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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED) -- MARCH 5, 1999
PALADYNE CORP.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 0-22969 59-3562953
(STATE OR OTHER (COMMISSION (I.R.S. EMPLOYER
JURISDICTION FILE NUMBER) IDENTIFICATION NO.)
OF INCORPORATION)
615 CRESCENT EXECUTIVE COURT,
SUITE 128, LAKE MARY, FLORIDA 32746
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER,
INCLUDING AREA CODE -- (407) 333-2488
SYNAPTX WORLDWIDE, INC.
(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT)
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ITEM 5. OTHER EVENTS
Effective March 5, 1999, Synaptx Worldwide, Inc., a Utah
corporation ("Synaptx"), completed a reincorporation (the
"Reincorporation"), whereby the surviving company (or successor
registrant) is Paladyne Corp., a Delaware corporation
("Paladyne"). The primary purpose of the Reincorporation was to
migrate to the State of Delaware and to change the corporate name
to Paladyne Corp. The shareholders of Synaptx approved the
Reincorporation at the 1999 Annual Meeting of Shareholders (the
"Annual Meeting") held on March 3, 1999.
Paladyne has an authorized capitalization consisting of
(i) 25,000,000 shares of common stock, $.001 par value ("Paladyne
Common Stock"), of which 6,584,452 shares are outstanding after
the Reincorporation, and (ii) 10,000,000 shares of Preferred
Stock, $.001 par value, of which 137,143 of the Series A
Convertible Preferred Stock are outstanding after the
Reincorporation. The Reincorporation was effected by a migratory
merger (the "Merger") between Synaptx and Paladyne, which was a
newly-formed, wholly-owned subsidiary of Synaptx. Upon the
Merger the outstanding shares of Synaptx Common Stock were
exchanged on a one-for-one basis for shares of Paladyne Common
Stock and the outstanding shares of Synaptx Series A Convertible
Preferred Stock were exchanged on a one-for-one basis for shares
of Paladyne Series A Convertible Preferred Stock, whereby the
former Synaptx shareholders received the same proportionate
ownership interest in Paladyne that they had in Synaptx.
Paladyne has a 1999 Stock Option Plan under which options may be
granted for the purchase of 2,500,000 shares of Paladyne Common
Stock. Options were granted under the Paladyne Option Plan for
outstanding options under the Synaptx 1996 Stock Option Plan and
on the same terms as the Synaptx options.
Upon the Reincorporation, Paladyne succeeded to all the
business, properties, assets and liabilities of Synaptx. The
Reincorporation did not result in any change of management.
Pursuant to Rule 12g-3(f) under the Securities Exchange Act
of 1934, as amended, by reason of the Reincorporation, the
Paladyne Common Stock became registered pursuant to Section 12(g)
thereof. The Paladyne Common Stock is traded on the OTC-Bulletin
Board under the symbol "PLDY". Letters of Transmittal are being
sent to the former Synaptx shareholders requesting that they
exchange their Synaptx stock certificates for Paladyne stock
certificates.
In addition to approving the Reincorporation, at the Annual
Meeting the shareholders of Synaptx also (i) elected Peter B.
Atwal, John D. Foster, Kenneth W. Horn, William N. Kashul, Sr.,
James L. McGovern and Ronald L. Weindruch as directors and
(ii) approved an amendment to Synaptx's 1996 Stock Option Plan to
increase the number of shares authorized for issuance thereunder
to 2,500,000. Upon the Reincorporation, the Board of Directors
was divided into three classes with one class to be elected
annually. Messrs. Horn and Kashul were designated as Class I
directors to serve until the 2000 annual meeting, Messrs. Atwal
and McGovern were designated as Class II directors to serve until
the 2001 annual meeting and Messrs. Foster and Weindruch were
designated as Class III directors to serve until the 2002 annual
meeting.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
3.1 Certificate of Incorporation for Paladyne.
3.2 By-Laws for Paladyne.
3.3 Articles of Merger of Synaptx into Paladyne, dated
March 3, 1999, as filed with the Division of
Corporations and Commercial Code of the State of Utah
on March 8, 1999.
3.4 Certificate of Merger of Synaptx into Paladyne, dated
March 3, 1999, as filed with the Secretary of State of
the State of Delaware on March 5, 1999.
10.1 Agreement and Plan of Merger, dated January 19, 1999,
between Synaptx and Paladyne.
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10.2 Paladyne 1999 Stock Option Plan.
99.1 Press Release, dated March 10, 1999.
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SIGNATURE
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.
PALADYNE CORP.
By: /s/ Ronald L. Weindruch
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Name: Ronald L. Weindruch
Title: President and Chief Executive
Officer
Dated: March 24, 1999
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Exhibit Index
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Exhibit Description
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3.1 Certificate of Incorporation for Paladyne.
3.2 By-Laws for Paladyne.
3.3 Articles of Merger of Synaptx into Paladyne,
dated March 3, 1999, as filed with the
Division of Corporations and Commercial Code
of the State of Utah on March 8, 1999.
3.4 Certificate of Merger of Synaptx into
Paladyne, dated March 3, 1999, as filed with
the Secretary of State of the State of
Delaware on March 5, 1999.
10.1 Agreement and Plan of Merger, dated
January 19, 1999, between Synaptx and
Paladyne.
10.2 Paladyne 1999 Stock Option Plan.
99.1 Press Release, dated March 10, 1999.
Exhibit 3.1
CERTIFICATE OF INCORPORATION
OF
PALADYNE CORP.
The undersigned, for the purpose of organizing a
corporation pursuant to the provisions of the General Corporation
Law of the State of Delaware (the "DGCL"), does make and file
this Certificate of Incorporation and does hereby certify as
follows:
FIRST: NAME. The name of the corporation is Paladyne
Corp. (the "Corporation").
SECOND: REGISTERED OFFICE. The registered office of
the Corporation is to be located in the City of Wilmington,
County of New Castle, in the State of Delaware. The name of its
registered agent is the Corporation Service Company, whose
address is 1013 Centre Road, Wilmington, Delaware 19805.
THIRD: PURPOSE. The purpose of the Corporation is to
engage in any lawful act or activity for which corporations may
be organized under the DGCL.
FOURTH: CAPITAL STOCK.
A. AUTHORIZED. The total number of shares of stock
which the Corporation shall have authority to issue is Thirty-
Five Million (35,000,000), of which Twenty-Five Million
(25,000,000) shares shall be common stock, $.001 par value per
share (the "Common Stock"), and Ten Million (10,000,000) shares
shall be preferred stock, $.001 par value per share (the
"Preferred Stock").
B. PROVISIONS RELATING TO PREFERRED STOCK. Shares of
Preferred Stock may be issued from time to time in series, and
the Board of Directors of the Corporation is hereby authorized,
subject to the limitations provided by law, to establish and
designate one or more series of the Preferred Stock, to fix the
number of shares constituting each series, and to fix the
designations, powers, preferences and relative, participating,
optional or other special rights, and qualifications, limitations
or restrictions thereof, of each series and the variations and
the relative rights, preferences and limitations as between
series, and to increase and to decrease the number of shares
constituting each series. The authority of the Board of
Directors of the Corporation with respect to each series shall
include, but shall not be limited to, the authority to determine
the following:
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(i) The designation of such series.
(ii) The number of shares initially constituting such
series.
(iii) The increase, and the decrease to a number not
less than the number of the outstanding shares of such series, of
the number of shares constituting such series theretofore fixed.
(iv) The rate or rates, and the conditions upon and
the times at which dividends on the shares of such series shall
be paid, the preference or relation which such dividends shall
bear to the dividends payable on any other class or classes or on
any other series of stock of the Corporation, and whether or not
such dividends shall be cumulative, and, if such dividends shall
be cumulative, the date or dates from and after which they shall
accumulate.
(v) Whether or not the shares of such series shall
be redeemable, and, if such shares shall be redeemable, the terms
and conditions of such redemption, including, but not limited to,
the date or dates upon or after which such shares shall be
redeemable and the amount per share which shall be payable upon
such redemption, which amount may vary under different conditions
and at different redemption dates.
(vi) The rights to which the holders of the shares of
such series shall be entitled upon the voluntary or involuntary
liquidation, dissolution or winding up of, or upon any
distribution of the assets of, the Corporation, which rights may
be different in the case of a voluntary liquidation, dissolution
or winding up than in the case of such an involuntary event.
(vii) Whether or not the shares of such series shall
have voting rights, in addition to the voting rights provided by
law, and, if such shares shall have such voting rights, the terms
and conditions thereof, including, but not limited to, the right
of the holders of such shares to vote as a separate class either
alone or with the holders of shares of one or more other series
of Preferred Stock and the right to have more than one vote per
share.
(viii) Whether or not a sinking fund or a purchase fund
shall be provided for the redemption or purchase of the shares of
such series, and, if such a sinking fund or purchase fund shall
be provided, the terms and conditions thereof.
(ix) Whether or not the shares of such series shall
be convertible into, or exchangeable for, shares of any other
class or classes or any other series of the same or any other
class or classes of stock of the corporation, and, if provision
be made for conversion or exchange, the terms and conditions of
conversion or exchange, including, but not limited to, any
provision for the adjustment of the conversion or exchange rate
or the conversion or exchange price.
(x) Any other relative rights, preferences and
limitations.
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C. PROVISIONS RELATING TO COMMON STOCK.
(i) DIVIDENDS. Subject to the preferential dividend
rights applicable to shares of the Preferred Stock pursuant to
Part D of this Article FOURTH and as determined by the Board of
Directors of the Corporation pursuant to the provisions of Part B
of this Article FOURTH, the holders of shares of the Common Stock
shall be entitled to receive such dividends as may be declared by
the Board of Directors of the Corporation.
(ii) LIQUIDATION. Subject to the preferential
liquidation rights pursuant to Part D of this Article FOURTH and
as determined by the Board of Directors of the Corporation
pursuant to the provisions of Part B of this Article FOURTH, in
the event of any voluntary or involuntary liquidation,
dissolution or winding up of, or any distribution of the assets
of, the Corporation, the holders of shares of the Common Stock
shall be entitled to receive all of the assets of the Corporation
available for distribution to its stockholders ratably in
proportion to the number of shares of the Common Stock held by
them.
(iii) VOTING. Except pursuant to Part D of this
Article FOURTH or as determined by the Board of Directors of the
Corporation pursuant to the provisions of Part B of this Article
FOURTH, the holders of shares of the Common Stock shall be
entitled to vote on all matters at all meetings of the
stockholders of the Corporation, and shall be entitled to one
vote for each share of the Common Stock entitled to vote at such
meeting, voting together with the holders of the Preferred Stock
who are entitled to vote thereon, and not as a separate class.
D. DESIGNATION OF SERIES A CONVERTIBLE PREFERRED
STOCK. One Hundred Thirty-Seven Thousand One Hundred Forty-Three
(137,143) authorized shares of Preferred Stock shall be issued in
and as a series to be designated Series A Convertible Preferred
Stock (the "Series A Preferred Stock") and shall have the powers,
preferences, rights, qualifications and limitations as set forth
in this Part D.
(i) DIVIDENDS. The holders of shares of Series A
Preferred Stock shall be entitled to receive, out of the net
profits of the Corporation, with funds that at the time are
legally available therefor, annual dividends at the rate of No
Dollars and Twenty-Nine Point Seventy-Five Cents ($0.2975) per
share. The calculation of net profits shall be taken from the
Corporation's financial reports. If net profits in any year are
not sufficient to pay this dividend, either in whole or in part,
then any unpaid portion of the dividend will become a charge
against the net profits of the Corporation and will be paid in
full out of the net profits of the Corporation in subsequent
years before any cash dividends are paid on the Common Stock of
the Corporation in those years. The Series A Preferred Stock
shall not be entitled to participate in the profits of the
Corporation beyond its fixed, preferential annual dividend.
(ii) VOTING PROVISIONS. The Series A Preferred Stock
shall be entitled to vote at meetings of the stockholders (or
consents in lieu of meetings) of the Corporation at the rate of
one vote per share on the same basis as the shares of the Common
Stock, and voting as a single class with the holders of the
Common Stock, and not as a separate class.
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(iii) LIQUIDATION PREFERENCE. (a) In the event of
any liquidation, dissolution or winding-up of the Corporation,
either voluntary or involuntary (a "Liquidation"), each holder of
shares of the Series A Preferred Stock then issued and
outstanding shall be entitled to be paid out of the assets of the
Corporation available for distribution to its stockholders, from
any source, before any payment shall be made to the holders of
shares of the Common Stock or upon any other series of Preferred
Stock of the Corporation with a liquidation preference
subordinate to the liquidation preference of Series A Preferred
Stock, an amount per share equal to $1.18 together with any
accumulated dividends thereon. If, upon any Liquidation of the
Corporation, the assets of the Corporation available for
distribution to its stockholders shall be insufficient to pay the
holders of shares of the Series A Preferred Stock and the holders
of any other series of Preferred Stock with a liquidation
preference equal to the liquidation preference of the Series A
Preferred Stock the full amounts to which they shall respectively
be entitled, the holders of shares of the Series A Preferred
Stock and the holders of any other series of Preferred Stock with
liquidation preference equal to the liquidation preference of the
Series A Preferred Stock, after providing for any stock which may
rank prior to the Series A Preferred Stock, shall receive all of
the assets of the Corporation available for distribution and each
such holder of shares of the Series A Preferred Stock and the
holders of any other series of Preferred Stock with a liquidation
preference equal to the liquidation preference of the Series A
Preferred Stock shall share ratably in any distribution in
accordance with the amounts due such stockholders. After payment
shall have been made to the holders of shares of Series A
Preferred Stock of the full amount to which they shall be
entitled, as aforesaid, the holders of shares of the Series A
Preferred Stock shall be entitled to no further distributions
thereon, and the holders of shares of the Common Stock and of
shares of any other series of stock of the Corporation ranking
junior to the Series A Preferred Stock in respect of distribution
of assets, shall be entitled to share, according to their
respective rights and preferences, in all remaining assets of the
Corporation available for distribution to its stockholders.
(b) The Corporation shall not establish a
series of Preferred Stock with a liquidation preference senior to
that of the Series A Preferred Stock.
(c) The consolidation or merger of the
Corporation with any other corporation or corporations shall not
be deemed a Liquidation of the Corporation within the meaning of
this Sub-Part (iii).
(iv) CONVERSION PRIVILEGES. The holders of shares of
Series A Preferred Stock have conversion rights as follows (the
"Conversion Rights"):
(a) Each share of Series A Preferred Stock
shall be convertible, at the option of its holder, at any time,
into shares of Common Stock of the Corporation at zero point six
seven three six two (0.67362) shares of Common Stock for every
one (1) share of Series A Preferred Stock held (the "Conversion
Rate"), with a minimum of 13,714 shares of Series A Preferred
Stock convertible in any single transaction, unless the holder is
redeeming his remaining balance of Series A Preferred Stock.
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(b) In the event the Corporation:
(1) pays a dividend or makes a distribution on
its Common Stock in shares of its Common Stock;
(2) subdivides its outstanding shares of Common
Stock into a greater number of shares;
(3) combines its outstanding shares of Common
Stock into a smaller number of shares;
(4) makes a distribution on its Common Stock in
shares of its capital stock other than Common Stock; or
(5) issues by reclassification of its Common
Stock any shares of its capital stock;
then the Conversion Rate in effect immediately prior to such
action shall be adjusted so that the holder may receive the
number of shares of capital stock of the Company which he would
have owned immediately following such action if he had converted
the Series A Preferred Stock immediately prior to such action.
The adjustment shall become effective immediately after the
record date in the case of a dividend or distribution and
immediately after the effective date in the case of a subdivision
combination or reclassification.
No adjustment in the Conversion Rate need be made
unless the adjustment would require an increase or decrease of at
least five (5%) percent in the Conversion Rate. Any adjustments
that are not made shall be carried forward and taken into account
in any subsequent adjustment.
If a conversion results in fractional shares of Common
Stock of the Corporation, such fractional share will be rounded
up or down to a whole share amount of Common Stock.
Whenever an adjustment is made in the Conversion Rate,
the Corporation shall promptly mail to the holders of the
Series A Preferred Stock a notice of adjustment.
If after an adjustment a holder of Series A Preferred
Stock upon conversion of it may receive shares of two or more
classes of capital stock of the Corporation, the Corporation
shall determine the allocation of the adjusted Conversion Rate
between the classes of capital stock. After such allocation, the
Conversion Rate of each class of capital stock shall thereafter
be subject to adjustment on terms comparable to those applicable
to Common Stock in this Section.
(c) In the event of any capital reorganization of
the Corporation, or any consolidation or merger of the
Corporation with or into another corporation, or any sale or
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<PAGE>
conveyance to another corporation of all or substantially all of
the property of the Corporation, the holder of each share of
Series A Preferred Stock then outstanding shall have the right
thereafter to convert such share into the kind and amount of
shares of stock and other securities and property receivable upon
such reorganization, consolidation, merger, sale or conveyance by
a holder of the number of shares of Common Stock of the
Corporation into which such share of Series A Preferred Stock
might have been converted immediately prior to such
reorganization, consolidation, merger, sale or conveyance, and
shall have no further conversion rights under these provisions;
and any such resulting or surviving corporation, if it is a
reporting company under the Securities Exchange Act of 1934, as
amended, shall expressly assume the obligation to deliver, upon
the exercise of the conversion privilege, such shares, securities
or property as the holders of the Series A Preferred Stock shall
be entitled to receive pursuant to the provisions hereof. In
case securities or property other than Common Stock shall be
issuable or deliverable upon conversion as aforesaid, then all
references in this Paragraph (c) to Common Stock shall be deemed
to apply, so far as appropriate and as nearly as may be, to such
other securities or property.
(d) Upon the Corporation receiving a notice of
conversion for any shares of Series A Preferred Stock pursuant to
this Subpart, the shares covered by such notice of conversion
shall no longer be deemed outstanding and all rights with respect
to such shares shall cease and be canceled and such shares shall
return to the status of authorized but unissued Preferred Stock
of no designated class or series, and shall not be issuable by
the Corporation as Series A Preferred Stock.
(e) The Corporation shall have the option to require
a conversion of all or any part of the outstanding shares of
Series A Preferred Stock if the Common Stock (as presently
constituted) of the Corporation achieves a closing price average
per share for a consecutive sixty (60) day tracking period of
Five Dollars and Twenty-Five Cents ($5.25) (the "Mandatory
Conversion"). In the event the Corporation exercised its right
to require a conversion under this provision, it shall give the
holders of the Series A Preferred Stock written notification at
least thirty (30) days prior to the exercise of the Mandatory
Conversion.
(v) REDEMPTION. The Corporation shall not have the
right to redeem all or any part of the Series A Preferred Stock,
and the holders of the Holders of the Series A Preferred Stock
shall not have the right to require the Corporation to redeem
such Preferred Stock.
FIFTH: CLASSIFIED DIRECTORS.
A. CLASSIFICATION. The total number of directors
shall be divided into three classes, designated Class I, Class II
and Class III, with each class containing one-third of the total,
as near as may be possible. The term of office of directors of
one class shall expire at each meeting of stockholders. The
initial term of office of directors of Class I shall expire at
annual meeting of stockholders in 2000, that of class II shall
expire at the annual meeting of stockholders in 2001; and that of
Class III shall expire at the annual meeting of stockholders in
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2002; and in any cases as to each director until his successor
shall be elected and shall qualify or until his earlier
resignation, removal from office, death or disability.
Additional directorships resulting from an increase in the number
of directors shall be apportioned among the classes as equally as
possible. At each annual meeting of stockholders, the number of
directors equal to the number of directors of the class whose
term expires at such meeting (or, if less, the number of
directors properly nominated and qualified for election) shall be
elected to hold office until the third succeeding annual meeting
of stockholders after their election. Notwithstanding the
foregoing, whenever the holders of any one or more classes or
series of Preferred Stock of the Corporation shall have the
right, voting separately as a class, to elect a director or
directors, the director or directors so elected shall not be
classified pursuant to this Article FIFTH, and the term of the
director or directors so elected shall expire at the next
succeeding annual meeting of stockholders.
B. VOTE TO CHANGE. Notwithstanding any other
provision of this Certificate of Incorporation or the By-Laws of
the Corporation (and in addition to any other vote that may be
required by law, the Certificate of Incorporation or the By-Laws
of the Corporation), the affirmative vote of the holders of
sixty-six and two-thirds (66 2/3%) percent of all classes of
stock of the Corporation entitled to vote generally in election
of directors, considered for purposes of this Article FIFTH as
one class, shall be required to amend, alter, change, repeal or
adopt any provision inconsistent with, this Article FIFTH.
SIXTH: INCORPORATOR. The name and mailing address of
the incorporator is:
Name Mailing Address
---- ---------------
Bruce A. Rich Thelen Reid & Priest LLP
40 West 57th Street
New York, New York 10019
SEVENTH: COMPROMISE. Whenever a compromise or
arrangement is proposed between this Corporation and its
creditors or any class of them and/or between this Corporation
and its stockholders or any class of them, any court of equitable
jurisdiction within the State of Delaware may, on the application
in a summary way of this Corporation or of any creditor or
stockholder thereof or on the application of any receiver or
receivers appointed for this Corporation under the provisions of
Section 291 of Title 8 of the Delaware Code or on the application
of trustees in dissolution or of any receiver or receivers
appointed for this Corporation under the provisions of
Section 279 of Title 8 of the Delaware Code, order a meeting of
the creditors or class of creditors, and/or of the stockholders
or class of stockholders of this Corporation, as the case may be,
to be summoned in such manner as the said court directs. If a
majority in number representing three-fourths in value of the
creditors or class of creditors, and/or of the stockholders or
class of stockholders of this Corporation, as the case may be,
agree to any compromise or arrangement and to any reorganization
of this Corporation as a consequence of such compromise or
arrangement, the said compromise or arrangement and the said
reorganization shall, if sanctioned by the court to which the
said application has been made, be binding on all the creditors
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or class of creditors, and/or on all the stockholders or class of
stockholders, of this Corporation, as the case may be, and also
on this Corporation.
EIGHTH: BOARD OF DIRECTORS AND BY-LAWS. All corporate
powers shall be exercised by the Board of Directors, except as
otherwise provided by statute, by this Certificate of
Incorporation, by the By-Laws, or by any agreement among all of
the stockholders. The By-Laws may be adopted, amended or
repealed by the Board of Directors of the Corporation, except as
otherwise provided by law, but any by-law made by the Board of
Directors is subject to amendment or repeal by the stockholders
of the Corporation.
NINTH: LIMITED LIABILITY. A director of the
Corporation shall not be personally liable to the Corporation or
its stockholders for monetary damages for breach of fiduciary
duty as a director, except for liability (i) for any breach of
the director's duty of loyalty to the Corporation or its
stockholders, (ii) for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of
law, (iii) under Section 174 of the DGCL, or (iv) for any
transaction from which the director derived any improper personal
benefit. If the DGCL is hereafter amended to authorize corporate
action further eliminating or limiting the personal liability of
directors, then the liability of a director of the Corporation
shall be eliminated or limited to the fullest extent permitted by
the Delaware General Corporation Law, as so amended.
Any repeal or modification of the foregoing paragraph by the
stockholders of the Corporation shall not adversely affect any
right or protection of a director of the Corporation existing at
the time of such repeal or modification.
TENTH: INDEMNIFICATION. The Corporation shall
indemnify any person who was or is a party or is threatened to be
made a party to any threatened, pending or complete action, suit
or proceeding, whether civil, criminal, administrative or
investigative, or by or in the right of the Corporation to
procure judgment in its favor, by reason of the fact that he is
or was a director, officer, employee or agent of the Corporation,
or is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against
expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by
him in connection with such action, suit or proceeding if he
acted in good faith and in a manner he reasonably believed to be
in or not opposed to the best interests of the Corporation, in
accordance with and to the full extent permitted by statute.
Expenses (including attorneys' fees) incurred in defending any
civil, criminal, administrative or investigative action, suit or
proceeding shall be paid by the Corporation in advance of the
final disposition of such action, suit or proceeding as
authorized by the Board of Directors in the specific case upon
receipt of an undertaking by or on behalf of the director,
officer, employee or agent to repay such amount unless it shall
ultimately be determined that he is entitled to be indemnified by
the Corporation as authorized in this Article. The
indemnification provided by this Article shall not be deemed
exclusive of any other rights to which those seeking
indemnification may be entitled under this Certificate of
Incorporation or any agreement or vote of stockholders or
disinterested directors or otherwise, both as to action in his
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official capacity and as to action in another capacity while
holding such office, and shall continue as to a person who has
ceased to be a director, officer, employee or agent and shall
inure to the benefit of the heirs, executors and administrators
of such a person.
IN WITNESS WHEREOF, the undersigned, being the sole
incorporator hereinbefore named, hereby declares and certifies
that the facts herein stated are true, and accordingly have
hereunto set my hand this 8th day of January, 1999.
/s/ Bruce A. Rich
-----------------------------------
Bruce A. Rich, Incorporator
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Exhibit 3.2
BY-LAWS
OF
PALADYNE CORP.
ARTICLE I
Stockholders' Meetings; Voting
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Section 1.1. Annual Meetings. An annual meeting of
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stockholders shall be held for the election of directors on the
first Wednesday in February of each year, if not a legal holiday,
and, if a legal holiday, then on the next day not a legal
holiday, at 10:00 o'clock in the forenoon at such time and place
either within or without the State of Delaware as may be
designated by the Board of Directors from time to time. Any
other proper business may be transacted at the annual meeting.
Section 1.2. Special Meetings. Special meetings of
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stockholders may be called at any time by the Chairman of the
Board, the President, the Board of Directors, or as provided in
Section 2.2, to be held at such date, time and place either
within or without the State of Delaware as may be stated in the
notice of the meeting. A special meeting of stockholders shall
be called by the Secretary upon the written request, stating the
purpose of the meeting, of stockholders who together own of
record at least twenty-five percent (25%) of the outstanding
shares of stock entitled to vote at such meeting.
Section 1.3. Notice of Meetings. Whenever
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stockholders are required or permitted to take any action at a
meeting, a written notice of the meeting shall be given which
shall state the place, date and hour of the meeting, and, in the
case of a special meeting, the purpose or purposes for which the
meeting is called. Unless otherwise provided by law, the written
notice of any meeting shall be given not less than ten nor more
than sixty days before the date of the meeting to each
stockholder entitled to vote at such meeting. If mailed, such
notice shall be deemed to be given when deposited in the United
States mail, postage prepaid, directed to the stockholder at his
address as it appears on the records of the Corporation. The
Corporation shall, at the written request of any stockholder,
cause such notice to such stockholder to be confirmed to such
other address and/or by such other means as such stockholder may
reasonably request, provided that if such written request is
received after the date any such notice is mailed, such request
shall be effective for subsequent notices only.
<PAGE>
Section 1.4. Adjournments. Any meeting of
------------
stockholders, annual or special, may adjourn from time to time to
reconvene at the same or some other place, and notice need not be
given of any such adjourned meeting if the time and place thereof
are announced at the meeting at which the adjournment is taken.
At the adjourned meeting the Corporation may transact any
business which might have been transacted at the original
meeting. If the adjournment is for more than thirty days, or if
after the adjournment a new record date is fixed for the
adjourned meeting, a notice of the adjourned meeting shall be
given to each stockholder of record entitled to vote at the
meeting.
Section 1.5. Quorum. At each meeting of stockholders,
------
except where otherwise provided by law or the Certificate of
Incorporation or these By-Laws, the holders of a majority of the
outstanding shares of each class of stock entitled to vote at the
meeting, present in person or represented by proxy, shall
constitute a quorum. With respect to any matter on which
stockholders vote separately as a class, the holders of a
majority of the outstanding shares of such class shall constitute
a quorum for a meeting with respect to such matter. Two or more
classes or series of stock shall be considered a single class for
purposes of determining existence of a quorum for any matter to
be acted on if the holders thereof are entitled or required to
vote together as a single class at the meeting on such matter.
In the absence of a quorum the stockholders so present may, by
majority vote, adjourn the meeting from time to time in the
manner provided by Section 1.4 of these By-Laws until a quorum
shall attend.
Section 1.6. Organization. Meetings of stockholders
------------
shall be presided over by the Chairman of the Board, or in his
absence by the President, or in his absence by a Vice President,
or in the absence of the foregoing persons by a chairman
designated by the Board of Directors, or in the absence of such
designation by a chairman chosen at the meeting. The Secretary
shall act as secretary of the meeting, but in his absence the
chairman of the meeting may appoint any person to act as
secretary of the meeting.
Section 1.7. Voting; Proxies. Unless otherwise
---------------
provided in the Certificate of Incorporation, each stockholder
entitled to vote at any meeting of stockholders shall be entitled
to one vote for each share of stock held by him which has voting
power upon the matter in question. Each stockholder entitled to
vote at a meeting of stockholders or to express consent or
dissent to corporate action in writing without a meeting may
authorize another person or persons to act for him by proxy, but
no such proxy shall be voted or acted upon after three years from
its date, unless the proxy provides for a longer period. A duly
executed proxy shall be irrevocable if it states that it is
irrevocable and if, and only as long as, it is coupled with an
interest sufficient in law to support an irrevocable power. A
stockholder may revoke any proxy which is not irrevocable by
attending the meeting and voting in person or by filing an
instrument in writing revoking the proxy or another duly executed
proxy bearing a later date with the Secretary of the Corporation.
Voting at meetings of stockholders need not be by written ballot
-2-
<PAGE>
and need not be conducted by inspectors unless the holders of a
majority of the outstanding shares of any class of stock entitled
to vote thereon present in person or by proxy at such meeting
shall so determine. At all meetings of stockholders for the
election of directors, such election and all other elections and
questions shall, unless otherwise provided by law or by the
Certificate of Incorporation or these By-Laws, be decided by the
vote of the holders of a majority of the outstanding shares of
all classes of stock entitled to vote thereon present in person
or by proxy at the meeting, voting as a single class.
Section 1.8. Fixing Date for Determination of
--------------------------------
Stockholders of Record. In order that the Corporation may
----------------------
determine the stockholders entitled to notice of or to vote at
any meeting of stockholders or any adjournment thereof, or to
express consent to corporate action in writing without a meeting,
or entitled to receive payment of any dividend or other
distribution or allotment of any rights, or entitled to exercise
any rights in respect of any change, conversion or exchange of
stock or for the purpose of any other lawful action, the Board of
Directors may fix, in advance, a record date, which shall not be
more than sixty nor less than ten days before the date of such
meeting, nor more than sixty days prior to any other action. If
no record date is fixed: (1) the record date for determining
stockholders entitled to notice of or to vote at a meeting of
stockholders shall be at the close of business on the day next
preceding the day on which notice is given, or, if notice is
waived, at the close of business on the day next preceding the
day on which the meeting is held; (2) the record date for
determining stockholders entitled to express consent to corporate
action in writing without a meeting, when no prior action by the
Board is necessary, shall be the day on which the first written
consent is expressed; and (3) the record date for determining
stockholders for any other purpose shall be at the close of
business on the day on which the Board adopts the resolution
relating thereto. A determination of stockholders of record
entitled to notice of or to vote at a meeting of stockholders
shall apply to any adjournment of the meeting; provided, however,
that the Board may fix a new record date for the adjourned
meeting.
Section 1.9. List of Stockholders Entitled to Vote.
-------------------------------------
The Secretary shall prepare and make, at least ten days before
every meeting of stockholders, a complete list of the
stockholders entitled to vote at the meeting, arranged in
alphabetical order, and showing the address of each stockholder
and the number of shares registered in the name of each
stockholder. Such list shall be open to the examination of any
stockholder, for any purpose germane to the meeting, during
ordinary business hours, for a period of at least ten days prior
to the meeting, either at a place within the city where the
meeting is to be held, which place shall be specified in the
notice of the meeting, or, if not so specified, at the place
where the meeting is to be held. The list shall also be produced
and kept at the time and place of the meeting during the whole
time thereof and may be inspected by any stockholder who is
present.
-3-
<PAGE>
Section 1.10. Consent of Stockholders in Lieu of
----------------------------------
Meeting. To the extent provided by any statute at the time in
-------
force, whenever the vote of stockholders at a meeting thereof is
required or permitted to be taken for or in connection with any
corporate action, by any statute, by the Certificate of
Incorporation or by these By-Laws, the meeting and prior notice
thereof and vote of stockholders may be dispensed with if the
holders of outstanding stock having not less than the minimum
number of votes that would be necessary to authorize or take such
action at a meeting at which all shares entitled to vote thereon
were present and voted shall consent in writing to such corporate
action without a meeting by less than unanimous written consent
and notice thereof shall be given to those stockholders who have
not consent in writing.
ARTICLE II
Board of Directors
-----------------
Section 2.1. Powers; Number; Qualifications. The
------------------------------
business and affairs of the Corporation shall be managed by or
under the direction of the Board of Directors, except as may be
otherwise provided by law or in the Certificate of Incorporation.
The number of Directors which shall constitute the whole Board of
Directors shall not be less than one (1) nor more than nine (9).
Within such limits, the number of directors may be fixed from
time to time by vote of the stockholders or of the Board of
Directors, at any regular or special meeting, subject to the
provisions of the Certificate of Incorporation.
Section 2.2. Election; Term of Office; Resignation;
--------------------------------------
Removal; Vacancies; Special Elections. Except as otherwise
-------------------------------------
provided in the Certificate of Incorporation or in this Section
2.2, directors shall be elected annually at the annual meeting of
the stockholders. Each director (whenever elected) shall hold
office for the term specified upon his election and until his
successor is elected and qualified or until his earlier
resignation or removal as provided in the Certificate of
Incorporation. Any director may resign at any time upon written
notice to the Board of Directors or to the Chairman of the Board
or to the President of the Corporation. Such resignation shall
take effect at the time specified therein, and unless otherwise
specified therein no acceptance of such resignation shall be
necessary to make it effective. Any director may be removed with
or without cause at any time upon the affirmative vote of the
holders of a majority of the outstanding shares of stock of the
Corporation entitled to vote for the election of such director,
given at a special meeting of such stockholders called for the
purpose, except as may otherwise be provided in the Certificate
of Incorporation. If any vacancies shall occur in the Board of
Directors, by reason of death, resignation, removal or otherwise,
or if the authorized number of directors shall be increased, the
directors then in office shall continue to act, and such
vacancies may be filled by a majority of the directors then in
office, though less than a quorum; provided, however, that
whenever the holders of any class or classes of stock or series
thereof are entitled to elect one or more directors by the
provisions of the Certificate of Incorporation, vacancies and
-4-
<PAGE>
newly created directorships of such class or classes or series
shall be filled by a majority of the directors elected by such
class or classes or series thereof then in office though less
than a quorum or by a sole remaining director so elected. Any
such vacancies or newly created directorships may also be filled
upon the affirmative vote of the holders of a majority of the
outstanding shares of stock of the Corporation entitled to vote
for the election of directors, given at a special meeting of the
stockholders called for the purpose.
Section 2.3. Regular Meetings. Regular meetings of
----------------
the Board of Directors may be held at such places within or
without the State of Delaware and at such times as the Board may
from time to time determine, and if so determined notice thereof
need not be given.
Section 2.4. Special Meetings. Special meetings of
----------------
the Board of Directors may be held at any time or place within or
without the State of Delaware whenever called by the Chairman of
the Board, by the President or by any two directors. Reasonable
notice thereof shall be given by the person or persons calling
the meeting.
Section 2.5. Telephonic Meetings Permitted. Unless
-----------------------------
otherwise restricted by the Certificate of Incorporation or these
By-Laws, any member of the Board of Directors, or any committee
designated by the Board, may participate in a meeting of the
Board or of such committee, as the case may be, by means of a
conference telephone or similar communications equipment by means
of which all persons participating in the meeting can hear each
other, and participation in a meeting pursuant to this by-law
shall constitute presence in person at such meeting.
Section 2.6. Quorum; Vote Required for Action. At all
--------------------------------
meetings of the Board of Directors the presence of a majority of
the total number of directors shall constitute a quorum for the
transaction of business. The vote of at least a majority of the
directors present at any meeting at which a quorum is present
shall be necessary to constitute and shall be the act of the
Board unless the Certificate of Incorporation or these By-Laws
shall otherwise provide. In case at any meeting of the Board a
quorum shall not be present, the members of the Board present may
adjourn the meeting from time to time until a quorum shall
attend.
Section 2.7. Organization. Meetings of the Board of
------------
Directors shall be presided over by the Chairman of the Board, or
in his absence by the President, or in their absence by a
chairman chosen at the meeting. The Secretary shall act as
secretary of the meeting, but in his absence the chairman of the
meeting may appoint any person to act as secretary of the
meeting.
Section 2.8. Action by Directors Without a Meeting.
-------------------------------------
Unless otherwise restricted by the Certificate of Incorporation
or these By-Laws, any action required or permitted to be taken at
-5-
<PAGE>
any meeting of the Board of Directors, or of any committee
thereof, may be taken without a meeting if all members of the
Board or such committee, as the case may be, consents thereto in
writing, and the writing or writings are filed with the minutes
of proceedings of the Board or committee.
ARTICLE III
Committees
----------
Section 3.1. Committees. The Board of Directors may,
----------
by resolution passed by a majority of the total number of
directors, designate one or more committees, each committee to
consist of one or more of the directors of the Corporation. Any
such committee, to the extent provided in the resolution of the
Board, and unless otherwise restricted by the Certificate of
Incorporation or these By-Laws, shall have and may exercise all
the powers and authority of the Board in the management of the
business and affairs of the Corporation, to the full extent
permitted by law.
Section 3.2. Committee Rules. Unless the Board of
---------------
Directors otherwise provides, each committee designated by the
Board may adopt, amend and repeal rules for the conduct of its
business. In the absence of a provision by the Board or a
provision in the rules of such committee to the contrary, the
entire authorized number of members of such committee shall
constitute a quorum for the transaction of business, the vote of
all such members present at a meeting shall be the act of such
committee, and in other respects each committee shall conduct its
business pursuant to Article II of these By-Laws.
ARTICLE IV
Officers
--------
Section 4.1. Officers; Election. As soon as
------------------
practicable after the annual meeting of stockholders in each
year, the Board shall elect a President and a Secretary. The
Board may also elect a Chairman of the Board, one or more Vice
Presidents, one or more Assistant Vice Presidents, one or more
Assistant Secretaries, a Treasurer and one or more Assistant
Treasurers and may give any of them such further designations or
alternate titles as it considers desirable. Any number of
offices may be held by the same person.
Section 4.2. Term of Office; Resignation; Removal;
-------------------------------------
Vacancies. Except as otherwise provided in the resolution of the
---------
Board of Directors electing any officer, each officer shall hold
office until the first meeting of the Board after the annual
meeting of stockholders next succeeding his election, and until
his successor is elected and qualified or until his earlier
resignation or removal. Any officer may resign at any time upon
-6-
<PAGE>
written notice to the Board or to the President of the
Corporation. Such resignation shall take effect at the time
specified therein, and unless otherwise specified therein no
acceptance of such resignation shall be necessary to make it
effective. The Board may remove any officer with or without
cause at any time, provided that such action by the Board shall
require the vote of a majority of the whole Board. Any such
removal shall be without prejudice to the contractual rights of
such officer, if any, with the Corporation, but the election of
an officer shall not of itself create contractual rights. Any
vacancy occurring in any office of the Corporation by death,
resignation, removal or otherwise shall or may be filled for the
unexpired portion of the term by the Board at any regular or
special meeting in the manner provided in Section 4.1 for
election of officers following the annual meeting of
stockholders.
Section 4.3. Chairman of the Board. The Chairman of
---------------------
the Board or, if there is not a Chairman of the Board, the
President, shall be the chief executive officer and shall have
general charge and supervision of the business of the
Corporation. In addition, he shall preside at all meetings of
the Board of Directors and of the stockholders at which he shall
be present. He shall have and may exercise such powers and
perform such other duties as are, from time to time, assigned to
him by the Board and as may be provided by law.
Section 4.4. President. The President shall be the
---------
chief operating officer and shall perform all duties incident to
such office, and such other duties as, from time to time, may be
assigned to him by the Board or as may be provided by law.
Section 4.5. Vice Presidents. The Vice President or
---------------
Vice Presidents, at the request of the President or in his
absence or during his inability to act, shall perform the duties
of the President, and when so acting shall have the powers of the
President. If there be more than one Vice President, the Board
of Directors may determine which one or more of the Vice
Presidents shall perform any of such duties; or if such
determination is not made by the Board, the President may make
such determination; otherwise any of the Vice Presidents may
perform any of such duties. The Vice President or Vice
Presidents shall have such other powers and perform such other
duties as may be assigned to him or them by the Board or the
President or as may be provided by law.
Section 4.6. Secretary. The Secretary shall have the
---------
duty to record the proceedings of the meetings of the
stockholders, the Board of Directors and any committees in a book
to be kept for that purpose; he shall see that all notices are
duly given in accordance with the provisions of these By-Laws or
as required by law; he shall be custodian of the records of the
Corporation; he may affix the corporate seal to any document the
execution of which, on behalf of the Corporation, is duly
authorized, and when so affixed may attest the same; and, in
general, he shall perform all duties incident to the office of
secretary of a corporation, and such other duties as, from time
to time, may be assigned to him by the Board or the President or
as may be provided by law.
-7-
<PAGE>
Section 4.7. Treasurer. The Treasurer shall have
---------
charge of and be responsible for all funds, securities, receipts
and disbursements of the Corporation, and shall deposit or cause
to be deposited, in the name of the Corporation, all moneys or
other valuable effects in such banks, trust companies or other
depositories as shall, from time to time, be selected by or under
authority of the Board of Directors; if required by the Board, he
shall give a bond for the faithful discharge of his duties, with
such surety or sureties as the Board may determine; he shall keep
or cause to be kept full and accurate records of all receipts and
disbursements in books of the Corporation and shall render to the
President and to the Board, whenever requested, an account of the
financial condition of the Corporation; and, in general, he shall
perform all the duties incident to the office of treasurer of a
corporation, and such other duties as may be assigned to him by
the Board or the President or as may be provided by law.
Section 4.8. Other Officers. The other officers, if
--------------
any, of the Corporation shall have such powers and duties in the
management of the Corporation as shall be stated in a resolution
adopted by the Board of Directors which is not inconsistent with
these By-Laws and, to the extent not so stated, as generally
pertain to their respective offices, subject to the control of
the Board. The Board may require any officer, agent or employee
to give security for the faithful performance of his duties.
ARTICLE V
Stock
-----
Section 5.1. Certificates. Every holder of stock in
------------
the Corporation shall be entitled to have a certificate signed by
or in the name of the Corporation by the Chairman of the Board of
Directors, or the President or a Vice President, and by the
Treasurer or an Assistant Treasurer, or the Secretary or an
Assistant Secretary, of the Corporation, certifying the number of
shares owned by him in the Corporation. If such certificate is
manually signed by one officer or manually countersigned by a
transfer agent or by a registrar, any other signature on the
certificate may be a facsimile. In case any officer, transfer
agent or registrar who has signed or whose facsimile signature
has been placed upon a certificate shall have ceased to be such
officer, transfer agent or registrar before such certificate is
issued, it may be issued by the Corporation with the same effect
as if he were such officer, transfer agent or registrar at the
date of issue.
Section 5.2. Lost, Stolen or Destroyed Stock
-------------------------------
Certificates; Issuance of New Certificates. The Corporation may
------------------------------------------
issue a new certificate of stock in the place of any certificate
theretofore issued by it, alleged to have been lost, stolen or
destroyed, and the Corporation may require the owner of the lost,
stolen or destroyed certificate, or his legal representative, to
-8-
<PAGE>
give the Corporation a bond sufficient to indemnify it against
any claim that may be made against it on account of the alleged
loss, theft or destruction of any such certificate or the
issuance of such new certificate.
ARTICLE VI
Miscellaneous
-------------
Section 6.1. Seal. The Corporation may have a
----
corporate seal which shall have the name of the Corporation
inscribed thereon and shall be in such form as may be approved
from time to time by the Board of Directors. The corporate seal
may be used by causing it or a facsimile thereof to be impressed
or affixed or in any other manner reproduced.
Section 6.2. Waiver of Notice of Meetings of
-------------------------------
Stockholders, Directors and Committees. Whenever notice is
--------------------------------------
required to be given by law or under any provision of the
Certificate of Incorporation or these By-Laws, a written waiver
thereof, signed by the person entitled to notice, whether before
or after the time stated therein, shall be deemed equivalent to
notice. Attendance of a person at a meeting shall constitute a
waiver of notice of such meeting, except when the person attends
a meeting for the express purpose of objecting, at the beginning
of the meeting, to the transaction of any business because the
meeting is not lawfully called or convened. Neither the business
to be transacted at, nor the purpose of, any regular or special
meeting of the stockholders, directors, or members of a committee
of directors need be specified in any written waiver of notice
unless so required by the Certificate of Incorporation or these
By-Laws.
Section 6.3. Form of Records. Any records maintained
---------------
by the Corporation in the regular course of its business,
including its stock ledger, books of account and minute books,
may be kept on, or be in the form of, punch cards, magnetic tape,
photographs, microphotographs or any other information storage
device, provided that the records so kept can be converted into
clearly legible form within a reasonable time. The Corporation
shall so convert any records so kept upon the request of any
person entitled to inspect the same.
Section 6.4. Dividends. Dividends upon the stock of
---------
the Corporation, subject to the provisions of the Certificate of
Incorporation, if any, may be declared by the Board of Directors
at any regular or special meeting, pursuant to law. Dividends
may be paid in cash, bonds, in property, or in shares of stock,
subject to the provisions of the Certificate of Incorporation.
Section 6.5. Reserves. Before the payment of any
--------
dividend, there may be set aside out of any funds of the
Corporation available for dividends such sum or sums as the
directors from time to time, in their absolute discretion, think
-9-
<PAGE>
proper as a reserve or reserves to meet contingencies, or for
equalizing dividends, or for repairing or maintaining any
property of the Corporation, or for such other purposes as the
directors shall think conducive to the interest of the
Corporation, and the directors may modify or abolish any such
reserve.
Section 6.6. Checks. All checks or demands for money
------
and notes of the Corporation shall be signed by such officer or
officers or such other person or persons as the Board of
Directors may from time to time designate.
Section 6.7. Fiscal Year. The fiscal year of the
-----------
Corporation shall be fixed by resolution of the Board of
Directors.
Section 6.8. Offices. The registered office of the
-------
Corporation shall be in the City of Wilmington, County of New
Castle, State of Delaware. The Corporation may also have offices
at such other places within or outside the State of Delaware as
the Board of Directors may from time to time determine or the
business of the Corporation may require.
ARTICLE VII
Amendments
----------
Section 7.1. Amendments. These By-Laws may be
----------
altered, amended or repealed at any regular meeting of the
stockholders or of the Board of Directors or at any special
meeting of the stockholders or of the Board of Directors if
notice of such alteration, amendment or repeal be contained in
the notice of such special meeting.
ARTICLE VIII
Indemnification
---------------
Section 8.1. Indemnification. The Corporation shall
---------------
indemnify to the fullest extent permitted by law any person made
or threatened to be made a party to any action, suit or
proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that such person, or a
person of whom he is the legal representative, is or was a
director, officer, employee or agent of the Corporation or any
predecessor of the Corporation, or serves or served any other
enterprise as a director, officer, employee or agent at the
request of the Corporation or any predecessor of the Corporation.
The Corporation shall pay any expenses reasonably
incurred by a director or officer in defending a civil or
criminal action, suit or proceeding in advance of the final
disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such director or officer to repay
such amount if it shall ultimately be determined that he is not
-10-
<PAGE>
entitled to be indemnified by the Corporation under this Article
or otherwise. The Corporation may, by action of its Board of
Directors, provide for the payment of such expenses incurred by
employees and agents of the Corporation as it deems appropriate.
The rights conferred on any person under this Article
shall not be deemed exclusive of any other rights that such
person may have or hereafter acquire under any statute, provision
of the Corporation's Certificate of Incorporation, by-law,
agreement, vote of stockholders or disinterested directors or
otherwise. All rights to indemnification and to the advancement
of expenses under this Article shall be deemed to be provided by
a contract between the Corporation and the director, officer,
employee or agent who serves in such capacity at any time while
these By-Laws and any other relevant provisions of the Delaware
General Corporation Law and any other applicable law, if any, are
in effect. Any repeal or modification thereof shall not affect
any rights or obligations then existing.
For purposes of this Article, references to "the
Corporation" shall be deemed to include any subsidiary of the
Corporation now or hereafter organized under the laws of the
State of Delaware.
-11-
Exhibit 3.3
ARTICLES OF MERGER
OF
SYNAPTX WORLDWIDE, INC.
AND
PALADYNE CORP.
To the Division of Corporations and Commerical Code
State of Utah
Pursuant to the provisions of the Utah Revised Business
Corporation Act, the domestic business corporation and the
foreign business corporation hereinafter named do hereby adopt
the following Articles of Merger.
1. Attached hereto as Exhibit A and made a part hereof is
---------
the Agreement and Plan of Merger (the "Merger Agreement") for
merging Synaptx Worldwide, Inc., a Utah corporation, with and
into Paladyne Corp., a Delaware corporation and a wholly-owned
subsidiary of Synaptx Worldwide, Inc., as adopted by unanimous
written consent of the Board of Directors of Synaptx Worldwide,
Inc. on January 19, 1999 and by unanimous written consent of the
Board of Directors of Paladyne Corp. on January 19, 1999.
2. With regard to Synaptx Worldwide, Inc., the
designation, the number of outstanding shares and the number of
votes entitled to be cast by each voting group entitled to vote
together on the Merger Agreement are as follows:
The holders of outstanding shares of Common Stock,
$.001 par value per share ("Common Stock"), and the
shares of Series A Convertible Preferred Stock, $.001
par value per share ("Series A Preferred Stock"), were
entitled to vote together as one class on the Merger
Agreement. As of January 22, 1999, 6,721,595 shares of
stock were issued and outstanding, consisting of
6,584,452 shares of Common Stock and 137,143 shares of
Series A Preferred Stock. Each share of Common Stock
and Series A Preferred Stock was entitled to one vote.
3. With regard to Paladyne Corp., the designation, the
number of outstanding shares and the number of votes entitled to
be cast by each voting group entitled to vote together on the
Merger Agreement are as follows:
The holder of the outstanding shares of Common Stock,
$.001 par value per share ("Common Stock"), was
entitled to vote on the Merger Agreement. As of
January 19, 1999, 100 shares of Common Stock were
issued and outstanding.
4. With regard to Synaptx Worldwide, Inc., 4,021,227 votes
were cast "for" approval of the Merger Agreement and -0- votes
were cast "against" approval of the Merger Agreement by the
holders of the outstanding shares of Common Stock and Series A
Preferred Stock at the annual meeting of shareholders of the
corporation held on March 3, 1999.
<PAGE>
5. With regard to Paladyne Corp., 100 votes were cast
"for" approval of the Merger Agreement and -0- votes were cast
"against" approval of the Merger Agreement by the holder of the
outstanding shares of Common Stock by a written consent of the
sole shareholder of the corporation, dated January 19, 1999.
6. The said number of votes cast for the Merger Agreement
by the shareholders of Synaptx Worldwide, Inc. was sufficient for
the approval by the sole voting group.
7. The said number of votes cast for the Merger Agreement
by the shareholders of Paladyne Corp. was sufficient for the
approval by the sole voting group.
8. The merger of Synaptx Worldwide, Inc. with and into
Paladyne Corp. is permitted by the laws of Delaware, the
jurisdiction of organization of Paladyne Corp., and has been
authorized in compliance with said laws.
9. The address of the principal office of Paladyne Corp.
within or without the State of Utah at which Paladyne Corp. has
authorized process to be served upon it by registered or
certified mail return receipt requested is as follows:
615 Crescent Executive Court, Suite 128, Lake Mary, Florida 32746
10. The merger shall be effective upon the filing of this
Certificate with the State of Utah.
Dated: March 3, 1999 SYNAPTX WORLDWIDE, INC.
By: /s/ Ronald L. Weindruch
---------------------------
Name: Ronald L. Weindruch
Title: President
PALADYNE CORP.
By: /s/ Ronald L. Weindruch
---------------------------
Name: Ronald L. Weindruch
Title: President
-2-
Exhibit 3.4
CERTIFICATE OF MERGER
OF
SYNAPTX WORLDWIDE, INC.
(A UTAH CORPORATION)
INTO
PALADYNE CORP.
(A DELAWARE CORPORATION)
(Pursuant to Section 252 of
the General Corporation Law of the State of Delaware)
The undersigned corporation organized and existing
under and by virtue of the General Corporation Law of the State
of Delaware, DOES HEREBY CERTIFY:
1. The name and state of incorporation of each of the
constituent corporations (the "Constituent Corporations") to the
merger (the "Merger") is as follows:
NAME STATE OF INCORPORATION
---- ----------------------
Synaptx Worldwide, Inc. Utah
Paladyne Corp. Delaware
2. An Agreement and Plan of Merger, dated January 19,
1999, between the Constituent Corporations has been approved,
adopted, certified, executed and acknowledged by each of the
Constituent Corporations in accordance with the requirements of
Section 252(c) of the General Corporation Law of the State of
Delaware.
3. The name of the surviving corporation of the Merger
is Paladyne Corp. (the "Surviving Corporation"). Synaptx
Worldwide, Inc. shall be the merging corporation.
4. The Certificate of Incorporation of the Surviving
Corporation shall be its Certificate of Incorporation.
<PAGE>
5. The executed Agreement and Plan of Merger is on
file at the principal place of business of the Surviving
Corporation. The address of the principal place of business of
the Surviving Corporation is 615 Crescent Executive Court, Suite
128, Lake Mary, Florida 32746.
6. A copy of the Agreement and Plan of Merger will be
furnished by the Surviving Corporation, on request and without
cost, to any stockholder of either Constituent Corporation.
7. The authorized capital stock of each Constituent
Corporation that is not a corporation of the State of Delaware is
as follows:
NAME AUTHORIZED CAPITAL STOCK
---- ------------------------
Synaptx Worldwide, Inc. 25,000,000 shares of Common Stock,
$.001 par value per share.
10,000,000 shares of Preferred
Stock, $.001 par value per share.
8. This Certificate of Merger shall be effective on
the date and at the time it is filed with the Secretary of State
of the State of Delaware.
IN WITNESS WHEREOF, this Certificate of Merger has been
executed on this 3rd day of March, 1999.
PALADYNE CORP.
By: /s/ Ronald L. Weindruch
--------------------------------
Ronald L. Weindruch
President and Chief Executive Officer
-2-
Exhibit 10.1
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated January 19, 1999 (the
"Agreement"), between SYNAPTX WORLDWIDE, INC., a Utah corporation
("Synaptx"), and PALADYNE CORP., a Delaware corporation
("Paladyne") (Synaptx and Paladyne are sometimes referred to
herein collectively as the "Constituent Corporations").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, Paladyne was incorporated in the State of Delaware
on January 11, 1999, and is a wholly-owned subsidiary of Synaptx;
and
WHEREAS, the Board of Directors of Synaptx believes that it
is in the best interest of Synaptx to reincorporate in the State
of Delaware by merging with and into Paladyne pursuant to this
Agreement.
NOW, THEREFORE, in consideration of the foregoing premises,
the mutual agreements and undertakings herein given and other
good and valuable consideration, the parties hereto agree, in
accordance with the applicable provisions of the statutes of Utah
and Delaware, respectively, which permit such merger, Synaptx
shall be, and hereby is, merged with and into Paladyne, at the
Effective Time (as herein defined), and that the terms and
conditions of the merger hereby agreed to (the "Merger") shall be
as hereinafter set forth:
ARTICLE ONE
Principal Terms of Merger
Section 1.01. Merger. At the Effective Time (as herein
------
defined), Synaptx shall merge with and into Paladyne provided
that this Agreement has not been terminated pursuant to Section
4.02 herein.
Section 1.02. Effective Time of Merger. The Merger shall
------------------------
become effective as of the completion of all filing requirements
specified in Sections 4.03 and 4.04 of this Agreement, and such
date and time is hereinafter referred to as the "Effective Time."
ARTICLE TWO
Certificate of Incorporation, By-Laws and Directors
Section 2.01. Certificate of Incorporation. The
----------------------------
Certificate of Incorporation of Paladyne in effect at the
Effective Time of the Merger shall be the Certificate of
Incorporation of Paladyne, to remain unchanged until amended as
provided by law.
<PAGE>
Section 2.02. By-Laws. The By-Laws of Paladyne in effect
-------
at the Effective Time of the Merger shall be the By-Laws of
Paladyne, to remain unchanged until amended as provided by law.
Section 2.03. Directors. Synaptx, in its capacity as sole
---------
shareholder of Paladyne, shall elect as directors of Paladyne
those individuals elected by the shareholders of Synaptx prior to
the Effective Time of the Merger, and such persons shall serve as
directors of Paladyne until the next annual meeting of the
stockholders of Paladyne.
ARTICLE THREE
Exchange and Cancellation of Shares
At the Effective Time of the Merger, all issued and
outstanding shares of Synaptx common stock, $.001 par value (the
"Old Common Stock"), and all issued and outstanding shares of
Synaptx's Series A Convertible Preferred Stock, $.001 par value
(the "Old Preferred Stock"), shall be canceled and the corporate
existence of Synaptx, shall cease. Shares of Paladyne's common
stock, par value $.001 per share (the "New Common Stock"), and
shares of Paladyne's Series A Convertible Preferred Stock, $.001
par value (the "New Preferred Stock"), shall be issued to the
shareholders of Synaptx as a result of the Merger as herein
provided.
Section 3.01. The Surviving Corporation Stock. Each share
-------------------------------
of Old Common Stock which is outstanding prior to the Effective
Time of the Merger shall be converted into one issued and
outstanding share of New Common Stock and, from and after the
Effective Time of the Merger, the holders of all of said issued
and outstanding shares of Old Common Stock shall automatically be
and become holders of shares of New Common Stock upon the basis
above specified, whether or not certificates representing said
shares are then issued and delivered. Each share of Old
Preferred Stock which is outstanding prior to the Effective Time
of the Merger shall be converted into one issued and outstanding
share of New Preferred Stock and, from and after the Effective
Time of the Merger, the holders of all of said issued and
outstanding shares of Old Preferred Stock shall automatically be
and become holders of shares of New Preferred Stock upon the
basis above specified, whether or not certificates representing
said shares are then issued and delivered.
Section 3.02. Cancellation of Old Common Stock and Old
----------------------------------------
Preferred Stock. After the Effective Time of the Merger, each
---------------
holder of record of any outstanding certificate or certificates
theretofore representing shares of Old Common Stock or Old
Preferred Stock may surrender the same to American Stock Transfer
& Trust Company, New York, New York, and such holder shall be
entitled upon such surrender to receive in exchange therefor a
certificate or certificates representing an equal number of
shares of New Common Stock or New Preferred Stock. Until so
surrendered, each outstanding certificate which, prior to the
Effective Time of the Merger, represented one or more shares of
Old Common Stock or Old Preferred Stock shall be deemed for all
corporate purposes to evidence ownership of an equal number of
shares of New Common Stock or New Preferred Stock, respectively.
Upon the surrender of a certificate or certificates representing
shares of Old Common Stock or Old Preferred Stock, a proper
officer of Paladyne shall cancel said certificate or
certificates.
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<PAGE>
ARTICLE FOUR
Adoption and Termination
Section 4.01. Submission to Vote of Shareholders. This
----------------------------------
Agreement shall be submitted to the shareholders of Synaptx, as
provided by applicable law, and shall take effect, and be deemed
to be the Agreement and Plan of Merger of the Constituent
Corporations, upon the approval or adoption thereof by said
shareholders of Synaptx in accordance with the requirements of
the laws of the State of Utah.
Section 4.02. Termination of Agreement. Anything herein or
------------------------
elsewhere to the contrary notwithstanding, this Agreement may be
abandoned by Synaptx by an appropriate resolution of its Board of
Directors at any time prior to the Effective Time of the Merger
if such Board of Directors believes that the Merger is not in the
best interests of Synaptx or in the event that the shareholders
who hold more than five (5%) percent of the outstanding and
issued shares of Old Common Stock [and Old Preferred Stock]
dissent from the Merger and seek appraisal rights pursuant to
Sections 16-10a-1301 through 16-10a-1331 of the Utah Revised
Business Corporation Act.
Section 4.03. Filing of Articles of Merger in the State of
--------------------------------------------
Utah. As soon as practicable after the requisite shareholder
----
approval referenced in Section 4.01 herein, Articles of Merger to
effectuate the terms of this Agreement shall be executed and
acknowledged by Paladyne and thereafter delivered to the Division
of Corporations and Commerical Code (the "Division") of the State
of Utah for filing and recording in accordance with applicable
law, unless this Agreement has been terminated pursuant to
Section 4.02 herein.
Section 4.04. Filing of Certificates of Merger in the State
---------------------------------------------
of Delaware. As soon as practicable after the requisite
-----------
shareholder approval referenced in Section 4.01 herein, a
Certificate of Merger to effectuate the terms of this Agreement
shall be executed by each of the Constituent Corporations and
thereafter delivered to the Secretary of State of the State of
Delaware for filing and recording in accordance with applicable
law, unless this Agreement has been terminated pursuant to
Section 4.02 herein.
ARTICLE FIVE
Effect of Merger
Section 5.01. Effect of Merger. At the Effective Time of
----------------
the Merger, the Constituent Corporations shall be a single
corporation, which shall be Paladyne, and the separate existence
of Synaptx shall cease except to the extent provided by the laws
of the States of Utah and Delaware. Paladyne shall thereupon and
thereafter possess all the rights, privileges, immunities and
franchises, of both a public and private nature, of each of the
Constituent Corporations; and all property, real, personal and
mixed, and all debts due on whatever account, including
subscriptions to shares, and all other choses in action, and all
and every other interest of, or belonging to, or due to each of
the Constituent Corporations, shall be taken and deemed to be
vested in Paladyne without further act or deed; and the title to
all real estate, or any interest therein, vested in either of the
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<PAGE>
Constituent Corporations shall not revert or be in any way
impaired by reason of the Merger. Paladyne shall thenceforth be
responsible and liable for all of the liabilities and obligations
of each of the Constituent Corporations and any claim existing or
action or proceeding pending by or against either of the
Constituent Corporations may be prosecuted to judgment as if the
Merger had not taken place, or the Surviving Corporation may be
substituted in its place, and neither the rights of creditors nor
any liens upon the property of either of the Constituent
Corporations shall be impaired by the Merger. Paladyne shall
assume any stock option or similar employee benefits plan of
Synaptx, and all contractual rights of Synaptx for the issuance
of shares of the Old Common Stock and Old Preferred Stock, and
such issuances or reserves for issuances shall be of shares of
New Common Stock and New Preferred Stock on an as-converted basis
as set forth in Section 3.01 hereof.
Section 5.02. Business Combinations with Ronald E. Weindruch.
----------------------------------------------
Paladyne hereby acknowledges that Ronald E. Weindruch, beneficially
owns 1,661,881 shares of Old Common Stock at the date of this
Agreement and further recognizes that, as a result of such stock
ownership, Mr. Weindruch could be deemed to be an Interested
Stockholder (as that term is defined under Section 203 of the General
Corporation Law of the State of Delaware) of Paladyne after the
consummation of the Merger. Paladyne hereby represents and warrants
to Synaptx that the Board of Directors of Paladyne has considered
the stock ownership that Mr. Weindruch will have in Paladyne at the
Effective Time of the Merger in approving this Agreement. Paladyne
hereby represents and warrants to Synaptx that the Board of Directors
of Paladyne has approved such stock acquisition.
ARTICLE SIX
Post Merger Undertakings
Section 6.01 Service of Process. Paladyne hereby agrees
------------------
that it may be served with process within the State of Utah in
any proceeding for the enforcement of any obligation of Synaptx
and in any proceeding for the enforcement of the rights of any
dissenting shareholder of Synaptx.
Section 6.02 Authorization of Service of Process.
-----------------------------------
Paladyne hereby authorizes service of process on it pursuant to
Section 6.01 herein by registered or certified mail return
receipt requested to its principal office as set forth in the
Articles of Merger to be filed pursuant to Section 4.03 herein or
as changed by notice to the Division.
Section 6.03 Payments to Dissenting Shareholders.
-----------------------------------
Paladyne shall promptly pay to any shareholders of Synaptx who
dissent from the Merger the amount, if any, to which such
dissenting shareholders shall be entitled with respect to the
Merger pursuant to applicable law.
ARTICLE SEVEN
Miscellaneous
Section 7.01 Further Actions. Each of the Constituent
---------------
Corporations shall take or cause to be taken all action, or do,
or cause to be done, all things necessary, proper or advisable
under the laws of the States of Utah and Delaware to consummate
and make effective the Merger following approval of the Merger by
the shareholders of Synaptx in accordance with the laws of said
States.
Section 7.02. Amendments. At any time prior to the
----------
Effective Time of the Merger (notwithstanding any shareholder
approval), if authorized by their respective Board of Directors,
-4-
<PAGE>
the parties hereto may, by written agreement, amend or supplement
any of the provisions of this Agreement. Any written instrument
or agreement referred to in this section shall be validly and
sufficiently authorized for the purposes of this Agreement if
signed on behalf of each of the Constituent Corporations by a
person authorized to sign this Agreement.
Section 7.03. Counterparts. This Agreement may be executed
------------
in any number of counterparts, each of which shall be deemed to
be an original instrument, but all such counterparts together
shall constitute one and the same instrument.
IN WITNESS WHEREOF, the Constituent Corporations,
pursuant to the approval and authority duly given by resolutions
adopted by their respective Board of Directors have caused this
Agreement and Plan of Merger to be executed by an authorized
officer of each party hereto, and the corporate seal affixed on
the date above first written.
PALADYNE CORP.
(a Delaware corporation)
By: /s/ Ronald L. Weindruch
------------------------------
Name: Ronald L. Weindruch
Title: President
SYNAPTX WORLDWIDE, INC.
(a Utah corporation)
By: /s/ Ronald L. Weindruch
------------------------------
Name: Ronald L. Weindruch
Title: President
-5-
Exhibit 10.2
PALADYNE CORP.
1999 STOCK OPTION PLAN
1 Purpose. This 1999 Stock Option Plan (the "Plan")
-------
of Paladyne Corp., a Delaware corporation (the "Company"), is
intended to provide incentives: (i) to certain directors,
officers, employees and other persons who perform services for or
on behalf of the Company and any subsidiaries of the Company
(collectively, the "Subsidiaries") by providing them with
opportunities to purchase capital stock in the Company pursuant
to options granted hereunder which qualify as "incentive stock
options" under Section 422(b) of the Internal Revenue Code of
1986, as amended (the "Code") ("ISO" or "ISOs") or which do not
qualify as ISOs ("Non-Qualified Option" or "Non-Qualified
Options"); and (ii) to individuals who are directors but not also
employees of the Company and the Subsidiaries ("Non-Employee
Directors"), and to individuals who are members of the Advisory
Board or an independent contractor, or consultant to the Company
or its Subsidiaries, by providing them with opportunities to
purchase capital stock in the Company pursuant to Non-Qualified
Options. Both ISOs and Non-Qualified Options are referred to
hereinafter individually as an "Option" and collectively as
"Options," and persons to whom Options are granted are referred
to hereinafter individually as an "Optionee" and collectively as
"Optionees." As used herein, the term "Subsidiary" means
"subsidiary corporation" as that term is defined in Section
424(f) of the Code.
2 Administration of the Plan. The Plan shall be
--------------------------
administered by a Committee of the Board of Directors of the
Company (the "Committee"), each member of which shall be a "Non-
Employee Director" within the meaning of Rule 16b-3 or any
successor provision ("Rule 16b-3") under the Securities Exchange
Act of 1934, as amended (the "Exchange Act"). The Committee
shall consist of two or more members. Subject to the terms of
the Plan, the Committee shall have the authority to (i) determine
the employees of the Company and Subsidiaries (from among the
class of employees eligible under Section 4 hereof to receive
ISOs) to whom ISOs may be granted; (ii) determine the person and
the number of shares which may be issued under each Option; (iii)
determine the time or times at which Options may be granted; (iv)
determine the exercise price of shares subject to each Option,
which price shall not be less than the fair market value as
specified in Section 6; (v) determine (subject to Sections 7 and
9) the time or times when each Option shall become exercisable
and the duration of the exercise period; (vi) determine whether
restrictions are to be imposed on shares subject to Options and
the nature of such restrictions, if any, and (vii) interpret the
Plan and prescribe and rescind rules and regulations relating to
it. If the Committee determines to issue a Non-Qualified Option,
it shall take whatever actions it deems necessary, under Section
422 of the Code and the regulations promulgated thereunder, to
ensure that such Option is not treated as an ISO. The
interpretation and construction by the Committee of any
provisions of the Plan or of any Option granted under it shall be
final. The Committee may from time to time adopt such rules and
regulations for carrying out the Plan as it may deem best. No
1
<PAGE>
member of the Committee or of the Board of Directors of the
Company shall be liable for any action or determination made in
good faith with respect to the Plan or any Option granted under
it.
3 Stock. The stock delivered under this Plan shall
-----
be the Company's Common Stock, par value $.001 per share (the
"Common Stock"), either authorized and unissued, treasury stock
or shares purchased on the open market. The aggregate number of
shares which may be issued pursuant to the Plan is 2,500,000,
subject to adjustment as provided in Section 13. If any Option
granted under the Plan shall expire or terminate for any reason
without having been exercised in full or shall cease for any
reason to be exercisable in whole or in part, the unpurchased
shares subject to such Option shall again be available for grants
of Options under the Plan.
4 Eligible Employees and Others. ISOs and Non-
-----------------------------
Qualified Options may be granted to individuals who are employees
of the Company and its Subsidiaries, including officers and
directors who are also employees at the time the Option is
granted. Non-Qualified Options may be granted to Non-Employee
Directors and independent contractors and consultants to the
Company and its Subsidiaries, affiliates or any entity in which
the Company has an interest, or who are deemed by the Committee
to be in a position to perform such services in the future.
Granting of any Option to any person shall neither entitle that
person to, nor disqualify him from, participation in any other
Option grant.
5 Term of Plan; Granting of Options. The term of
---------------------------------
the Plan will commence on the date of adoption of the Plan by the
Company's Board of Directors, subject to approval by stockholders
within one year of adoption, and terminate on the day immediately
preceding the tenth anniversary of said adoption, except as to
Options outstanding on that date and subject to earlier
termination as provided in Sections 9 and 10 hereof. Options may
be granted under the Plan at any time during the term of the
Plan. The date of grant of an Option under the Plan shall be the
date specified by the Committee at the time it grants the Option;
provided, however, that such date shall not be prior to the date
on which the Committee acts to approve the grant. No Option shall
be granted pursuant to the Plan after January 18, 2009.
6 Minimum Exercise Price; ISO Limitations.
---------------------------------------
6.1 Price for Non-Qualified Options. The
-------------------------------
exercise price per share for each Non-Qualified Option granted under
the Plan shall not be less than the fair market value of the Common
Stock on the date of grant of the Option, and in no event shall
be less than the minimum legal consideration required therefor
under the laws of the State of Delaware or the laws of any
jurisdiction in which the Company or its successors in interest
may be organized.
6.2 Price for ISOs. The exercise price per share
--------------
for each ISO granted under the Plan shall not be less than the
fair market value per share of Common Stock on the date of such
grant. In the case of an ISO to be granted to an employee owning
stock possessing more than ten percent (10%) of the total
combined voting power of all classes of stock of the Company or
any Subsidiary (a "10% Employee"), the price per share for such
ISO shall not be less than one hundred ten percent (110%) of the
fair market value per share of Common Stock on the date of grant.
2
<PAGE>
For purposes of determining stock ownership under this Section,
the rules of Section 424(d) of the Code shall apply.
6.3 $100,000 Annual Limitation on ISO Vesting.
-----------------------------------------
To the extent that, in the aggregate under this Plan and all
incentive stock option plans of the Company and any Subsidiary,
ISOs become exercisable for the first time by an employee during
any calendar year with respect to stock having a fair market
value (determined at the time the ISOs were granted) in excess of
$100,000, such excess amount of stock shall be deemed to have
been granted as a Non-Qualified Option, and not as an ISO.
6.4 Determination of Fair Market Value. If at
----------------------------------
the time an Option is granted under the Plan, the Company's Common
Stock is publicly traded, "fair market value" shall be determined
as of the last business day for which the prices or quotes
discussed in this sentence are available prior to the date such
Option is granted and shall be (i) the mean (on that date) of the
high and low prices of the Common Stock on the principal national
securities exchange on which the Common Stock is traded, if the
Common Stock is then traded on a national securities exchange;
(ii) the last reported sale price (on that date) of the Common
Stock on the NASDAQ National Market or Small Cap Market (or other
interdealer quotation system), if the Common Stock is not then
traded on a national securities exchange; or (iii) the closing
bid price (or average of bid prices) last quoted (on that date)
by the OTC Electronic Bulletin Board or other established
quotation service for over-the-counter securities, if the Common
Stock is not reported on the NASDAQ National Market or Small Cap
Market (or other interdealer quotation system). However, if the
Common Stock is not publicly traded at the time an Option is
granted under the Plan, the "fair market value" shall be deemed
to be the fair value of the Common Stock as determined by the
Committee in good faith after taking into consideration all
factors which it deems appropriate, including, without
limitation, recent sale and offer prices of the Common Stock in
private transactions negotiated at arm's length.
7 Option Duration. Subject to earlier termination
---------------
as provided in Sections 9 and 10, each Option shall expire on the
date specified by the Committee, but not more than (i) ten (10)
years from the date of grant in the case of Non-Qualified
Options, (ii) ten (10) years from the date of grant in the case of
ISOs generally, and (iii) five (5) years from the date of grant in
the case of ISOs granted to a 10% Employee, as determined under
Section 6.02. Subject to earlier termination as provided in
Sections 9 and 10, the term of each ISO shall be the term set
forth in the original instrument granting such ISO, except with
respect to any part of such ISO that is converted into a
Non-Qualified Option pursuant to Section 16.
8 Exercise of Option. Subject to the provisions of
------------------
Sections 9 through 12, each Option granted under the Plan shall
be exercisable as follows:
8.1 Vesting. The Option shall either be fully
-------
exercisable on the date of grant or shall become exercisable
thereafter in such installments as the Committee may specify,
provided that an Option granted to a director or officer of the
Company may not vest earlier than six (6) months from the date of
grant.
3
<PAGE>
8.2 Full Vesting of Installments. Once an
----------------------------
installment becomes exercisable it shall remain exercisable until
expiration or termination of the Option, unless otherwise
specified by the Committee.
8.3 Partial Exercise. Each Option or installment
----------------
may be exercised at any time or from time to time, in whole or in
part, for up to the total number of shares with respect to which
it is then exercisable.
8.4 Acceleration of Vesting. The Committee shall
-----------------------
have the right to accelerate the date of exercise of any
installment of any Option, provided that the Committee shall not,
without the consent of an Optionee, accelerate the exercise date
of any installment of any Option granted to any employee as an
ISO if such acceleration would violate the annual vesting
limitation contained in Section 422(d) of the Code, as described
in Section 6.03.
9 Termination of Employment. If an Optionee ceases
-------------------------
his employment with, or service by, the Company and all
Subsidiaries other than by reason of death or disability as
defined in Section 10 or by the Company or any Subsidiary for
cause, no further installments of his Options shall become
exercisable, and his Options shall terminate after the passage of
one (1) year from the date of termination of his employment or
service (or three (3) months as to ISOs), but in no event later
than on their specified expiration dates, during which period he
shall have the right to exercise any Options exercisable by him
on the date of termination of employment, subject to exercise for
such other periods as determined by the Committee at the time of
grant. Options held by an Optionee whose termination of
employment or service is for cause shall terminate upon such
termination. For purposes of this Section 9 only, employment or
service shall be considered as continuing uninterrupted during
any bona fide leave of absence (such as those attributable to
illness, military obligations or governmental service). A bona
fide leave of absence with the written approval of the Committee
shall not be considered an interruption of employment or service
under this Section 9, provided that such written approval
contractually obligates the Company or any Subsidiary to continue
the employment or service of the Optionee after the approved
period of absence. Options granted under the Plan shall not be
affected by any change of employment or service within or among
the Company and Subsidiaries, so long as the Optionee continues
to be an employee or independent contractor or advisor of the
Company or any Subsidiary. Nothing in the Plan shall be deemed
to give any Optionee the right to be retained in employment or
other service by the Company or any Subsidiary for any period of
time. The Committee may, in its sole discretion, change the
termination period for any Option from the period provided for in
this Section 9 or in Section 10 to a period less than the
respective periods specified herein.
10 Death; Disability.
-----------------
10.1 Death. If an Optionee ceases his employment
-----
with or service by the Company and all Subsidiaries by reason of
his death, any Option may be exercised, to the extent of the
number of shares with respect to which he could have exercised it
on the date of his death, by his estate, personal representative
or beneficiary who has acquired the Option by will or by the laws
of descent and distribution at any time within one (1) year from
4
<PAGE>
the date of the Optionee's death or such later date as fixed by
the Committee as to Non-Qualified Options, but in no event later
than on their specified expiration dates.
10.2 Disability. If an Optionee ceases his
----------
employment with or service by the Company and all Subsidiaries by
reason of his disability, he shall have the right to exercise any
Option held by him on the date of termination of employment, to
the extent of the number of shares with respect to which he could
have exercised it on that date, at any time prior to one (1) year
from the date of the termination of the Optionee's employment or
service or such later date as fixed by the Committee as to Non-
Qualified Options, but in no event later than on their specified
expiration dates. For the purposes of the Plan, the term
"disability" shall mean "permanent and total disability" as
defined in Section 22(e)(3) of the Code or successor statute.
11 Assignability. No Option shall be assignable or
-------------
transferable by the Optionee except (i) by will or by the laws of
descent and distribution, (ii) pursuant to a qualified domestic
relations order or Title I of the Employee Retirement Income
Security Act or (iii) with respect to Non-Qualified Options, to a
spouse or lineal descendant or lineal ascendant of the Optionee.
12 Terms and Conditions of Options. Options shall be
-------------------------------
evidenced instruments (which need not be identical) in such forms
as the Committee may from time to time approve (the "Option
Agreements"). The Option Agreements shall conform to the terms
and conditions set forth in Sections 6 through 11 hereof and may
contain such other provisions as the Committee deems advisable
which are not inconsistent with the Plan, including restrictions
applicable to shares of Common Stock issuable upon the exercise
of Options. The Committee may from time to time confer authority
and responsibility on one or more of its own members and/or one
or more officers of the Company to execute and deliver the Option
Agreements. The proper officers of the Company are authorized
and directed to take any and all action necessary or advisable
from time to time to carry out the terms of the Option
Agreements.
13 Adjustments. Upon the occurrence of any of the
-----------
following events, an Optionee's rights with respect to Options
granted to him hereunder shall be adjusted as hereinafter
provided, unless otherwise specifically provided in the written
agreement between the Optionee and the Company relating to such
Option:
13.1 Stock Dividends and Stock Splits. If the
--------------------------------
shares of Common Stock shall be subdivided or combined into a
smaller or greater number of shares or if the Company shall issue
any shares of Common Stock as a stock dividend on its outstanding
Common Stock, the number of shares of Common Stock deliverable
upon the exercise of Options shall be appropriately decreased or
increased proportionately, and appropriate adjustments shall be
made in the purchase price per share to reflect such subdivision,
combination or stock dividend.
13.2 Consolidations or Mergers. If the Company is
-------------------------
to be consolidated with or acquired by another entity in a
merger, sale of all or substantially all of the Company's assets
or otherwise (an "Acquisition"), the Committee or the board of
directors of any entity assuming the obligations of the Company
hereunder (the "Successor Board"), shall, as to outstanding
Options, either (i) make appropriate provision for the
continuation of such Options by substituting on an equitable
5
<PAGE>
basis for the shares then subject to such Options the
consideration payable with respect to the outstanding shares of
Common Stock in connection with the Acquisition; (ii) upon
written notice to the Optionees, provide that all Options must be
exercised, to the extent then exercisable, within a specified
number of days of the date of such notice, at the end of which
period the Options shall terminate; or (iii) terminate all
Options in exchange for a cash payment equal to the excess of the
fair market value of the shares subject to such Options (to the
extent then exercisable) over the exercise price thereof.
13.3 Recapitalization or Reorganization. In the
----------------------------------
event of a recapitalization or reorganization of the Company
(other than a transaction described in Section 13.02) pursuant to
which securities of the Company or of another corporation are
issued with respect to the outstanding shares of Common Stock, an
Optionee upon exercising an Option shall be entitled to receive
for the purchase price paid upon such exercise the securities he
would have received if he had exercised his Option prior to such
recapitalization or reorganization.
13.4 Change in Control. In the event of a change
-----------------
in control of the Company, all Options under the Plan which are not
fully vested shall vest 100% and shall be immediately
exercisable. For purposes of this Plan, a "change in control"
shall mean any of the following events: (a) the Company receives
a report on Schedule 13D filed with the Securities and Exchange
Commission pursuant to Section 13(d) of the Exchange Act disclosing
that any person, group, corporation or other entity is the beneficial
owner, directly or indirectly, of twenty percent (20%) or more of
the outstanding Common Stock of the Company; (b) any person (as
such term is defined in Section 13(d) of the Exchange Act),
group, corporation or other entity other than the Company or any
Subsidiary, purchases shares pursuant to a tender offer or
exchange offer to acquire any Common Stock of the Company for
cash, securities or any other consideration, provided that after
consummation of the offer, the person, group, corporation or
other entity in question is the beneficial owner (as such term is
defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of twenty percent (20%) or more of the outstanding
Common Stock of the Company (calculated as provided in paragraph
(d) of Rule 13d-3 under the Exchange Act in the case of rights to
acquire common stock); (c) the stockholders of the Company
approve (i) any consolidation or merger of the Company in which
the Company is not the continuing or surviving corporation or
pursuant to which shares of Common Stock would be converted into
cash, securities or other property, or (ii) any sale, lease,
exchange or other transfer (in one transaction or a series of
related transactions) of all or substantially all of the assets
of the Company; or (d) there shall have been a change in a
majority of the members of the Board of Directors of the Company
within a twenty-four (24) month period unless the election or
nomination for election by the Company's stockholders of each new
director was approved by the vote of two-thirds of the directors
then still in office who were in office at the beginning of the
twenty-four (24) month period.
13.5 Modification of ISOs. Notwithstanding the
--------------------
foregoing, any adjustments made pursuant to Section 13.01, 13.02,
13.03 or 13.04 with respect to ISOs shall be made only after the
Committee, after consulting with counsel for the Company,
determines whether such adjustments would constitute a
"modification" of such ISOs (as that term is defined in Section
424 of the Code) or would cause any adverse tax consequences for
6
<PAGE>
the holders of such ISOs. If the Committee determines that such
adjustments made with respect to ISOs would constitute a
modification of such ISOs, it may refrain from making such
adjustments.
13.6 Dissolution or Liquidation. In the event of
--------------------------
the proposed dissolution or liquidation of the Company, each
Option will terminate immediately prior to the consummation of
such proposed action or at such other time and subject to such
other conditions as shall be determined by the Committee.
13.7 Issuances of Securities. Except as expressly
-----------------------
provided herein, no issuance by the Company of shares of stock of
any class, or securities convertible into shares of stock of any
class, shall affect, and no adjustment by reason thereof shall be
made with respect to, the number or price of shares subject to
Options. No adjustments shall be made for dividends paid in cash
or in property other than securities of the Company.
13.8 Fractional Shares. No fractional shares
-----------------
shall be issued under the Plan and the Optionee shall receive from
the Company cash in lieu of such fractional shares.
13.9 Adjustments. Upon the happening of any of
-----------
the events described in Section 13.01, 13.02, 13.03 or 13.04 above,
the class and aggregate number of shares set forth in Section 3
hereof that are subject to Options which previously have been or
subsequently may be granted under the Plan shall also be
appropriately adjusted to reflect the events described in such
subparagraphs. The Committee or the Successor Board shall
determine the specific adjustments to be made under this Section
13 and, subject to Section 2 hereof, its determination shall be
conclusive.
14 Means of Exercising Options. An Option (or any
---------------------------
installment or portion of an installment thereof) shall be
exercised by giving written notice to the Company at its
principal office address. The notice shall identify the Option
being exercised and specify the number of shares as to which such
Option is being exercised, accompanied by full payment of the
purchase price therefor either: (a) in United States dollars in
cash or by check; (b) at the discretion of the Committee, through
delivery of shares of Common Stock having a fair market value
equal as of the date of the exercise to the cash exercise price
of the Option; or (c) at the discretion of the Committee, by any
combination of (a) and (b) above. If the Committee exercises its
discretion to permit payment of the exercise price of an ISO by
means of the methods set forth in clauses (b) or (c) of the
preceding sentence, such discretion shall be exercised in writing
at the time of the grant of the Option in question. An Optionee
shall not have the rights of a stockholder with respect to the
shares covered by his Option until the date of issuance of a
stock certificate to him for such shares. Except as expressly
provided above in Section 13 with respect to changes in
capitalization and stock dividends, no adjustment shall be made
for dividends or similar rights for which the record date is
before the date such stock certificate is issued.
15 Termination or Amendment of Plan. The Board of
--------------------------------
Directors may terminate or amend the Plan in any respect at any
time; however, without the approval of the Company's stockholders
obtained within twelve (12) months before or after the Board of
Directors adopts a resolution authorizing any such termination or
7
<PAGE>
amendment, the Board of Directors may not so terminate or amend
the Plan if prior stockholder approval is then required by
Section 16(b) of the Exchange Act, applicable Delaware law or tax
law, or the rules of any applicable national securities exchange
or national stock quotation system on which the Common Stock may
then be listed or traded. Except as otherwise provided in this
Section 15, in no event may action of the Board of Directors or
stockholders alter or impair the rights of an Optionee, without
his consent, under any Option previously granted to him.
16 Notice to Company of Disqualifying Disposition.
----------------------------------------------
By accepting an ISO granted under the Plan, each Optionee agrees to
notify the Company in writing immediately after making a
Disqualifying Disposition, as described in Sections 421, 422 and
424 of the Code and regulations thereunder, of any stock acquired
under the Plan (or stock received in a transaction described in
Section 424(b) or 424(c)(1)(B) of the Code, relating to
distributions of stock with respect to stock acquired under the
Plan and certain tax-free exchanges of stock acquired under the
Plan for other stock or securities). A Disqualifying Disposition
(with certain exceptions) is generally any disposition within two
(2) years of the date the ISO was granted or within one (1) year
of the date the ISO was exercised, whichever period ends later.
With respect to stock held jointly with right of survivorship, a
termination of such joint tenancy may constitute a Disqualifying
Disposition. This Section 16 shall be made binding upon the
Optionee and upon any transferee of stock described in this
Section to whom Section 424(c)(4)(B) of the Code applies.
17 Withholding of Additional Income Taxes. Upon the
--------------------------------------
exercise of a Non-Qualified Option or the making of a
Disqualifying Disposition (as defined in Section 16), the Company
may withhold taxes in respect of amounts that constitute
compensation includible in gross income, whenever the Company
determines that such withholding is required. The Committee in
its discretion may condition the exercise of an Option on the
Optionee's making satisfactory arrangement for such withholding.
In addition to tax withholding, government regulations may impose
reporting or other obligations on the Company with respect to the
Plan. For example, the Company may be required to send tax
information statements to employees and former employees that
exercise ISOs.
18 Governing Law, Construction. The validity and
---------------------------
construction of the Plan and the agreements evidencing Options
shall be governed by the laws of the State of Delaware, or the
laws of any jurisdiction in which the Company or its successors
in interest may be organized. In construing this Plan, the
singular shall include the plural and the masculine gender shall
include the feminine and neuter, unless the context otherwise
requires.
Adopted by the Board of Directors
and Stockholders as of January 19, 1999
8
Exhibit 99.1
Wednesday March 10, 1999
Company Press Release
Synaptx Elects New Board Members
And Approves PALADYNE As New Name
ORLANDO, FL--(BUSINESS WIRE)--March 10, 1999-- Synaptx Worldwide, Inc. (OTC:BB
SYTX) announced the election of John Foster and Kenneth Horn to its Board of
Directors.
Mr. Foster, 55, is the President of Vedra International Associates. He was
formerly a Corporate Officer of AT&T (NYSE:T} where he served as Vice President
- -Marketing and Sales, Southeastern Region, President and CEO of AT&T American
Transtech, and as President and Managing Director of AT&T Communications
Services Group - Europe. Foster is also a board member of Aerial Communications
(NASDAQ:AERL).
Mr. Horn, 58, is Managing Director of K&H Associates. He recently retired as a
Corporate Officer of Nortel Networks (NYSE:NT/TSE:NTL) where he served as Vice
President, Independents. Horn is widely credited with establishing Nortel's
industry leading position with the Independent Telecommunication companies and
the Competitive Local Exchange Carriers by generating many billions in sales.
Commenting on the new Board Members, Ronald Weindruch, Chairman & CEO, stated
that: "We are pleased to be able to attract quality people like John Foster and
Ken Horn to the Board of our fast growing company. I'm confidant that their
contributions will be significant as we accelerate the rollout of our
Information Engineered Customer Management Products and Services. The four
continuing directors were re-elected and the directors were classified with
three year terms."
In other business, the Company announced that the shareholders have approved a
migratory merger pursuant to which the Company changed its state of
incorporation from Utah to Delaware and its name to PALADYNE Corporation. On the
merger, each outstanding share of Synaptx Common Stock became exchanged for one
share of PALADYNE Common Stock. The name PALADYNE comes from the Greek language
and represents CUSTOMER POWER. The new stock symbol will be PLDY effective with
trading on Thursday, March 11, 1999.
<PAGE>
PALADYNE Corporation, headquartered in Orlando, Florida, provides companies the
power to understand their customers, to know each customer, to best serve each
customer, and to anticipate the needs of a customer and the market. PALADYNE's
power to accomplish this comes from software products and ancillary services
that integrate data quality, data processing, database development and customer
interaction to help firms best target, acquire, and retain valued customers.
Forward-looking statements in this release are made pursuant to the "safe
harbor" provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements are based on current management expectations that
involve risks and uncertainties that may result in such expectations not being
realized. Potential risks and uncertainties include, but are not limited to, the
risks described in filings with the Securities and Exchange Commission
===================
Contact:
PALADYNE CORPORATION, Orlando, Florida
Nik Souris
Vice President and General Manager
407-333-8161 email: [email protected]
