member and Managing Director of WP LLC; Partner of WP
Kewsong Lee Member and Managing Director of WP LLC; Partner of WP
Jonathan S. Leff Member and Managing Director of WP LLC; Partner of WP
Reuben S. Leibowitz Member and Managing Director of WP LLC; Partner of WP
David E. Libowitz Member and Managing Director of WP LLC; Partner of WP
Nicholas J. Lowcock (7) Member and Managing Director of WP LLC
John W. MacIntosh (8) Member and Managing Director of WP LLC
Nancy Martin Member and Managing Director of WP LLC; Partner of WP
Edward J. McKinley Member and Managing Director of WP LLC; Partner of WP
Rodman W. Moorhead III Member and Managing Director of WP LLC; Partner of WP
James Neary Member and Managing Director of WP LLC; Partner of WP
Howard H. Newman Member and Vice Chairman of WP LLC; Partner of WP
Gary D. Nusbaum Member and Managing Director of WP LLC; Partner of WP
Dalip Pathak Member and Managing Director of WP LLC; Partner of WP
PRESENT PRINCIPAL OCCUPATION IN ADDITION TO
POSITION WITH WP LLC, AND POSITIONS WITH THE
NAME REPORTING ENTITIES
Lionel I. Pincus Managing Member, Chairman of the Board and Chief Executive
Officer of WP LLC; Managing Partner of WP
Pulak Chandan Prasad (6) Member and Managing Director of WP LLC
John D. Santoleri Member and Managing Director of WP LLC; Partner of WP
Steven G. Schneider Member and Managing Director of WP LLC; Partner of WP
Melchior Stahl (3) Member and Managing Director of WP LLC
Chang Q. Sun (9) Member and Managing Director of WP LLC
Barry Taylor Member and Managing Director of WP LLC, Partner of WP
John L. Vogelstein Member and President of WP LLC; Partner of WP
Elizabeth H. Weatherman Member and Managing Director of WP LLC; Partner of WP
David Wenstrup Member and Managing Director of WP LLC; Partner of WP
Jeremy S. Young (7) Member and Managing Director of WP LLC
Pincus & Co.(1)
(1) Citizen of France
(2) Citizen of Japan
(3) Citizen of Germany
(4) Citizen of Korea
(5) Citizen of Italy
(6) Citizen of India
(7) Citizen of United Kingdom
(8) Citizen of Canada
(9) Citizen of China
--------------
(1) New York limited partnership; primary activity is ownership interest in WP
and EMW LLC
Exhibit Index
1. Joint Filing Agreement
2. Series A Preferred Stock Purchase Agreement, dated as of September 23,
2001, by and between the Company, WP VIII and certain other persons.
3. Form of Form A Subscription Warrant and Form of Form B Subscription
Warrant.
4. Form of Warrant to Purchase Shares of Common Stock.
5. Form of Certificate of Designation of Series A Preferred Stock of Evolve
Software, Inc.
6. Form of Preemptive Rights Agreement between the Company, WP VIII and
certain other persons.
7. Form of Voting Agreement between WP VIII and certain stockholders of the
Company.
8. Power of Attorney.