<PAGE> 1
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
MICROS Systems, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
MICROS Systems, Inc.
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] No filing fee.
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
[ ] $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
--------------------------------------------------------------------------
2) Aggregate number of securities to which transaction applies:
--------------------------------------------------------------------------
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act 0-11:(1)
--------------------------------------------------------------------------
4) Proposed maximum aggregate value of transaction:
--------------------------------------------------------------------------
(1)Set forth the amount on which the filing fee is calculated and state how it
was determined.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
-----------------------------------------------
2) Form, Schedule or Registration Statement No.:
-------------------------
3) Filing Party:
---------------------------------------------------------
4) Date Filed:
-----------------------------------------------------------
<PAGE> 2
MICROS SYSTEMS, INC.
12000 BALTIMORE AVENUE
BELTSVILLE, MARYLAND 20705-1291
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON NOVEMBER 20, 1998
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of
MICROS Systems, Inc., ("MICROS" or the "Company") will be held at 2:00 p.m.
Eastern Standard Time on Friday, November 20, 1998, at the BWI Airport
Marriott, 1743 West Nursery Road, Baltimore-Washington International Airport,
Baltimore, Maryland, 21240 for the following purposes:
(1) To approve an amendment to the Company's Articles of
Incorporation that provides for an increase in the aggregate
number of shares of Common Stock that the Company is authorized
to issue from 30,000,000 to 50,000,000 shares (Proposal 1); and
(2) To elect six directors to serve for a one year term (Proposal 2);
and
(3) To approve the appointment of PricewaterhouseCoopers LLP as
independent public accountants for the 1999 fiscal year (Proposal
3); and
(4) To approve an amendment to the Company's 1991 Stock Option Plan,
which serves to authorize the issuance of an additional 1,000,000
shares of Common Stock under the Option Plan, for a total of
4,500,000 shares of Common Stock (Proposal 4); and
(5) To transact such other business as may properly come before the
Annual Meeting or any adjournments thereof.
The close of business on October 2, 1998, has been fixed as the record
date for the determination of stockholders entitled to notice of and to vote
at the Annual Meeting. Only holders of Common Stock of record at the close
of business on that date will be entitled to notice of and to vote at the
Annual Meeting or any adjournments thereof. The transfer books of the
Company will not be closed.
Finally, with respect to Proposal 2, please note that Alan M. Voorhees,
a director of the Company since 1982, is retiring from the Board of Directors at
the end of the current term, and hence, not standing for re-election. The Board
of Directors, management and employees of the Company wish to acknowledge with
gratitude the sophisticated guidance, astute business insight and wisdom
provided by Mr. Voorhees over the past 16 years. The Company wishes Mr. Voorhees
well in his future endeavors.
By Order of the Board of Directors,
/s/
Judith F. Wilbert
Corporate Secretary
Beltsville, Maryland
October 23, 1998
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. THEREFORE, WHETHER OR NOT YOU
PLAN TO BE PRESENT IN PERSON AT THE ANNUAL MEETING, PLEASE SIGN AND DATE THE
ENCLOSED PROXY AND RETURN IT IN THE ENCLOSED ENVELOPE WHICH REQUIRES NO POSTAGE
IF MAILED IN THE UNITED STATES.
<PAGE> 3
MICROS SYSTEMS, INC.
12000 BALTIMORE AVENUE
BELTSVILLE, MARYLAND 20705-1291
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
NOVEMBER 20, 1998
VOTING RIGHTS AND PROXY SOLICITATION
This Proxy Statement is furnished to stockholders of MICROS Systems,
Inc. ("MICROS" or the "Company") in connection with the solicitation by the
Board of Directors of MICROS of proxies to be used at the Annual Meeting of
Stockholders to be held on Friday, November 20, 1998, at 2:00 p.m. Eastern
Standard Time at the BWI Airport Marriott, 1743 West Nursery Road,
Baltimore-Washington International Airport, Baltimore, Maryland, 21240, and
at any adjournments thereof.
It is anticipated that this Proxy Statement and form of proxy will
initially be mailed to stockholders on or about October 23, 1998.
If the enclosed form of proxy is properly executed and returned to the
Company in time to be voted at the Annual Meeting, the shares represented
thereby will be voted in accordance with the instructions marked thereon.
EXECUTED BUT UNMARKED PROXIES WILL BE VOTED FOR THE ELECTION OF MANAGEMENT'S
NOMINEES FOR DIRECTORS AND FOR ALL OTHER PROPOSALS, EXCEPT AS OTHERWISE
PROVIDED HEREIN. If any other matters are properly brought before the Annual
Meeting, the persons named in the accompanying proxy will vote the shares
represented by such proxies on such matters in their best judgment.
The presence of a stockholder at the Annual Meeting will not
automatically revoke such stockholder's proxy. Stockholders may, however,
revoke a proxy at any time prior to its exercise by filing with the Secretary
of the Company a written notice of revocation, by delivering to the Company a
duly executed proxy bearing a later date, or by attending the Annual Meeting
and voting in person.
The cost of solicitation of proxies in the form enclosed herewith will
be borne by the Company. In addition to the solicitation of proxies by mail,
the Company, through its Directors, officers and regular employees, may also
solicit proxies personally or by telephone or telegraph. The Company will
request persons, firms and corporations holding shares in their names or in
the names of their nominees, which are beneficially owned by others, to send
proxy materials to and obtain proxies from such beneficial owners and will
reimburse such holders for their reasonable out-of-pocket expenses in doing
so. The Company may retain a proxy solicitor if it were to determine
subsequently that such action is appropriate.
The securities which can be voted at the Annual Meeting consist of
shares of Common Stock of the Company with each share entitling its owner to
one vote. The close of business on October 2, 1998, has been fixed as the
record date for determination of stockholders entitled to vote at the
meeting. The number of shares outstanding on October 2, 1998, was
16,119,766. The presence in person or by proxy of stockholders holding of
record a majority of all votes entitled to be cast at the Annual Meeting is
necessary to constitute a quorum.
1
<PAGE> 4
A majority of all votes cast at the meeting, a quorum being present, is
required for the adoption of each of the Proposals, other than Proposal 1
which requires approval by a majority of all votes entitled to be cast, and
Proposal 4, which requires approval by a majority of all votes entitled to be
cast at the meeting. Under applicable Maryland law, with respect to
Proposals 2 and 3, proxies marked as abstentions and broker non-votes (where
a nominee holding shares for a beneficial owner has not received voting
instructions from the beneficial owner with respect to a particular matter
and such nominee does not possess or choose to exercise discretionary
authority with respect thereto) will be considered as present at the meeting
for purposes of determining the existence of a quorum but not entitled to
vote with respect to the particular matter and will therefore have no effect
on the vote. With respect to Proposal 1, broker non-votes and abstentions
shall have the effect of a negative vote. With respect to Proposal 4, broker
non-votes shall have no effect, but abstentions shall have the effect of a
negative vote. A proxy marked to withhold a vote from a nominee in the case
of election of Directors shall have the effect of a negative vote. Each
stockholder of record on the record voting date is entitled to one vote per
share. There are no cumulative voting rights.
A COPY OF THE COMPANY'S ANNUAL REPORT TO STOCKHOLDERS FOR ITS FISCAL
YEAR ENDED JUNE 30, 1998, ACCOMPANIES THIS PROXY STATEMENT. THE COMPANY HAS
FILED AN ANNUAL REPORT ON FORM 10-K FOR ITS FISCAL YEAR ENDED JUNE 30, 1998,
WITH THE SECURITIES AND EXCHANGE COMMISSION. STOCKHOLDERS MAY OBTAIN, FREE
OF CHARGE, A COPY OF SUCH ANNUAL REPORT ON FORM 10-K BY WRITING TO THE
CORPORATE SECRETARY AT THE COMPANY'S ADDRESS SET FORTH ABOVE.
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
Set forth below is the number of shares of the Company's Common Stock
and the percentage of total outstanding shares beneficially owned by each
Director of the Company, the Chief Executive Officer, the four most highly
compensated executive officers (other than the Chief Executive Officer), all
Directors and executive officers as a group and, to the knowledge of the
Company, all persons beneficially owning more than 5% of the Company's Common
Stock as of August 31, 1998. Also set forth below is the address of each
such beneficial owner of more than 5% of the Company's Common Stock.
<TABLE>
<CAPTION>
NUMBER OF
SHARES
OF COMMON STOCK
BENEFICIALLY
OWNED AS
OF AUGUST 31, PERCENT OF
INDIVIDUAL OR GROUP (1) 1998 (2) CLASS
----------------------- -------- ------------
<S> <C> <C>
Louis M. Brown, Jr. 76,332 (3) Less than 1%
Director, Chairman of the Board
Daniel Cohen 20,000 Less than 1%
Director
A. L. Giannopoulos 102,666 (4) Less than 1%
Director, President and Chief Executive Officer
F. Suzanne Jenniches 2,512 Less than 1%
Director
John G. Puente 8,000 Less than 1%
Director
Dwight S. Taylor 400 Less than 1%
Director
Alan M. Voorhees 80,000 (5) Less than 1%
Director
Jeffrey B. Edwards 36,998 (6) Less than 1%
President, MICROS Fidelio Software GmbH and Co. KG
Daniel G. Interlandi 73,308 (7) Less than 1%
Senior Vice President and General Manager, Table
Service Restaurants and Leisure and Entertainment
Groups
</TABLE>
2
<PAGE> 5
<TABLE>
<CAPTION>
NUMBER OF
SHARES
OF COMMON STOCK
BENEFICIALLY
OWNED AS
OF AUGUST 31, PERCENT OF
INDIVIDUAL OR GROUP (1) 1998 (2) CLASS
----------------------- -------- ------------
<S> <C> <C>
Gary C. Kaufman 69,600 (8) Less than 1%
Senior Vice President, Finance and Administration
and Chief Financial Officer
Ronald J. Kolson 151,332 (9) Less than 1%
Executive Vice President and Chief Operating Officer
Directors and Executive 800,673 (10) 4.8%
Officers as a Group (15 persons, including the
above-named persons)
SAFECO Asset Management Company 2,438,728 14.6%
SAFECO Plaza
Seattle, WA 98185
Wanger Asset Management 1,588,000 9.5%
227 West Monroe, Suite 3000
Chicago, IL 60606
Dresdner RCM Global Investors 1,529,162 9.2%
4 Embarcadero Center, Suite 3000
San Francisco, CA 94111
</TABLE>
(1) As of August 31, 1998, CEDE & Co., nominee for Stock Clearing
Corporation, Box 20, Bowling Green Station, New York, New York, a central
certificate service, held of record 15,869,646 shares, representing 98.0% of
the outstanding shares of Common Stock. Those shares are believed to be
owned beneficially by a large number of beneficial owners and, except as
indicated in this table, the Company is not aware of any other individual or
group owning beneficially more than 5% of the outstanding Common Stock.
(2) Information with respect to beneficial ownership is based on
information furnished by each shareholder. Sole voting and sole investing
power is exercised by each individual.
(3) Includes options to purchase 55,332 shares exercisable within 60 days.
(4) Includes options to purchase 96,666 shares exercisable within 60 days.
(5) Does not include 80,000 shares held by irrevocable trusts created for
the benefit of the adult children of Mr. Voorhees, with respect to which he
disclaims any beneficial interest.
(6) Includes options to purchase 36,998 shares exercisable within 60 days.
(7) Includes options to purchase 66,000 shares exercisable within 60 days;
does not include 500 shares of Common Stock held by his wife, with respect to
which Mr. Interlandi disclaims any beneficial interest.
(8) Includes options to purchase 68,000 shares exercisable within 60 days;
does not include 400 shares of Common Stock held in custody for a dependent
child, with respect to which Mr. Kaufman disclaims any beneficial interest.
(9) Includes options to purchase 81,332 shares exercisable within 60 days.
(10) Includes stock options for the purchase of 544,985 shares of Common
Stock which are exercisable as of or within 60 days of August 31, 1998, and
assumes 16,663,252 shares outstanding upon the exercise of such options.
3
<PAGE> 6
PROPOSAL TO AMEND
THE ARTICLES OF INCORPORATION
TO PROVIDE FOR AN INCREASE IN AUTHORIZED CAPITAL STOCK
(PROPOSAL 1)
On September 24, 1998, the Board of Directors unanimously adopted a
resolution approving an amendment to the Company's Articles of Incorporation
which serves to increase the aggregate number of shares of Common Stock that
the Company is authorized to issue from 30,000,000 to 50,000,000 shares.
The Board of Directors has determined that this proposed amendment is
advisable and in the best interest of the Company and its stockholders. The
proposed amendment (the "Charter Amendment") would amend Article FIFTH of the
Articles of Incorporation by deleting such in the entirety and replacing with
the provisions set forth below.
INCREASE IN AUTHORIZED CAPITAL STOCK
The Company's Articles of Incorporation currently authorize the
issuance of 30,000,000 shares of Common Stock, par value of $0.025 per share.
As of August 31, 1998, 16,118,267 shares were issued and outstanding, and
another 3,117,973 shares were subject to unexercised options granted pursuant
to the 1991 MICROS Stock Option Plan, or reserved for issuance pursuant to
future grants under the Company's 1991 Stock Option Plan. On November 21,
1997, the Shareholders of the Company approved an amendment to the Company's
Articles of Incorporation which increased the aggregate number of shares of
Common Stock that the Company was authorized to issue from 10,000,000 to
30,000,000 shares. Accordingly, the Shareholders of the Company approved the
issuance at that time of an additional 20,000,000 shares so as to allow the
Company to effectuate important corporate objectives. Since that time,
however, effective June 23, 1998, the Company implemented a two-for-one stock
split effected in the form of a 100% stock dividend. Not only did this stock
split have the effect of reducing the number of shares available for
corporate purposes by approximately 8,039,258 shares, but it also served to
reduce by half the value of all shares. While the Board of Directors
continues to believe that the stock split was advisable, it did serve to
reduce significantly the amount and value of authorized unissued shares that
could be used for corporate purposes. Accordingly, an increase in the number
of authorized shares of Common Stock is necessary to permit the Company to
engage in potentially advisable transactions, such as sale of stock in a
private placement to raise equity financing, stock splits or stock dividends,
acquisitions funded with Company stock, secondary offerings, or additional
issuances pursuant to future grants under the Stock Option Plan.
The proposed Charter Amendment will increase the total number of
authorized shares of Common Stock by an amount substantially greater than
that necessary to achieve currently contemplated corporate objectives. The
Charter Amendment may be viewed as having the possible effect of diluting the
stock ownership of current stockholders, as well as discouraging, under
certain circumstances, an unsolicited attempt by another person or entity to
acquire control of the Company. Although the Board of Directors has no
present intention of doing so, the Company's authorized but unissued Common
Stock could be issued in one or more transactions which would make a takeover
of the Company more difficult or costly. Notwithstanding the above, the
proposed Charter Amendment will ensure that the Company continues to have
additional shares available for future issuance from time to time as approved
by the Board of Directors for any proper corporate purpose, including the
sale of stock in a private placement to raise equity financing, stock splits
or stock dividends, acquisitions of other businesses, secondary offerings,
and issuances under stock option and other employee incentive programs, in
each case subject to applicable laws and regulations.
4
<PAGE> 7
EFFECTIVE DATE OF THE CHARTER AMENDMENT
If the Charter Amendment is adopted by the required vote of
stockholders, the Charter Amendment will become effective when the
appropriate Articles of Amendment to the Company's Articles of Incorporation
are filed with the State Department of Assessments and Taxation of Maryland.
The Company anticipates that this filing will be made promptly following the
Annual Meeting, or as soon as practicable thereafter.
RECOMMENDATION OF THE BOARD OF DIRECTORS
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS A VOTE FOR THE
FOLLOWING RESOLUTION CONSTITUTING PROPOSAL 1. Proxies received by the Board
of Directors will be voted for this resolution unless stockholders specify in
their proxies a contrary choice.
"RESOLVED, that the Company's stockholders hereby approve the following
amendments to the Company's Articles of Incorporation:
(a) that Article FIFTH of the Articles of Incorporation of the
Corporation be amended to read in its entirety as follows:
FIFTH: The total number of shares which the Corporation shall
have authority to issue is 50,000,000, all such shares to be
common stock, par value $0.025 per share. Dividends may be
declared on the common stock and each share of common stock
will entitle the holder thereof to one vote in all proceedings
in which action should be taken by stockholders of the
Corporation."
ELECTION OF DIRECTORS
(PROPOSAL 2)
Six directors are to be elected at the Annual Meeting, each to hold
office for a one year term and until his or her successor is elected and
qualified. Unless authority so to vote is withheld, proxies received pursuant
to this solicitation will be voted for the election of the six nominees named
below.
Unless otherwise specified on the proxy, it is the intention of the
persons named in the proxy to vote the shares represented by each properly
executed proxy for the election of the Director nominees listed below.
Management believes that all such nominees will stand for election and will
serve if elected as Directors. If any of the nominees should for any reason
not be available for election, proxies will be voted for the election of the
remaining nominees and such substitute nominees as may be designated by the
Board of Directors.
Pursuant to the Company's By-Laws, the number of Directors shall be no
less than five and no more than nine. There are currently seven Directors
and the Board has nominated six individuals for election. After the Annual
Meeting, the Board of Directors shall be comprised of six Directors. Proxies
cannot be voted for a greater number of persons than the six nominees named.
During the fiscal year ended June 30, 1998, the Board of Directors held
five regular meetings. Each incumbent Director attended more than 75% of the
aggregate of the total number of meetings of the Board of Directors and
meetings of committees of the Board of Directors of which he or she was a
member.
5
<PAGE> 8
The Board of Directors had an Audit Committee for fiscal 1998. The
Audit Committee was chaired by Mr. Puente, and included Ms. Jenniches and Mr.
Taylor. The Audit Committee reviews the financial statements of the Company
and the scope of the independent annual audit and internal audits. It also
reviews the Company's internal accounting procedures and the independent
accountants' recommendations to management concerning the effectiveness of
the Company's internal financial and accounting controls. In addition, the
Audit Committee reviews and recommends to the Board of Directors the firm to
be engaged as the Company's independent accountants. The Audit Committee
also examines and considers other matters relating to the financial affairs
of the Company as it determines appropriate. The Audit Committee met two
times during the fiscal year ended June 30, 1998. Representatives of
PricewaterhouseCoopers LLP attended both meetings of the Audit Committee in
fiscal 1998.
Additionally, the Board of Directors had a Compensation Committee for
fiscal 1998 comprised of Mr. Voorhees, who is the Compensation Committee
chairman, Ms. Jenniches and Mr. Puente. The Compensation Committee met two
times during the fiscal year ended June 30, 1998. The Board of Directors has
assigned the Compensation Committee with the function of analyzing and
approving, among other things, executive compensation, bonuses, and the
issuance of stock options under the 1991 Option Plan.
Further, the Board of Directors has established a Nominating Committee
comprised of Mr. Giannopoulos, who is the Nominating Committee chairman, Mr.
Brown and Mr. Taylor. The Nominating Committee has been assigned with the
responsibility of identifying and interviewing individuals who may be
qualified to serve as new Board members. The Nominating Committee shall act
unilaterally, and accordingly, will not consider proposed recommendations
from shareholders. In fiscal 1998, the Nominating Committee met once, and on
several other occasions discussed informally Board composition and
qualifications.
At the Annual Meeting on November 21, 1997, the holders of 8,007,278
outstanding shares of Common Stock were eligible to cast votes in the
election of Directors. Of such shares, 92% were present in person or by
proxy and voted or withheld authority to vote in the election of Directors.
INFORMATION AS TO NOMINEES
The following table sets forth the names of management's nominees for
election as Directors to serve until the next Annual Meeting and until their
successors are elected and qualified. Also set forth is certain other
information, some of which has been obtained from the Company's records and
some of which has been supplied by the nominees, with respect to each
nominee's principal occupation or employment, his/her background, his/her age
as of August 31, 1998, the periods during which he/she has served as a
Director of the Company and positions held with the Company, if any.
<TABLE>
<CAPTION>
NOMINEES FOR DIRECTOR POSITION
DIRECTORS SINCE HELD IN MICROS
- --------- ----- --------------
<S> <C> <C>
Louis M. Brown, Jr. 1977 Director, Chairman of the Board
Daniel Cohen 1992 Director
A. L. Giannopoulos 1992 Director, President and Chief
Executive Officer
F. Suzanne Jenniches 1996 Director
John G. Puente 1996 Director
Dwight S. Taylor 1997 Director
</TABLE>
Louis M. Brown, Jr., 55, has been a Director of the Company since 1977.
Mr. Brown held the position of President and Chief Executive Officer from
January 1986 until his appointment as Chairman of the Board in January 1987.
He also serves as President and a director of IDEAS, Inc., a supplier of high
technology, custom-engineered products and services. Mr. Brown serves as
Chairman of Autometric, Inc. and of Planning Systems, Inc. He is a graduate
of The Johns Hopkins University (B.E.S.-E.E.).
Daniel Cohen, 43, has been a Director of the Company since November 1992.
Mr. Cohen currently serves as President of Bartech Systems International,
Inc., a Delaware corporation. Pursuant to a consulting agreement which was
6
<PAGE> 9
terminated June 30, 1998, Mr. Cohen provided consulting services to the
Company. Until June 30, 1997, he was Managing Director of Fidelio MICROS
France, S.A., a subsidiary of MICROS Systems, Inc. and distributor of the
Company's products. Formerly, Mr. Cohen was Managing Director and principal
shareholder of D.A.C. Systemes/MICROS France, a company he founded in 1986.
In 1992, the Company acquired a 15% equity interest in D.A.C. Systemes, and
the name was changed to D.A.C. Systemes/MICROS France. An additional 8%
equity interest was acquired by the Company in fiscal 1994, and the remainder
of the stock was acquired by the Company in fiscal 1996. Mr. Cohen is a
graduate of the Hotel School of Lausanne, Switzerland, from which he holds a
Masters degree in Hotel Administration.
A. L. Giannopoulos, 58, has been a Director since March 1992 and was
elected President and Chief Executive Officer in May 1993. Effective as of
June 1, 1995, Mr. Giannopoulos resigned as General Manager of the
Westinghouse Information and Security Systems Divisions, having been with
Westinghouse for 30 years, and was hired by the Company pursuant to an
Employment Agreement to terminate December 31, 1999, subsequently amended to
terminate on June 30, 2002. In prior assignments at Westinghouse, Mr.
Giannopoulos was General Manager of the Automation Division and National
Industrial Systems Sales Force, Industries Group. Mr. Giannopoulos currently
serves as a Trustee of Capitol College and as a director of V-One, a public
company engaged in the software development of virtual private networks. Mr.
Giannopoulos is a graduate of Lamar University with a Bachelor of Science
degree in Electrical Engineering.
F. Suzanne Jenniches, 50, has been a Director of the Company since October
1996. She is Vice President and General Manager of Automation and
Information Systems (AIS) for the Electronic Sensors and Systems Sector of
Northrop Grumman, which, either directly or through subsidiaries, designs and
develops postal automation systems, intelligent material management systems,
enterprise management systems, airline reservation systems and information
systems for the travel industry, license plate readers, imaging inspection
systems, and records management systems. Ms. Jenniches is past president of
the national Society of Women Engineers, has served on the board of governors
for the American Association of Engineering Societies, and is currently a
board member of the State of Maryland's Greater Baltimore Committee
Technology Council. Ms. Jenniches is a graduate of Clarion College and holds
a Masters degree in Environmental Engineering from The Johns Hopkins
University.
John G. Puente, 68, has been a Director since May 1996. He is the
Chairman of Telogy Networks, Inc., a developer of communications software
products. Mr. Puente is on the board of directors of Primus
Telecommunications, a long distance telecommunications service provider.
Previously, he was Chairman and Chief Executive Officer of Orion Network
Systems, a company which provides satellite services and facilities. Prior
to joining Orion, Mr. Puente was Vice Chairman of M/A-Com, a supplier of
microwave components and systems to the telecommunications industry. He was
a founder and Chairman of Digital Communications Corporation (now Hughes
Network Systems) and SouthernNet, a fiber optic long distance company which
merged to form Telecom USA and was later acquired by MCI. Mr. Puente is a
graduate of Polytechnic Institute of New York and now serves on the Board of
Trustees of that institution, and he holds a Masters degree from Stevens
Institute of Technology. He is Chairman of the Board of Trustees of Capitol
College.
Dwight S. Taylor, 53, has been a Director of the Company since 1997. He
is Senior Vice President of Corporate Development Services, LLC ("CDS"), a
commercial real estate development firm with offices in Columbia, Maryland,
and a subsidiary of Corporate Offices Properties Trust (NYSE:OFC). Mr.
Taylor has been employed by CDS (or Constellation Real Estate, Inc., an
entity with which CDS merged in 1998) in various capacities for the last 14
years. Mr. Taylor is also a member of the Board of Directors of the
Associated Black Charities, of which he was formerly its Chairman, and the
National Association of Industrial and Office Properties. Mr. Taylor is a
1968 graduate of Lincoln University with a Bachelor of Science degree in
Economics.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ELECTION OF THE SIX NOMINEES AS
DIRECTORS.
7
<PAGE> 10
EXECUTIVE COMPENSATION
The following table sets forth the total annual compensation paid or accrued
by the Company for services in all capacities for the Chief Executive Officer
and the four most highly compensated executive officers of the Company whose
aggregate compensation exceeded $100,000.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
ANNUAL COMPENSATION COMPENSATION
------------------------------------------- ---------------
NAME AND OTHER SECURITIES
PRINCIPAL ANNUAL UNDERLYING ALL OTHER
POSITION YEAR SALARY BONUS (1) COMPENSATION (2) OPTIONS (#) (3) COMPENSATION (4)
-------- ---- ------ --------- ---------------- --------------- ----------------
<S> <C> <C> <C> <C> <C> <C>
A. L. Giannopoulos 1998 $263,510 $111,180 $0 90,000 $4,461
President and Chief 1997 250,962 112,000 0 130,000 5,680
Executive Officer 1996 203,000 114,000 0 0 3,000
Jeffrey B. Edwards 1998 190,215 61,502 0 54,000 260,553 (5)
President 1997 173,030 63,629 0 51,000 99,941
MICROS-Fidelio 1996 106,731 41,250 0 0 36,211
Software GmbH and
Co. KG
Daniel G. Interlandi 1998 160,100 59,500 0 54,000 3,073
Senior Vice President 1997 123,075 57,000 181,881 78,000 49,542
and General Manager, 1996 106,400 73,400 133,900 0 48,900
Table Service
Restaurants and
Leisure and
Entertainment Groups
Gary C. Kaufman 1998 173,204 64,600 0 66,000 3,797
Senior Vice President 1997 139,128 55,000 0 102,000 41,710
Finance and 1996 122,000 57,000 0 0 41,100
Administration and
Chief Financial
Officer
Ronald J. Kolson 1998 178,230 64,600 0 72,000 3,052
Executive Vice 1997 144,478 64,000 0 116,000 50,331
President and Chief 1996 124,500 82,900 334,600 0 49,800
Operating Officer
</TABLE>
(1) Bonuses were paid to all recipients pursuant to decisions made by the
Compensation Committee of the Board of Directors based on financial
performance of the Company, including profitability and growth of the Company
as measured by pre-tax income and net revenue, and satisfaction of individual
performance objectives.
(2) Represents the aggregate difference between the actual exercise price
of options granted and the fair market value of the Common Stock as of the
date of option exercise.
(3) Fiscal 1997 options granted have been restated to reflect a
two-for-one stock split effected during fiscal 1998 in
8
<PAGE> 11
the form of a stock dividend.
(4) All Other Compensation includes the Company's contributions to the
Company's 401(k) savings plan for the named executives for fiscal 1996 and
1997, and in fiscal 1998 of $4,461 for Mr. Giannopoulos, $2,179 for Mr.
Edwards, $3,073 for Mr. Interlandi, $3,797 for Mr. Kaufman, and $3,052 for
Mr. Kolson. Also included in this column relating to fiscal 1997
is the Westinghouse Electric Corporation incentive bonus payments of $46,498
for Mr. Interlandi, $38,268 for Mr. Kaufman, and $47,173 for Mr. Kolson.
Specifically, Westinghouse, in conjunction with its sale of stock in the
Company through an underwritten public offering, and as an incentive to 11
key officers to remain with the Company for a period of two years following
June 1, 1995, agreed to make payments to such officers aggregating up to
approximately $1.25 million, payable in three equal annual installments after
such date (subject to the officer remaining employed by the Company on the
relevant payment date). In June 1995, the first installment of $409,100 was
paid for these key officers of the Company. In June 1996, the second
installment of $360,800, reduced by $48,300 from the June 1995 payment due to
the resignation of one of the 11 key officers, was paid by Westinghouse. The
final installment of $360,800 was paid in June 1997. Even though such
payments were funded by Westinghouse and did not require any use of the
Company's cash, for accounting purposes, they are required to be reflected as
compensation expense in the Company's financial statements.
(5) Included in this column for Mr. Edwards relating to fiscal 1998 and
1997 are amounts of $258,374 and $97,780, respectively, in relocation, ongoing
cost of living adjustments and additional tax reimbursement payments
(implemented to reimburse Mr. Edwards for incremental foreign tax liabilities)
pertaining to his assignment as President of MICROS-Fidelio Software GmbH and
Co. KG in Munich, Germany. During fiscal year 1996, Mr. Edwards received
relocation compensation of $34,437 relating to other relocations.
EMPLOYMENT AGREEMENTS
The Company has entered into an Employment Agreement with Mr.
Giannopoulos that, as amended, expires on June 30, 2002. The Agreement, as
amended, provides that Mr. Giannopoulos was to be paid an annual salary of
$262,500 for fiscal 1998 and was eligible for a bonus targeted at $163,500
for fiscal 1998. The actual amount of the bonus is tied to certain
performance criteria but cannot exceed 200% of the targeted amount. The
annual salary and target bonus may be increased each year of the Agreement in
a manner determined by the Compensation Committee.
The Company has entered into an Employment Agreement with Mr. Kaufman
that expires on May 28, 2000. The Agreement provides that Mr. Kaufman was to
be paid an annual salary of $173,000 for fiscal 1998 and was eligible for a
bonus targeted at $95,000 for fiscal 1998. The actual amount of the bonus is
tied to certain performance criteria but cannot exceed 200% of the targeted
amount. The annual salary and target bonus may be increased each year of the
Agreement in a manner determined by the Compensation Committee.
The Company has entered into an Employment Agreement with Mr. Kolson
that expires on May 28, 2000. The Agreement provides that Mr. Kolson was to
be paid an annual salary of $178,000 for fiscal 1998 and was eligible for a
bonus targeted at $95,000 for fiscal 1998. The actual amount of the bonus is
tied to certain performance criteria but cannot exceed 200% of the targeted
amount. The annual salary and target bonus may be increased each year of the
Agreement in a manner determined by the Compensation Committee.
STOCK OPTIONS
Certain full-time, salaried officers and employees of the Company and
its subsidiaries, and non-employee Company Directors are eligible to
participate in the 1991 Option Plan which provides for the issuance of
incentive stock options, non-qualified stock options and stock appreciation
rights.
9
<PAGE> 12
An option may not be exercised within one year after the date of grant
and is exercisable in installments during its term as determined by the Board
of Directors or Compensation Committee. If an option holder dies or becomes
disabled, his or her option becomes fully exercisable and may be exercised
for one year following the termination of employment. If the option holder
retires, his or her option becomes fully exercisable and may be exercised for
three months following retirement. If termination occurs for any other
reason, an option may be exercised, to the extent exercisable at termination,
for 30 days after termination of employment. No option may be exercised
after the expiration of its term.
The exercise price of the shares of Common Stock covered by an option
may not be less than the fair market value of the Common Stock on the date of
grant, which is defined under the Option Plan to be not less than the average
of the highest bid and lowest asked prices of the Common Stock on NASDAQ on
the date of grant.
The following table sets forth the details of stock options granted to
the individuals listed in the Summary Compensation Table during fiscal 1998.
The second table in this section shows the value of exercised and unexercised
options for the individuals listed in the Summary Compensation Table.
OPTION GRANTS TABLE
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE VALUE AT
ASSUMED ANNUAL RATES OF
STOCK PRICE APPRECIATION FOR
INDIVIDUAL GRANTS OPTION TERM
--------------------------------------------------------------------------------------------
% OF TOTAL
OPTIONS
GRANTED TO EXERCISE
OPTIONS EMPLOYEES PRICE EXPIRATION
NAME GRANTED (1) IN 1998 PER SHARE DATE 5% ($) 10%($)
---- ----------- ------- --------- ---- ------ ------
<S> <C> <C> <C> <C> <C> <C>
A. L. Giannopoulos 90,000 10.4% $23.0938 1/2/08 $1,307,118 $3,312,494
Jeffrey B. Edwards 54,000 6.2 23.0938 1/2/08 784,271 1,987,496
Daniel G. Interlandi 54,000 6.2 23.0938 1/2/08 784,271 1,987,496
Gary C. Kaufman 66,000 7.6 23.0938 1/2/08 958,553 2,429,162
Ronald J. Kolson 72,000 8.3 23.0938 1/2/08 1,045,695 2,649,995
Options to purchase 864,800 shares of Common Stock were granted to Company employees during fiscal 1998.
</TABLE>
10
<PAGE> 13
OPTION EXERCISES AND YEAR-END VALUE TABLE
<TABLE>
<CAPTION>
NUMBER OF VALUE OF
SECURITIES UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS AT 6/30/98 OPTIONS AT 6/30/98 (2)
SHARES ACQUIRED VALUE ------------------------------- -----------------------------------
NAME ON EXERCISE (#) REALIZED (1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- --------------- ------------ ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
A. L. Giannopoulos 0 $0 87,332 176,668 $1,611,930 $2,520,445
Jeffrey B. Edwards 0 0 30,999 88,001 542,593 1,111,845
Daniel G. Interlandi 0 0 60,000 106,000 1,100,625 1,514,625
Gary C. Kaufman 0 0 62,000 134,000 1,142,813 1,924,125
Ronald J. Kolson 0 0 74,666 149,334 1,369,153 2,157,097
</TABLE>
(1) Represents market value of the Company's Common Stock at exercise date
less the exercise price.
(2) Represents market value of the Company's Common Stock at June 30, 1998,
less the exercise price.
DIRECTOR COMPENSATION
Directors received a fee of $2,500 per quarter during fiscal 1998 and
an additional $1,000 for each Board of Directors meeting attended. The
compensation for Directors for fiscal 1999 has been set at $2,500 per quarter
and $1,000 for each Board of Directors meeting attended. The compensation
for Audit Committee members, Compensation Committee members, and Nominating
Committee members for fiscal 1998 was $1,000 per meeting, and shall remain at
this level for fiscal 1999. Members of the Board of Directors are reimbursed
for travel and other reasonable out-of-pocket expenses. Directors who are
full-time, salaried employees of the Company or any of its subsidiaries or
affiliates do not receive any fees for their services as members of the Board
of Directors or any of its committees. Additionally, Mr. Brown does not
receive any compensation for serving on the Board-appointed committees.
In addition to the above-mentioned fees, Mr. Brown was compensated
$230,000 and $226,300 in fiscal 1998 and 1997, respectively, for consulting
services provided to the Company. See "Certain Relationships and Related
Transactions" below.
In addition to the above-mentioned fees, Mr. Cohen was compensated
$97,000 and $208,000 in fiscal 1998 and 1997, respectively, for consulting
services and management provided to the Company. Additionally, pursuant to
the terms of the Purchase Agreement dated August 25, 1995 under which the
Company purchased from Mr. Cohen and his family the remaining 77% of D.A.C.
Systemes/MICROS France and AD-Maintenance Informatique ("ADMI") the Company
did not already own, the Company paid to Mr. Cohen approximately $203,000 and
$365,000 during fiscal 1998 and 1997, respectively. See "Certain
Relationships and Related Transactions" below.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During fiscal 1998, none of the members of the Compensation Committee
is or was an employee or officer of the Company, or has any relationship with
the Company requiring additional special disclosure.
11
<PAGE> 14
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
In fiscal 1998, the Company's compensation for executives, including
grants under the Stock Option Plan, was administered by the Compensation
Committee. In fiscal 1998, there were two meetings of the Compensation
Committee. Set forth below is a report submitted by Mr. Voorhees, Ms.
Jenniches and Mr. Puente, as members of the Company's Compensation Committee,
addressing the Company's compensation policies for the last completed fiscal
year, as they affected Mr. Giannopoulos, in his capacity as President and
Chief Executive Officer of the Company, and the four executive officers other
than Mr. Giannopoulos, who, for the last completed fiscal year, were the
Company's most highly compensated executives (collectively with Mr.
Giannopoulos, the "Named Executive Officers").
COMPONENTS OF EXECUTIVE COMPENSATION
The basic premise of the Company's executive compensation policy is to
ensure a link between executive compensation and the creation of stockholder
value, while motivating and retaining key employees. The primary components
of the compensation packages offered to the Company's executive officers by
the Company for the last completed fiscal year consisted of three basic
elements - base salary, annual incentive bonus, and long-term incentives in
the form of stock options.
SALARY
Base salaries of the executive officers, including the Named Executive
Officers, reflect the evaluation of the Compensation Committee of the
performance of the Company's executive officers in the point-of-sale and
property management and central reservation systems industry (specifically,
information systems for the hospitality industry) on an international, rather
than a national, regional or local level. Although there is no fixed
relationship between corporate performance and base salary, the Compensation
Committee considers several factors in determining base salaries of the
Company's executive officers, including corporate performance, the increasing
importance of their role in the Company's operations on a consolidated basis,
achievement of personal objectives, and the general effect of increases in
the cost of living. Moreover, the Company engaged an outside compensation
consulting firm in fiscal 1997 to evaluate the level of compensation paid to
both Named Executive Officers and all other employees. The firm made
recommendations as to how the Company may adjust salary in certain situations
to pay a level of compensation at least equal to the average of other
companies of similar size and in similar industries to that of MICROS. In
fiscal 1998, the Compensation Committee continued to evaluate compensation
levels offered by other companies similarly positioned to MICROS in terms of
both size (revenue and income) and industry.
The Compensation Committee continues to attempt to offer compensation
to the Company's Named Executive Officers in amounts equal to that of other
companies in competitive industries and with comparable levels of revenue.
Currently, the Compensation Committee considers the base salary and incentive
bonus components of total compensation to be generally in the middle range of
compensation as compared to compensation levels of other senior executives of
companies in similar industries. Moreover, the Company considers that the
compensation levels are comparable to those companies in the computer
software and services peer group.
12
<PAGE> 15
BONUSES
Bonuses for the last completed fiscal year were determined by the
Compensation Committee based on the assessment of the Compensation Committee
of various factors relating to both corporate and individual performance, as
further discussed below.
STOCK OPTIONS
Stock options for the purchase of 336,000 shares were granted to Named
Executive Officers during fiscal 1998. Options were granted in fiscal 1998 to
employees who are not Named Executive Officers. The Compensation Committee
allocated options on the basis of various factors, including the employee's
current position, performance based on both objective and subjective factors,
seniority, and Company performance in general. The Compensation Committee
attempts to achieve an equitable allocation of the grant of options, to both
the Named Executive Officers, other senior officers, and non-executive
employees of the Company and its subsidiaries. To the extent stock options
are exercised, the benefit derived therefrom provides additional compensation
to those executives whom the Compensation Committee believes are deserving of
such benefits on the basis of the value of their efforts on behalf of the
Company and its stockholders. Stock options constitute the element of
executive compensation most linked to stockholder value inasmuch as their
value increases directly with any increase in the price of the Company's
Common Stock. The real value recognized by the award recipient is directly
related to future corporate performance. The stock option grants tie
executive compensation to stock performance, since the stock options will
only have value if and to the extent the market price of the Company's stock
increases from the exercise price of the stock options. Recommendations with
respect to recipients and the number of options to be granted thereto are
made by the President and CEO based on performance. The Compensation
Committee evaluates the recommendations, analyzing both the quantity of the
proposed grants and the identities of the proposed recipients. The
Compensation Committee will then, in its sole discretion, approve, reject or
modify the proposed allocation of stock options.
COMPENSATION POLICIES TOWARD EXECUTIVE OFFICERS
The Compensation Committee executive compensation policies are designed
to provide competitive levels of compensation by integrating into total
compensation the Company's annual and long-term performance goals. The
Compensation Committee acknowledges and emphasizes the importance of stock
ownership by management and, accordingly, stock-based performance
compensation arrangements. Stock-based incentives create a nexus between
stockholder and management interests by providing motivation for executives
over the long term. The Company's 1991 Option Plan is designed to attract,
motivate and retain the valuable executive talent necessary to ensure the
continued success of the Company. As a result of the use of long-term
compensation as part of executive officers' total compensation, actual
compensation levels in any particular year may be above or below those of the
Company's competitors, depending upon the Company's overall performance.
RELATIONSHIP OF CORPORATE PERFORMANCE TO EXECUTIVE COMPENSATION
The determination of bonuses for the last completed fiscal year was
based primarily on corporate performance as measured by pre-tax income and
net revenue. Accordingly, the Compensation Committee performs a mathematical
analysis based on actual performance compared to budgeted performance.
Actual bonuses paid to the Named Executive Officers equal to a large extent
the targeted bonus, established in the beginning of the fiscal year, times
the factor calculated comparing actual and budgeted performance.
Additionally, individual non-financial performance items were taken into
consideration as well.
13
<PAGE> 16
In reviewing corporate performance, pre-tax income and net revenue
serve as the focal points in the analysis by the Compensation Committee. The
pre-tax income and net revenue are evaluated both on a consolidated basis and
a business unit basis. Additionally, the Compensation Committee considers
the competitive climate in which the Company must operate. It is the
Compensation Committee's policy that the total compensation package, the sum
total of base salaries and incentive bonuses, for executive officers,
including the Named Executive Officers, eligible for incentive compensation
should be equal to competitive average total compensation as presented in
appropriate wage surveys. Target bonus amounts vary according to salary
levels and positions comparable to those established in the previous fiscal
year. The total amount of the incentive bonuses can vary from zero to six
percent of the pre-tax income of the Company when positive operating income
is achieved.
The financial position of the Company is reviewed annually to determine
which aspects of the executive officers' performance need to be emphasized,
and accordingly, which factors will be taken into consideration in the
determination of the incentive bonuses. The measures of corporate
performance that were considered by the Compensation Committee for the last
completed fiscal year included pre-tax income and net revenue. In addition
to these performance factors, the Compensation Committee considered the
"individual" factor. This factor is based on the recommendation of the Chief
Executive Officer and may be quantitative or qualitative, depending on
emphasis desired, but not necessarily derived from normal financial reports.
The non-financial objectives also generally include achieving certain
pre-designated non-financial events or objectives, such as consummating a
transaction with a key customer, or completing a certain software development
milestone.
As in most other executive compensation packages, the subjective factor
of human judgment plays a key role in determining the Company's incentive
bonuses. Individual bonuses are reviewed and judgment is applied by the
Compensation Committee based upon the executive's individual contribution to
the performance of the Company as a whole and his or her primary area of
responsibility in particular. No bonuses are paid where an executive fails
to perform duties in accordance with the Company's Code of Business Practices.
CHIEF EXECUTIVE OFFICER COMPENSATION
The Company considers that the compensation level of the Chief
Executive Officer should be comparable to those companies in the computer
software and services peer group. Mr. A. L. Giannopoulos was elected
President and Chief Executive Officer in May 1993. Until May 31, 1995,
however, Mr. Giannopoulos was a full-time employee of Westinghouse Electric
Corporation and as such received no compensation from the Company. Effective
June 1, 1995, Mr. Giannopoulos became a full-time employee of the Company
pursuant to the terms of an Employment Agreement in effect until December 31,
1999. Under the Agreement for fiscal 1998, as amended, Mr. Giannopoulos was
eligible to receive a base salary of $262,500 and a bonus of $163,500. In
determining Mr. Giannopoulos' fiscal 1998 bonus, the Compensation Committee
considered a number of factors, including the Company's revenue growth,
income before taxes and certain personal performance factors. The
Compensation Committee also evaluated Mr. Giannopoulos' execution and
management of several significant infrastructure modifications, including the
outsourcing of most manufacturing functions, the implementation of a new
service and support arrangement with a third party supplier for all United
States customers, and the implementation of a new year 2000 compliant
corporate management information system. Finally, the Compensation Committee
evaluated Mr. Giannopoulos on the progress he made with respect to the
world-wide improvements in customer service and support capabilities, and the
consolidation of certain international operations.
14
<PAGE> 17
The Committee has considered the impact of the provisions of the
Internal Revenue Code that, in certain circumstances, disallow compensation
deductions in excess of $1 million for any year with respect to the Company's
CEO and four other most highly compensated officers. These disallowance
provisions do not apply to performance-based compensation. The Company
expects that these provisions will not limit its tax deductions for executive
compensation in the near term.
ALAN M. VOORHEES
JOHN G. PUENTE F. SUZANNE JENNICHES.
Members of the Compensation Committee
COMMON STOCK PERFORMANCE GRAPH
The following line graph compares (1) the cumulative total stockholder
return on the Company's Common Stock during the past five fiscal years, based
on the market price of MICROS Systems, Inc. Common Stock, with (2) the
cumulative total yearly return of the S&P 500 Index and (3) the S&P Computer
Software and Services composite index.
SHAREHOLDER RETURN
(DIVIDENDS REINVESTED)
<TABLE>
<CAPTION>
COMPANY/INDEX JUN93 JUN94 JUN95 JUN96 JUN97 JUN98
- ------------- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C>
MICROS SYSTEMS, INC. 100 192.73 240.00 202.73 305.45 481.37
S&P 500 INDEX 100 101.41 127.84 161.08 216.98 282.42
COMPUTER
(SOFTWARE&SVC)-500 100 113.29 176.35 234.90 390.36 605.40
</TABLE>
Note to graph:
Assumes $100 invested on July 1, 1993, in MICROS Systems, Inc. Common Stock,
and an identical amount in the S&P 500 Index and the Computer Software and
Services composite index.
15
<PAGE> 18
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
During fiscal 1998, Daniel Cohen was compensated $97,000 in consideration
for his provision of consulting services to the Company. During fiscal 1997,
Mr. Cohen was a full-time employee of the Company, and was compensated
$208,000. Mr. Cohen's employment with the Company terminated on June 30,
1997, and his consultant agreement with the Company terminated on June 30,
1998. Additionally, pursuant to the terms of the Purchase Agreement dated
August 25, 1995 under which the Company purchased from Mr. Cohen and his
family the remaining 77% of D.A.C. Systemes/MICROS France and AD-Maintenance
Informatique ("ADMI") the Company did not already own, the Company paid to
Mr. Cohen approximately $203,000 and $365,000 during fiscal 1998 and 1997,
respectively.
During fiscal 1998 and 1997, the Company compensated Louis M. Brown, Jr.,
Chairman of the Board, $230,000 and $226,300, respectively, for consulting
services provided to the Company. Effective June 30, 1995, the Company and
Mr. Brown entered into a Consulting Agreement terminating June 30, 2000,
pursuant to which Mr. Brown is to provide on the average 20 hours per week of
consulting services to the Company in exchange for a base consulting fee
commencing at $150,000 plus a target bonus of $70,000, with annual
adjustments.
APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
(PROPOSAL 3)
The Company's Board of Directors has selected the firm of
PricewaterhouseCoopers LLP as the independent public accountants for the
Company for the year ending June 30, 1999. The approval of its selection is
to be voted upon at the Annual Meeting. PricewaterhouseCoopers LLP has
served in this role since August 1990, and its selection was approved by the
stockholders at the last Annual Meeting. It is expected that representatives
of PricewaterhouseCoopers LLP will be present at the Annual Meeting and
available to respond to appropriate questions, and will have the opportunity
to make a statement if they so desire.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE APPROVAL OF
PRICEWATERHOUSECOOPERS LLP AS INDEPENDENT PUBLIC ACCOUNTANTS FOR THE 1999
FISCAL YEAR.
AMENDMENT TO THE
1991 STOCK OPTION PLAN
(PROPOSAL 4)
INTRODUCTION
Under the MICROS Systems, Inc. 1991 Stock Option Plan (the "1991 Option
Plan"), 3,500,000 shares of Common Stock (as adjusted to reflect the impact
of the two-for-one stock split effected in the form of a 100% stock dividend
on June 23, 1998) were reserved for issuance in the form of incentive stock
options and non-qualified stock options to officers, directors, and employees
of the Company and its subsidiaries. In addition, non-qualified options may
be granted to non-employee Directors.
At this Annual Meeting, the stockholders are being requested to
consider and approve the adoption of an amendment to the 1991 Option Plan
which serves to authorize the issuance of an additional 1,000,000 shares of
Common Stock under the Option Plan, for a total of 4,500,000 shares of Common
Stock. The Board of Directors believes that such an increase is necessary to
assure that the 1991 Option Plan maintains a sufficient number of shares
reserved for issuance in the form of options for the purposes of retaining,
attracting and compensating employees and future employees of the Company.
In an environment which has become increasingly competitive in the search for
employees, especially in the technology industry, it is necessary that the
Company have the ability to grant options in a form and quantity consistent
with other employers in comparable industries.
16
<PAGE> 19
The affirmative vote of a majority of all votes entitled to be cast by
stockholders at a meeting at which a quorum is present is required in order
to adopt the amendment to the 1991 Option Plan. As of the record date,
Directors and officers of the Company have the power to vote approximately
4.8% of the outstanding shares of Common Stock. All of the Directors and
officers have expressed an intent to vote in favor of the proposed amendment
to the 1991 Option Plan.
The principal features of the 1991 Option Plan are summarized below.
The summary is qualified by reference to the complete text of the 1991 Option
Plan, which is attached as Exhibit A.
PURPOSE
The purpose of the 1991 Option Plan is to provide a performance
incentive to certain officers, and other key employees of the Company and its
subsidiaries in order that such persons may acquire a (or increase their)
proprietary interest in the Company and to encourage such persons to remain
in the employ of the Company and its subsidiaries. In addition, non-employee
Directors may participate in the 1991 Option Plan.
ADMINISTRATION
The 1991 Option Plan may be administered by either the Compensation
Committee or by the Board of Directors itself (individually and collectively,
the "Administrating Committee"). It is intended that at all times the 1991
Option Plan will be administered by Directors who are "non-employee
directors" within the meaning of Rule 16b-3 promulgated by the Securities and
Exchange Commission under the Securities Exchange Act of 1934 (the "1934
Act").
In general, the Administrating Committee determines the persons to whom
options are granted, the terms of the options and the number of shares
covered by each option.
DURATION, AMENDMENT AND TERMINATION
The 1991 Option Plan became effective as of September 23, 1991 and will
terminate on September 23, 2001, unless sooner terminated by the Board of
Directors.
In addition to the power to terminate the 1991 Option Plan at any time,
the Board of Directors also has the power to amend the 1991 Option Plan;
provided, no amendment to the 1991 Option Plan may be made without
stockholder approval if the amendment would (i) change the minimum option
prices set forth in the 1991 Option Plan, (ii) increase the maximum term of
options, (iii) materially increase the benefits accruing to the participants
under the 1991 Option Plan, or (iv) materially modify the requirements as to
eligibility under the 1991 Option Plan.
ELIGIBILITY
The 1991 Option Plan provides for the grant of options to directors,
officers and other key employees of the Company and its subsidiaries. As
described below, non-employee directors may be granted only non-qualified
options. As of August 31, 1998, 2,967,015 options have been granted under
the 1991 Option Plan. Pursuant to Section 5 of the Plan, if all or part of
an expired option is unexercised, the shares which were not exercised may
again be available for grant.
17
<PAGE> 20
AWARDS UNDER THE 1991 OPTION PLAN
2,967,015 shares of the Company's Common Stock have been subject to
options under the 1991 Option Plan since its inception. As of October 2,
1998, the closing market price for the Company's Common Stock was $30.75 per
share. The 1991 Option Plan provides for the grant of Incentive Stock
Options as defined under Section 422 of the Internal Revenue Code of 1986, as
amended (the "Code") and non-qualified options.
The type and terms of each option granted under the 1991 Option Plan
are determined by the Compensation Committee. The option price per share
shall not be less than the fair market value of the Company's Common Stock at
the date of grant of the option. Fair market value will be determined by the
Compensation Committee pursuant to the criteria set forth in the 1991 Option
Plan. An option may contain such terms as are deemed appropriate by the
Administrating Committee, including a provision that allows the Company to
re-acquire an option for cash.
EXERCISE OF OPTIONS
An option may be exercised by an optionee by delivery to the Company of
the exercise price which must be paid either: (i) in cash or cash
equivalent; or (ii) in the discretion of the Compensation Committee, by
delivery of previously owned shares of Common Stock or by a combination of
cash and Common Stock.
The term of an option may not exceed ten (10) years. An option is
exercisable in such installments and at such times during its term as
determined by the Compensation Committee. To the extent not exercised,
installments are cumulative and may be exercised in whole or in part at any
time after becoming exercisable until the option expires.
With respect to Incentive Stock Options, the aggregate fair market
value of shares that may be exercised by an optionee for the first time
during any year may not exceed $100,000.
TERMINATION OF EMPLOYMENT
In the event the optionee's employment (or service as a non-employee
Director) terminates by reason of death, all options become fully exercisable
and may be exercised by the optionee's estate within one year after the date
of such death but not later than the date on which such options would
otherwise expire.
If the optionee's employment (or service as a non-employee Director) is
terminated as a result of disability, all options become fully exercisable
and may be exercised within one year after such termination but not later
than the date on which such options would otherwise expire.
If an optionee's employment is terminated on or after age 62 in
accordance with the Company's normal retirement policies, all options become
fully exercisable and may be exercised for a period of three months after
such termination, but not later than the date on which the options would
otherwise expire.
18
<PAGE> 21
If an optionee's employment (or service as a non-employee Director)
terminates other than for retirement, death or disability, the options held
by such optionee, to the extent exercisable as of the date of termination,
may be exercised at any time during the thirty (30) day period immediately
following the date of termination, but not after the date on which such
options would otherwise expire. However, if termination is on account of
cause, all options expire as of the date of termination.
An optionee's estate means the optionee's legal representative or any
person who acquires the right to exercise an option by reason of the
optionee's death.
RESTRICTION ON TRANSFER
Options are transferable only by will or by the laws of descent and
distribution. During an optionee's lifetime, an option may be exercised only
by the optionee.
FEDERAL INCOME TAX TREATMENT
Incentive Stock Options
Incentive Stock Options under the 1991 Option Plan are intended to meet
the requirements of Section 422 of the Code. There are no tax liabilities to
the optionee upon the grant of an Incentive Stock Option. In general, if an
optionee acquires stock upon the exercise of an Incentive Stock Option, no
income will result to the optionee upon such exercise and the Company will
not be allowed a deduction as a result of such exercise provided the optionee
makes no disposition of the stock within two years from the date of grant and
one year after the option is exercised. The basis to the optionee of shares
acquired on the exercise of an Incentive Stock Option will be equal to the
exercise price. Any gain or loss realized upon the sale of the shares
acquired will be treated as capital gains or loss, as applicable, which will
be long-term or mid-term depending upon the holding period.
If the optionee fails to satisfy the one or two-year holding periods
described above, the optionee will be treated as having received ordinary
income at the time of the disposition of the stock equal to the excess of the
value of the stock on the date of exercise (or, if less, the amount realized
from the disposition) over the exercise price. Any gain in excess of the
amount treated as ordinary income will be treated as capital gain. The
Company will be entitled to a deduction for the amount taxable to the
optionee as ordinary income.
Although the exercise of an Incentive Stock Option will not result in
regular income tax liability to an optionee, it may subject the optionee to
liability for the "alternative minimum tax."
Non-Qualified Options
There are no tax liabilities to the optionee upon the grant of a
non-qualified option. In general, an optionee who exercises a non-qualified
option will realize ordinary income in an amount equal to the difference
between the option price and the fair market value of the shares on the date
of exercise and the Company will be entitled to a deduction in the same
amount. The Company will withhold federal and state income and employment
taxes due on this compensation from amounts otherwise payable to the
optionee. The optionee's basis in such shares will generally be the fair
market value on the date of exercise, and when he/she disposes of the shares
he/she will recognize capital gain or loss, either long-term or short-term,
depending on the holding period of the shares.
THE BOARD OF DIRECTORS BELIEVES THAT APPROVAL OF AN INCREASE IN THE
NUMBER OF SHARES ISSUABLE UNDER THE MICROS SYSTEMS, INC. 1991 STOCK OPTION
PLAN IS IN THE BEST INTERESTS OF ALL STOCKHOLDERS AND RECOMMENDS A VOTE FOR
THE PROPOSAL.
19
<PAGE> 22
NEW PLAN BENEFITS
The following table sets forth the number of shares of Common Stock
subject to options granted to each of the following under the 1991 Option
Plan during fiscal 1998. Future awards under the 1991 Option Plan as
proposed to be amended are not determinable at this time. The Company does
not believe that the amount of awards granted during fiscal 1998 or since the
inception of the 1991 Option Plan would have been different if the 1991
Option Plan had been amended at the time such grants were made.
<TABLE>
<CAPTION>
1991 OPTION
-----------
NAME AND POSITION PLAN (1)
----------------- --------
<S> <C>
A. L. Giannopoulos. . . . . . . . . . . . . . 90,000
President and Chief Executive Officer
Jeffrey B. Edwards. . . . . . . . . . . . . . 54,000
President, MICROS-Fidelio Software GmbH
and Co. KG
Daniel G. Interlandi. . . . . . . . . . . . . 54,000
Senior Vice President and General Manager,
Table Service Restaurants and Leisure and
Entertainment Groups 66,000
Gary C. Kaufman. . . . . . . . . . . . . . .
Senior Vice President, Finance and
Administration and Chief Financial Officer
Ronald J. Kolson. . . . . . . . . . . . . . . 72,000
Executive Vice President and Chief
Operating Officer
Executive Officers as a Group. . . . . . . . 492,000
(9 executive officers, including those
named above)
Non-Executive Director Group (6 persons) 36,000
Non-Executive Officer Employee Group 336,800
</TABLE>
(1) A copy of such plan, as amended, is included as Exhibit A.
20
<PAGE> 23
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities and Exchange Act of 1934 requires the
Company's executive officers and directors, and persons who own more than 10%
of a registered class of the Company's equity securities, to file reports of
ownership and changes in ownership with the Securities and Exchange
Commission (the "SEC"). Executive officers, directors and greater than 10%
beneficial owners are required by SEC regulation to furnish the Company with
copies of all Section 16(a) forms they file.
Based solely on its review of the copies of such forms received by it,
the Company believes that during fiscal 1998 all filing requirements
applicable to its executive officers, directors and greater than 10%
beneficial owners have been satisfied.
SUBMISSION OF STOCKHOLDER PROPOSALS
Stockholder proposals intended to be presented at the fiscal 1999
Annual Meeting of Stockholders must be received by the Company by June 25,
1999, to be considered for inclusion in the proxy statement and form of proxy
relating to that meeting.
OTHER MATTERS
The Board of Directors is not aware of any matters other than those
discussed herein, which are to be presented for action at the Annual
Meeting. If any other business properly comes before the Annual Meeting, the
persons named in the accompanying form of proxy will vote in regard thereto
according to their best judgment.
By Order of the Board of Directors,
/s/
Judith F. Wilbert
Corporate Secretary
Beltsville, Maryland
October 23, 1998
21
<PAGE> 24
EXHIBIT A
MICROS SYSTEMS, INC.
1991 STOCK OPTION PLAN
1. PURPOSE OF PLAN. The purpose of the MICROS Systems, Inc. 1991 Stock
Option Plan, as amended (the "Plan"), is to serve as a performance incentive and
to encourage the ownership of MICROS Systems, Inc. (the "Company") stock by key
employees of the Company and its subsidiaries (including officers and directors)
so that the person to whom the option is granted may acquire a (or increase his
or her) proprietary interest in the Company and its subsidiaries and in order to
encourage such person to remain in the employ of the Company or its
subsidiaries. In addition, nonemployee directors may participate in the Plan as
provided herein. Options granted pursuant to the Plan may consist of incentive
stock options ("ISOs") (within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended (the "Code")) and nonqualified options.
2. ADMINISTRATION. The Plan shall be administered by a committee (the
"Committee") appointed by the Board of Directors; except that if and to the
extent that no Committee exists which has the authority to administer the Plan,
the functions of the Committee shall be exercised by the Board of Directors. The
Committee shall consist of not less than two (2) members of the Board of
Directors. Members of the Committee shall be "non-employee directors" (within
the meaning of Rule 240.16(b)-3 of the Securities and Exchange Commission).
The Committee shall determine the purchase price of the stock covered by
each option, the employees and nonemployee directors to whom, and the time or
times at which, options shall be granted, the number of shares to be covered by
each option, and the term of each option. In addition, the Committee shall have
the power and authority to interpret the Plan, to prescribe, amend and rescind
rules and regulations relating to the Plan, to determine the terms and
provisions of the respective option agreements (which need not be identical) and
to make all other determinations deemed necessary or advisable for the
administration of the Plan.
If the Committee is appointed, the Board of Directors shall designate one
of the members of the Committee as chairman and the Committee shall hold
meetings at such times and places as it shall deem advisable. A majority of the
Committee members shall constitute a quorum. All determinations of the Committee
shall be made by a majority of its members. Any decision or determination
reduced to writing and signed by all the Committee members shall be fully as
effective as if it had been made by a vote at a meeting duly called and held.
The Committee shall keep minutes of its meetings and shall make such rules and
regulations for the conduct of its business as it shall deem advisable.
3. EFFECTIVENESS AND TERMINATION OF PLAN.
(a) The Plan shall become effective as of September 23, 1991.
(b) This Plan shall terminate on the earliest of (i) the tenth anniversary
of the effective date (i.e., September 23, 2001), (ii) the date when all shares
of the Company's Common Stock (the "Shares") reserved for issuance under the
Plan have been acquired through the exercise of options granted under the Plan,
or (iii) such earlier date as determined by the Board of Directors. Any option
outstanding under the Plan at the time of the Plan's termination shall remain in
effect in accordance with its terms and conditions and those of the Plan.
4. GRANTEES. Subject to Section 2, options may be granted to key employees
(including directors and officers) and nonemployee directors of the Company and
its subsidiaries as determined by the Committee (each such employee or director,
a "Grantee"); provided, however, ISOs shall only be granted to employees.
A-1
<PAGE> 25
5. THE SHARES. Subject to Section 7, the aggregate number of Shares which
may be issued under the Plan shall be 4,500,000. Such number of Shares may be
set aside out of the authorized but unissued Common Stock not reserved for any
other purpose or out of Common Stock held in or acquired for the treasury of the
Company. If all or part of an expired option is unexercised, the Shares which
were not exercised may again be available for grant under the Plan.
6. GRANT, TERMS AND CONDITIONS OF OPTIONS. Options may be granted by the
Committee at any time and from time to time prior to the termination of the
Plan. Except as hereinafter provided, options granted pursuant to the Plan shall
be subject to the following terms and conditions.
(a) Price. The purchase price of the Shares subject to an option shall be
no less than the fair market value of the Shares at the time of grant; provided,
however, if an ISO is granted to a person owning Common Stock of the Company
possessing more than 10% of the total combined voting power of all classes of
stock of the Company as defined in Section 422 of the code ("10% Stockholder"),
the purchase price shall be no less than 110% of the fair market value of the
Shares. The fair market value of the Shares shall be determined by and in
accordance with procedures to be established by the Committee, whose
determination shall be final.
Notwithstanding the foregoing, if the Company's Common Stock is admitted to
quotation on the National Association of Securities Dealers Automated Quotation
system on the date the option is granted, fair market value shall not be less
than the average of the highest bid and lowest asked prices of the Common Stock
on such system on such date. If the Common Stock is admitted to trading on a
national securities exchange on the date the option is granted, fair market
value shall not be less than the last sales price reported for the Common Stock
on such exchange on such date or on the last date preceding such date on which a
sale was reported.
The exercise price shall be paid in full in United States dollars in cash
or by check at the time of exercise. At the discretion of the Committee, the
exercise price may be paid with (i) Common Stock already owned by, and in
possession of, the Grantee or (ii) any combination of United States dollars or
Common Stock. Anything contained herein to the contrary notwithstanding, any
required withholding tax shall be paid by the Grantee in full at the time of
exercise of an option. Common Stock used to satisfy the exercise price of an
option shall be valued at its fair market as of the close of business on the day
of exercise. The exercise price shall be subject to adjustment, but only as
provided in Section 7 hereof.
(b) Limit on Incentive Option Amount. Notwithstanding any provisions
contained herein to the contrary, the Shares covered by an ISO granted to a
Grantee which are exercisable for the first time during any calendar year shall
not exceed the $100,000 limitation in Section 422 of the Code.
(c) Duration and Exercise of Options. An option may be granted for a term
as determined by the Committee but not exceeding ten (10) years from the date of
grant; provided, however, the term of an ISO granted to a 10% Stockholder may
not exceed five (5) years. Options shall be exercised at such time and in such
amounts (up to the full amount thereof) as may be determined by the Committee at
the time of grant. If an option is exercisable in installments, the Committee
shall determine what events, if any, will accelerate the exercise of the option.
The Plan shall be subject to approval by the Company's stockholders within
one (1) year from the date on which it was adopted. Prior to such stockholder
approval, options may be granted under the Plan, but any such option shall not
be exercisable prior to such stockholder approval. If the Plan is not approved
by the Company's stockholders, the Plan shall terminate and all options
theretofore granted under the Plan shall terminate and become null and void.
(d) Termination of Employment. Except as otherwise determined by the
Committee, upon the termination of a Grantee's employment (or service as a
nonemployee director), the Grantee's rights to exercise an option shall be as
follows:
A-2
<PAGE> 26
i) If the Grantee's employment (or service as a nonemployee
director) is terminated on account of total and permanent disability (pursuant
to the Company's long-term disability plan for Grantees who are employees) and
as defined in Section 22(e)(3) of the Code), any option shall become fully
(100%) vested as of the date of termination and may be exercised by the Grantee
(or by the Grantee's estate if the Grantee dies after termination) at any time
within one (1) year after termination on account of disability but in no event
after the expiration of the term of the option.
ii) In the case of a Grantee whose employment (or service as a
nonemployee director) is terminated by death, any option shall become fully
(100%) vested as of the date of death and the Grantee's estate shall have the
right for a period of one (1) year following the date of such death to exercise
the option but in no event after the expiration of the term of the option.
iii) In the case of a Grantee who retires from the Company and its
subsidiaries after attaining age 62, an option shall become fully (100%) vested
as of the date of retirement and the Grantee may, within the three-month period
following retirement, exercise such option but in no event after the expiration
of the term of the option. If the Grantee dies during such three-month period,
the Grantee's estate may exercise such option during the period ending on the
first anniversary of the Grantee's retirement but in no event after the
expiration of the term of the option.
iv) In the case of a Grantee whose employment with the Company and
its subsidiaries (or service as a nonemployee director) is terminated for any
reason other than death, disability or retirement, the Grantee (or the Grantee's
estate in the event of the Grantee's death after such termination) may, within
the 30-day period following such termination, exercise an option to the extent
the right to exercise had accrued prior to such termination but in no event
after the expiration of the term of the option. Notwithstanding the foregoing,
if the Grantee's termination of employment is on account of misconduct or any
act that is adverse to the Company, the Grantee's option shall expire as of the
date of termination of employment.
v) A Grantee's "estate" shall mean the Grantee's legal
representative or any person who acquires the right to exercise an option by
reason of the Grantee's death. The Committee may in its discretion require the
transferee of a Grantee to supply it with written notice of the Grantee's death
or disability and to supply it with written notice of the Grantee's death or
disability and to supply it with a copy of the will (in the case of the
Grantee's death) or such other evidence as the Committee deems necessary to
establish the validity of the transfer of an option. The Committee may also
require the agreement of the transferee to be bound by all of the terms and
conditions of the Plan.
(e) Transferability of Option. Options shall be transferable only by will
or the laws of descent and distribution and shall be exercisable during the
Grantee's lifetime only by the Grantee.
(f) Form, Modification, Extension and Renewal of Options. Subject to the
terms and conditions and within the limitations of the Plan, an option shall be
evidenced by such form of agreement as is approved by the Committee, and
consistent with the terms hereof. Notwithstanding the foregoing, no modification
of an option shall, without the consent of the Grantee, alter or impair any
rights or obligations under any option theretofore granted under the Plan nor
shall any modification be made which shall adversely affect the status of an ISO
as an incentive stock option under Section 422 of the Code.
(g) Minimum Number of Shares. The minimum number of Shares for which an
option may be exercised at any time shall be 100 shares, unless the unexercised
portion of the option covers a lesser number of Shares.
(h) Maximum Number of Shares. Subject to adjustments as provided in
Section 7(a) hereof, the maximum number of Shares subject to options that may be
granted hereunder during any one fiscal year of the Company to any one
individual shall be limited to 100,000 Shares.
A-3
<PAGE> 27
(i) Other Terms and Conditions. Options may contain such other provisions,
which shall not be inconsistent with any of the foregoing terms of the Plan, as
the Committee shall deem appropriate, including a provision permitting the
Company or a subsidiary to reacquire an option for cash.
7. CAPITAL STRUCTURE CHANGES.
(a) If the outstanding shares of the Company's Common Stock are increased,
decreased or changed into, or exchanged for a different number or kind of shares
or securities of the Company, whether through merger, consolidation,
reorganization, recapitalization, reclassification, stock dividend, stock split,
combination of shares, exchange of shares, change in corporate structure or the
like, the Board of Directors shall make appropriate and proportionate
adjustments in the number, kinds and limits of shares available for options
pursuant to the Plan or subject to any outstanding options and in the purchase
price therefor. The determination of the Board of Directors as to such
adjustments shall be conclusive.
(b) Fractional Shares resulting from any adjustment in options pursuant to
Section 7 shall be eliminated at the time of exercise by rounding-down for
fractions less than one-half (1/2) and rounding-up for fractions equal to or
greater than one-half (1/2). No cash settlements shall be made with respect to
fractional Shares eliminated by rounding. Notice of any adjustments shall be
given by the Committee to each Grantee whose option has been adjusted and such
adjustment (whether or not such notice is given) shall be effective and binding
for all purposes of the Plan.
(c) Upon dissolution or liquidation of the Company, or upon a
reorganization, merger or consolidation in which the Company is not the
surviving corporation, or upon the sale of substantially all of the property of
the Company to another corporation, the Plan and options issued thereunder shall
terminate, unless provision is made in connection with such transaction for the
assumption of options theretofore granted, or the substitution for such options
of new options of the successor employer corporation or a parent or subsidiary
thereof, with appropriate adjustment as to the number and kinds of shares and
the per share exercise price. In the event of such termination, all outstanding
options shall be exercisable in full for at least 30 days prior to the
termination date whether or not otherwise exercisable during such period.
(d) Options may be granted under this Plan from time to time in
substitution for similar options held by employees of corporations who become or
are about to become employees of the Company or a subsidiary as the result of a
merger or consolidation, the acquisition by the Company or a subsidiary of the
assets of the employing corporation, or the acquisition by the Company or a
subsidiary of the fifty percent (50%) or more of the stock of the employing
corporation causing it to become a subsidiary.
8. SECURITIES LAW REQUIREMENTS. No option granted pursuant to this Plan
shall be exercisable in whole or in part nor shall the Company be obligated to
sell any Shares subject to any such option if such exercise or sale, in the
opinion of counsel for the Company, violates the Securities Act of 1933 (or
other federal or state statutes having similar requirements). Each option shall
be subject to the further requirement that, if at any time the Committee shall
determine in its discretion that the listing, registration or qualification of
the Shares subject to such option under any securities exchange requirements or
under any applicable law, or the consent or approval of any governmental
regulatory body, is necessary as a condition of, or in connection with, the
granting of such option or the issuance of Shares thereunder, such option may
not be exercised in whole or in part unless such listing, registration,
qualification, consent or approval shall have been effected or obtained free of
any conditions not acceptable to the Committee. The Committee may require each
person purchasing Shares pursuant to an option to represent to and agree with
the Company in writing that he is acquiring the Shares without a view to
distribution thereof. The certificates for such Shares may include any legend
which the Committee deems appropriate to reflect any restrictions on transfer.
All certificates for Shares delivered under the Plan shall be subject to
stop-transfer orders and other restrictions as the Committee may deem advisable
under the rules, regulations, and other requirements of the Securities and
Exchange Commission, any stock exchange upon which the Common Stock is then
listed, and any applicable federal or state securities law, and the Committee
may cause a legend or legends to be put on any such certificates to make
appropriate reference to such restrictions.
A-4
<PAGE> 28
9. AMENDMENTS. The Board of Directors may amend or terminate
the Plan in whole or in part as it deems appropriate and proper;
provided, however, except as provided in Section 7, (i) without
stockholder approval no action may be taken which changes the minimum
option price, increases the maximum term of options, materially
increases the benefits accruing to Grantees under the Plan, materially
increases the number of Shares which may be subject to options pursuant
to this Plan, or materially modifies the requirements as to eligibility
for participation hereunder, and (ii) without the consent of the
Grantee, no action may be taken which adversely affects the rights of
such Grantee concerning an option.
10. NO EMPLOYMENT RIGHT. Neither this Plan nor any action taken
hereunder shall be construed as giving any right to any individual to
be retained as an officer or employee of the Company or any of its
subsidiaries.
11. INDEMNIFICATION. Each person who is or at any time serves
as a member of the Board of Directors or the Committee shall be
indemnified and held harmless by the Company against and from (i) any
loss, cost, liability or expense that may be imposed upon or reasonably
incurred by such person in connection with or resulting from any claim,
action, suit or proceeding to which such person may be a party or in
which such person may be involved by reason of any action or failure to
act under this Plan and (ii) any and all amounts paid by such person in
satisfaction of judgment in any such action, suit or proceeding
relating to this Plan.
Each person covered by this indemnification shall give the
Company an opportunity, at its own expense, to handle and defend the
same before such person undertakes to handle and defend the same on
such person's own behalf. The foregoing persons may be entitled under
the charter or by-laws of the Company or any of its subsidiaries, as a
matter of law, or otherwise, or any power that the Company or a
subsidiary may have to indemnify such person or hold such person
harmless.
12. GOVERNING LAW. Except to the extent preempted by federal
law, all matters relating to this Plan or to options granted hereunder
shall be governed by the laws of the State of Maryland.
13. EXPENSES; PROCEEDS. The expenses of implementing and
administering this Plan shall be borne by the Company and its
subsidiaries. Proceeds from the sale of Common Stock under the Plan
shall constitute general funds of the Company.
14. TITLES AND HEADINGS. The titles and headings of the
Sections in this Plan are for convenience of reference only; in the
event of any conflict, the text of this Plan, rather than such titles
or headings, shall control.
A-5
<PAGE> 29
[ X ] PLEASE MARK VOTES REVOCABLE PROXY
AS IN THIS EXAMPLE MICROS SYSTEMS, INC.
<TABLE>
<S> <C>
FOR AGAINST ABSTAIN
THIS PROXY IS SOLICITED ON BEHALF OF 1. Proposal to amend the Company's [ ] [ ] [ ]
THE BOARD OF DIRECTORS Articles of Incorporation to
provide for an increase in
The undersigned stockholder of MICROS Systems, Inc. authorized shares from 30,000,000
(the "Company") hereby appoints Louis M. Brown, Jr. and to 50,000,000 shares (Proposal 1)
A.L. Glannopoulos as Proxies, each with the power to WITH- FOR ALL
appoint his substitute, and hereby authorizes either FOR HOLD EXCEPT
of them to represent and to vote, as designated below, 2. Election of Directors (Proposal 2) [ ] [ ] [ ]
all the shares of Common Stock of the Company LOUIS M. BROWN, JR., DANIEL COHEN,
held on record by the undersigned on October 2, 1998, A.L. GLANNOPOULOS, F. SUZANNE
at the Annual Meeting of Stockholders to be held at JENNICHES, JOHN G. PUENTE, DWIGHT S. TAYLOR
2:00 PM on November 20, 1998, at the BWI Airport Marriott,
1743 West Nursery Road, Baltimore-Washington International INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
Airport, Baltimore, Maryland 21240 or at any adjournments NOMINEE, MARK "FOR ALL EXCEPT" AND WRITE THAT NOMINEE'S NAME
thereof. The Board of Directors recommends votes FOR IN THE SPACE PROVIDED BELOW.
Proposals 1 through 4.
-----------------------------------------------------------------
FOR AGAINST ABSTAIN
3. Proposal to approve the appoint- [ ] [ ] [ ]
ment of PricewaterhouseCoopers
LLP as the independent public
accountants of the Company (Proposal 3)
FOR AGAINST ABSTAIN
4. Proposal to approve the amend- [ ] [ ] [ ]
ment to the Company's 1991 Stock
Option Plan (Proposal 4)
This proxy will be voted as directed by the undersigned stock-
holder. UNLESS CONTRARY DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED
---------------------- FOR PROPOSALS 1, 2, 3, AND 4. The Proxies are authorized, in their
Please be sure to sign and date Date discretion, to vote upon such other business as may properly come
this Proxy in the box below. before the Annual Meeting or any adjournments thereof. The under-
- ------------------------------------------------------------ signed stockholder may revoke this proxy at any time before it is
voted by delivering to the Secretary of the Company either a written
revocation of the proxy or a duly executed proxy bearing a later
date, or by appearing at the Annual Meeting and voting in person.
- ---Stockholder sign above---Co-holder (if any) sign above--- The undersigned stockholder hereby acknowledges receipt of the
Notice of Annual Meeting and Proxy Statement.
* SIGN YOUR NAME EXACTLY AS IT APPEARS ABOVE.
- ------------------------------------------------------------------------------------------------------------------------------------
[ARROW] DETACH ABOVE CARD, SIGN, DATE AND MAIL IN POSTAGE PAID ENVELOPE PROVIDED. [ARROW]
MICROS SYSTEMS, INC.
- ------------------------------------------------------------------------------------------------------------------------------------
PLEASE ACT PROMPTLY
SIGN, DATE & MAIL YOUR PROXY CARD TODAY
- ------------------------------------------------------------------------------------------------------------------------------------
If you receive more than one proxy card, please sign and return all cards in the accompanying envelope. When signing as attorney,
executor, administrator, trustee or guardian, please give full title as such. If a corporation, please sign in full corporate name
by President or other authorized officer. If a partnership, please sign in partnership name by authorized person.
</TABLE>
