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________________________________________________________________________________
SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF
THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. 1)
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 Rule 14a-11(c) or Rule 14a-12
ASIA MEDIA COMMUNICATIONS, LTD.
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE REGISTRANT)
Payment of filing fee (Check the appropriate box):
[x] No Fee Required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) 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 Rule 0-11. (Set forth the amount on which the filing fee
is calculated and state how it was determined.)
.........................................................................
(4) Proposed maximum aggregate value of transaction:
.........................................................................
(5) Total fee paid:
.........................................................................
[ ] Fee paid previously with preliminary materials:
[ ] 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, Schedules or Registration Statement No.:
.........................................................................
(3) Filing party:
.........................................................................
(4) Date filed:
.........................................................................
________________________________________________________________________________
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ASIA MEDIA COMMUNICATIONS, LTD.
712 FIFTH AVENUE
SEVENTH FLOOR
NEW YORK, NY 10019
------------------------
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
FEBRUARY 23, 1999
------------------------
To the Stockholders of
ASIA MEDIA COMMUNICATIONS, LTD.
NOTICE IS HEREBY GIVEN that a Special Meeting (the 'Meeting') of
Stockholders of ASIA MEDIA COMMUNICATIONS, LTD. (the 'Company'), a Nevada
corporation, will be held at the law offices of Bryan Cave LLP located at 245
Park Avenue, 27th Floor, New York, NY 10167 on February 23, 1999 at 9:00 A.M.
for the following purposes:
1. To consider and vote upon a proposed amendment to the Company's
Articles of Incorporation to effect a one for 100 reverse split of the
Company's outstanding common stock.
2. To consider the approval of the Company's 1999 Incentive Program
adopted by the Board of Directors.
3. To transact such other business as may properly come before the
Meeting or any adjournment thereof.
The above matters are more fully described in the accompanying Proxy
Statement.
The Board of Directors has fixed the close of business on February 11, 1999
as the date for the determination of stockholders entitled to notice of, and to
vote at, the Meeting. A list of stockholders entitled to vote at the Meeting
will be open to examination by stockholders during ordinary business hours for a
period of ten (10) days prior to the Meeting at the executive offices of the
Company, 712 Fifth Avenue, Seventh Floor, New York, NY 10019.
By order of the Board of Directors,
STEVEN A. SAIDE, ESQ.
Secretary
New York, New York
February 12, 1999
IMPORTANT
WHETHER OR NOT YOU PLAN TO ATTEND THIS MEETING, PLEASE DATE AND SIGN THE
ENCLOSED PROXY CARD AND RETURN IT IN THE ENVELOPE PROVIDED. IF YOU ATTEND THE
MEETING, YOU MAY REVOKE THE PROXY AND VOTE YOUR SHARES IN PERSON.
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ASIA MEDIA COMMUNICATIONS, LTD.
712 FIFTH AVENUE
SEVENTH FLOOR
NEW YORK, NEW YORK 10019
------------------------
SPECIAL MEETING OF STOCKHOLDERS
------------------------
PROXY STATEMENT
APPROXIMATE DATE OF MAILING: FEBRUARY 12, 1999
------------------------
The enclosed Proxy is solicited on behalf of the Board of Directors (the
'Board' or the 'Board of Directors') of Asia Media Communications, Ltd. (the
'Company') for use at the Special Meeting of Stockholders to be held at the time
and place set forth in the foregoing notice and at any adjournment thereof (the
'Meeting'). Only stockholders of record (the 'Stockholders') of the Company's
common stock, $.01 par value per share (the 'Common Stock'), at the close of
business on February 11, 1999 are entitled to notice of, and to vote at, the
Meeting. Proxies in the accompanying form, which are properly executed and duly
returned to the Company and not revoked prior to exercise, will be voted in
accordance with the instructions contained therein. If a Proxy is executed and
returned without instructions as to how it is to be voted, such Proxy will be
voted in favor of all proposals contained in this Proxy Statement. Each Proxy
granted pursuant to this solicitation is revocable and may be revoked at any
time prior to its exercise provided written notice of revocation is received by
the Secretary of the Company prior to the Meeting. A Stockholder who attends the
Meeting in person may, if he or she wishes, vote by ballot at the Meeting,
thereby canceling any Proxy previously given by such Stockholder.
The holders of a majority of the shares of Common Stock issued and
outstanding and entitled to vote at the Meeting, present in person or
represented by proxy, shall constitute a quorum at the Meeting. Any Stockholder
present in person or by proxy who abstains from voting on any particular matter
described herein will be counted for purposes of determining a quorum. For
purposes of voting on the matters described herein, the affirmative vote of the
majority of the voting power present in person or represented by proxy at the
Meeting and entitled to vote on the matter shall be determinative of such
matter. If a Stockholder abstains from voting or directs his or her proxy to
abstain from voting, the shares are considered present at the Meeting for such
matter but, since they are not affirmative votes for the matter, they will have
the same effect as votes against the matter. With respect to broker non-votes on
any such matter, the shares are not considered present at the Meeting for such
matter and they are, therefore, not counted in respect of such matter. Provided
that a quorum is otherwise present, such broker non-votes do have the practical
effect of reducing the number of affirmative votes required to achieve a
majority for such matter by reducing the total number of shares from which the
majority is calculated.
INTEREST OF CERTAIN PERSONS IN MATTERS TO BE ACTED UPON
No director, executive officer, or associate of any director or executive
officer or any other person has any substantial interest, direct or indirect, by
security holdings or otherwise, resulting from the proposed amendment (the
'Amendment') to the Company's Articles of Incorporation to effect a one for 100
reverse split (the 'Reverse Stock Split') of the issued and outstanding shares
of Common Stock, which is not shared by all other stockholders pro-rata, and in
accordance with their respective interests. Subject to stockholder approval of
the Company's 1999 Incentive Program (the 'Plan'), the Company's current
officers and directors will be eligible for participation under the Plan. To
date, no awards under the Plan have been made to the current officers and
directors of the Company.
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PRINCIPAL STOCKHOLDERS
The outstanding voting stock of the Company as of January 15, 1999
consisted of 5,535,586 shares of Common Stock, with each share entitled to one
vote. Beneficial ownership has been determined for purposes herein in accordance
with Rule 13d-3 of the Securities Exchange Act of 1934, as amended (the
'Exchange Act'), under which a person is deemed to be the beneficial owner of
securities if such person has or shares voting power or investment power in
respect of such securities or has the right to acquire beneficial ownership
within 60 days. So far as is known to the Company, the following were the only
beneficial owners of more than 5% of the outstanding Common Stock of the Company
on such date:
<TABLE>
<CAPTION>
NAME AND ADDRESS AMOUNT OF SHARES PERCENT
OF BENEFICIAL OWNER BENEFICIALLY OWNED OF CLASS
- -------------------------------------------------------------------- ------------------ --------
<S> <C> <C>
Christopher F. Brown ............................................... 3,656,667(1) 74.6%
712 Fifth Avenue
Seventh Floor
New York, New York 10019
Ocean Strategic Holding Limited .................................... 608,239(2) 9.9%
11 Bath Street
St. Helier, Jersey
Channel Islands
Edward J. Tobin .................................................... 3,656,667(1) 74.6%
712 Fifth Avenue
Seventh Floor
New York, New York 10019
</TABLE>
- ------------
(1) These shares are held of record by D-Vine Investment Partners, a partnership
between Christopher F. Brown and Edward J. Tobin.
(2) Includes 608,239 shares issuable upon exercise of an outstanding warrant and
is subject to increase up to a maximum of 1,000,000 shares upon an increase
in the total number of issued and outstanding shares of Common Stock.
------------------------
D-Vine Investment Partners, the record holder of 74.6% of the total issued
and outstanding shares of Common Stock on the date hereof, has advised the
Company that it intends to attend the Special Meeting, in person or by proxy,
and to vote all of its shares in favor of the Amendment and the Plan. In such
event, irrespective of whether any Stockholder attends the Special Meeting and
irrespective of how he or she votes, the Amendment and the Plan will be
approved.
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APPROVAL OF AMENDMENT TO ARTICLES OF INCORPORATION
TO EFFECT A ONE FOR 100 REVERSE SPLIT OF THE OUTSTANDING
SHARES OF COMMON STOCK
PROPOSED AMENDMENT
The Board has approved an amendment (the 'Amendment') to Article Fourth of
the Company's Articles of Incorporation, as amended (the 'Articles of
Incorporation'), to effect the Reverse Stock Split. If the Amendment is approved
by the Stockholders, a sentence would be added at the end of Article Fourth
thereof, so that, as amended, said Article shall read in its entirety as
follows:
'FOURTH: That the total number of shares of voting common stock
authorized that may be issued by the Corporation is ONE HUNDRED MILLION
(100,000,000) shares of stock with a par value of One Cent ($0.01) per
share and no other class of stock shall be authorized. Said shares of stock
with a par value of ONE CENT ($0.01) per share may be issued by the
Corporation from time to time for such consideration as may be fixed from
time to time by the Board of Directors. Each 100 shares of Common Stock
outstanding at 9:00 a.m. on February 23, 1999 shall be deemed to be one
share of Common Stock of the Corporation, par value ONE CENT ($0.01) per
share.'
As of January 15, 1999, there were 5,535,586 shares of Common Stock
outstanding. If the Amendment is approved and assuming no additional issuances,
there would be approximately 55,356 shares of Common Stock ('New Common Stock')
issued and outstanding upon the filing of the Amendment with the Secretary of
State of Nevada (the 'Effective Date').
REASONS FOR AMENDMENT
The Amendment has been recommended by the Board of Directors to make the
Company more attractive to potential sellers of businesses to be acquired by the
Company. The Company does not currently have any operations and its principal
activity has been to seek business opportunities. As the Company has no
substantial assets, the Board anticipates that it will have to issue shares of
common stock in order to acquire a business. If the Amendment is adopted, the
Board believes that the Company will have to issue fewer shares of New Common
Stock to the sellers of such business and therefore the total number of issued
and outstanding shares of New Common Stock after any such acquisition would be
reduced to a level more readily acceptable to such sellers. In addition,
although the Common Stock is admitted for trading on the OTC Electronic Bulletin
Board, there has been no active market for the Common Stock. The Board believes
that the decrease in the number of shares of Common Stock outstanding as a
consequence of the Reverse Stock Split may stimulate interest in the New Common
Stock and a market for such shares may develop, although there can be no
assurance that any such market will develop.
The Company does not have any pending acquisitions and there can be no
assurance that a suitable business opportunity will be effected even if the
Amendment is adopted.
PRINCIPAL EFFECTS OF THE REVERSE STOCK SPLIT
Assuming the Amendment is adopted, then upon filing of the Amendment with
the Secretary of State of Nevada:
1. The Reverse Stock Split will result in each 100 presently issued
and outstanding shares of Common Stock being automatically converted into
one share of New Common Stock. No further action on the part of any
stockholder will be necessary to effect this conversion. Stock certificates
representing the Common Stock will automatically be deemed to represent the
appropriate number of shares of New Common Stock.
2. As a result of the Reverse Stock Split, an active market may
develop for the New Common Stock on the OTC Electronic Bulletin Board and
the price per share may increase to reflect the reduced number of shares of
New Common Stock issued and outstanding. THERE CAN BE NO ASSURANCE THAT AN
ACTIVE PUBLIC TRADING MARKET MAY DEVELOP OR THAT THE PRICE PER SHARE MAY
INCREASE OR THAT ANY SUCH MARKET OR
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INCREASE WILL REMAIN FOLLOWING THE EFFECTIVENESS OF THE REVERSE STOCK
SPLIT.
3. The Reverse Stock Split will not have any effect on the par value
of each share of Common Stock which will remain at $0.01 per share.
4. Any shareholder who owns other than even increments of 100 shares
of Common Stock after the Reverse Split (an 'Odd Lot') may incur increased
transaction costs, such as brokerage fees, in connection with the sale of
such Odd Lot.
5. The New Common Stock issued pursuant to the Reverse Stock Split
will be fully paid and non-assessable. The voting rights and other rights
that accompany the Common Stock will not be altered by the Amendment. The
Reverse Stock Split will not affect any stockholder's proportionate equity
ownership of the Company. However, the reduction in the number of
outstanding shares caused by the Reverse Stock Split will increase
proportionately the Company's reported earnings or loss per share and book
value per share.
EXCHANGE OF STOCK CERTIFICATES
As soon as practicable after the Effective Date, stockholders of record on
the Effective Date will be furnished with the necessary materials and
instructions for the surrender and exchange of their certificates representing
shares of existing Common Stock. One share of New Common Stock will be issued in
exchange for 100 presently issued and outstanding shares of Common Stock.
Beginning on the Effective Date, each certificate representing shares of the
Common Stock, will be deemed for all corporate purposes to evidence ownership of
shares of New Common Stock. Accordingly, stockholders may, but need not,
surrender and exchange their certificates representing shares of existing Common
Stock.
STOCKHOLDERS SHOULD NOT SUBMIT ANY STOCK CERTIFICATES TO THE COMPANY OR THE
COMPANY'S TRANSFER AGENT UNTIL REQUESTED TO DO SO. No service charge will be
payable by stockholders in connection with the exchange of certificates, all
costs will be borne by the Company.
NO FRACTIONAL SHARES; NO REDUCTION TO ZERO
No fractional certificates will be issued in connection with the Reverse
Stock Split. On the Effective Date, stockholders who would be entitled to
receive fractional shares because they hold a number of shares not evenly
divisible by 100, will be entitled, in lieu thereof, to receive such number of
shares as rounded up to the nearest whole share. Any stockholder who holds less
than one hundred shares will be entitled to receive one share.
DISSENTERS' RIGHTS
Under the provisions of the applicable Nevada General Corporation Law,
stockholders are not provided with dissenters' rights or rights of appraisal in
connection with a reverse stock split of any class.
EFFECT ON WARRANTS AND OTHER OUTSTANDING SECURITIES
The Company has granted an option to its former wholly owned subsidiary,
AMC International Holdings, Ltd. ('AMC Holdings'), to acquire for nominal
consideration such number of shares of Common Stock as may be required to
exchange 25 preference shares (the 'Preference Shares') issued by AMC Holdings.
As a result of the Reverse Stock Split, the number of shares of the Company's
common stock issuable upon exercise of the option will be reduced from
12,500,000 to 125,000 shares of New Common Stock.
The Company currently has outstanding a warrant (the 'Warrant') to purchase
1,000,000 shares of Common Stock at a price of $.01 per share, provided that the
holder is not entitled to exercise any portion of the Warrant such that upon
giving effect to such exercise, the aggregate number of shares of
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common stock beneficially owned by the holder and its affiliates would exceed
9.9% of the outstanding shares of common stock following such exercise. The
Warrant is exercisable until April 1, 2001. Under the terms of the Warrant,
neither the number of shares issuable upon exercise nor the exercise price will
be effected by the Reverse Stock Split.
FEDERAL INCOME TAX CONSEQUENCES
A summary of the federal income tax consequences of the Reverse Stock Split
is set forth below. The following discussion is based upon present federal tax
laws and does not purport to be a complete discussion of the consequences of the
Reverse Stock Split. This discussion is for general information only and does
not discuss consequences which may apply to special classes of taxpayers (e.g.,
non-resident aliens, broker-dealers, or insurance companies). Accordingly,
stockholders are advised to consult their own tax advisors for more detailed
information regarding the effects of the Reverse Stock Split on their own
individual tax status.
The Reverse Stock Split will be treated as a tax-free recapitalization of
the Company and as a tax-free exchange to its stockholders to the extent that
shares of presently issued and outstanding Common Stock are exchanged for shares
of New Common Stock. The shares of New Common Stock issued to each stockholder
will have an aggregate basis for computing gain or loss equal to the aggregate
basis of shares of Common Stock held by such stockholder immediately prior to
the Reverse Stock Split.
A stockholder's holding period for shares of New Common Stock will include
the holding period for shares of Common Stock exchanged therefore, provided that
the shares of Common Stock were capital assets held by such stockholder.
The Board recommends a vote FOR approval of the proposed amendment to the
Articles of Incorporation.
ADOPTION OF THE PLAN
SUMMARY
The Plan is intended to provide the Board of Directors flexibility to adapt
the compensation of key employees in a changing business environment by making
available many types of awards, greater latitude as to the measurements of
performance, and allowing for certain awards to be contingent on the achievement
of business objectives and/or continued employment. The purpose of the Plan is
to attract and retain qualified employees and directors and to encourage them to
own stock in the Company so that they will have a proprietary interest in the
success of the Company.
The following summary of the Plan is not intended to be complete and is
qualified in its entirety by reference to the Plan itself, a copy of which is
attached hereto as Exhibit A.
TYPES OF AWARDS
The Plan permits the granting of any or all of the following types of
awards: (l) stock options, including incentive stock options ('ISOs'), (2) stock
appreciation rights ('SARs') in tandem with stock options or freestanding and
(3) restricted stock grants. No consideration is payable to the Company by the
Plan participants for the award of benefits under the Plan.
SHARES SUBJECT TO THE PLAN
Subject to adjustment other than on account of the Reverse Stock Split as
described below, the aggregate number of shares of Common Stock that may be
issued or transferred under the Plan is 1,000,000, plus, (i) any shares which
are forfeited under the Plan after the adoption of the Plan by the Board of
Directors (the 'Adoption Date'); plus (ii) the number of shares repurchased by
the Company in the open market and otherwise with an aggregate price no greater
than the cash proceeds received by the Company from the sale of shares under the
Plan; plus (iii) any shares surrendered to the Company in payment of the
exercise price of options issued under the Plan. However, no award may be issued
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that would bring the total of all outstanding awards under the Plan to more than
15% of the total number of shares of Common Stock of the Company at the time
outstanding. Accordingly, upon adoption of the Amendment and the Plan by the
Stockholders and assuming no additional issuances of shares of Common Stock in
the interim, the total number of shares then subject to award under the Plan
will be 8,303.
ELIGIBILITY FOR PARTICIPATION
Grants under the Plan may be made to any employee, officer, key executive,
director, professional or administrative employee, consultant or advisor to the
Company or any subsidiary of the Company selected within the discretion of the
Board of Directors or any committee thereof appointed to administer the Plan.
There are presently four directors and officers of the Company eligible to
participate in the Plan. The number of key employees of other entities who may
be eligible to participate in the Plan is not presently determinable.
ADMINISTRATION AND AMENDMENT OF THE PLAN
The Plan is administered by the Board of Directors or a committee thereof
(the 'Administrator'). The Administrator has the exclusive right, except as
noted below, to interpret its provisions and to promulgate, amend, and rescind
rules and regulations for its administration. The Administrator is authorized to
amend, alter, suspend or discontinue the Plan in its discretion, except in
certain situations which would increase the maximum number of shares of Common
Stock subject to the Plan, change the manner of determining the minimum option
prices, increase the periods during which options may be granted or exercised,
or change the employees or class of employees eligible to receive options
thereunder.
Subject to the limitations in the Plan described below, the Administrator
has as one of its responsibilities the annual determination of the aggregate
extent to which shares of Common Stock or their equivalent may be awarded and
bonuses may be granted to all recipients in relation to the then-current year.
The Administrator has the further authority and responsibility for consenting to
or disapproving any election of a recipient to receive cash in whole or partial
settlement of the exercise of a SAR.
PLAN TERMINATION DATE
The Plan will terminate on the tenth anniversary of its effective date,
unless terminated earlier by the Board of Directors or unless extended by the
Board of Directors, after which time no incentive award grants may be authorized
under the Plan.
STOCK OPTIONS
The employees to whom options are granted, the number of shares of stock to
be included in each option, the exercise price per share, and the term of the
option, will be determined by the Administrator. Options are exercisable at such
time or times as determined by the Administrator, but no ISO will be exercisable
after the expiration of ten years from the date the option is granted (or five
years from the date the option is granted if the optionee is also a 10%
stockholder). The fair market value of shares with respect to which ISOs are
first exercisable in any one year as to any recipient may not exceed $100,000.
An option for additional shares, if any, which the Administrator may grant to an
employee who in the same year has been granted the maximum permissible ISOs,
would be in the form of a non-qualified stock option not intended to qualify as
an ISO. Payment of the exercise price of a stock option will be made in cash,
shares, or other consideration in accordance with the terms of the Plan and any
applicable rules of the Administrator and valued at fair market value on the
date of exercise. ISOs may be granted only to employees of the Company or any
subsidiary or parent of the Company.
Options may be granted under the Plan which do not qualify for special tax
treatment under Section 422 of the Internal Revenue Code (the 'Code').
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STOCK APPRECIATION RIGHTS (SARS)
A SAR may be granted freestanding or in tandem with new options or
previously granted options. Upon exercise, a SAR permits the holder to receive a
number of shares having an aggregate value equal to any excess of the fair
market value of the Company's shares subject to the SAR over the grant price of
the SAR. If the SAR was granted in tandem with a stock option, upon exercise of
the SAR the option for the shares for which the SAR is exercised is surrendered.
SARs granted under the Plan may be settled in cash or shares of Common Stock at
the discretion of the Administrator. In the case of optionees who are employee
directors or officers, any such cash election will be permitted only in
compliance with the applicable rule of the Securities and Exchange Commission
which, in general and as currently in effect, limits the time of such an
election to ten business days following a quarterly earnings release and
requires that the election be consented to by a disinterested corporate body.
The Plan allows for the continuation of this practice so that the SAR may be
deemed to have been exercised at the close of business on the business day
preceding the expiration of the SAR or related option when such SAR has positive
value and the expiration would have been caused by the passage of ten years from
the date of grant, five years from normal termination, or any earlier period
specified by the grant.
RESTRICTED STOCK
The Plan allows awards of restricted stock, either at no cost to the
recipient or for such cost as specified by the grant. Restricted stock may not
be disposed of by the recipient until the restrictions specified in the award
expire. The recipient will have, with respect to restricted stock, all of the
rights of a stockholder of the Company, including the right to vote the shares,
and the right to receive any cash dividends, unless otherwise specified by the
grant. Unless waived in whole or in part by the Administrator, if employment of
a holder of record of restricted stock terminates but does not terminate
normally, all shares of restricted stock then held and still subject to
restriction will be forfeited by such holder and reacquired by the Company.
RESTORED OPTIONS
The Plan permits the Company to grant 'Restored Options' to a recipient in
the Plan who has previously been granted stock options. Restored Options can be
granted to those recipients who satisfy the exercise price of an option or the
tax obligation incurred as a result of the exercise of an option, with
previously-acquired Common Stock of the Company. Under the Plan, a recipient may
surrender previously-acquired shares of Common Stock of the Company to satisfy
all or a portion of the option exercise price and the tax incurred as a result
of the exercise of the option. This permits the recipient to exercise the option
without the need to sell shares to generate the necessary cash to satisfy the
exercise price and the tax.
A 'Restored Option' feature in an option agreement entered into between a
recipient and the Company enables a recipient who exercises an option by
exchanging (either actually or constructively) previously-acquired Common Stock
to receive a new option, exercisable at the then market value, for the same
number of shares as were exchanged in payment. In addition, to the extent that
shares are withheld by the Company in a stock-for-stock exercise in satisfaction
of a recipient's tax obligations, the Company, at its discretion, may issue a
number of new options equal to the number of shares so withheld which are
exercisable at the then fair market value of a share of Common Stock. Thus, the
recipient may make a stock-for-stock exercise without necessarily suffering a
dilution in his ownership of the Company's Common Stock. At the same time, the
recipient will be able to participate fully in any future appreciation in the
Company's Common Stock, as if the original option had been exercised for cash.
A Restored Option will have terms substantially similar to the original
option (including having a term equal to the remaining term of the original
option), except that it will have an exercise price equal to the fair market
value of a share of Common Stock on the date the Restored Option is granted.
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ADJUSTMENTS
In the event of any stock split (excluding the Reverse Stock Split), stock
dividend, or other relevant change in capitalization, appropriate adjustment
will be made in the number of shares and the purchase price per share, if any,
under any outstanding awards granted under the Plan and in determining whether a
particular award may thereafter be granted.
ADDITIONAL GENERAL PROVISIONS
No termination, suspension, modification or amendment of the Plan may
adversely affect the rights of any recipient without his or her consent. The
Plan also authorizes the Administrator to amend the terms of any outstanding
award to secure compliance with applicable law or, so long as such amendment
comports with the Plan, with the consent of the recipient. The Administrator may
adopt rules concerning the withholding of taxes payable by the recipient.
FEDERAL INCOME TAX CONSEQUENCES
A summary of the federal income tax consequences of receiving and
exercising options, SARs, Restricted Stock and Restored Option under the Plan is
set forth below. The following discussion is based upon present federal tax laws
and does not purport to be a complete discussion of the consequences of
receiving and exercising options, SARs, Restricted Stock and Restored Options
under the Plan. Any specific questions which a recipient may have concerning the
tax consequences of receiving or exercising options, SARs, Restricted Stock or
Restored Options under the Plan should therefore be referred to his individual
tax advisers.
INCENTIVE STOCK OPTIONS
Under the Code, the recipient of an ISO does not recognize any income when
the option is granted or exercised; however, the exercise of the option gives
rise to income that is taken into account in computing the tax base for purposes
of the alternative minimum tax, and this may be subject to such tax. The amount
so taken into account is equal to the difference between the fair market value
of the Common Stock on the date of exercise of the option and the exercise price
of the option. No business expense or other deduction will be allowed to the
Company with respect to the grant or exercise of any ISO unless a recipient
disposes of stock upon exercise of an ISO within one year of the date of
exercise or within two years of the date of grant thereof. Such a disposition is
referred to as a 'disqualifying disposition.'
If the Common Stock that a recipient receives upon exercise of an ISO is
held for at least two years from the date of grant of the option and for at
least one year from the date of exercise, the gain or loss, if any, resulting
from sale or disposition of such stock will be a capital gain or loss if the
stock was a capital asset in the hands of the recipient.
A recipient who makes a disqualifying disposition, however, will generally
recognize compensation income equal to the excess of the fair market value of
the Common Stock on the date of exercise (or, if lower, the amount received on
the sale) over the amount paid upon exercise of the option. Any additional gain
or loss recognized on the sale of the stock will be taxed as long or short-term
capital gain or loss depending on the holding period of such stock. The holding
period of stock acquired upon exercise of an option begins on the date of
exercise. In such cases, the Company will be entitled to deduct as a business
expense the compensation income recognized by the recipient.
NON-STATUTORY STOCK OPTIONS
Non-statutory stock options granted under the Plan generally will not have
a readily ascertainable fair market value and, consequently, the recipient will
not recognize income when the option is granted. The recipient will, however,
recognize compensation income at the time of exercise of the option equal to the
difference, if any, between the fair market value of the Common Stock received
and the amount paid in cash upon exercise. The holding period for determining
the capital gain on such stock begins on
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the date of exercise. The basis of the recipient in such stock will be equal to
its fair market value on that date.
PAYMENT FOR SHARES WITH STOCK
If the optionee exercises an option and surrenders stock already owned by
him ('Old Shares'), the following rules apply:
(i) To the extent the number of shares acquired ('New Shares') exceeds
the number of Old Shares exchanged, the optionee will recognize ordinary
income on the receipt of such additional shares (provided the option is not
an ISO) in an amount equal to the fair market value of such additional
shares less any cash paid for them and the Company will be entitled to a
deduction in an amount equal to such income. The basis of such additional
shares will be equal to the fair market value of such shares (or, in the
case of an ISO, the cash, if any, paid for the additional shares) on the
date of exercise and the holding period for such additional shares will
commence on the date the option is exercised.
(ii) Except as provided below, to the extent the number of New Shares
acquired does not exceed the number of Old Shares exchanged, no gain or
loss will be recognized on such exchange, the basis of the New Shares
received will be equal to the basis of the Old Shares surrendered, and the
holding period of the New Shares received will include the holding period
of the Old Shares surrendered. However, under proposed regulations
promulgated by the U.S. Department of Treasury, if the optionee exercises
an ISO by surrendering Old Shares, the holding period for the New Shares
will begin on the date the New Shares are transferred to the optionee for
purposes of determining whether there is a Disqualifying Disposition of the
New Shares and, if the optionee makes a Disqualifying Disposition of the
New Shares, he will be deemed to have disposed of the New Shares with the
lowest basis first. If the optionee exercises an ISO by surrendering Old
Shares that were acquired through the exercise of an ISO or an option
granted under an employee stock purchase plan, and if the surrender occurs
prior to the expiration of the holding period applicable to the type of
option under which the Old Shares were acquired, the surrender will be
deemed to be a Disqualifying Disposition of the Old Shares. The federal
income tax consequences of a Disqualifying Disposition are discussed above.
(iii) If the Old Shares surrendered were acquired by the optionee by
exercise of an ISO, or an option granted under an employee stock purchase
plan, then, except as provided in paragraph (ii) above, the exchange will
not constitute a Disqualifying Disposition of the Old Shares.
(iv) Based upon prior rulings of the Internal Revenue Service in
analogous areas, it is believed that if an optionee exercises an ISO and
surrenders Old Shares and if he disposes of the New Shares received upon
exercise within two years from the date of the grant of the option or
within one year from the date of exercise, the following tax consequences
would result:
(a) To the extent the number of New Shares received upon exercise
does not exceed the number of Old Shares surrendered, the disposition of
the New Shares will not constitute a Disqualifying Disposition (unless
the disposition is a surrender of the New Shares in the exercise of an
ISO).
(b) The disposition of the New Shares will constitute a
Disqualifying Disposition to the extent the number of New Shares
received upon exercise and disposed of exceeds the number of Old Shares
surrendered.
STOCK APPRECIATION RIGHTS
In the case of SARs granted either freestanding or in tandem with an
option, a recipient will not realize any compensation income at the time of
grant. However, the fair market value of stock or cash delivered pursuant to the
exercise of such SARs will be treated as compensation income taxable to the
employee at the time of exercise, and the Company will be entitled to a
deduction under the Code at the time and equal to the amount of compensation
income that is realized by the recipient.
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RESTRICTED STOCK
In the case of restricted stock, a recipient will realize compensation
income in an amount equal to the fair market value of such stock less any amount
paid for such stock at a time when the employee's rights with respect to such
stock are no longer subject to a substantial risk of forfeiture unless the
employee otherwise elects pursuant to a special election provided in Section
83(b) of the Code. Dividends paid to the employee during a period of restriction
will be taxable as compensation income unless the election referred to in the
preceding sentence has been made. The Company will be entitled to a deduction
under the Code and equal to the amount of compensation income that is realized
by the recipient provided applicable withholding requirements are met.
RESTORED OPTIONS
There are no federal income tax consequences to either the recipient or the
Company upon the grant of a Restored Option. When a Restored Option is
exercised, the tax consequences are the same as the tax consequences of the
exercise of nonstatutory stock options described above.
WITHHOLDING
The Administrator may, in its discretion, permit any recipient of a
non-statutory stock option to satisfy any withholding tax obligation that may
arise in connection with the exercise of such an option by having the Company
withhold shares of Common Stock equal to the fair market value of the
withholding tax due.
TAXATION OF CAPITAL GAINS
An individual's net capital gain (the excess of his net long-term capital
gain over his short-term capital loss) is currently taxed at the same rate as is
his ordinary income.
TAXATION OF PREFERENCE ITEMS
Section 55 of the Code imposes an Alternative Minimum Tax equal to the
excess, if any, of (i) 26% of the optionee's 'alternative minimum taxable
income' up to $175,000 ($87,500 in the case of married taxpayers filing
separately) and 28% of 'alternative minimum taxable income' over $175,000
($87,500 in the case of married taxpayers filing separately) over (ii) his
'regular' federal income tax. Alternative minimum taxable income is determined
by adding the optionee's Stock Option Preference and any other items of tax
preference to the optionee's adjusted gross income and then subtracting certain
allowable deductions and an exemption amount. The exemption amount is $33,750
for single taxpayers, $45,000 for married taxpayers filing jointly and $22,500
for married taxpayers filing separately. However, these exemption amounts are
phased out beginning at certain levels of alternative minimum taxable income.
CHANGE IN CONTROL
If there is an acceleration of the vesting or payment of benefits or an
acceleration of the exercisability of stock options upon a change in control of
the Company, all or a portion of the accelerated benefits may constitute 'Excess
Parachute Payments' under Section 280G of the Code. The employee receiving an
Excess Parachute Payment incurs an excise tax of 20% of the amount of the
payment in excess of the employee's average annual compensation over the five
calendar years preceding the year of the change in control, and the Company is
not entitled to a deduction for such payment.
The Board recommends a vote FOR approval of the Plan.
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OTHER BUSINESS
Management does not know of any other matters to be brought before the
Meeting except that set forth in the notice thereof. If other business is
properly presented for consideration at the Meeting, it is intended that the
proxies will be voted by the persons named therein in accordance with their
judgment on such matters.
SOLICITATION AND EXPENSES OF SOLICITATION
Officers and employees of the Company may solicit proxies. Proxies may be
solicited by personal interview, mail, telegraph and telephone. No compensation
will be paid by the Company to any person in connection with the solicitation of
proxies. Brokers, bankers and other nominees will be reimbursed for
out-of-pocket and other reasonable clerical expenses incurred in obtaining
instructions from beneficial owners of the Company's stock. The cost of
preparing this Proxy Statement and all other costs in connection with
solicitation of proxies for the Special Meeting of Stockholders are being borne
by the Company.
Even if you plan to attend the Meeting in person, please sign, date and
return the enclosed proxy promptly. If you attend the Meeting, your proxy will
be voided at your request and you can vote in person. A postage-paid
return-addressed envelope is enclosed for your convenience.
Your cooperation in giving this matter your immediate attention and in
returning your proxies will be appreciated.
By order of the Board of Directors,
STEVEN A. SAIDE, ESQ.
Secretary
February 12, 1999
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EXHIBIT A
ASIA MEDIA COMMUNICATIONS, LTD.
1999 INCENTIVE PROGRAM
The 1999 Incentive Program (the 'Program') provides for the grant to
officers, directors and employees of Asia Media Communications, Ltd., and its
direct and indirect subsidiaries (collectively, the 'Company'), and certain
consultants to the Company, with certain rights to acquire shares of the
Company's common stock, par value $.01 per share (the 'Common Stock'). The
Company believes that this Program will cause those persons to contribute
materially to the growth and success of the Company, thereby benefitting its
stockholders.
1. ADMINISTRATION
The Program shall be administered and interpreted by the Board of Directors
of the Company or by one or more Committees appointed by the Board of Directors
of the Company from among its members (the 'Administrator'). The Board of
Directors may appoint different Committees to handle different duties under the
Program. The Administrator's decisions shall be final and conclusive with
respect to the interpretation and administration of the Program and any Grant
made under it.
2. GRANTS
Incentives under the Program shall consist of incentive stock options,
non-qualified stock options, stock appreciation rights in tandem with stock
options or freestanding, and restricted stock grants (any of the foregoing, in
any combination, collectively, 'Grants'). All Grants shall be subject to the
terms and conditions set out herein and to such other terms and conditions
consistent with this Program as the Administrator deems appropriate. The
Administrator shall approve the form and provisions of each Grant. Grants under
a particular section of the Program need not be uniform, and Grants under two or
more sections may be combined in one instrument.
3. ELIGIBILITY FOR GRANTS
Grants may be made to any employee, officer, key executive, director,
professional or administrative employee, consultant or advisor to the Company or
any subsidiary of the Company selected by the Administrator to receive Grants
under the Program (persons so selected, the 'Grantees'); provided, that
incentive stock options may only be granted to employees of the Company.
4. SHARES AVAILABLE FOR GRANT
(a) Shares Subject to Issuance or Transfer. Subject to adjustment as
provided in Section 4(b), the aggregate number of shares of Common Stock (the
'Shares') that may be issued or transferred under the Program is 1,000,000
Shares, plus, (i) any Shares which are forfeited under the Program after the
adoption of the Program by the Company's Board of Directors (the 'Adoption
Date'); plus (ii) the number of Shares repurchased by the Company in the open
market and otherwise with an aggregate price no greater than the cash proceeds
received by the Company from the sale of Shares under the Program; plus (iii)
any Shares surrendered to the Company in payment of the exercise price of
options issued under the Program. However, no award may be issued that would
bring the total of all outstanding awards under the Program to more than 15% of
the total number of Shares of Common Stock of the Company at the time
outstanding. The Shares may be authorized but unissued Shares or treasury
Shares. The number of Shares available for Grants at any given time shall be
reduced by the aggregate of all Shares previously issued or transferred pursuant
to the Program plus the aggregate of all Shares which may become subject to
issuance or transfer under then-outstanding and then-currently exercisable
Grants under the Program. The maximum number of Shares for which options and
stock appreciation rights may be granted under the Program to any person during
any calendar year is
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150,000 (subject to appropriate adjustment in the event of any changes in
capitalization of the Company).
(b) Adjustments Upon Changes in Capitalization or Other Events. Upon
changes in the Common Stock of the Company by reason of a stock dividend, stock
split, reverse split, recapitalization, merger, consolidation, combination or
exchange of shares, separation, reorganization or liquidation, the number and
class of Shares available under the Program as to which Grants may be made (both
in the aggregate and to any one Grantee), the number and class of Shares under
each then-outstanding Stock Option and the Option Price per share of such
options, and the terms of stock appreciation rights shall be correspondingly
adjusted by the Administrator, such adjustments to be made in the case of
outstanding Stock Options without change in the total price applicable to such
options; provided that no adjustment shall be made hereunder on account of the
one for 100 reverse split of the outstanding Common Stock of the Company
authorized by the Board of Directors on January 11, 1999. In the event of a
merger, consolidation, combination, reorganization or other transaction in which
the Company will not be the surviving corporation, or in which the Company
becomes a wholly-owned subsidiary of a new corporation, a Grantee of Stock
Options under the Program shall be entitled to options on that number of shares
of stock in the new corporation which the Grantee would have received had the
Grantee exercised all of the unexercised options available to the Grantee under
the Program, whether or not then exercisable, at the instant immediately prior
to the effective date of such transaction, and, if such unexercised options had
related stock appreciation rights, the Grantee also will receive new stock
appreciation rights related to the new options. Thereafter, adjustments as
provided above shall relate to the options or stock appreciation rights of the
new corporation. Except as otherwise specifically provided in the instrument of
Grant, in the event of a Change in Control (as defined below), merger,
consolidation, combination, reorganization or other transaction in which the
shareholders of the Company will receive cash or securities (other than Common
Stock) or in the event that an offer is made to the holders of Common Stock of
the Company to sell or exchange such Common Stock for cash, securities or stock
of another corporation and such offer, if accepted, would result in the offeror
becoming the owner of (a) at least 50% of the outstanding Common Stock of the
Company or (b) such lesser percentage of the outstanding Common Stock which the
Administrator in its sole discretion determines will materially adversely affect
the market value of the Common Stock after the tender or exchange offer, the
Administrator shall have the right, but not the obligation, in the exercise of
its business judgment, prior to the shareholders' vote on such transaction or
prior to the expiration date (without extensions) of the tender or exchange
offer, (i) accelerate the time of exercise so that all Stock Options and stock
appreciation rights which are outstanding shall become immediately exercisable
in full, and all Restricted Stock Grants shall immediately vest in full, without
regard to any limitations of time, performance or amount otherwise contained in
the Program or in the instruments of Grant and/or (ii) determine that the
options and stock appreciation rights shall be adjusted and make such
adjustments by substituting for Common Stock of the Company subject to options
and stock appreciation rights, common stock of the surviving corporation or
offeror if such stock of such corporation is publicly traded or, if such stock
is not publicly traded, by substituting common stock of a parent of the
surviving corporation or offeror if the stock of such parent is publicly traded,
in which event the aggregate option price shall remain the same and the number
of shares subject to outstanding grants shall be the number of shares which
could have been purchased on the closing day of such transaction or the
expiration date of the offer with the proceeds which would have been received by
the Grantee if the option had been exercised in full prior to such transaction
or expiration date and the Grantee had exchanged all of such shares in the
transaction or sold or exchanged all of such shares pursuant to the tender or
exchange offer, and if any such option has related stock appreciation rights,
the stock appreciation rights shall likewise be adjusted. For purposes of this
Section 4(b), 'Change in Control' means (i) any 'person', as such term is used
in Section 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended
(the 'Exchange Act') (other than the Company, any trustee or other fiduciary
holding securities under an employee benefit plan of the Company, or any
corporation owned, directly or indirectly, by the shareholders of the Company in
substantially the same proportion as their ownership of stock of the Company),
is or becomes the 'beneficial owner' (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the Company representing
30% or more of the combined voting power of the Company's then outstanding
securities without the approval
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of the Board of Directors of the Company; (ii) during any period of two
consecutive years, individuals who at the beginning of such period constitute
the Board, and any new director (other than a director designated by a person
who has entered into an agreement with the Company to effect a transaction
described in clause (i), (iii), or (iv) of this sentence) whose election by the
Board or nomination for election by the Company's shareholders was approved by a
vote of at least two-thirds ( 2/3) of the directors then still in office who
either were directors at the beginning of the period or whose election or
nomination for election was previously so approved cease for any reason to
constitute at least a majority thereof; (iii) the shareholders of the Company
approve a merger or consolidation of the Company with any other company, other
than (1) a merger or consolidation which would result in the voting securities
of the Company outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting securities of
the surviving entity) more than 50% of the combined voting power of the voting
securities of the Company or such surviving entity outstanding immediately after
such merger or consolidation or (2) a merger or consolidation effected to
implement a recapitalization of the Company (or similar transaction) in which no
'person' (as hereinabove defined) acquires more than 50% of the combined voting
power of the Company's then outstanding securities; or (iv) the shareholders of
the Company approve a plan of complete liquidation of the Company or an
agreement for the sale or disposition by the Company of all or substantially all
of the Company's assets and properties.
5. STOCK OPTIONS
The Administrator may grant options qualifying as incentive stock options
under the Internal Revenue Code of 1986, as amended ('Incentive Stock Options'),
or non-qualified options not entitled to special tax treatment under Section 422
of the Internal Revenue Code of 1986 (the 'Code'), as amended (collectively,
'Stock Options'). The following provisions of this Section 5 are applicable to
Stock Options:
(a) Exercise of Option. A Grantee may exercise a Stock Option by delivering
a notice of exercise to the Company, either with or without accompanying payment
of the option price (the 'Option Price'). The notice of exercise, once
delivered, shall be irrevocable.
(b) Satisfaction of Option Price. The Grantee shall pay the Option Price in
cash or with the Administrator's permission, by delivering shares of Common
Stock already owned by the Grantee and having a Fair Market Value on the date of
exercise equal to the Option Price, or a combination of cash and Shares. The
Grantee shall pay the Option Price not later than thirty (30) days after the
date of a statement from the Company following exercise setting forth the Option
Price, Fair Market Value of Common Stock on the exercise date, the number of
shares of Common Stock that may be delivered in payment of the Option Price, and
the amount of withholding tax due, if any. If the Grantee fails to pay the
Option Price within the thirty (30) day period, the Administrator shall have the
right to take whatever action it deems appropriate, including voiding the option
exercise. The Company shall not issue or transfer shares of Common Stock upon
exercise of a Stock Option until the Option Price is fully paid.
(c) Share Withholding. With respect to any non-qualified option or SAR (as
defined below), the Administrator may, in its discretion and subject to such
rules as the Administrator may adopt, permit the Grantee to satisfy, in whole or
in part, any withholding tax obligation which may arise in connection with the
exercise of the non-qualified option or SAR by electing to have the Company
withhold shares of Common Stock having a Fair Market Value equal to the amount
of the withholding tax. Notwithstanding the foregoing, as a condition of the
Grant of any Stock Option or SAR to any officer or director of the Company
subject to the reporting requirements (a 'Reporting Person') of Section 16
promulgated under the Securities Exchange Act of 1934, as amended (the 'Exchange
Act'), the Administrator shall require, upon the exercise of any Stock Option or
SAR by any Reporting Person, at a time when the Company shall be required to
file periodic reports under Section 13 of the Exchange Act, that the number of
shares of Common Stock otherwise issuable upon the exercise of such Stock Option
or SAR shall be reduced by the number of shares of Common Stock having an
aggregate Fair Market Value equal to the amount of the Reporting Person's
liability for any and all taxes required by law to be withheld.
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(d) Price and Term. The Option Price per share, term and other provisions
of Stock Options granted under the Program shall be specified by the Grant, as
limited, in the case of Incentive Stock Options, by the provisions of Section
5(e) below, if granted pursuant to such Section. In addition, the Administrator
may prescribe such other conditions as it may deem appropriate, which conditions
shall be specified in the instrument of Grant.
(e) Limits on Incentive Stock Options. The aggregate fair market value of
the stock covered by Incentive Stock Options granted under the Program or any
other stock option plan of the Company or any subsidiary or parent of the
Company that become exercisable for the first time by any employee in any
calendar year shall not exceed $100,000. The aggregate Fair Market Value will be
determined at the time of grant. The period for exercise of an Incentive Stock
Option shall not exceed ten (10) years from the date of the Grant (or five years
if the Grantee is also a 10% stockholder). The Option Price at which Common
Stock may be purchased by the Grantee under an Incentive Stock Option shall be
the Fair Market Value (or 110% of the Fair Market Value if the Grantee is a 10%
stockholder) of the Common Stock on the date of the Grant. Incentive Stock
Options may only be granted to employees of the Company or any subsidiary or
parent of the Company. Incentive Stock Options by their terms shall not be
transferrable by the Grantee other than by the laws of descent and distribution,
and shall be exercisable, during the lifetime of the Grantee, only by the
Grantee.
(f) Restored Options. Stock Options granted under the Program may, with the
Administrator's permission, include the right to acquire a restored option (a
'Restored Option'). If a Stock Option grant contains a Restored Option feature
and if a Grantee pays all or part of the Option Price of such Stock Option with
shares of Common Stock held by the Grantee, then upon exercise of such Stock
Option the Grantee shall be granted a Restored Option to purchase, at the Fair
Market Value of the Common Stock as of the date of the grant of the Restored
Option, the number of shares of Common Stock of the Company equal to the sum of
the number of whole shares used by the Grantee in payment of the Option Price
and the number of whole shares, if any, withheld by the Company as payment for
withholding taxes. A Restored Option may be exercised between the date of grant
and the date of expiration, which will be the same as the date of expiration of
the Stock Option to which such Restored Option is related.
6. STOCK APPRECIATION RIGHT
The Administrator may grant a Stock Appreciation Right ('SAR') either
independently or in conjunction with any Stock Option granted under the Program.
The following provisions are applicable to each SAR:
(a) Options to Which Right Relates. Each SAR which is issued in conjunction
with a Stock Option shall specify the Stock Option to which the SAR is related,
together with the Option Price and number of option shares subject to the SAR at
the time of its grant.
(b) Requirement of Employment. An SAR may be exercised only while the
Grantee is in the employment or consultancy of the Company, except that the
Administrator may provide for partial or complete exceptions to this requirement
as it deems equitable.
(c) Exercise. A Grantee may exercise an SAR in whole or in part by
delivering a notice of exercise to the Company, except that the Administrator
may provide for partial or complete exceptions to this requirement as it deems
equitable.
(d) Payment and Form of Settlement. If a Grantee exercises an SAR which is
issued in conjunction with a Stock Option, he shall receive the aggregate of the
excess of the Fair Market Value of each share of Common Stock with respect to
which the SAR is being exercised over the Option Price of each such share.
Payment, in any event, may be made in cash, Common Stock or a combination of the
two, in the discretion of the Administrator. Fair Market Value shall be
determined as of the date of exercise.
(e) Expiration and Termination. Each SAR shall expire on a date determined
by the Administrator at the time of grant. If a Stock Option is exercised in
whole or in part, any SAR related to the Shares purchased in connection with
such exercise shall terminate immediately.
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7. RESTRICTED STOCK GRANTS
The Administrator may issue or transfer shares of Common Stock ('Restricted
Stock') to a Grantee under a Restricted Stock Grant. Shares of Restricted Stock
are subject to forfeiture unless and until specified employment vesting and/or
performance vesting conditions are met, as determined by the Administrator.
Until the shares vest or are forfeited, as the case may be, the Grantee shall be
entitled to vote the shares and to receive any dividends paid. The following
provisions are applicable to Restricted Stock Grants:
(a) Requirement of Employment. If the Grantee's employment terminates prior
to the fulfillment of the conditions for vesting of the Restricted Stock, as set
forth in the specific instrument of Grant, all shares of Restricted Stock held
by him or her and still subject to restriction will be forfeited and must be
returned immediately to the Company. However, the Administrator may provide for
partial or complete exceptions to this requirement as it deems equitable.
(b) Restrictions of Transfer and Legend on Stock Certificate. Prior to the
fulfillment of the conditions for vesting, a Grantee may not sell, assign,
transfer, pledge, or otherwise dispose of the shares of Common Stock except to a
Successor Grantee under Section 9(a). Each certificate for shares issued or
transferred under a Restricted Stock Grant shall contain a legend giving
appropriate notice of the restrictions applicable to the Grant. The
Administrator may, in its sole discretion, require that such certificates be
placed into escrow with the Company until vesting.
(c) Lapse of Restrictions. All restrictions imposed under a Restricted
Stock Grant shall lapse upon the fulfillment of the conditions for vesting set
forth in the instrument of Grant provided that all of the conditions stated in
Sections 7(a) and (b) have been met as of the date of such lapse. The Grantee
shall then be entitled to have the legend removed from the certificate.
8. AMENDMENT AND TERMINATION OF THE PROGRAM
(a) Amendment. The Administrator may from time to time amend, alter,
suspend or discontinue the Program, subject to any requirement of stockholder
approval required by applicable law, rule or regulation, including Section
162(m) of the Code or, if the Common Stock is then listed or admitted for
trading on any United States securities exchange or on the National Association
of Securities Dealers, Inc. Automated Quotation System ('NASDAQ'), any
requirement for stockholder approval required under the rules of such exchange
or NASDAQ, as the case may be; provided, however, that no amendment shall be
made without stockholder approval if such amendment would (1) increase the
maximum number of shares of Common Stock available for issuance under this
Program (subject to Section 4(b)), (2) reduce the minimum Option Price in the
case of an option or the base price in the case of an SAR, (3) effect any change
inconsistent with Section 422 of the Code or (4) extend the term of this
Program.
(b) Termination of the Program. The Program shall terminate on the tenth
anniversary of its effective date unless terminated earlier by the Board or
unless extended by the Board.
(c) Termination and Amendment of Outstanding Grants. A termination or
amendment of the Program that occurs after a Grant is made shall not result in
the termination or amendment of the Grant unless the Grantee consents or unless
the Administrator acts under Section 9(d). The termination of the Program shall
not impair the power and authority of the Administrator with respect to
outstanding Grants. Whether or not the Program has terminated, an outstanding
Grant may be terminated or amended under Section 9(d) or may be amended by
agreement of the Company and the Grantee on terms consistent with the Program.
9. GENERAL PROVISIONS
(a) Prohibitions Against Transfer. Only a Grantee or his or her authorized
representative may exercise rights under a Grant. Such persons may not transfer
those rights, except upon the express written consent of the Company, which may
be granted or denied in the Company's discretion. Except as otherwise expressly
provided herein or in the instrument of grant, when a Grantee dies, the personal
representative or other person entitled under a Grant under the Program to
succeed to the rights of the
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Grantee ('Successor Grantee') may exercise the rights. A Successor Grantee must
furnish proof satisfactory to the Administrator of his or her right to receive
the Grant under the Grantee's will or under the applicable laws of descent and
distribution.
(b) Suitable Grants. The Administrator may make a Grant to an employee of
another corporation who becomes an eligible grantee by reason of a corporate
merger, consolidation, acquisition of stock or property, share exchange,
reorganization or liquidation involving the Company in substitution for a stock
option, stock appreciation right, performance award, or restricted stock grant
previously granted by such corporation (the 'Original Incentives'). The terms
and conditions of the substitute Grant may vary from the terms and conditions
required by the Program and from those of the Original Incentives. The
Administrator shall prescribe the exact provisions of the substitute Grants,
preserving where possible the provisions of the Original Incentives.
(c) Subsidiaries. The term 'subsidiary' means a corporation in which the
Company owns directly or indirectly 50% or more of the voting power.
(d) Compliance with Law. The Program, the exercise of Grants, and the
obligations of the Company to issue or transfer shares of Common Stock under
Grants shall be subject to all applicable laws and to approvals by any
governmental or regulatory agency as may be required. The Administrator may
revoke any Grant if it is contrary to law or modify a Grant to bring it into
compliance with any valid and mandatory government regulation. The Administrator
may also adopt rules regarding the withholding of taxes on payment to Grantees.
(e) Ownership of Stock. A Grantee or Successor Grantee shall have no rights
as a stockholder of the Company with respect to any Shares covered by a Grant
until the Shares are issued or transferred to the Grantee or Successor Grantee
on the Company's books.
(f) No Right to Employment. The Program and the Grants under it shall not
confer upon any Grantee the right to continue in the employment of the Company
or affect in any way the right of the Company to terminate the employment of a
Grantee at any time.
(g) Effective Date of the Program. The Program shall become effective upon
its approval by the Company's stockholders under applicable law and regulatory
requirements. Grants may be made prior to such approval but no Grant may be
exercised until such approval is obtained.
(h) Fair Market Value. For the purposes of the Program, the term 'Fair
Market Value' means, as of any date, the closing price of a share of Common
Stock of the Company on such date. The closing price shall be (i) if the Common
Stock is then listed or admitted for trading on any national securities
exchange, or if not so listed or admitted for trading, is listed or admitted for
trading on NASDAQ, the last sale price of the Common Stock, regular way, or the
mean of the bid and asked prices thereof for any trading day on which no such
sale occurred, in each case as officially reported on the principal securities
exchange on which the Common Stock is listed or admitted for trading or on
NASDAQ, as the case may be, or (ii) if not so listed or admitted for trading on
a national securities exchange or NASDAQ, the mean between the closing high bid
and low asked quotations for the Common Stock in the over-the-counter market as
reported by NASDAQ, or any similar system for the automated dissemination of
securities prices then in common use, if so quoted, as reported by any member
firm of the New York Stock Exchange selected by the Company; provided, however,
that if, by reason of extended or continuous trading hours on any exchange or in
any market or for any other reason, the time, with respect to any trading day,
of the close of trading for the purpose of determining the 'last sale price' or
the 'closing' bid and asked prices is not objectively determinable, the time on
such trading day used for the purpose of reporting any compilation of last sale
prices or closing bid and asked prices in The Wall Street Journal shall be the
time on such trading day as of which the 'last sale price' or 'closing' bid and
asked prices are determined for purposes of this definition. If the Common Stock
is quoted on a national securities or central market system in lieu of a market
or quotation system described above, the closing price shall be determined in
the manner set forth in clause (i) of the preceding sentence if actual
transactions are reported, and in the manner set forth in clause (ii) of the
preceding sentence if bid and asked quotations are reported but actual
transactions are not. If on the date in question, there is no exchange or
over-the-counter market for the Common Stock, the 'fair market value' of such
Common Stock shall be determined by the Administrator acting in good faith.
A-6
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Notwithstanding the foregoing, so long as the Common Stock of the Company shall
be listed for trading on the Vancouver Stock Exchange (the 'VSE'), for the
purposes of the Program the term 'Fair Market Value' means, as of any date, the
average of the closing price of a share of Common Stock of the Company for the
ten trading days immediately preceding such date, and the closing price shall
mean the last sale price of the Common Stock on the VSE.
(i) Application of Funds. The proceeds received by the Company from the
issuance of Grants pursuant to the Program will be used for general corporate
purposes.
(j) No Obligation to Exercise Option. The granting of an option to any
Grantee under the Program shall impose no obligation upon such Grantee to
exercise such option.
(k) Severability. If any provision of the Program, or any term or condition
of any Grant granted or form executed or to be executed thereunder, or any
application thereof to any person or circumstances is invalid, such provision,
term, condition or application shall to that extent be void (or, in the
discretion of the Administrator, such provision, term or condition may be
amended so as to avoid such invalidity or failure), and shall not affect other
provisions, terms or conditions or applications thereof, and to this extent such
provisions, terms and conditions are severable.
(l) Instrument of Grant. Each Grant under this Program shall be evidenced
by an agreement (i.e., an instrument of Grant) setting forth the terms and
conditions applicable to such Grant. No Grant shall be valid until an agreement
is executed by the Company and the recipient of such award and, upon execution
by each party and delivery of the agreement to the Company, such award shall be
effective as of the effective date set forth in the Agreement.
(m) Restricted Shares. Each award made hereunder shall be subject to the
requirement that if at any time the Company determines that the listing,
registration or qualification of the shares of Common Stock subject to such
award upon any securities exchange or under any law, or the consent or approval
of any governmental body, or the taking of any other action is necessary or
desirable as a condition of, or in connection with, the delivery of shares
thereunder, such shares shall not be delivered unless such listing,
registration, qualification, consent, approval or other action shall have been
effected or obtained, free of any conditions not acceptable to the Company. The
Company may require that certificates evidencing shares of Common Stock
delivered pursuant to any award made hereunder bear a legend indicating that the
sale, transfer or other disposition thereof by the holder is prohibited except
in compliance with the Securities Act of 1933, as amended, and the rules and
regulations thereunder.
(n) Program Controls. In the case of any conflict or inconsistency between
the terms of this Program and the terms of any instrument of Grant, the terms of
this Program will control, unless the instrument of grant expressly provides
that the terms of such instrument of grant will control.
A-7
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APPENDIX 1
ASIA MEDIA COMMUNICATIONS, LTD. COMMON STOCK
712 FIFTH AVENUE, SEVENTH FLOOR, NEW YORK, NY 10019 PROXY
PROXY/VOTING INSTRUCTION CARD
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THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
ASIA MEDIA COMMUNICATIONS, LTD. FOR THE
SPECIAL MEETING OF STOCKHOLDERS ON FEBRUARY 23, 1999.
The undersigned appoints Christopher F. Brown and Edward J. Tobin, and each
of them, with full power of substitution in each, the proxies of the
undersigned, to represent the undersigned and vote all shares of Asia Media
Communications, Ltd. Common Stock which the undersigned may be entitled to vote
at the Special Meeting of Stockholders to be held on February 23, 1999, and at
any adjournment or postponement thereof, as indicated on the reverse side.
This proxy, when properly executed, will be voted in the manner directed
herein by the undersigned stockholder. If no direction is given, this proxy will
be voted FOR proposals 1 and 2.
(Continued, and to be signed and dated on the reverse side.)
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VOTES MUST BE INDICATED BY [x] IN BLACK OR BLUE INK
1. Amendment to the Articles of Incorporation to effect a one for 100 reverse
split of the Company's outstanding Common Stock.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
2. Approval of the 1999 Incentive Program
FOR [ ] AGAINST [ ] ABSTAIN [ ]
3. To transact such other business as may properly come before the Meeting or
any adjournments thereof.
If you plan to attend the meeting please check here [ ] Change of address or
Comments mark here [ ]
PLEASE SIGN EXACTLY AS NAME APPEARS
HEREON.
When shares are held by joint tenants,
both should sign. 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
an authorized officer. If a
partnership, please sign in
partnership name by an authorized
person.
Date: __________________________, 1999
______________________________________
Signature
______________________________________
Signature, if held jointly
(PLEASE SIGN, DATE AND RETURN THIS PROXY IN THE ENCLOSED POSTAGE PREPAID
ENVELOPE.)
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