SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
(Rule 13d-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO
RULE 13d-2(a)
(Amendment No. _____)1
ISLAND PACIFIC, INC.
(Name of Issuer)
COMMON STOCK, $0.0001 PAR VALUE PER SHARE
(Title of Class of Securities)
464478106
(CUSIP Number)
Michael Robinson
Corporate Secretary and Group Legal Director
The Sage Group plc
Sage House
Benton Park Road
Newcastle upon Tyne NE7 7LZ, England
Telephone: +44 (191) 255 3000
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
Copy to:
Marc R. Packer, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
525 University Avenue, Suite 1100
Palo Alto, CA 94301
Telephone: (650) 470-4500
November 14, 2003
(Date of Event which Requires Filing of this Statement)
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.
1 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 (the "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).
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CUSIP NO. 464478106 13D Page 2 OF 9 Pages
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NAME OF REPORTING PERSONS
1 I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
The Sage Group plc I.D. No.
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)
2 (a) [ ]
(b) [ ]
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SEC USE ONLY
3
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SOURCE OF FUNDS (See Instructions)
4
WC
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CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
5 TO ITEMS 2(d) or 2(e)
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CITIZENSHIP OR PLACE OF ORGANIZATION
6
England
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7 SOLE VOTING POWER
NUMBER
27,406,607 (See Item 5)
OF ------- ---------------------------------------------
8 SHARED VOTING POWER
SHARES
0
BENEFICIALLY ------- ---------------------------------------------
9 SOLE DISPOSITIVE POWER
OWNED BY
27,406,607 (See Item 5)
EACH ------- ---------------------------------------------
10 SHARED DISPOSITIVE POWER
REPORTING
0
PERSON ------- ---------------------------------------------
WITH
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
27,406,607 (See Item 5)
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CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
12 SHARES (See Instructions)
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
48.4% (See Item 5)
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TYPE OF REPORTING PERSON (See Instructions)
14
CO
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ITEM 1. SECURITY AND ISSUER.
The class of equity securities to which this statement on Schedule 13D
(this "Schedule 13D") relates is the common stock, $0.0001 par value per share
(the "Common Stock"), of Island Pacific, Inc. (formerly, SVI Solutions, Inc.),
a Delaware corporation (the "Company"). The principal executive offices of the
Company are located at 19800 MacArthur Boulevard, Suite 1200, Irvine,
California 92612.
ITEM 2. IDENTITY AND BACKGROUND.
This Schedule 13D is being filed by The Sage Group plc, a company
organized under the laws of England ("Sage"). The principal business of Sage is
supplying business management software solutions and related products and
services to the small- and medium-sized business community worldwide. The
principal offices and principal business of Sage are located at Sage House,
Benton Park Road, Newcastle upon Tyne NE7 7LZ, England.
(a) - (c), (f) Certain information concerning the executive officers
and directors of Sage is set forth in Schedule A hereto and is incorporated
herein by reference.
(d) - (e) During the past five years, neither Sage nor, to the best
knowledge of Sage, any of the executive officers and directors of Sage, has
been convicted in a criminal proceeding (excluding traffic violations or
similar misdemeanors) or was a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction as a result of which any such
person 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.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
The total amount of funds used by Sage in acquiring its interest in
the Company was ZAR 174,889,027 (equivalent to $26,818,946 based on an
exchange rate of 0.14854 on November 14, 2003, the date the securities were
acquired). Sage obtained all of such funds from its working capital.
ITEM 4. PURPOSE OF TRANSACTION.
The securities of the Company to which this Schedule 13D relate were
acquired by Sage in connection with the consummation of the transactions
contemplated by the Sale of Business Agreement (the "Original Sale of Business
Agreement"), dated August 26, 2003, between Softline Limited, a company
registered in accordance with the laws of South Africa ("Softline"), and Sage
Software (SA) (Proprietary) Limited (formerly, Flagman Investments
(Proprietary) Limited), a company registered in accordance with the laws of
South Africa and a wholly-owned subsidiary of Sage ("Sage South Africa"), the
Addendum to Sale of Business Agreement, dated November 7, 2003 (the "Addendum")
and the Second Addendum to Sale of Business Agreement, dated November 24, 2003
(the "Second Addendum" and together with the Original Sale of Business
Agreement and the Addendum, the "Sale of Business Agreement"). Under the Sale
of Business Agreement, Sage South Africa agreed to acquire substantially all of
the assets and liabilities of Softline, including the equity holdings of
Softline in its subsidiaries and certain other entities, including the Company.
Pursuant to the Addendum, among other things, Sage South Africa
assigned to Sage all of its rights and obligations under the Sale of Business
Agreement with respect to the equity interests held by Softline in the Company.
In connection with the consummation of the transactions contemplated
by the Sale of Business Agreement, certain agreements relating to the
securities of the Company were assigned to and assumed by Sage, including the
Purchase and Exchange Agreement (the "Purchase Agreement"), dated January 1,
2002, by and between the Company and Softline; the Investor Rights Agreement
(the "Investor Rights Agreement"), dated January 1, 2002, by and between the
Company and Softline; and the Option Agreement (the "Beck Option Agreement"),
dated April 25, 2003, by and between Softline, as grantor, and Steven Beck, as
trustee of a certain management group of the Company. In addition, in order to
induce certain third parties to consent to the transaction, Sage executed a
letter, dated November 20, 2003 (the "Lock-Up Letter"), in favor of Midsummer
Investment, Ltd. and Omicron Master Trust.
Pursuant to the Purchase Agreement, the Company (a) issued and sold to
Softline 53,000 shares of Series A Preferred Stock and (b) sold, assigned and
transferred to Softline all of the Company's right, title and interest in and
to a note and a pledge agreement, in exchange for a release by Softline in
favor of the Company. The Company also issued 88,000 shares of Series A
Preferred Stock to Softline in exchange for 10,700,000 shares of the Common
Stock held by Softline. As assignee of Softline's rights and obligations under
the Purchase Agreement, Sage is prohibited from offering or selling the Series
A Preferred Stock in the United States or to a U.S. person unless such
securities are registered under the Securities Act of 1933, as amended (the
"Securities Act"), or an exemption from the registration requirements is
available.
Pursuant to the Investor Rights Agreement, as assignee of Softline's
rights and obligations, Sage is entitled to certain rights with respect to the
registration under the Securities Act of the shares of Common Stock issuable
upon conversion of the Series A Preferred Stock. Under the terms of the
Investor Rights Agreement, subject to certain limitations, if the Company
proposes to register any shares of Common Stock, the Company shall, upon Sage's
written request, register all or any portion of the Common Stock issuable upon
conversion of the Series A Preferred Stock held by Sage. The Company shall not
include Sage's securities in an offering involving an underwriting of shares,
unless Sage accepts the terms of the underwriting and enters into an
underwriting agreement. The Company shall include in the offering only that
number of shares held by Sage that the underwriters determine in their sole
discretion will not jeopardize the success of the offering. The Investor Rights
Agreement further provides that, under certain conditions, Sage may require the
Company to register on Form S-3 the resale of the Common Stock issuable upon
conversion of the Series A Preferred Stock. In addition, pursuant to the terms
of the Investor Rights Agreement, the Company has a right of first refusal to
purchase all but not less than all of any securities Sage proposes to sell to a
third party.
Pursuant to the Beck Option Agreement, Softline granted to Steven Beck
("Beck") the option to purchase, subject to certain conditions, from Softline
8,000,000 shares of Common Stock held by Softline and such number of shares of
Series A Preferred Stock that are convertible into 17,625,000 shares of Common
Stock as of April 25, 2003 (the "Option Shares"). The price for each Option
Share shall be $0.80 per share of Common Stock represented by such Option
Share. The option expires on the earlier of March 24, 2003 and the date on
which an optionee's full-time employment as an officer or director of the
Company is terminated for any reason. The Beck Option Agreement is subject to
any agreement to which Softline and/or the Company are bound, including the
Investor Rights Agreement. On September 17, 2003, in accordance with the terms
of the Beck Option Agreement, Beck exercised, in part, his option to purchase
such number of shares
of Series A Preferred Stock convertible into 500,000 shares of Common Stock, at
an exercise price of $400,000.
Pursuant to the Lock-Up Letter, during the option period of that
certain option granted to Beck, Sage may not sell those shares of Common Stock
or Series A Preferred Stock that are subject to the Beck Option Agreement,
except to Beck pursuant to such Beck Option Agreement. In addition, provided
that Midsummer Investments, Ltd. and Omicron Master Trust continue to hold
unconverted debentures of the Company at the time the Beck option expires and
Sage continues to hold the Option Shares after such period, then Sage may sell
only that number of shares that Sage would be permitted to sell pursuant to
Rule 144(e) under the Securities Act, notwithstanding that any shares may be
registered for resale at such time.
The foregoing descriptions of the Sale of Business Agreement, the
Purchase Agreement, the Investor Rights Agreement, the Beck Option Agreement
and the Lock-Up Letter are qualified in their entirety by reference to the full
text of such agreements, which are incorporated herein by reference and copies
of which are filed as Exhibits 1 through 7 to this Schedule 13D, respectively.
Sage may from time to time, depending on certain conditions, sell all
or part of the shares of the Company. Sage intends to review its investment in
the Company from time to time, evaluating the Company's business, prospects,
financial condition, the market price of the shares, general economic
conditions, general stock market and other factors and future developments that
Sage may deem relevant from time to time, and may decide at any time, based on
the foregoing and other factors, to decrease the size of its investment in the
Company. Any such disposition may be effected through open market or privately
negotiated transactions, or otherwise.
Except as set forth above, Sage does not have, and to the best
knowledge of Sage, none of the individuals identified in Schedule A has, any
plan or proposal which relates to or would result in the types of transactions
set forth in subparagraphs (a) through (j) of Item 4 of Schedule 13D.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) - (b) The number of shares of Common Stock that may be deemed to
be beneficially owned by Sage is equal to 27,406,607 which consists of (i)
8,923,915 shares of Common Stock, (ii) 18,410,880 shares of Common Stock
issuable upon conversion of 136,788 shares of Series A Preferred Stock, (iii)
61,812 shares of Common Stock issuable, at an exercise price of $2.00 per
share, upon exercise of outstanding options exercisable within 60 days and (iv)
10,000 shares of Common Stock issuable, at an exercise price of $11.75 per
share, upon exercise of outstanding options exercisable within 60 days, which
in the aggregate constitute approximately 48.4% of the issued and outstanding
shares of Common Stock (based on 38,195,279 shares of Common Stock of the
Company outstanding as of August 20, 2003, as disclosed by the Company in its
Registration Statement on Form S-1/A, filed on September 26, 2003, plus the
shares of Common Stock referred to in clauses (ii) through (iv) above).
With respect to all of the 27,406,607 shares of Common Stock that may
be deemed to be beneficially owned by Sage, Sage has sole voting power and sole
dispositive power.
(c) In connection with the consummation of the transactions
contemplated by the Sale of Business Agreement, Sage acquired all of the
equity interests in the Company described in this Item 5 on November 14,
2003, for the aggregate price of ZAR 174,889,027 (equivalent to
$26,818,946 based on an exchange rate of 0.14854 on November 14, 2003, the date
the securities were acquired).
Other than as set forth in this Item 5, there have been no
transactions in the shares of Common Stock effected during the past 60 days by
Sage, nor to the knowledge of Sage, as of the date hereof, by any person listed
on Schedule A hereto.
(d) - (e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER.
The responses to Items 4 and 5 of this Schedule 13D and the exhibits
to this Schedule 13D are incorporated herein by reference.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
Exhibit No. Exhibit Name
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1 Sale of Business Agreement, dated August 26, 2003, by and
between Sage Software (SA) (Proprietary) Limited (formerly,
Flagman Investments (Proprietary) Limited), and Softline
Limited.
2 Addendum to Sale of Business Agreement, dated November 7,
2003, by and between Sage Software (SA) (Proprietary)
Limited (formerly, Flagman Investments (Proprietary)
Limited), and Softline Limited.
3 Second Addendum to Sale of Business Agreement, dated
November 24, 2003, by and between Sage Software (SA)
(Proprietary) Limited (formerly, Flagman Investments
(Proprietary) Limited), and Softline Limited.
4 Purchase and Exchange Agreement, dated January 1, 2002, by
and between Island Pacific, Inc. and Softline Limited.
5 Investor Rights Agreement, dated January 1, 2002, by and
between Island Pacific, Inc. and Softline Limited.
6 Option Agreement, dated April 25, 2003, by and between
Softline, as grantor, and Steven Beck, as trustee.
7 Lock-Up Letter, dated November 20, 2003, in favor of
Midsummer Investment, Ltd. and Omicron Master Trust.
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: November 24, 2003 The Sage Group plc
By: /s/ Paul Walker
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Name: Paul Walker
Title: Chief Executive Officer
Schedule A
EXECUTIVE OFFICERS AND DIRECTORS OF THE SAGE GROUP PLC
The following table sets forth the name, business address and present
principal occupation or employment of each executive officer and director of
The Sage Group plc. Unless otherwise indicated, each such person is a citizen
of the United Kingdom, and the business address of each such person is c/o The
Sage Group plc, Sage House, Benton Park Road, Newcastle upon Tyne NE7 7LZ,
England.
THE SAGE GROUP PLC
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| Name | Present Principal Occupation |
|---------------------------------------|---------------------------------------------------------------------|
| Michael Jackson | Chairman of The Sage Group plc. |
|---------------------------------------|---------------------------------------------------------------------|
| Paul Walker | Chief Executive Officer of The Sage Group plc. |
|---------------------------------------|---------------------------------------------------------------------|
| Paul Stobart | Managing Director, U.K. of The Sage Group plc. |
|---------------------------------------|---------------------------------------------------------------------|
| Paul Harrison | Group Finance Director of The Sage Group plc. |
|---------------------------------------|---------------------------------------------------------------------|
| Guy Berruyer (French citizenship) | Managing Director, Mainland Europe of The Sage Group plc. |
|---------------------------------------|---------------------------------------------------------------------|
| Ron Verni (U.S. citizenship)* | Managing Director, U.S. Operations of The Sage Group plc.; |
| | President and Chief Executive Officer of Best Software of |
| | California, Inc. |
|---------------------------------------|---------------------------------------------------------------------|
| Kevin Howe (U.S. citizenship) | Manager of Mercury Ventures. |
|---------------------------------------|---------------------------------------------------------------------|
| Lindsay Bury | Chairman of South Staffordshire Group plc and Henderson Electric |
| | and General Investment Trust plc. |
|---------------------------------------|---------------------------------------------------------------------|
| John Constable | Trustee of the Pensions Trust; Chairman of the Harpur Trust. |
|---------------------------------------|---------------------------------------------------------------------|
| Tim Ingram | Chief Executive Officer of Caledonia Investments plc. |
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* The business address of such person is c/o Best Software, Inc., 56 Technology
Drive, Irvine, California 92618.
EXHIBIT INDEX
Exhibit No. Exhibit Name
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1 Sale of Business Agreement, dated August 26, 2003, by and
between Sage Software (SA) (Proprietary) Limited (formerly,
Flagman Investments (Proprietary) Limited), and Softline
Limited.
2 Addendum to Sale of Business Agreement, dated November 7,
2003, by and between Sage Software (SA) (Proprietary)
Limited (formerly, Flagman Investments (Proprietary)
Limited), and Softline Limited.
3 Second Addendum to Sale of Business Agreement, dated
November 24, 2003, by and between Sage Software (SA)
(Proprietary) Limited (formerly, Flagman Investments
(Proprietary) Limited), and Softline Limited.
4 Purchase and Exchange Agreement, dated January 1, 2002, by
and between Island Pacific, Inc. and Softline Limited.
5 Investor Rights Agreement, dated January 1, 2002, by and
between Island Pacific, Inc. and Softline Limited.
6 Option Agreement, dated April 25, 2003, by and between
Softline, as grantor, and Steven Beck, as trustee.
7 Lock-Up Letter, dated November 20, 2003, in favor of
Midsummer Investment, Ltd. and Omicron Master Trust.