Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
FORM S-8
REGISTRATION STATEMENT
under
THE SECURITIES ACT OF 1933
-----------------------
AEROFLEX INCORPORATED
(Exact name of registrant as specified in its charter)
Delaware 11-1974412
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
35 South Service Road, Plainview, New York 11803
(Address of principal executive offices) (Zip Code)
AEROFLEX INCORPORATED - UTMC OPTIONS
(Full Title of the Plan)
Michael Gorin, President
Aeroflex Incorporated
35 South Service Road
Plainview, New York 11803
(Name and address of agent for service)
(516) 694-6700
(Telephone number, including area code, of agent for service)
-----------------------
copy to:
Nancy D. Lieberman, Esq.
Blau, Kramer, Wactlar & Lieberman, P.C.
100 Jericho Quadrangle
Jericho, New York 11753
(516) 822-4820
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
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Title of Each Proposed Minimum Proposed Maximum
Class of Securities Amount to be Offering Price Per Aggregate Offering Amount of
To be Registered Registered Security (1) Price (1) Registration Fee
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock,
par value $.10 273,000 shs.(2) $5.75 $1,569,750 $414.42
per share
==============================================================================================
<FN>
(1) Estimated solely for the purpose of calculating the registration fee, based
upon the last reported sales price of the Company's Common Stock on the New York
Stock Exchange on October 28, 1999.
(2) The Registration Statement also covers an indeterminate number of additional
shares of Common Stock which may become issuable pursuant to anti-dilution and
adjustment provisions of the Plan.
</FN>
==============================================================================================
</TABLE>
<PAGE>
AEROFLEX INCORPORATED
SUMMARY OF OPTIONS GRANTED TO
EMPLOYEES OF UTMC MICROELECTRONIC SYSTEMS, INC.
In February 1999, Aeroflex Incorporated acquired all of the issued and
outstanding common stock of UTMC Microelectronic Systems, Inc. We determined
that it was advisable, in connection with the acquisition, to grant options to
certain employees of UTMC in order to retain people we believe will contribute
to our success. Consequently, we granted non-qualified stock options to a total
of 25 UTMC employees covering a total of 273,000 shares of our common stock.
The stock options have a term of ten years from February 25, 1999, which is
the date of grant. All but one of the options have an exercise price of $11.625
per share and become exercisable (1) 50% on February 25, 2000 and (2) 50% on
February 25, 2001. The remaining option to purchase a total of 50,000 shares of
common stock has an exercise price of $13.625 per share and becomes exercisable
(1) 33 1/3% on August 25, 1999, (2) 33 1/3% on February 25, 2000 and (3) 33 1/3%
on February 25, 2001.
The options may not be sold, pledged, hypothecated, transferred or disposed
of in any manner other than by will or by the laws of descent or distribution
and may be exercised, during the lifetime of the optionee, only by the optionee.
In the case of all but one of the optionees, if he ceases to be an employee
of UTMC, he may, for a two (2) month period from the date he stops being an
employee, exercise his options to the extent that the options were exercisable
as of the date of his termination. One optionee has a one year period from the
date his employment terminates to exercise his options. To the extent that an
optionee was not entitled to exercise an option at the date of such termination,
or he does not exercise the option (which he was entitled to exercise) within
the two month or one year period, the option terminates. If an optionee dies
while she is an employee of UTMC , the optionee's estate or any person who
acquires the right to exercise the option by bequest or inheritance or by reason
of the death of the optionee may exercise her option at any time within the
period of two years from the date of her death. If an optionee becomes disabled
while she is an employee of UTMC, the optionee may exercise her option at any
time within the period of three years from the date of termination of her
employment due to the disability. In each case the option will be exercisable
only to the extent it was exercisable on the date of such termination of
employment.
In the event of a change in control (as defined in the option agreement) of
our company all options become immediately and fully exercisable.
Our reports and registration statements filed with the Securities and
Exchange Commission pursuant to the provisions of the Securities Exchange Act of
1934, are incorporated by reference herein and these documents, as well as our
annual report to shareholders, its latest prospectus filed pursuant to Rule
424(b) under the Securities Act of 1933, as amended, are available upon written
or oral request from our Secretary or Treasurer, at our offices at Aeroflex
Incorporated, 35 South Service Road, Plainview, New York 11803. We do not intend
to furnish any reports to participating employees as to the amount and status of
their options.
<PAGE>
FEDERAL INCOME TAX CONSEQUENCES
The following is a brief summary of the principal federal income tax
consequences under current federal income tax laws relating to the options. This
summary is not intended to be exhaustive. Among other things, it does not
describe state, local or foreign income tax consequences.
We understand that under present federal tax laws, the grant of stock
options creates no tax consequences for an optionee or for us. Upon exercising a
nonqualified stock option, the optionee must generally recognize ordinary income
equal to the "spread" between the exercise price and the fair market value of
the common stock on the date of exercise. The fair market value of the shares on
the date of exercise will constitute the tax basis for the shares for computing
gain or loss on their subsequent sale.
Compensation that is subject to a substantial risk of forfeiture generally
is not included in income until the risk of forfeiture lapses. Under current
law, optionees who are either directors, officers or more than 10% stockholders
are subject to the "short-swing" insider trading restrictions of Section 16(b)
of the Exchange Act of 1934. The Section 16(b) restriction is considered a
substantial risk of forfeiture for tax purposes. Consequently, the time of
recognition of compensation income and its amount will be determined when the
restriction ceases to apply. The Section 16(b) restriction lapses six months
after the date of exercise.
Nevertheless, an optionee who is subject to the Section 16(b) restriction
is entitled to elect to recognize income on the date of exercise of the option.
The election must be made within 30 days of the date of exercise. If the
election is made, the results are the same as if the optionee were not subject
to the Section 16(b) restriction.
If permitted by our board of directors and if the optionee pays the
exercise price of an option in whole or in part with previously-owned shares of
common stock, the optionee's tax basis and holding period for the newly-acquired
shares is determined as follows: As to a number of newly-acquired shares equal
to the number of previously-owned shares used by the optionee to pay the
exercise price, the optionee's tax basis and holding period for the
previously-owned shares will carry over to the newly-acquired shares on a
share-for-share basis, thereby deferring any gain inherent in the
previously-owned shares. As to each remaining newly acquired share, the
optionee's tax basis will equal the fair market value of the share on the date
of exercise and the optionee's holding period will begin on the day after the
exercise date. The optionee's compensation income and our deduction will not be
affected by whether the exercise price is paid in cash or in shares of common
stock.
We will generally be entitled to a deduction for federal income tax
purposes at the same time and in the same amount as an optionee is required to
recognize ordinary compensation income. We will be required to comply with
applicable federal income tax withholding and information reporting requirements
with respect to the amount of ordinary compensation income recognized by the
optionee. If our board of directors permits shares of common stock to be used to
satisfy tax withholding, such shares will be valued at their fair market value
on the date of exercise.
When a sale of the acquired shares occurs, an optionee will recognize
capital gain or loss equal to the difference between the sales proceeds and the
tax basis of the shares. Such gain or loss will be treated as capital gain or
loss if the shares are capital assets. The capital gain or loss will be
long-term capital gain or loss treatment if the shares have been held for more
than 12 months. There will be no tax consequences to us in connection with a
sale of shares acquired under an option.
<PAGE>
RESTRICTION ON REOFFERS OR RESALES OF COMMON STOCK
ACQUIRED UPON THE EXERCISE OF OPTIONS
UTMC employees who receive shares of our common stock upon the exercise of
options may from time to time sell all or a part of such common stock. In some
instances, there may be restrictions on the amount and manner of such sales by
reason of pertinent provisions of the securities laws and the rules thereunder.
Optionees should consult with legal counsel about the securities law
implications of the exercise of options and the acquisition or disposition of
shares of common stock received upon the exercise of options.
Pursuant to Section 16(b) of the Exchange Act, if an optionee, while an
officer, director or holder of ten percent (10%) or more of our common stock,
(i) acquires any of our equity securities (other than shares of common stock
acquired upon the exercise of the options granted to UTMC employees or another
of our stock option plans, if the grant is exempt from Section 16(b)), and (ii)
within six months before or after such acquisition sells any of our equity
securities, including common stock acquired upon the exercise of options, then
the optionee will be required to repay to us any profit attributable to the two
transactions. Further, reoffers and resales of common stock received upon the
exercise of options granted in connection with the UTMC acquisition by
participants who are our "affiliates" must be made pursuant to a separate
prospectus or pursuant to the provisions of Rule 144 under the Securities Act or
pursuant to another applicable exemption from the registration requirements of
the Securities Act. Such reoffers or resales may not be made pursuant to this
prospectus.
This document constitutes part of a prospectus covering securities that
have been registered under the Securities Act of 1933.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
---------------------------------------
The Registrant hereby incorporates by reference into this Registration
Statement the documents listed in (a) and (b) below:
(a) The Registrant's Annual Report on Form 10-K for the fiscal year
ended June 30, 1999;
(b) The description of the class of securities to be offered which is
contained in a registration statement filed under Section 12 of
the Securities Exchange Act of 1934 (File No. 1-8037), including
any amendment or report filed for the purpose of updating such
description.
All documents subsequently filed by the Registrant pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934,
prior to the filing of a post-effective amendment which indicates that all
securities offered have been sold or which deregisters all such securities then
remaining unsold, shall be deemed to be incorporated by reference in this
Registration Statement and to be a part hereof from the date of filing of such
documents.
Item 4. Description of Securities.
-------------------------
Not applicable.
Item 5. Interests of Named Experts and Counsel.
--------------------------------------
Harvey R. Blau, a member of the law firm of Blau, Kramer, Wactlar &
Lieberman, P.C. ("BKW&L") is Chairman of the Board and Chief Executive Officer
of the Registrant. As of September 27, 1999, Mr. Blau owns 1,269,678 shares of
Common Stock, including 4,651 shares held by the Blau, Kramer, Wactlar &
Lieberman, P.C. Profit Sharing Plan and 110,058 shares owned by his wife, as to
which Mr. Blau has disclaimed beneficial ownership, as well as options to
purchase 1,000,000shares of Common Stock granted to Mr. Blau pursuant to the
Registrant's various stock option plans.
Item 6. Indemnification of Directors and Officers.
-----------------------------------------
Under the provisions of the Certificate of Incorporation and By-Laws
of Registrant, each person who is or was a director or officer of Registrant
shall be indemnified by Registrant as of right to the full extent permitted or
authorized by the General Corporation Law of Delaware.
Under such law, to the extent that such person is successful on the
merits of defense of a suit or proceeding brought against him by reason of the
fact that he is a director or officer of Registrant, he shall be indemnified
against expenses (including attorneys' fees) reasonably incurred in connection
with such action.
<PAGE>
If unsuccessful in defense of a third-party civil suit or a criminal
suit is settled, such a person shall be indemnified under such law against both
(1) expenses (including attorneys' fees) and (2) judgments, fines and amounts
paid in settlement if he acted in good faith and in a manner he reasonably
believed to be in, or not opposed to, the best interests of Registrant, and with
respect to any criminal action, had no reasonable cause to believe his conduct
was unlawful.
If unsuccessful in defense of a suit brought by or in the right of
Registrant, or if such suit is settled, such a person shall be indemnified under
such law only against expenses (including attorneys' fees) incurred in the
defense or settlement of such suit if he acted in good faith and in a manner he
reasonably believed to be in, or not opposed to, the best interests of
Registrant except that if such a person is adjudicated to be liable in such suit
for negligence or misconduct in the performance of his duty to Registrant, he
cannot be made whole even for expenses unless the court determines that he is
fairly and reasonably entitled to be indemnified for such expenses.
The officers and directors of the Registrant are covered by officers' and
directors' liability insurance. The policy coverage is $25,000,000 which
includes reimbursement for costs and fees. There is a maximum aggregate
deductible for each loss under the policy of $250,000. The Registrant has
entered into Indemnification Agreements with certain of its officers and
directors. The Agreements provide for reimbursement for all direct and indirect
costs of any type or nature whatsoever (including attorneys' fees and related
disbursements) actually and reasonably incurred in connection with either the
investigation, defense or appeal of a Proceeding, as defined, including amounts
paid in settlement by or on behalf of an Indemnitee.
Item 7. Exemption from Registration Claimed.
-----------------------------------
Not applicable.
Item 8. Exhibits.
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4.1 Form of UTMC Option Agreement
4.2 Form of UTMC Option Agreement.
5 Opinion and consent of Blau, Kramer, Wactlar & Lieberman, P.C.
23.1 Consent of Blau, Kramer, Wactlar & Lieberman, P.C. - included in
their opinion filed as Exhibit 5.
23.2 Consent of KPMG LLP.
24 Powers of Attorney.
Item 9. Undertakings.
------------
(a) The undersigned Registrant hereby undertakes:
<PAGE>
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or the
most recent post-effective amendment thereof) which, individually
or in the aggregate, represent a fundamental change in the
information set forth in the Registration Statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement; provided, however, that paragraphs
(a)(l)(i) and (a)(l)(ii) do not apply if the information required
to be included in a post-effective amendment by those paragraphs
is contained in periodic reports filed by the Registrant pursuant
to section 13 or section 15(d) of the Securities Exchange Act of
1934 that are incorporated by reference in the Registration
Statement.
(2) That, for the purposes of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new Registration Statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination
of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at the time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against policy as expressed in the Act and will be
governed by final adjudication of such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in Plainview, New York on the 29th day of October, 1999.
AEROFLEX INCORPORATED
By: /s/ Michael Gorin
---------------------------
Michael Gorin
President and Director (Chief Financial
Officer and Principal Accounting Officer)
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on October 29, 1999 by the following
persons in the capacities indicated. Each person whose signature appears below
constitutes and appoints Michael Gorin and Leonard Borow, and each of them
acting individually, with full power of substitution, our true and lawful
attorneys-in-fact and agents to do any and all acts and things in our name and
on our behalf in our capacities indicated below which they or either of them may
deem necessary or advisable to enable Aeroflex Incorporated to comply with the
Securities Act of 1933, as amended, and any rules, regulations and requirements
of the Securities and Exchange Commission, in connection with this Registration
Statement including specifically, but not limited to, power and authority to
sign for us or any of us in our names in the capacities stated below, any and
all amendments (including post-effective amendments) thereto, granting unto said
attorneys-in-fact and agents full power and authority to do and perform each and
every act and thing requisite and necessary to be done in such connection, as
fully to all intents and purposes as we might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or his
substitute or substitutes, may lawfully do or cause to be done by virtue
thereof.
Signature Title
--------- -----
/s/ Harvey R. Blau Chairman of the Board
Harvey R. Blau (Chief Executive Officer)
/s/ Michael Gorin President and Director
Michael Gorin (Chief Financial Officer and Principal
Accounting Officer)
/s/ Leonard Borow Executive Vice President, Secretary and Director
Leonard Borow (Chief Operating Officer)
/s/ Paul Abecassis Director
Paul Abecassis
/s/ Milton Brenner Director
Milton Brenner
/s/ Ernest E. Courchene, Jr. Director
Ernest E. Courchene, Jr.
/s/ Donald S. Jones Director
Donald S. Jones
/s/ Eugene Novikoff Director
Eugene Novikoff
/s/ John S. Patton Director
John S. Patton
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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AEROFLEX INCORPORATED
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Form S-8 Registration Statement
________________________________________________________________________________
E X H I B I T I N D E X
________________________________________________________________________________
Page No. in Sequential
Exhibit Numbering of all Pages,
Number Exhibit Description including Exhibit Pages
- ------- ------------------- -----------------------
4.1 Form of UTMC Option Agreement. . . . .
4.2 Form of UTMC Option Agreement. . . . .
5 Opinion and Consent of Counsel . . . .
23.1 Consent of Counsel . . . . . . . . . . See Exhibit 5
23.2 Consent of KPMG LLP. . . . . . . . . .
24 Powers of Attorney . . . . . . . . . . See signature page
Exhibit 4.1
STOCK OPTION AGREEMENT
----------------------
AGREEMENT made the 25th day of February, 1999, between Aeroflex Incorporated,
a Delaware corporation, (hereinafter called the "Company") and ___________,
residing at _________________________________________ (hereinafter called the
"Optionee").
W I T N E S S E T H:
Whereas, the Company and United Technologies Corporation entered into a Stock
Purchase Agreement dated as of February 25, 1999, pursuant to which the Company
has acquired (the "Acquisition") all of the outstanding Common Stock of UTMC
Microelectronic Systems Inc.("UTMC"); and
Whereas, the Optionee is currently an employee of UTMC, and the Company is
desirous of inducing or encouraging the Optionee to continue to remain in the
employ of UTMC after the Acquisition by offering the Optionee certain incentives
or rewards to do so; and
Whereas, the Board of Directors of the Company has determined that Optionee
is eligible for, and should be granted an option as hereinbelow provided, and
Optionee desires to have such option;
Now, Therefore, in consideration of the premises and the mutual covenants
hereinafter set forth, the parties hereto agree as follows:
1. Grant and Exercise of Option. The Company hereby grants to Optionee an
option to purchase a total of _________(_____)shares of the authorized and
unissued Common Stock of the Company, having a par value of $.10 per share, at
the price of $11.625 per share, upon and subject to the following terms and
conditions:
(a) The within option may be exercised on or before February 24,
2009 (the "Expiration Date") and, within such period, only at the following
times and in the following amounts:
(i) After the expiration of one (1) year from the
date of this Agreement, the option may be exercised to the extent
of not more than FIFTY (50%) PERCENT of the shares granted in
Paragraph 1 hereof; and
(ii) After the expiration of two (2) years from the
date of this Agreement, the option may be exercised to the extent
of not more than ONE HUNDRED (100%) PERCENT of the shares granted
in Paragraph 1 hereof.
(b) The right to exercise set forth in Paragraph 1(a)(i), and (ii)
shall be accelerated providing for immediate exercise, in the event of a change
in control of the Company.
(1) For purposes of this Agreement, a change in control of the
Company, or in any person directly or indirectly controlling the Company, shall
mean:
(i) a change in control as such term is presently
defined in Regulation 240.12b-2 under the Securities and Exchange Act of
1934; or
<PAGE>
(ii) if any "person" (as such term is used in Section
13(d) and 14(d) of the Exchange Act) other than the Company or any
"person" who on the date of this Agreement is a director or officer of
the Company, becomes the "beneficial owner" (as defined in Rule 13(d)-3
under the Exchange Act) directly or indirectly, of securities of the
Company representing ten (10%) percent of the voting power of the
Company's then outstanding securities; or
(iii) if during any period of two (2) consecutive years
during the term of this Agreement, individuals who at the beginning of
such period constitute the Board of Directors, cease for any reason to
constitute at least a majority thereof, unless the election of each
director who is not a director at the beginning of such period has been
approved in advance by directors representing at least two-third (2/3)
of the directors then in office who were directors at the beginning of
the period.
(2) Notwithstanding the foregoing, this paragraph shall have no
applicability to any change of control as defined hereunder in the event that:
(i) a majority of the Board of Directors in office
immediately prior to the event or events resulting in the change of
control determine that such change is in the best interests of the
Company; or
(ii) a majority of the Board of Directors in office
immediately prior to the event or events resulting in the change of
control determine that such change is not in the best interests of the
Company; and thereafter Employee cooperates, assists or acts, directly
or indirectly, on behalf of or in connection with the party seeking to
acquire control of the Company; it being expressly understood and agreed
that in the event the within option is not exercised on or before the
Expiration Date, as to any part or all of the shares which may be
purchased under the option, the right to purchase such shares shall
completely lapse;
(c) Each exercise of the within option shall be by delivery to the
Company, at its then principal office (attention of the Secretary) of written
notice stating the number of shares to be purchased, accompanied by payment in
full of the option price of such shares. The option price shall be payable in
United States dollars in cash or by certified check, bank draft, postal or
express money order; provided, however, that in lieu of payment in full in cash,
the Optionee may, with the approval of the Board of Directors, exercise his
option by tendering to the Company shares of the Company's Common Stock owned by
him and having a fair market value (as determined by the Board of Directors in
its absolute discretion) equal to the cash exercise price (or the balance
thereof) applicable to his option.
(d) In the event of each exercise of the within option, the Company
shall deliver to the Optionee, personally or at the Optionee's designated
address, as soon as practicable, a certificate made out to the Optionee for the
number of shares being purchased.
2. Non-Transferability of Option. The option granted under this
Agreement shall not be transferred otherwise than by will or the laws of descent
and distribution and shall be exercisable during Optionee's lifetime only by the
Optionee. No option granted hereunder shall be subject to execution, attachment,
pledge, hypothecation, or other process.
3. Death, Retirement and Termination of Employment. Any Option, the
period of which has not expired, shall terminate at the time of death of the
Optionee, or at the time of retirement or termination for any reason of such
person's employment or service with UTMC, including service as a consultant, and
no share of Common Stock may thereafter be delivered pursuant to such Option,
except that:
(a) Upon retirement or termination of employment or service (other
than by death, disability, or termination for cause), an Optionee may within two
(2) months after the date of such retirement or termination, purchase all or
part of the shares with respect to which such Optionee is entitled to exercise
such option, in accordance herewith, but in no event after the Expiration Date;
<PAGE>
(b) Upon the termination of employment or service for cause, this
Option shall terminate. For purposes of this Section, "cause" shall mean (i)
willful disregard of duties and/or gross insubordination, (ii) habitual absence
from employment, or (iii) the commission of fraud, misrepresentation or
embezzlement;
(c) Upon the "disability" of any Optionee, the Optionee may within
three (3) years after the date of such termination of employment, but in no
event after the Expiration Date, purchase all or part of the shares with respect
to which such Optionee is entitled to exercise such Option in accordance
herewith. For purposes of this section, the term "disability" shall mean a
physical or mental disability as defined in Section 105 of the Internal Revenue
Code of 1986, as amended; and
(d) Upon the death of the Optionee during his employment, the
person or persons to whom such Optionee's rights under the Option are
transferred by will or the laws of descent and distribution may, within two (2)
years after the date of such Optionee's death, but in no event after the
Expiration Date, purchase all or any part of the shares with respect to which
the Option was exercisable on the date of termination of employment or service
in accordance herewith.
4. Dilution and Other Adjustments. In the event that there is any change
in the stock subject to the within option through merger, consolidation or
reorganization, or in the event of any dividend in stock of the same class to
holders of issued and outstanding stock of the same class, or the issuance to
the holders of such stock of rights to subscribe to stock of the same class, or
in the event of any split, combination or exchange of stock or other change in
the capital structure of the Company, the Board of Directors of the Company
shall make such adjustments in the within option as it may deem equitable to
prevent dilution or enlargement of the rights granted to the Optionee hereunder,
and such adjustments, when so made, shall be conclusive and binding on the
parties to this Agreement; and provided, further, that nothing herein shall be
construed as limiting or preventing the Company from exercising any right or
power to make or enter into adjustments, reclassifications, reorganizations, or
changes in its capital or business structure or to merge, consolidate or
dissolve or to sell or transfer all or any part of its business or assets.
5. Registration.
The Company shall cause a Registration Statement on Form S-8 covering
the Shares of the Common Stock of the Company issuable upon the exercise of the
Option granted hereunder to be filed with the Securities and Exchange Commission
and to become effective under the Securities Act of 1933, as amended, prior to
the first anniversary date of this Agreement; provided, however, that if the
Company is not permitted for any reason to register such Common Stock pursuant
to a Registration Statement on Form S-8, the Company shall use its best efforts
to cause a Registration Statement on Form S-3 covering the Common Stock to be
filed with the Securities and Exchange Commission and to become effective under
the Securities Act of 1933, as amended, prior to the first anniversary date of
this Agreement.
6. Requirements by Law.
(a) If any law, regulation of the Securities and Exchange
Commission, or any regulation of any other commission or agency having
jurisdiction shall require the Company or the Optionee to take any action with
respect to the shares of stock to be acquired upon the exercise of the within
option, then the date upon which the Company shall deliver or cause to be
delivered the certificate or certificates for the shares of stock shall be
postponed until full compliance has been made with all such requirements of law
or regulation.
(b) Neither the Optionee nor any person or persons referred to in
Paragraph 3 above, as the case may be, shall be, or shall be deemed to be, a
holder of any shares subject to the within option unless and until certificates
for such shares are delivered to him or them in accordance with this Agreement,
and no certificates may be delivered until the shares represented thereby are
paid in full.
<PAGE>
7. Purchase for Investment. The Optionee represents, on behalf of
himself and the person or persons referred to in Paragraph 3 above, that any
shares of the Company purchased pursuant to this Agreement will be acquired in
good faith for investment and not for resale or distribution, and Optionee on
behalf of himself and said person or persons, agrees that each notice of the
exercise of the within option shall contain or be accompanied by a
representation in writing signed by him or said person or persons, as the case
may be, in form satisfactory to the Company, that the shares of the Company to
be purchased pursuant to such notice are being so acquired and will not be sold
except in compliance with applicable securities laws. The requirements of this
Paragraph 7 may be waived by the Company if the Company shall have received an
opinion of its counsel that such representation is not required.
8. Acknowledgment. Optionee represents that he has read and understands
the terms and conditions of this Agreement and agrees to be bound thereby.
In Witness Whereof, the parties hereto have duly executed this Agreement
as of the day and year first above written.
AEROFLEX INCORPORATED
By: ____________________________
--------------------------------
_______________, Optionee
Exhibit 4.2
STOCK OPTION AGREEMENT
----------------------
AGREEMENT made the 25th day of February, 1999, between Aeroflex
Incorporated, a Delaware corporation, (hereinafter called the "Company") and
_______, residing at _____________________ (hereinafter called the "Optionee").
W I T N E S S E T H:
Whereas, the Company and United Technologies Corporation entered into a
Stock Purchase Agreement dated as of February 25, 1999, pursuant to which the
Company has acquired (the "Acquisition") all of the outstanding Common Stock of
UTMC Microelectronic Systems Inc.("UTMC"); and
Whereas, the Optionee is currently an employee of UTMC, and the Company is
desirous of inducing or encouraging the Optionee to continue to remain in the
employ of UTMC after the Acquisition by offering the Optionee certain
incentives or rewards to do so; and
Whereas, the Board of Directors of the Company has determined that Optionee
is eligible for, and should be granted an option as hereinbelow provided, and
Optionee desires to have such option;
Now, Therefore, in consideration of the premises and the mutual covenants
hereinafter set forth, the parties hereto agree as follows:
1. Grant and Exercise of Option. The Company hereby grants to Optionee an
option to purchase a total of ___________(_____) shares of the authorized and
unissued Common Stock of the Company, having a par value of $.10 per share, at
the price of $13.625 per share, upon and subject to the following terms and
conditions:
(a) The within option may be exercised on or before February 24, 2009
(the "Expiration Date") and, within such period, only at the following times
and in the following amounts:
(i) After the expiration of six (6) months from the date
of this Agreement, the option may be exercised to the extent of not
more than THIRTY-THREE AND ONE-THIRD (33 1/3%) PERCENT of the shares
granted in Paragraph 1 hereof;
(ii) After the expiration of one (1) year from the date of
this Agreement, the option may be exercised to the extent of not more
than SIXTY-SIX AND TWO-THIRDS (66 2/3%) PERCENT of the shares granted
in Paragraph 1 hereof; and
(iii) After the expiration of two (2) years from the date
of this Agreement, the option may be exercised to the extent of not
more than ONE HUNDRED (100%) PERCENT of the shares granted in
Paragraph 1 hereof.
(b) The right to exercise set forth in Paragraph 1(a)(i), (ii) and
(iii) shall be accelerated providing for immediate exercise, in the event of a
change in control of the Company.
(1) For purposes of this Agreement, a change in control of the
Company, or in any person directly or indirectly controlling the Company, shall
mean:
<PAGE>
(i) a change in control as such term is presently defined in
Regulation 240.12b-2 under the Securities and Exchange Act of 1934; or
(ii) if any "person" (as such term is used in Section 13(d) and
14(d) of the Exchange Act) other than the Company or any "person" who on
the date of this Agreement is a director or officer of the Company, becomes
the "beneficial owner" (as defined in Rule 13(d)-3 under the Exchange Act)
directly or indirectly, of securities of the Company representing ten (10%)
percent of the voting power of the Company's then outstanding securities;
or
(iii) if during any period of two (2) consecutive years during
the term of this Agreement, individuals who at the beginning of such period
constitute the Board of Directors, cease for any reason to constitute at
least a majority thereof, unless the election of each director who is not a
director at the beginning of such period has been approved in advance by
directors representing at least two-third (2/3) of the directors then in
office who were directors at the beginning of the period.
(2) Notwithstanding the foregoing, this paragraph shall have no
applicability to any change of control as defined hereunder in the event that:
(i) a majority of the Board of Directors in office immediately
prior to the event or events resulting in the change of control determine
that such change is in the best interests of the Company; or
(ii) a majority of the Board of Directors in office immediately
prior to the event or events resulting in the change of control determine
that such change is not in the best interests of the Company; and
thereafter Employee cooperates, assists or acts, directly or indirectly, on
behalf of or in connection with the party seeking to acquire control of the
Company; it being expressly understood and agreed that in the event the
within option is not exercised on or before the Expiration Date, as to any
part or all of the shares which may be purchased under the option, the
right to purchase such shares shall completely lapse;
(c) Each exercise of the within option shall be by delivery to the
Company, at its then principal office (attention of the Secretary) of written
notice stating the number of shares to be purchased, accompanied by payment in
full of the option price of such shares. The option price shall be payable in
United States dollars in cash or by certified check, bank draft, postal or
express money order; provided, however, that in lieu of payment in full in
cash, the Optionee may, with the approval of the Board of Directors, exercise
his option by tendering to the Company shares of the Company's Common Stock
owned by him and having a fair market value (as determined by the Board of
Directors in its absolute discretion) equal to the cash exercise price (or the
balance thereof) applicable to his option.
(d) In the event of each exercise of the within option, the Company
shall deliver to the Optionee, personally or at the Optionee's designated
address, as soon as practicable, a certificate made out to the Optionee for the
number of shares being purchased.
2. Non-Transferability of Option. The option granted under this Agreement
shall not be transferred otherwise than by will or the laws of descent and
distribution and shall be exercisable during Optionee's lifetime only by the
Optionee. No option granted hereunder shall be subject to execution,
attachment, pledge, hypothecation, or other process.
3. Death, Retirement and Termination of Employment. Any Option, the period
of which has not expired, shall terminate at the time of death of the Optionee,
or at the time of retirement or termination for any reason of such person's
employment or service with UTMC, including service as a consultant , and no
share of Common Stock may thereafter be delivered pursuant to such Option,
except that:
<PAGE>
(a) Upon retirement or termination of employment or service (other
than by death, disability, voluntary termination or termination for cause), an
Optionee may within one (1) year after the date of such retirement or
termination, purchase all or part of the shares with respect to which such
Optionee is entitled to exercise such option, in accordance herewith, but in no
event after the Expiration Date. ;
(b) Upon voluntary termination or the termination of employment or
service for cause, this Option shall terminate. For purposes of this Section,
"cause" shall mean (i)conviction of a felony involving moral turpitude, (ii)
willful disregard of duties and/or gross insubordination or (iii) a breach
Optionee of the provisions of Section 10 or Section 11 of his employment
agreement of even date;
(c) Upon the "disability" of any Optionee, the Optionee may within
three (3) years after the date of such termination of employment, but in no
event after the Expiration Date, purchase all or part of the shares with
respect to which such Optionee is entitled to exercise such Option in
accordance herewith. For purposes of this section, the term "disability" shall
mean a physical or mental disability as defined in Section 105 of the Internal
Revenue Code of 1986, as amended; and
(d) Upon the death of the Optionee during his employment, the person
or persons to whom such Optionee's rights under the Option are transferred by
will or the laws of descent and distribution may, within two (2) years after
the date of such Optionee's death, but in no event after the Expiration Date,
purchase all or any part of the shares with respect to which the Option was
exercisable on the date of termination of employment or service in accordance
herewith.
4. Dilution and Other Adjustments. In the event that there is any change in
the stock subject to the within option through merger, consolidation or
reorganization, or in the event of any dividend in stock of the same class to
holders of issued and outstanding stock of the same class, or the issuance to
the holders of such stock of rights to subscribe to stock of the same class, or
in the event of any split, combination or exchange of stock or other change in
the capital structure of the Company, the Board of Directors of the Company
shall make such adjustments in the within option as it may deem equitable to
prevent dilution or enlargement of the rights granted to the Optionee
hereunder, and such adjustments, when so made, shall be conclusive and binding
on the parties to this Agreement; and provided, further, that nothing herein
shall be construed as limiting or preventing the Company from exercising any
right or power to make or enter into adjustments, reclassifications,
reorganizations, or changes in its capital or business structure or to merge,
consolidate or dissolve or to sell or transfer all or any part of its business
or assets.
5. Registration.
The Company shall cause a Registration Statement on Form S-8 covering the
Shares of the Common Stock of the Company issuable upon the exercise of the
Option granted hereunder to be filed with the Securities and Exchange
Commission and to become effective under the Securities Act of 1933, as
amended, prior to the first anniversary date of this Agreement; provided,
however, that if the Company is not permitted for any reason to register such
Common Stock pursuant to a Registration Statement on Form S-8, the Company
shall use its best efforts to cause a Registration Statement on Form S-3
covering the Common Stock to be filed with the Securities and Exchange
Commission and to become effective under the Securities Act of 1933, as
amended, prior to the first anniversary date of this Agreement.
<PAGE>
6. Requirements by Law.
(a) If any law, regulation of the Securities and Exchange Commission,
or any regulation of any other commission or agency having jurisdiction shall
require the Company or the Optionee to take any action with respect to the
shares of stock to be acquired upon the exercise of the within option, then the
date upon which the Company shall deliver or cause to be delivered the
certificate or certificates for the shares of stock shall be postponed until
full compliance has been made with all such requirements of law or regulation.
(b) Neither the Optionee nor any person or persons referred to in
Paragraph 3 above, as the case may be, shall be, or shall be deemed to be, a
holder of any shares subject to the within option unless and until certificates
for such shares are delivered to him or them in accordance with this Agreement,
and no certificates may be delivered until the shares represented thereby are
paid in full.
7. Purchase for Investment. The Optionee represents, on behalf of himself
and the person or persons referred to in Paragraph 3 above, that any shares of
the Company purchased pursuant to this Agreement will be acquired in good faith
for investment and not for resale or distribution, and Optionee on behalf of
himself and said person or persons, agrees that each notice of the exercise of
the within option shall contain or be accompanied by a representation in
writing signed by him or said person or persons, as the case may be, in form
satisfactory to the Company, that the shares of the Company to be purchased
pursuant to such notice are being so acquired and will not be sold except in
compliance with applicable securities laws. The requirements of this Paragraph
7 may be waived by the Company if the Company shall have received an opinion of
its counsel that such representation is not required.
8. Acknowledgment. Optionee represents that he has read and understands the
terms and conditions of this Agreement and agrees to be bound thereby.
In Witness Whereof, the parties hereto have duly executed this Agreement as
of the day and year first above written.
AEROFLEX INCORPORATED
By: ____________________________
--------------------------------
_________, Optionee
Exhibit 5
November 2, 1999
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Aeroflex Incorporated
Registration Statement on Form S-8
----------------------------------
Gentlemen:
Reference is made to the filing by Aeroflex Incorporated (the
"Corporation") of a Registration Statement on Form S-8 with the Securities and
Exchange Commission pursuant to the provisions of the Securities Act of 1933,
as amended, covering the registration of 273,000 shares of the Corporation's
Common Stock, $.10 par value per share, in connection with the issuance of
options to various employees of UTMC Microelectronic Systems, Inc.
As counsel for the Corporation, we have examined its corporate records,
including its Certificate of Incorporation, as amended, By-Laws, its corporate
minutes, the form of its Common Stock certificate, the forms of option
agreement and such other documents as we have deemed necessary or relevant
under the circumstances.
Based upon our examination, we are of the opinion that:
1. The Corporation is duly organized and validly existing under the laws of
the State of Delaware.
2. There have been reserved for issuance by the Board of Directors of the
Corporation 273,000 shares of its Common Stock, $.10 par value per share. The
shares of the Corporation's Common Stock, when issued pursuant to the exercise
of options granted to UTMC employees, will be validly authorized, legally
issued, fully paid and non-assessable.
We hereby consent to be named in the Registration Statement and in the
Prospectus which constitutes a part thereof as counsel of the Corporation, and
we hereby consent to the filing of this opinion as Exhibit 5 to the
Registration Statement.
Very truly yours,
/s/ BLAU, KRAMER, WACTLAR & LIEBERMAN, P.C.
BLAU, KRAMER, WACTLAR & LIEBERMAN, P.C.
CONSENT OF INDEPENDENT AUDITORS
The Board of Directors
Aeroflex Incorporated
We consent to the incorporation by reference in the registration statement
on Form S-8 of Aeroflex Incorporated of our report dated August 10, 1999,
relating to the consolidated balance sheets of Aeroflex Incorporated and
subsidiaries as of June 30, 1999 and 1998 and the related consolidated
statements of earnings, stockholders' equity and cash flows for each of the
years in the three-year period ended June 30, 1999, which report is incorporated
by reference in the June 30, 1999 annual report on Form 10-K of Aeroflex
Incorporated and subsidiaries.
/s/ KPMG LLP
KPMG LLP
Melville, New York
November 2,1999
