UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13A-16 OR 15D-16 UNDER THE
SECURITIES EXCHANGE ACT OF 1934
For the month of November 2004.
Commission File Number 001-14552
TOP IMAGE SYSTEMS LTD.
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(Translation of registrant's name into English)
2 HABARZEL STREET, RAMAT HAHAYAL, ISRAEL 69710
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(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports
under cover of Form 20-F or Form 40-F. Form 20-F |X| Form 40-F |_|
Indicate by check mark if the registrant is submitting the Form 6-K in paper as
permitted by Regulation S-T Rule 101(b)(1):________
NOTE: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a
Form 6-K if submitted solely to provide an attached annual report to security
holders.
Indicate by check mark if the registrant is submitting the Form 6-K in paper as
permitted by Regulation S-T Rule 101(b)(7):________
NOTE: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a
Form 6-K if submitted to furnish a report or other document that the registrant
foreign private issuer must furnish and make public under the laws of the
jurisdiction in which the registrant is incorporated, domiciled or legally
organized (the registrant's "home country"), or under the rules of the home
country exchange on which the registrant's securities are traded, as long as the
report or other document is not a press release, is not required to be and has
not been distributed to the registrant's security holders, and, if discussing a
material event, has already been the subject of a Form 6-K submission or other
Commission filing on EDGAR.
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes |_| No |X|
If "Yes" is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b):
The Registrant is filing herewith the Registrant's most current
proxy materials and the related notice to shareholders.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Top Image Systems Ltd.
Date: December 6, 2004
/s/Ido Schechter
----------------------------------
By: Ido Schechter
Chief Executive Officer
TOP IMAGE SYSTEMS LTD.
2 HABARZEL STREET
RAMAT HAHAYAL, TEL-AVIV
ISRAEL
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
DECEMBER 21, 2004
Notice is hereby given that the Annual Meeting of the Shareholders of
Top Image Systems Ltd. (the "Company") will be held at the corporate offices of
the Company at 2 Habarzel St., Ramat Hahayal, Tel Aviv, Israel on December 21,
2004 at 10 a.m. (local time) for the following purposes:
1. To elect and appoint five directors for the coming year.
2. To appoint Kost, Forer & Gabbay (a member of Ernst & Young
Global) as the independent public accountants of the Company for
the year ending December 31, 2004, and to authorize the Audi
Committee of the Company to fix the remuneration of such auditors
in accordance with the volume and nature of their services.
3. To review and ratify the Company's consolidated Financial
Statements for the year ended December 31, 2003.
4. To approve the terms of compensation of the members of the
Company's Board of Directors.
Shareholders of record at the close of business on October 25, 2004
will be entitled to notice of and to vote at the meeting.
Shareholders who do not expect to attend the meeting in person are
requested to mark, date, and sign and mail the enclosed proxy as promptly as
possible in the enclosed stamped envelope.
By Order of the Board of Directors,
TOP IMAGE SYSTEMS LTD.
Thomas C. Lavey
Chairman of the Board of Directors
Date: October 30, 2004
PROXY STATEMENT
TOP IMAGE SYSTEMS LTD.
2 HABARZEL STREET
RAMAT HAHAYAL, TEL-AVIV
ISRAEL
ANNUAL MEETING OF SHAREHOLDERS
DECEMBER 21, 2004
The enclosed proxy is being solicited by the board of directors (the
"Board of Directors") of Top Image Systems Ltd. (the "Company") for use at the
Company's Annual Meeting of Shareholders (the "Meeting") to be held on December
21, 2004 at 10:00 a.m. (local time), or at any adjourned date or time thereof.
Upon the receipt of a properly executed proxy in the form enclosed, the persons
named as proxies therein will vote the ordinary shares, par value New Israeli
Shekel ("NIS") 0.04 of the Company, (the "Ordinary Shares") covered thereby in
accordance with the directions of the shareholders executing the proxy. In the
absence of such instructions, the Ordinary Shares represented thereby will be
voted in favor of each of the proposals discussed in this Proxy Statement and
for each of the nominees for directors set forth herein.
The proxy solicited hereby may be revoked, at any time prior to its
exercise, by means of a written notice delivered to the Company, by substitution
of a new proxy bearing a later date or by a request for the return of the proxy
prior to the Meeting. The Company expects to solicit proxies by mail and to mail
this proxy statement and the enclosed form of proxy to shareholders on or about
October 30, 2004. Directors, officers and employees of the Company may also
solicit proxies by telephone, telefax, telegraph, email and personal interview.
The Company will bear the cost of the preparation and mailing of its
proxy materials and the solicitation of proxies. Copies of solicitation
materials will be furnished to brokerage firms, nominees, fiduciaries and other
custodians for forwarding to their principals, and the reasonable fees and
expenses of such forwarding agents will be borne by the Company. Only holders of
record of Ordinary Shares at the close of business on October 25, 2004 are
entitled to notice of, and to vote at, the Meeting. At that date, 8,713,991
Ordinary Shares were outstanding and entitled to vote (the "Outstanding Ordinary
Shares"). Each Ordinary Share is entitled to one vote on each matter to be voted
at the Meeting. The Company's Articles of Association do not permit cumulative
voting for the election of directors or for any other purpose. The presence at
the Meeting of two or more shareholders, personally or by proxy, who hold or
have the right to vote 33% or more of the voting rights of the issued share
capital shall constitute a quorum for the Meeting. The resolutions set forth in
Sections 1,2,3 and 4, of the Agenda require a simple majority vote of all
Ordinary Shares represented at the Meeting, in person or by proxy, and voting
thereon.
PRINCIPAL SHAREHOLDERS
The following table shows as of October 30, 2004 certain information as
to each person known to the Company to be the beneficial owner of more than 5%
of the Ordinary Shares then outstanding and all directors and officers as a
group.
NAME NUMBER OF SHARES PERCENTAGE OF
---- BENEFICIALLY OWNED CLASS(2)
------------------ -------------
Charter TiS LLC ("Charter")
2,000,000 22.95%
Pandora Select Partners LP
712,025 10.89%
Iroquois Capital LP
949,367 8.17%
All executive officers and directors
as a group (persons) 520,799(1) 5.85%
(1) Includes vested options to purchase an aggregate 181,625 Ordinary
Shares held by officers and directors of the Company. Does not include
the shares held by Charter, which may be deemed to be beneficially held
by MS. Haberman and Mr. Landuyt. Each of Ms. Haberman and Mr. Landuyt
disclaim any beneficial ownership of the shares held by Charter.
(2) The percentage of class is calculated by dividing the number of shares
that a shareholder owns and the number of shares the shareholder has
the right to acquire within 60 days, with the sum of the number of the
outstanding shares and the number of shares that the shareholder has
the right to acquire within 60 days.
PROPOSAL OF ELECTION OF DIRECTORS
The Board of Directors of the Company has nominated the persons named
below for election as directors to serve for a period of one year and until
their respective successors are duly elected and shall qualify.
In the absence of instructions to the contrary, the persons named in
the enclosed proxy will vote the Ordinary Shares represented thereby "For" the
election of the nominees listed below. If any of such nominees is unable to
serve, the persons named in the proxy shall vote the Ordinary Shares covered by
a duly executed and delivered proxy for the election of such other nominees as
the Board of Directors may propose. Each of the nominees has advised the Company
that he or she will serve as directors if elected.
The following table provides certain relevant information concerning
the nominees, including their principal occupation during the past five years:
NOMINEE AGE PRINCIPAL OCCUPATION
------- --- --------------------
Thomas C. Lavey 60 Thomas C. Lavey became a Director of the
Company in August 2002 and the Board elected
him as non-Executive Chairman at the same
meeting. Since September 2003, Tom Lavey has
served as Executive Vice President of Taleo,
Inc. Previously, Mr. Lavey served as Executive
Vice President of MS2, Inc. which provides
product life cycle automation software. Prior
to joining MS2, Mr. Lavey was senior vice
president of worldwide operations at
Extricity, which became part of Peregrine
Systems and provided B2B relationship
management software. Mr. Lavey also served as
senior vice president at i2 Technologies and,
from 1994 through 1999, he served as vice
president of application sales at Oracle
Corporation. Mr. Lavey has a bachelor's degree
in mathematics from Penn State University and
an MBA from the University of Southern
California.
Izhak Nakar 52 Izhak Nakar founded the Company and served as
Chief Executive Officer through December 31,
2001. Mr. Nakar served in the Israel Air Force
from 1970 to 1987, where he led various
large-scale highly technical development
projects. He received his B.Sc. in computer
science in 1982, and an MBA in 1984. Mr. Nakar
is a recipient of the "Israel Defense Award",
bestowed annually by the President of Israel,
for the development of high-tech systems in
the field of intelligence for the Israeli
Defense Force. He also received the Israeli
"Man of the Year Award" in Business and
Management (`95-`96) in recognition of his
business accomplishments and contributions to
the growth and development of Israeli hi-tech
companies.
William M. Landuyt 48 William M. Landuyt, has been a director of the
Company since March 2, 2004. Mr. Landuyt has
been a Principal at Charterhouse Group
International, Inc. since December 2003. He
served as Chairman of the Board and Chief
Executive Officer of Millennium Chemicals Inc.
from its demerger from Hanson Plc ("Hanson")
in October 1996 until July 2003. He had served
as the President of that company from June
1997 until that date. Mr. Landuyt was
Director, President and Chief Executive
Officer of Hanson Industries (which managed
the United States operations of Hanson until
the demerger) from June 1995 until the
demerger, a Director of Hanson from 1992 until
September 29, 1996, Finance Director of Hanson
from 1992 to May 1995, and Vice President and
Chief Financial Officer of Hanson Industries
from 1988 to 1992. He joined Hanson Industries
in 1983. He was a director of Bethlehem Steel
Corporation from April 1997 until October
2003.
Phyllis Haberman 55 Phyllis Haberman has served as a Director of
the Company since 2000. She has been a Partner
of Charterhouse since 2002 and a Senior Vice
President since January 1997. From 1988
through December 1996, Ms. Haberman was a Vice
President of Charterhouse.
Elie Housman 67 Elie Housman has served as a Director of the
Company since 2000. He was a principal and a
consultant to Charterhouse from 1988 through
2001. Presently Mr. Houseman serves as a
chairman of InkSure Iinc. and as a director
for ICTS and EVCI - all companies are quoted
on Nasdaq.
The Board of Directors met 4 times during the fiscal year ended
December 31, 2003. Each of the directors attended (in person or by proxy) no
fewer than 75% of those meetings.
Remuneration of Officers and Directors
For the year ended December 31, 2003, the compensation paid, and
benefits in kind granted, to Mr. Ido Schechter, the Company's CEO, for the year
ended December 31, 2003 was $189,689. The compensation paid to all other
persons, as a group, who were, at December 31, 2003, directors or members of the
Company's administrative, supervisory or management bodies was $637,842. In
addition, in 2003, members of that group were granted options to purchase 37,500
Ordinary Shares with an exercise price of $1.31 per share under the Company's
ESOP 2003. The compensation paid does not include (i) reimbursement of
directors' expenses, (ii) $138,007, which has been accrued to provide pension,
retirement, severance, vacation or similar benefits, and (iii) $62,551amounts
expended by the Company for automobiles made available to its officers and other
expenses (including business travel, and professional and business association
dues and expenses) reimbursed to officers
The shareholders of the Company are requested to adopt the following
resolution:
RESOLVED, to elect Thomas C. Lavey, Izhak Nakar, William M. Landuyt, Phyllis
Haberman and Elie Housman as directors to serve for a period of one year and
until their respective successors are duly elected and shall qualify.
The Board of Directors recommends that the shareholders vote "FOR" the
election of Thomas C. Lavey, Izhak Nakar, William M. Landuyt, Phyllis Haberman
and Elie Housman as directors to serve for a period of one year and until their
respective successors are duly elected and shall qualify.
EXTERNAL DIRECTORS
Israeli law requires that the Company shall have two external directors
in office at all times. An external director is appointed for a period of three
years. At the Meeting held on December 18, 2003 two external directors, Mr.
Zamir Bar-Zion and Mr. Victor Halpert were appointed for a three-year term, of
which one year has expired as of the date of this Meeting, and their appointment
shall thus continue for an additional period of two years, and until their
respective successors are duly elected and shall qualify.
The following table provides certain relevant information concerning
the acting external directors, including their principal occupation during the
past five years:
NOMINEE AGE PRINCIPAL OCCUPATION
------- --- --------------------
Victor Halpert 43 Victor Halpert served in various positions in
the field of equity research and Israel
technology analyst. From June 1999 through
January 2003 Mr. Halpert served as director
for Salomon, Smith and Barney in New York, NY.
From January 1998 through May 1999, Mr.
Halpert served as vice president (equity
research, telecommunications and Israel
technology analyst) for Robertson Stephens in
New York. From January 1995 through December
1997, Mr. Halpert served as vice president for
Salomon Brothers Inc. New York. From April
1993 through January 1995 Mr. Halpert served
as senior equity research analyst for Israel
Equity Research Management Ltd. in Chicago,
and from April 1990 to April 1993, Mr. Halpert
served as a senior accountant for Arthur
Andersen LLC. In Chicago.
Mr. Halpert has a Bachelor of Science in
Accounting from the State University of New
York, College at New Patz, NY, a Master of
Science in Accounting from the University of
Illinois at Chicago, Graduate Business School
and an M.B.A. from the University of Chicago
Graduate Business School.
Zamir Bar-Zion 46 Zamir Bar-Zion currently represents Piper
Jaffray in Israel. Mr. Zamir served as
Managing Director for Nessuah Zannex &
Co./USBancorp Piper Jaffray from 1998 through
2001. From 1995 to 1998 Mr. Bar-Zion served as
a private financial consultant.
From 1990 through 1995 Mr. Bar-Zion served as
a senior partner for Evergreen Canada-Israel
Investments Ltd. From 1988 through 1990 Mr.
Bar-Zion served as a manager at the foreign
securities department at Bank Hapoalim, Israel
and from 1983 through 1987 served as Arbitrage
trader, CRB index (wall street).
Mr. Bar-Zion received B.Sc. In Computer
Science and Finance from New York Institute of
Technology, an M.A. from the Department of
Finance from Pace University, New York, and a
PMD from the Program Management Development
Program at Harvard University.
PROPOSAL TO APPOINT THE
INDEPENDENT PUBLIC ACCOUNTANTS OF THE COMPANY
The Board of Directors recommended and the shareholders in a resolution
dated December 18, 2003, appointed the accounting firm of Kost, Forer & Gabbay
(a member of Ernst & Young Global) as independent certified public accountants
of the Company for the year ending December 31, 2004. The Board of Directors
believes that the selection of Kost, Forer & Gabbay as independent accountants
is appropriate and in the best interests of the Company and its shareholders.
Kost, Forer & Gabbay has audited the Company's books and accounts and performed
other accounting services for the Company since 2003and performed the Company's
annual audit for the fiscal year ended December 31, 2003.
The shareholders of the Company are requested to adopt the following
resolution:
RESOLVED, TO APPOINT KOST, FORER & GABBAY AS THE INDEPENDENT PUBLIC
ACCOUNTANTS OF THE COMPANY FOR THE YEAR ENDING DECEMBER 31, 2004, AND TO
AUTHORIZE THE AUDIT COMMITTEE TO FIX THE REMUNERATION OF SUCH AUDITORS IN
ACCORDANCE WITH THE VOLUME AND NATURE OF THEIR SERVICES.
The Board of Directors recommends that the shareholders vote "FOR" the
appointment of Kost, Forer & Gabbay as the independent public accountants of the
Company for the year ending December 31, 2004.
PROPOSAL TO RATIFY THE COMPANY'S CONSOLIDATED FINANCIAL
STATEMENTS FOR THE YEAR ENDED DECMEBER 31, 2003
A copy of the Company's audited consolidated financial statements for
the year ended December 31, 2003 is attached hereto. The shareholders of the
Company are requested to adopt the following resolution:
RESOLVED THAT THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED
DECEMBER 31, 2003 BE RATIFIED.
The Board of Directors recommends that the shareholders vote "FOR" the
ratification of the Company's consolidated financial statements.
PROPOSAL TO APPROVE THE TERMS OF COMPENSATION OF THE MEMBERS OF
THE BOARD OF DIRECTORS
OF THE COMPANY FOR THE FISCAL YEAR 2005
Pursuant to Israeli law, the terms of compensation of members of the
Board of Directors requires approval of the Audit Committee, the Board of
Directors and Shareholders of the Company. Accordingly, the Audit Committee and
the Board of Directors have resolved and recommend the following:
1. Assuming that they are elected to serve as directors at the Meeting,
each of Ms. Haberman and Mr. M. Landuyt have waived their right to
receive compensation for service as a member of the Board. Therefore,
they shall receive only reimbursement for expenses related to their
service.
2. The other directors of the Company shall receive compensation in the
sums and upon the terms set forth below:
a. Thomas C. Lavey shall continue to receive compensation in the
amount of US$24,000 per year and reimbursement for expenses, all
as further detailed in the agreement with Mr. Lavey, as was
approved at the 2002 annual shareholders meeting.
b. Mr. Elie Housman, Zamir Bar-Zion and Victor Halpert (all of whom
are members of the Audit Committee, with the latter two serving
as External Directors) shall receive compensation for his or her
service as members of the Board of Directors and Audit Committee
of the Company, an annual payment in the amount of 15,750 NIS
(approx. US$3,500 at a current exchange rate) per annum. In
addition each of the above directors shall receive an amount of
3,000 NIS (approximately US$670 at a current exchange rate) for
each Board and/or Audit committee meeting attended.
c. Mr. Izhak Nakar shall receive compensation for his service as
member of the Board of Directors, in the amount of 19,841 NIS
(approximately US$4,500 at a current exchange rate) per year and
993 NIS (approximately US$225 at a current exchange rate) for
each Board and/or committee meeting attended.
3. In addition to the above, based on the resolution of the shareholders in
a meeting held on December 18, 2003 as further clarified in the
shareholders extraordinary meeting held on August 24, 2004, relating
to a large-scale transaction between the Company and Toyo Ink (Japan)
(which was actually concluded on September 1, 2004 Mr. Nakar has
become entitled to receive a one time payment of US$100,000 and, in
addition, an annual fee of US$100,000 as consideration for consulting
services to be provided one week per month for the new business. At
the conclusion of 6 months from the commencement of operation of the
Company's new business, discussions shall be conducted regarding the
possibility of the Company paying Mr. Nakar a percentage of the income
received by the Company from the operations of the new business and,
if so resolved at that time, what percentage of such income shall be
paid. (ii) in addition, should the Company require the active
involvement of Mr. Nakar with any other business of the Company then
Mr. Nakar shall be paid a fee of US$1,000, plus reimbursement of any
expenses for every business day invested by him with regard to same.
The shareholders of the Company are requested to adopt the following
resolution:
RESOLVED, TO APPROVE THE TERMS OF COMPENSATION OF THE DIRECTORS OF THE
COMPANY AS PROPOSED ABOVE.
The Board of Directors of the Company do not express any recommendation
as to the vote on the above resolution.
Management is not aware of any other matters to be presented at the
Meeting. If, however, any other matters should properly come before the Meeting
or any adjournment thereof, the proxy confers discretionary authority with
respect to acting thereon, and the persons named in the enclosed proxy will vote
on such matters in accordance with their best judgment.
Shareholders are urged to complete and return their Proxies promptly in
order, among other things, to insure action by a quorum and to avoid the expense
of additional solicitation. If the accompanying proxy is properly executed and
returned in time for voting, and a choice is specified, the shares represented
thereby will be voted as indicated thereon. If no specification is made, the
proxy will be voted in favor of each of the proposals described in this Proxy
Statement.
By Order of the Board of Directors
Thomas C. Lavey
Chairman of the Board of Directors
Tel Aviv, Israel
Date: October 30, 2004
PROXY TOP IMAGE SYSTEMS LIMITED
FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD
ON TUESDAY, DECEMBER 21, 2004
The undersigned shareholder of Top Image Systems Limited (the "Company") hereby
appoints Mr Izhak Nakar, with full power of substitution, the true and lawful
attorney, agent and proxy of the undersigned, to vote, as designated below, all
of the Ordinary Shares of the Company which the undersigned is entitled in any
capacity to vote at the Annual Meeting of Shareholders of the Company to be held
at the corporate offices of Top Image Systems Limited at 2 Habarzel St., Ramat
Hahayal, Tel Aviv, Israel on Tuesday, December 21, 2004 at 10:00 a.m. (local
time), and all adjournments and postponements thereof.
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE)
A /X/ Please mark your vote as in this example
WITTHOLD
FOR AUTHORITY
all to vote for
nominees nominees
listed listed
below at below at
left. right.
PROPOSAL NO. 1:
I. ELECTION OF
DIRECTORS |_| |_|
Nominees:
THOMAS C. LAVEY
IZHAK NAKAR
WILLIAM M. LANDUYT
PHYLLIS HABERMAN
ELIE HOUSMAN
FOR AGAINST ABSTAIN
II. PROPOSAL NO. 2: TO APPOINT Kost,
Forrer & Gabbay (a member of Ernst
& Young Global) as the independent
public accountants of the Company
for the year ending December 31,
2004, and to authorize the Audit
Committee of the Company to fix the
remuneration of such auditors in
accordance with the volume and
nature of their services. |_| |_| |_|
III.PROPOSAL NO. 3: TO REVIEW and RATIFY
the Company'sConsolidated Financial
Statements for the year ended
December 31, 2003.
|_| |_| |_|
IV. PROPSAL NO. 4: TO APPROVE the terms
of compensation of the directors of
the Company. The board of directors
does not express any recommendation
as to the vote on the above resolution. |_| |_| |_|
|_| |_| |_|
. |_| |_| |_|
|_| |_| |_|
|_| |_| |_|
THIS PROXY WHEN PROPEY EXECUTED WILL BE VOTED IN ACCORDANCE WITH THE MANNER
DIRECTED HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS
PROXY WILL BE VOTED FOR PROPOSALS 1, 2, 3 AND 4.
The undersigned hereby acknowledges receipt of the Notice of Annual Meeting of
Shareholders and the Proxy Statement accompanying such Notice. This proxy
statement revokes any proxy or proxies heretofore given to vote upon or act with
respect to the undersigned's shares and hereby ratifies and confirm all that the
proxies, their substitutes, or any of them, may lawfully do by virtue hereof.
Dated:, 2004
-------------------------- --------------------------- -------------------
(SIGNATURE OF SHAREHOLDER) (SIGNATURE OF SHAREHOLDER)
Note: Please mark, date and sign exactly as name(s) appear on this proxy and
return the proxy card promptly using the enclosed envelope. If the signer
is a corporation, please sign full corporate name by duly authorized
officer. Executives, administrators, trustees, etc. should state full
title or capacity. Joint owners should each sign.