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. 3) (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
North Park
Newcastle upon Tyne NE13 9AA, England
Telephone: +44 (191) 294-3000
(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
February 15, 2006
(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 6 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 and Wales
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NUMBER 7 SOLE VOTING POWER
OF 0
SHARES ------- --------------------------------------------
8 SHARED VOTING POWER
BENEFICIALLY
28,758,700 (See Item 5)
OWNED BY ------- --------------------------------------------
9 SOLE DISPOSITIVE POWER
EACH
28,758,700 (See Item 5)
REPORTING ------- --------------------------------------------
PERSON 10 SHARED DISPOSITIVE POWER
WITH 0
s--------- --------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
11 PERSON
28,758,700 (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
34.5% (See Item 5)
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TYPE OF REPORTING PERSON (See Instructions)
14
CO
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This Amendment No. 3 (the "Amendment No. 3") amends and
supplements the Schedule 13D originally filed with the Securities and Exchange
Commission on November 24, 2003 as such original filing was amended and
supplemented by Amendment No. 1 filed on March 1, 2004 and Amendment No. 2 filed
on June 10, 2004 (as amended, the "Schedule 13D"), by The Sage Group plc, a
company organized under the laws of England and Wales ("Sage"), with respect to
the shares of common stock, $0.0001 par value per share ("Common Stock"), of
Island Pacific, Inc., a Delaware corporation (the "Company"). Except as
indicated in this Amendment No. 3, all other information set forth in the
Schedule 13D remains unchanged and capitalized terms used herein which are not
defined herein have the meanings set forth in the Schedule 13D.
Item 4. Purpose of Transaction.
Item 4 of the Schedule 13D is hereby amended and supplemented by
adding the following paragraphs following the last paragraph of Item 4:
On February 15, 2006, Sage and the Company entered into a Stock
Repurchase Agreement (the "Repurchase Agreement"), pursuant to which, subject to
the terms and conditions set forth in the Repurchase Agreement, Sage agreed to
sell and the Company agreed to repurchase all of the shares of Common Stock
beneficially owned by Sage, including the shares of Common Stock issuable upon
conversion of the Series A Convertible Preferred Stock (the "Shares"), for cash
consideration of $750,000 (the "Purchase Price"). The Purchase Price will be
paid by the Company in monthly payments of $100,000 for seven consequent months,
commencing on February 15, 2006, and in the eighth month an additional payment
of $50,000. In consideration for the Purchase Price, Sage also agreed to the
cancellation of its options to purchase 71,812 shares of Common Stock, which
cancellation was effected upon delivery of the first payment received on
February 21, 2006. Pursuant to the terms of the Repurchase Agreement, Sage will
retain the share certificates for the Shares and record title to such Shares as
security until all payments, including accrued interest, are made by the
Company. The Company has the right to prepay, without premium or penalty, all or
part of the outstanding payments and accrued interest. The Repurchase Agreement
further provides that if the Company is in material default under the Repurchase
Agreement and fails to cure within 30 days of receiving notice of such default,
Sage has the option to (a) rescind the sale and return all payments received by
Sage at that time, less Sage's reasonable costs incurred in connection with the
Repurchase Agreement, plus a termination fee of 30% of the payments received or
(b) retain all payments received at that time and deliver to the Company the
share certificates representing the number of shares for which Sage has received
payment.
In connection with the Repurchase Agreement and as a condition
to the obligations set forth therein, Sage and the Company also entered into a
Voting Agreement, dated as of February 15, 2006 (the "Repurchase Voting
Agreement"), pursuant to which Sage agreed to vote the Shares as directed by
Barry Schechter, the Chief Executive Officer of the Company; provided that
Sage is not obligated to vote the Shares in favor of any action (a) that would
adversely affect the rights, powers and privileges of Sage as a stockholder of
the Company or the value of Sage's interest in the Company, in either case,
disproportionately from any other stockholder of the Company or (b) in which
Barry Schechter or any other officer or director of the Company or any of
their respective affiliates, directly or indirectly, has any interest other
than as a stockholder of the Company. The term of the Repurchase
Voting Agreement commences on February 15, 2006 and continues until (i) the
Company makes the final payment due under the Repurchase Agreement and Sage
delivers to the Company the share certificates for the Shares; provided, that
the Repurchase Voting Agreement will be suspended for the Company's failure to
make timely payments until such time that the Company re-commences such
payments and pays all past-due amounts or (ii) the earlier termination of the
Repurchase Agreement.
The foregoing descriptions of the Repurchase Agreement and the
Repurchase Voting Agreement are qualified in their entirety by reference to the
full texts of such agreements, which are incorporated herein by reference and
copies of which are filed as Exhibits 9 and 10, respectively, to this Schedule
13D.
Item 5. Interest in Securities of the Issuer.
Item 5 of the Schedule 13D is hereby amended by replacing
paragraphs (a) to (b) with the following:
(a) - (b) The number of shares of Common Stock that may be deemed
to be beneficially owned by Sage is equal to 28,758,700 which consists of (i)
8,923,915 shares of Common Stock and (ii) 19,834,785 shares of Common Stock
issuable upon conversion of 141,000 shares of Series A Preferred Stock, which in
the aggregate constitute approximately 34.5% of the issued and outstanding
shares of Common Stock (based on 63,486,885 shares of Common Stock of the
Company outstanding as of January 31, 2005, as disclosed by the Company in its
Form 10-Q, filed on February 14, 2005, plus the shares of Common Stock referred
to in clause (ii) above).
With respect to all of the 28,758,700 shares of Common Stock that
may be deemed to be beneficially owned by Sage, Sage has sole dispositive power
and may be deemed to share voting power with Mr. Schechter. Sage believes that
(a) Mr. Schechter is the Chief Executive Officer of the Company; (b) Mr.
Schechter is a citizen of the United States of America; (c) Mr. Schechter's
business address is c/o Island Pacific, Inc., 19800 MacArthur Boulevard, 12th
floor, Irvine, CA 92612; (d) the principal business of the Company is retail
software solutions, store operations, CRM and multi-channel software solutions
and (e) during the past five years Mr. Schechter has not been convicted in a
criminal proceeding (excluding traffic violations or similar misdemeanors) and
was not a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction as a result of which Mr. Schechter 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 5 of the Schedule 13D is hereby amended and supplemented by
adding the following sentence to the end of paragraph (c):
The response to Item 4 of this Amendment No. 3 is incorporated
herein by reference.
Item 6. Contracts, Arrangements, Understandings or Relationships With Respect
to Securities of the Issuer.
The response to Item 4 of this Amendment No. 3 is incorporated
herein by reference.
Item 7. Material to be Filed as Exhibits.
Item 7 of the Schedule 13D is hereby amended and supplemented
by adding the following Exhibits 9 and 10 at the end of the Exhibit Index.
Exhibit
No. Exhibit Name
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9 Stock Repurchase Agreement, dated as of February 15, 2006, by
and between Island Pacific, Inc. and The Sage Group plc
10 Voting Agreement, dated as of February 15, 2006, by and
between Island Pacific, Inc. and The Sage Group plc
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: February 21, 2006 The Sage Group plc
By: /s/ Michael Robinson
--------------------------
Name: Michael Robinson
Title: Company Secretary
EXHIBIT INDEX
Exhibit
No. Exhibit Name
------- ------------
9 Stock Repurchase Agreement, dated as of February 15, 2006, by
and between Island Pacific, Inc. and The Sage Group plc
10 Voting Agreement, dated as of February 15, 2006, by and
between Island Pacific, Inc. and The Sage Group plc