<PAGE>
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. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/X/ Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
CIBER, Inc.
- -------------------------------------------------------------------------------
(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)(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 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 of 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>
CIBER
25TH ANNIVERSARY
CIBER, Inc.
5251 DTC Parkway, Suite 1400
Englewood, Colorado 80111
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD OCTOBER 28, 1999
TO THE SHAREHOLDERS OF CIBER, INC.:
NOTICE IS HEREBY GIVEN that the 1999 Annual Meeting of Shareholders (the
"Meeting") of CIBER, Inc., a Delaware corporation (the "Company"), will be
held on Thursday, October 28, 1999 at 10:00 a.m. local time, at Glenmoor
Country Club, 110 Glenmoor Drive, Cherry Hills Village, Colorado, for the
following purposes:
(1) To elect three Class II Directors of the Company to serve for a
term of three years.
(2) To approve an amendment to the Company's Certificate of Incorporation
to increase the number of authorized shares of Common Stock from
80,000,000 to 100,000,000 shares.
(3) To approve an increase in the number of shares of Common Stock reserved
for issuance pursuant to the Company's Equity Incentive Plan from
8,000,000 to 10,500,000 shares.
(4) To transact such other business as may properly come before the Meeting
or any adjournment of postponements thereof.
The foregoing items of business are more fully described in the
accompanying Proxy Statement. The Board of Directors of the Company fixed the
close of business on September 10, 1999 as the record date for the
determination of shareholders entitled to notice of and to vote at the
Meeting and at any adjournment or postponement thereof. Consequently, only
holders of the Company's Common Stock at the close of business on September
10, 1999 will be entitled to notice of and to vote at the Meeting. A complete
list of shareholders entitled to vote at the Meeting will be available for
examination during business hours by any shareholder, for purposes related to
the Meeting, for a period of ten days prior to the Meeting at the Company's
corporate offices at 5251 DTC Parkway, Suite 1400, Englewood, Colorado.
Whether or not you plan to attend the Meeting in person, please complete,
date and sign the accompanying proxy card and return it promptly in the
enclosed envelope to ensure your representation at the Meeting. You are
cordially invited to attend the Meeting and, if you do so, you may personally
vote, regardless of whether you have submitted a signed proxy. Thank you.
By order of the Board of Directors,
Bobby G. Stevenson
Chairman of the Board
Englewood, Colorado
September 24, 1999
<PAGE>
CIBER, INC.
-----
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
OCTOBER 28, 1999
-----
This Proxy Statement and the accompanying proxy card are being
furnished in connection with the solicitation of proxies by and on behalf of
the Board of Directors (the "Board") of CIBER, Inc., a Delaware corporation
(the "Company"), to be used at the 1999 Annual Meeting of Shareholders of the
Company (the "Meeting") to be held on Thursday, October 28, 1999 at 10:00
a.m. local time, at Glenmoor Country Club, 110 Glenmoor Drive, Cherry Hills
Village, Colorado, and at any adjournment or postponement thereof. This Proxy
Statement and the accompanying proxy card are first being mailed to the
holders of record of the Company's Common Stock, $.01 par value per share
(the "Common Stock"), on or about September 24, 1999.
Shareholders of the Company represented at the Meeting will consider
and vote upon (i) the election of three Class II Directors to serve on the
Board until the 2002 Annual Meeting of Shareholders or until their successors
have been duly elected and qualified, (ii) an amendment to the Company's
Certificate of Incorporation to increase the number of authorized shares of
Common Stock from 80,000,000 to 100,000,000, (iii) an increase in the number
of shares of Common Stock reserved for issuance pursuant to the Company's
Equity Incentive Plan from 8,000,000 to 10,500,000 and (iv) such other
business as may properly come before the Meeting or any adjournment or
adjournments thereof. The Company is not aware of any other business to be
presented for consideration at the Meeting. If any other matters properly
come before the Meeting, the persons designated as agents in the enclosed
proxy will vote on such matters in accordance with their best judgment.
VOTING AND SOLICATION OF PROXIES
Only holders of record of the Common Stock at the close of business
on September 10, 1999 (the "Record Date") will be entitled to notice of and
to vote at the Meeting. As of the Record Date, 59,110,399 shares of Common
Stock were outstanding. Each shareholder is entitled to one vote for each
share of Common Stock held of record on the Record Date for each proposal
submitted for shareholder consideration at the Meeting. The presence, in
person or by proxy, of the holders of not less than one-third of the shares
of Common Stock entitled to vote at the Meeting is necessary to constitute a
quorum for the conduct of business at the Meeting. To be elected, a director
must receive a plurality of the votes present in person or represented by
proxy and entitled to vote on the election. The affirmative vote of a
majority of the shares of Common Stock issued and outstanding is required to
approve the proposal to amend the Company's Certificate of Incorporation.
Abstentions and broker non-votes will have the same effect as a vote against
the proposal. With respect to all other matters, the affirmative vote of the
majority of such quorum will be the act of the shareholders. Abstentions will
have the same effect as a vote against such proposals and broker non-votes
will have no impact on the outcome of such proposals. "Broker non-votes" are
proxies with respect to shares held in record name by brokers or nominees, as
to which (i) instructions have not been received from the beneficial owners
or persons entitled to vote and (ii) the broker or nominee does not have
discretionary voting power under applicable national securities exchange
rules or the instrument under which it serves in such capacity.
All shares represented by properly executed proxies will, unless
such proxies have previously been revoked, be voted at the Meeting in
accordance with the directions on the proxies. A proxy may be revoked at any
time prior to final tabulation of the votes. Shareholders may revoke proxies
by written notice to the Secretary of the Company, by delivery of a proxy
bearing a later date, or by personally appearing at the Meeting and casting a
contrary vote. If no direction is indicated, the shares will be voted in
favor of the Board of Directors' nominees for director, for the amendment to
the Company's Certificate of Incorporation to increase the number of
authorized shares of the Company's Common Stock and for the increase in the
number of shares reserved for issuance pursuant to the Company's Equity
Incentive Plan, as listed in this Proxy Statement. The persons named in the
proxies will have discretionary authority to vote all proxies with respect to
additional matters that are properly presented for action at the Meeting.
1
<PAGE>
The executive officers and directors of the Company as a group own
or may be deemed to control approximately 22% of the outstanding shares of
Common Stock of the Company. Each of the executive officers and directors has
indicated his intent to vote all shares of Common Stock owned or controlled
by him in favor of each item set forth herein.
The proxy solicitation is made by and on behalf of the Board of
Directors. Solicitation of proxies for use at the Meeting may be made in
person or by mail by directors, officers and regular employees of the
Company. Such persons will receive no additional compensation for any
solicitation activities. Copies of solicitation materials will be furnished
to banks, brokerage houses, fiduciaries and custodians holding in their names
shares of Common Stock beneficially owned by others to forward to such
beneficial owners. The Company may reimburse persons representing beneficial
owners of Common Stock for their costs of forwarding solicitation materials
to such beneficial owners. The Company will bear the entire cost of
solicitation of proxies, including the preparation, assembly, printing and
mailing of this Proxy Statement, the proxy and any additional information
furnished to shareholders.
PROPOSAL 1 - ELECTION OF DIRECTORS
Directors constituting approximately one-third of the Board of
Directors are elected each year for a three-year term at the Company's Annual
Meeting of Shareholders or until their successors are duly elected by the
shareholders. The terms of Messrs. Mac J. Slingerlend and James A. Rutherford
expire in 1999 (the "Class II Directors"); the terms of Messrs. Bobby G.
Stevenson, Richard A. Montoni and Archibald J. McGill expire in 2000 (the
"Class III Directors") and the terms of Messrs. Roy L. Burger and James G.
Brocksmith, Jr. expire in 2001 (the "Class I Directors"). The Board has
nominated Messrs. Mac J. Slingerlend, James A. Rutherford and Paul E. Rudolph
(to become a new director) to serve for three-year terms to expire at the
2002 Annual Meeting of Shareholders or until their successors are elected and
qualified.
Vacancies on the Board may be filled by the affirmative vote of a
majority of the remaining directors then in office. A director elected to
fill a vacancy (including a vacancy created by an increase in the Board)
shall serve for the remainder of the full term of the new directorship or of
the class of directors in which the vacancy occurred. Officers are elected by
and serve at the discretion of the Board.
Shares represented by all proxies by the Board and not marked so as
to withhold authority to vote for Messrs. Mac J. Slingerlend, James A.
Rutherford and Paul E. Rudolph will be voted for the election of Messrs. Mac
J. Slingerlend, James A. Rutherford and Paul E. Rudolph. To be elected, each
nominee must receive the favorable vote of a plurality of the votes cast. If
any of the nominees are unavailable or unwilling to serve as director,
persons named in the proxy intend to cast votes for which they hold proxies
in favor of the election of such other person as the Board may designate. The
Board knows of no reason why any of Messrs. Mac J. Slingerlend, James A.
Rutherford or Paul E. Rudolph should be unable or unwilling to serve on the
Board. See "Directors and Executive Officers" below for biographical
information for the persons nominated as directors.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" EACH OF THE NOMINEES
2
<PAGE>
DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth the Company's directors and executive
officers, their ages, positions currently held with the Company, the year
elected as director or appointment as officer and class of directorship. For
information about the ownership of the Company's voting securities held by
each director, director nominee or executive officer, see "Securities
Ownership of Certain Beneficial Owners and Management."
<TABLE>
<CAPTION>
Served as
Officer or
Name Age Positions Director Since Class
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Bobby G. Stevenson 57 Chairman and Founder 1974 Class III
Mac J. Slingerlend 52 Chief Executive Officer, President, 1989 Class II
Secretary and Director
Paul E. Rudolph 42 Chief Operating Officer 1999 Class II
(proposed)
Richard A. Montoni 48 Chief Financial Officer, Executive 1996 Class III
Vice President, Treasurer and Director
Joseph A. Mancuso 53 Senior Vice President/Custom 1994 -
Solutions Group - President
Donald R. Hahl 49 Senior Vice President/Strategic 1997 -
Solutions Group - President
James A. Rutherford 53 Director 1994 Class II
Roy L. Burger 44 Director 1995 Class I
James G. Brocksmith, Jr. 58 Director 1998 Class I
Archibald J. McGill 68 Director 1998 Class III
</TABLE>
BOBBY G. STEVENSON. Mr. Stevenson is Chairman of the Board of
Directors and one of the original founders of the Company. Mr. Stevenson was
Vice President in charge of recruiting and management of the technical staff
from 1974 until November 1977 when he became Chief Executive Officer. As
Chief Executive Officer, he had been responsible for all operations of the
Company from 1977 to 1998.
MAC J. SLINGERLEND. Mr. Slingerlend joined the Company in January
1989 as Executive Vice President/Chief Financial Officer and was elected a
director in 1994. He was made President and Chief Operating Officer in 1996
and was promoted to Chief Executive Officer in March 1998 and became
Secretary in 1998. Prior to joining the Company, Mr. Slingerlend spent 15
years in the banking industry, primarily as a commercial lender, and five
years in corporate financial positions in the cable television and
hospitality industries.
PAUL E. RUDOLPH. Mr. Rudolph joined the Company in June 1999 as
Chief Operating Officer. Prior to his employment with CIBER, Mr. Rudolph
served as President of EDS' Electronic Business unit from 1996 to 1999. Since
joining EDS in 1979 and until 1996, Mr. Rudolph held a variety of management
and technical leadership roles spanning multiple industry groups.
RICHARD A. MONTONI. Mr. Montoni has been the Company's Executive
Vice President/Chief Financial Officer and a director since October 1996. He
became Treasurer in 1998. Prior to joining the Company, Mr. Montoni was a
partner with KPMG Peat Marwick LLP, where he worked for approximately 20
years with companies in the high technology, manufacturing, merchandising and
distribution industries. Mr. Montoni is a member of the American Institute of
Certified Public Accountants and the Colorado Society of Certified Public
Accountants.
3
<PAGE>
JOSEPH A. MANCUSO. Effective July 1, 1999, Mr. Mancuso became Senior
Vice President/Custom Solutions Group - President. Mr. Mancuso has also
served as President of the CIBER Information Services Division since March of
1998. Previously, Mr. Mancuso was Divisional Vice President in charge of
eastern operations from 1996 to 1998. Mr. Mancuso joined CIBER as a result of
CIBER acquiring CPU, Inc. in 1994 and served as Regional Vice President from
1994 to 1996 in charge of southeast branch operations. From 1993 to 1994 Mr.
Mancuso was a Vice President for CPU, Inc.
DONALD R. HAHL. Effective July 1, 1999, Mr. Hahl became Senior Vice
President/Strategic Solutions Group - President. From March 1998 to June
1999, Mr. Hahl was President/CIBER Solutions Division. From August 1997 to
February 1998, Mr. Hahl was President of Spectrum Technology Group, Inc. Mr.
Hahl joined CIBER in 1996 when Spectrum merged into CIBER. Mr. Hahl was a
co-founder of Spectrum in 1979 and served as Vice President/Consulting
Services when the merger occurred.
JAMES A. RUTHERFORD. Mr. Rutherford has been a director of the
Company since February 1994. He is currently a managing director of Wingset
Investments Ltd., a private venture capital company located in New Albany,
Ohio. Prior to forming Wingset in 1995, Mr. Rutherford was one of the
founders of Goal Systems International, Inc., serving in various executive
positions, including Chief Executive Officer, and as a director from its
incorporation in 1977 until its sale in 1992. Mr. Rutherford is also a
trustee of Case Western Reserve University and a director of Symix Systems,
Inc., Columbus, Ohio, as well as several private corporations.
ROY L. BURGER. Mr. Burger has been a director of the Company since
November 1995. Mr. Burger has approximately 22 years of experience in the
equipment leasing and finance industry and has arranged the financing of more
than $2 billion of equipment and real estate. Mr. Burger currently serves as
President and Chief Executive Officer of Boulder Capital Group, a company
founded by him in 1986 that specializes in equipment leasing. In May 1998,
Boulder Capital Group, together with 11 other finance companies, merged and
consolidated to become part of UniCapital Corporation ("UniCapital"). Mr.
Burger served on the Board of Directors of UniCapital during its first year
of listing on the New York Stock Exchange.
JAMES G. BROCKSMITH, JR. Mr. Brocksmith has been a director of the
Company since July 1998. Mr. Brocksmith served as a partner of KPMG Peat
Marwick LLP from 1971 to January 1997. From 1990 to October 1996, Mr.
Brocksmith served as the Deputy Chairman of the Board and Chief Operating
Officer of KPMG Peat Marwick LLP. Since January 1997, Mr. Brocksmith has been
a self-employed business consultant for several companies. Mr. Brocksmith is
a member of the board of directors of two publicly traded companies;
Nationwide Financial Services, Inc., a provider of life insurance, mutual
funds and pension products, and Vistana, Inc., a leading developer and
operator of vacation ownership resorts.
ARCHIBALD J. MCGILL. Mr. McGill has been a director of the Company
since September 1998. Mr. McGill has served in executive capacities at IBM
and AT&T and was President of Rothschild Venture Capital. He is on the board
of directors of several small high-technology companies. From 1985 to the
present, Mr. McGill has been the President of Chardonnay, Inc., a venture
capital investment company.
BOARD COMMITTEES AND MEETINGS
The Board met fifteen times (including telephone meetings) during
the Company's 1999 fiscal year. Each director participated in all of the
board meetings and committee meetings (of which such director was a member)
held during fiscal 1999; except that one of the directors was unable to
attend one meeting. The Board has an Audit Committee and a Compensation
Committee but does not have a Nominating Committee or any committee
performing a similar function.
COMPENSATION COMMITTEE. The principal responsibilities of the
Compensation Committee are the administration and grant of awards under the
Company's Equity Incentive Plan (the "Employees' Plan") and the Stock
Purchase Plan, as well as the recommendation of annual salaries for senior
management to the Company's Board. The current members of the Compensation
Committee are Messrs. Rutherford, Burger, Brocksmith and McGill. The
Compensation Committee met five times in fiscal 1999.
AUDIT COMMITTEE. The principal responsibilities of the Audit
Committee are to meet periodically with representatives of the Company's
independent auditors to review the general scope of audit coverage, including
consideration of the Company's accounting practices and procedures and system
of internal accounting controls, and
4
<PAGE>
to review any transactions that may involve a conflict of interest, and to
report to the Board with respect thereto. The Audit Committee also recommends
to the Board the appointment of the Company's independent auditors. The
current members of the Audit Committee are Messrs. Rutherford, Burger,
Brocksmith and McGill. The Audit Committee met twice in fiscal 1999.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), requires the Company's directors, executive officers
and persons who beneficially own greater than 10% of a registered class of
the Company's equity securities to file initial reports of ownership and
changes in ownership of such securities with the Securities and Exchange
Commission (the "Commission") and the Company. Based solely upon its review
of copies of the Section 16(a) reports the Company has received and written
representations from certain reporting persons, the Company believes that
during its fiscal year ended June 30, 1999, all of its directors, executive
officers and greater than 10% beneficial owners were in compliance with their
filing requirements except that Mac J. Slingerlend reported one transaction
late on an amended Form 4 and James A. Rutherford reported one transaction
late on an amended Form 4.
5
<PAGE>
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information regarding beneficial
ownership of the Company's Common Stock at September 1, 1999, and stock
options exercisable for shares of Common Stock within sixty days of such
date, held by (i) each person or group of persons known by the Company to own
beneficially more than five percent (5%) of the outstanding Common Stock,
(ii) each director and nominee for director of the Company, (iii) each Named
Executive Officer (as defined under "Executive Compensation" below) and (iv)
all executive officers and directors of the Company as a group. All
information is taken from or based upon ownership filings made by such
persons with the Commission or upon information provided by such persons to
the Company. Unless otherwise indicated, the shareholders listed below have
sole voting and investment power with respect to the shares reported as owned.
<TABLE>
<CAPTION>
Name of Amount and nature of Percent of
beneficial owner beneficial ownership class
---------------- -------------------- -----
<S> <C> <C>
Bobby G. Stevenson(1) 12,005,139 20%
Mac J. Slingerlend(2) 830,053 1%
Paul E. Rudolph -- --
Richard A. Montoni(3) 76,549 *
Joseph A. Mancuso(4) 41,984 *
Donald R. Hahl(5) 219,578 *
Lawrence D. Greenwood(6) 157,507 *
William E. Storrison(7) 35,002 *
James A. Rutherford(8) 80,684 *
Roy L. Burger(8) 24,557 *
James G. Brocksmith, Jr.(8) 10,458 *
Archibald J. McGill(8) 10,458 *
Putnam Investments, Inc.(9) 3,611,285 6%
All directors and executive
officers as a group (12 persons)(10) 13,491,969 22%
*less than 1%
</TABLE>
(1)The address of Mr. Stevenson is c/o CIBER, Inc., 5251 DTC Parkway, Suite
1400, Englewood, CO 80111. Includes shares held by the Bobby G. Stevenson
Revocable Trust, of which Mr. Stevenson is the settler, trustee and beneficiary.
Excludes 87,100 shares of Common Stock held in the Irrevocable First Stevenson
Charitable Remainder Unitrust, of which shares Mr. Stevenson disclaims
beneficial ownership.
(2)Includes options to purchase 725,224 shares of Common Stock.
(3)Includes options to purchase 75,659 shares of Common Stock.
(4)Includes options to purchase 39,649 shares of Common Stock.
6
<PAGE>
(5)Includes options to purchase 14,599 shares of Common Stock.
(6)Includes options to purchase 15,268 shares of Common Stock.
(7)Includes options to purchase 35,002 shares of Common Stock.
(8)Includes options to purchase 36,000, 23,000, 10,000 and 10,000 shares of
Common Stock for Messrs. Rutherford, Burger, Brocksmith and McGill,
respectively.
(9)Address: One Post Office Square, Boston, MA 02109. Includes affiliated
entities.
(10)Includes options to purchase 984,401 shares of Common Stock.
COMPENSATION OF DIRECTORS
COMPENSATION OF DIRECTORS
All non-employee directors receive shares of CIBER Common Stock
valued at approximately $2,500 for each meeting attended and are paid a
$6,000 semi-annual retainer. All directors are reimbursed for their expenses
in attending meetings. Non-employee directors receive stock options under the
Non-employee Directors' Stock Option Plan for serving on the Board. Employee
directors do not receive additional compensation for serving on the Board.
Under the terms of the Non-employee Directors' Stock Option Plan
(the "Directors' Plan"), the Company may grant to non-employee directors
awards of stock options. The Directors' Plan provides for an initial
authorization of 200,000 shares of Common Stock and is administered by the
Board. Each option granted under the Directors' Plan expires ten years from
the date of grant. The Directors' Plan provides for an initial grant of
options to purchase 20,000 shares of Common Stock to each non-employee
director when such director takes office, which options vest in equal annual
installments over two years. Additionally, after each year of service, each
non-employee director receives a grant of options to purchase 4,000 shares of
Common Stock; such options vest one year after the date of grant.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
There were no Compensation Committee Interlocks in fiscal 1999.
7
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth compensation information with respect
to Mr. Slingerlend, the Company's Chief Executive Officer and the Company's
four most highly paid executive officers with annual compensation in excess
of $100,000 (the "Named Executive Officers") for services rendered for the
fiscal years ended June 30, 1999, 1998 and 1997. See "Employment Agreements".
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Long-term
Annual Compensation Compensation
------------------- ------------
Securities All Other
Name and Fiscal Underlying Compensation
Principal Position Year Salary ($) Bonus ($) Options (#) ($) (1)
------------------ ---- ---------- --------- ----------- -------
<S> <C> <C> <C> <C> <C>
Mac J. Slingerlend 1999 362,500 132,372 45,000 7,523
Chief Executive Officer, 1998 325,000 150,000 400,000 6,864
President and Secretary 1997 300,000 140,000 20,000 7,163
Richard A. Montoni 1999 267,500 73,935 60,000 5,284
Chief Financial Officer, 1998 250,000 98,846 20,000 6,394
Executive Vice President 1997 163,431 100,000 100,000 3,228
and Treasurer
Joseph A. Mancuso 1999 232,500 61,250 45,000 3,888
Senior Vice President/Custom 1998 -- -- -- --
Solutions Group - President 1997 -- -- -- --
Donald R. Hahl 1999 232,500 57,380 45,000 4,051
Senior Vice President/Strategic 1998 185,000 41,621 10,400 5,665
Solutions Group - President 1997 -- -- -- --
Lawrence D. Greenwood(2) 1999 275,000 69,275 37,500 4,437
Vice President 1998 256,250 84,423 210,400 6,635
1997 -- -- -- --
William E. Storrison(3) 1999 275,000 37,500 37,500 2,504
Executive Vice President 1998 237,500 138,654 240,000 3,345
1997 200,000 131,049 40,000 5,032
</TABLE>
(1) Consists of amounts contributed under the Company's 401(k) Savings Plan and
amounts paid by the Company for life insurance benefits. Savings Plan
contributions for the fiscal years ended June 30, 1999, 1998 and 1997 were:
Mr. Slingerlend - $2,760, $2,615 and $4,175; Mr. Montoni - $3,150, $4,319
and $1,250; Mr. Mancuso - $3,357, 0 and 0; Mr. Hahl - $3,655, $3,655 and 0;
Mr. Greenwood - $3,110, $3,462 and 0; Mr. Storrison - $2,190, $3,000 and
$4,674, respectively.
(2) Resigned from position of Executive Vice President prior to fiscal year end
and was not considered an executive officer at year end.
(3) Resigned from position of Executive Vice President subsequent to fiscal
year end.
8
<PAGE>
OPTION GRANTS IN THE LAST FISCAL YEAR
The following table sets forth information regarding options granted to
the Named Executive Officers during the fiscal year ended June 30, 1999.
<TABLE>
<CAPTION>
Number of Potential Realizable Value at
Securities Percent of Total Assumed Annual Rates of Stock Price
Underlying Options Granted Exercise or Appreciation for
Options to Employees in Base Price Expiration Option Term (1)
Name Granted (#) Fiscal Year ($/Share) Date 5%($) 10%($)
---- ----------- ----------- --------- ---- ----- ------
<S> <C> <C> <C> <C> <C> <C>
Mac J. Slingerlend(2) 30,000 1.1% $27.06 9/1/08 510,584 1,293,920
15,000 .5% $16.00 10/9/08 150,935 382,498
Richard A. Montoni(3) 40,000 1.5% $27.06 9/1/08 680,778 1,725,226
20,000 .7% $16.00 10/9/08 201,246 509,998
Joseph A. Mancuso(4) 30,000 1.1% $27.06 9/1/08 510,584 1,293,920
15,000 .5% $16.00 10/9/08 150,935 382,498
Donald R. Hahl(4) 30,000 1.1% $27.06 9/1/08 510,584 1,293,920
15,000 .5% $16.00 10/9/08 150,935 382,498
Lawrence D. Greenwood(5) 25,000 .9% $27.06 9/1/08 425,487 1,078,266
12,500 .5% $16.00 10/9/08 125,779 318,749
William E. Storrison(5) 25,000 .9% $27.06 9/1/08 425,487 1,078,266
12,500 .5% $16.00 10/9/08 125,779 318,749
</TABLE>
(1) Amounts reflect certain assumed rates of appreciation set forth in the
Commission's executive compensation disclosure rules. Actual gains, if any,
on stock option exercises will depend on the future performance of the
Common Stock. No assurance can be made that the amounts reflected in these
columns will be achieved.
(2) Options for 30,000 shares were granted on 9/1/98 that vest: 3,000 on
9/1/99; 4,500 on 9/1/00; 6,000 on 9/1/01; 7,500 on 9/1/02; and 9,000 on
9/1/03. Options for 15,000 shares were granted on 10/9/98 that vest: 1,500
on 11/1/99; 2,250 on 11/1/00; 3,000 on 11/1/01; 3,750 on 11/1/02; and 4,500
on 11/1/03.
(3) Options for 40,000 shares were granted on 9/1/98 that vest: 7,500 on
9/1/99; 8,750 on 9/1/00; 10,000 on 9/1/01, 6,250 on 9/1/02; and 7,500 on
9/1/03. Options for 20,000 shares were granted on 10/9/98 that vest: 3,750
on 11/1/99; 4,375 on 11/1/00; 5,000 on 11/1/01; 3,125 on 11/1/02; and 3,750
on 11/1/03.
(4) Options for 30,000 shares were granted on 9/1/98 that vest: 7,667 on
9/1/99; 8,167 on 9/1/00; 8,666 on 9/1/01; 2,500 on 9/1/02; and 3,000 on
9/1/03. Options for 15,000 shares were granted on 10/9/98 that vest: 3,834
on 11/1/99; 4,083 on 11/1/00; 4,333 on 11/1/01; 1,250 on 11/1/02; and 1,500
on 11/1/03.
(5) Options for 25,000 shares were granted on 9/1/98 that vest in three equal
annual installments beginning 9/1/99. Options for 12,500 shares were
granted on 10/9/98 that vest in three equal installments beginning 11/1/99.
OPTION EXERCISES IN THE LAST FISCAL YEAR AND FISCAL YEAR-END OPTION VALUES
The following table sets forth information concerning outstanding
options held by the Named Executive Officers as of June 30, 1999.
<TABLE>
<CAPTION>
Shares Number of Securities Underlying Value of Unexercised
Acquired Unexercised Options at Money Options at
On Value Fiscal Year End (#) Fiscal Year End ($)
Name Exercise (#) Realized ($) Exercisable/Unexercisable Exercisable/Unexercisable
---- ------------ ------------ ------------------------- -------------------------
<S> <C> <C> <C> <C>
Mac J. Slingerlend 61,110 2,163,826 715,558 / 451,661 13,458,976 / 913,516
Richard A. Montoni -- -- 41,884 / 134,116 88,378 / 218,746
Joseph A. Mancuso 9,000 124,118 15,315 / 71,667 63,496 / 141,668
Donald R. Hahl -- -- 3,466 / 51,934 7,040 / 60,959
Lawrence D. Greenwood -- -- 3,468 / 44,432 7,044 / 53,143
William E. Storrison 66,668 1,068,963 26,666 / 118,334 135,407 / 215,622
</TABLE>
9
<PAGE>
EMPLOYMENT AGREEMENT
The Company has employment agreements with each of the Named
Executive Officers, which have a term of one year and are renewable annually.
Each employment agreement provides that an officer's compensation will
include a base and a bonus. In the event that an officer's employment is
terminated upon a change in control of the Company, upon death or disability
of the officer or without cause, the officer will be entitled to a severance
payment of up to three times their annual compensation which varies based
upon the cause of termination and officer position. Officers are also
entitled to receive continuance of medical, dental and disability benefits
for 18 months following termination, which varies based on the officer's
position.
LONG-TERM DEFERRED COMPENSATION PLAN
The Company has agreed to make certain post-employment payments to
Messrs. Slingerlend and Montoni, or their designated beneficiaries, except in
the event of a termination for cause. The payments will be made for 15 years
after Messrs. Slingerlend and Montoni's termination of employment with the
Company and will range from $60,000 to $100,000 and $30,000 to $75,000 per
year, respectfully, based on Messrs. Slingerlend and Montoni's age at the
time of termination of employment. The benefits are also subject to certain
vesting provisions.
THE COMPENSATION COMMITTEE REPORT
COMPENSATION POLICIES
The Compensation Committee (the "Committee") of the Board consists
of its independent non-employee directors. The purpose of the Committee is to
develop policies and make specific recommendations with respect to the
compensation of the Company's executive officers, with the objective that a
fair relationship exists between executive pay and the creation of
shareholder value.
The Committee, among other things, considers the performance of the
Company's operations, compensation of executive officers of competitors,
salary surveys of industry-related positions, the salary history of the
particular officer and other compensation in place, including stock option
awards. There is no singular objective formula by which compensation is
determined and the decisions are ultimately subjective.
FISCAL 1999 COMPENSATION
With respect to the Company's chief executive officer and the other
Named Executive Officers, the Committee focused principally upon establishing
appropriate base salary and incentive compensation. The chief executive
officer and each of the other Named Executive Officers are parties to
employment agreements with the Company that provide for base salary and
bonuses at stipulated performance levels for Messrs. Slingerlend, Montoni,
Mancuso, Hahl, Greenwood and Storrison. The base salary and bonuses granted
the chief executive officer and the other Named Executive Officers with
respect to fiscal 1999 are consistent with the Committee's objectives.
The Company has periodically granted stock options in order to
provide certain of its executives with a competitive total compensation
package and to reward them for their contribution to the Company's long-term
performance, as well as to align a portion of their compensation with the
market value of the Common Stock. During fiscal 1999, stock options were
granted to Messrs. Slingerlend, Montoni, Mancuso, Hahl, Greenwood and
Storrison and to other members of management based upon their actual and
potential contributions to the Company.
Compensation Committee
James A. Rutherford
Roy L. Burger
James G. Brocksmith, Jr.
Archibald J. McGill
10
<PAGE>
PERFORMANCE GRAPH
The following provides a comparison of the 5 year cumulative total
return* among CIBER, Inc., the S & P 500 Index and two Peer Groups.
Peer Group 1 (presented in CIBER, Inc.'s fiscal 1998 Proxy Statement)
includes: Cambridge Technology Partners (Massachusetts), Inc., Computer
Horizons Corp., Computer Task Group, Inc., Keane, Inc., Renaissance
Worldwide, Inc., Sapient Corp., Technology Solutions Co. and Whittman-Hart,
Inc. Due to the Company's growth, the Company believes that Peer Group 1 is
no longer representative of its peers; therefore, the Company has selected H
& Q Information Services Sector (Peer Group 2) as its Peer Group for future
years. Peer Group 2 (subject to change annually according to H & Q
Information Services Sector) includes: Affiliated Computer Services, Inc.,
Cambridge Technology Partners (Massachusetts), Inc., Computer Sciences Corp.,
Electronic Data Systems Corp., First Consulting Group, Inc., International
Network Services, Keane, Inc., Renaissance Worldwide, Inc., Sapient Corp.,
Syntel, Inc., USWeb Corp. and Whittman-Hart, Inc.
*Assumes $100 invested on June 30, 1994 in stock or index including reinvestment
of dividends. The Company's fiscal year ends June 30.
Corresponding index value and Common Stock price values are given below:
<TABLE>
<CAPTION>
6/94 6/95 6/96 6/97 6/98 6/99
----- ----- ------ ------ ------ -----
<S> <C> <C> <C> <C> <C> <C>
CIBER, Inc. 100 203 503 781 1,737 874
Peer Group 1 100 162 397 626 958 517
Peer Group 2 100 128 165 146 184 203
S & P 500 100 126 159 214 279 342
CIBER, Inc. Closing Stock Price 2.188 4.438 11.000 17.094 38.000 19.125
</TABLE>
11
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On December 2, 1996, the Company purchased CIBER Network Services,
Inc. ("CNSI"), which was 85% owned by Bobby G. Stevenson, Mac J. Slingerlend
and Prasong Suvarnasorn, each of whom were and remain officers and/or
directors of the Company. Mr. Stevenson is also the Company's largest
shareholder. In October 1998, additional contingent consideration of $1.2
million was paid to the selling shareholders, of which Messrs. Stevenson,
Slingerlend and Suvarnasorn and members of their families received an
aggregate of 46,925 shares of Common Stock and cash of $118,000. In May 1999,
final contingent consideration of $200,000 was paid to the selling
shareholders, of which Messrs. Stevenson, Slingerlend and Suvarnasorn and
members of their families received an aggregate of 5,300 shares of Common
Stock and cash of $50,000.
PROPOSAL 2 - AMENDMENT TO CERTIFICATE OF INCORPORATION TO
INCREASE THE NUMBER OF AUTHORIZED SHARES OF COMMON STOCK
GENERAL
On August 17, 1999, the Board adopted a resolution proposing that
the Company's Certificate of Incorporation be amended to increase the total
number of shares of Common Stock that the Company is authorized to issue from
80,000,000 to 100,000,000 shares.
PURPOSES
The additional authorized shares will benefit the Company by
providing flexibility to the Board of Directors without further action or
authorization by shareholders (except as required by law), in responding to
business needs and opportunities as they arise, and for other corporate
purposes. These corporate purposes might include the obtaining of capital
funds through public and private offerings of shares of Common Stock or of
securities convertible into shares of Common Stock or the acquisition of
businesses, technologies or other assets. In addition, the Board may deem it
appropriate to issue shares of Common Stock for distribution to the Company's
shareholders in the event of a stock dividend or stock split, or for
distributions pursuant to employee benefit plans. If such additional
authorized shares of Common Stock are subsequently issued to other than
existing shareholders, the percentage interest of existing shareholders in
the Company will be reduced. The issuance of any additional shares will be on
terms deemed by the Board to be in the best interests of the Company and its
shareholders.
In addition, the Company may seek to raise additional capital from
time to time and the Board believes that it is prudent to have additional
shares of Common Stock available for such purpose and for general corporate
purposes, including business combinations, grants of stock options and
recapitalizations, which transactions can be consummated expediently only if
the proposal to amend the Company's Certificate of Incorporation to increase
the number of authorized shares of Common Stock of the Company is approved by
holders of a majority of the issued and outstanding shares of Common Stock.
The Board will determine whether, when and on what terms the issuance of
shares of Common Stock may be warranted in connection with any of the
foregoing purposes.
The Board believes that the proposed increase in the number of
authorized shares of Common Stock will give the Company greater flexibility
by allowing shares of Common Stock to be issued by the Board of Directors
without the delay and expense of a special meeting of shareholders.
If the proposed Amendment is adopted by the shareholders, it will
become effective upon the filing and recording of a Certificate of Amendment
as required by the General Corporation Law of the State of Delaware.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE AMENDMENT
TO THE CERTIFICATE OF INCORPORATION TO INCREASE THE NUMBER
OF AUTHORIZED SHARES OF COMMON STOCK
12
<PAGE>
PROPOSAL 3 - AMENDMENT TO THE EQUITY INCENTIVE PLAN
The demand for skilled information technology consultants has
increased significantly in recent years and management expects this trend to
continue. As an integral element of the Company's approach to attracting,
motivating and retaining employees in such a competitive labor market, it has
issued and plans to continue to issue Common Stock-based incentives,
primarily stock options, to employees. In addition, management believes
additional options to purchase Common Stock will be required for issuance to
employees of companies that may be merged with or acquired by the Company in
the future, in part to replace existing options of merged or acquired
companies that may exist. As of September 10, 1999, the Company had 13,641
options available for future issuance under its Equity Incentive Plan (the
"Employees' Plan"). Therefore, to ensure the continued availability of the
Employees' Plan to attract, motivate and retain employees, on August 17,
1999, the Board of Directors approved an amendment to the Employees' Plan to
increase the number of shares of Common Stock reserved for issuance
thereunder from 8,000,000 to 10,500,000 shares, subject to the approval by
the Company's shareholders at the Meeting. Assuming no unusual matter to the
contrary (such as a significant business combination), management expects the
increase in the number of shares reserved under the Employees' Plan to be
sufficient through October 31, 2000. The affirmative vote of a majority of
the shares of the Company's Common Stock represented at the Meeting will be
required to approve the amendment to the Employees' Plan.
EMPLOYEES' EQUITY INCENTIVE PLAN
The Employees' Plan was adopted by the Board of Directors and
shareholders of the Company in January 1994. A total of 8,000,000 shares of
Common Stock are currently reserved for issuance under the Employees' Plan.
The purpose of the Employees' Plan is to provide long-term incentives to the
Company's officers, employees and consultants and to encourage and enable
such participants who are in a position to make significant contributions to
the success of the Company to acquire a closer identification of their
interests with those of the Company.
The Employees' Plan may be administered by the Board or a committee
to which the Board has delegated authority (the "Committee"). Any Committee
which makes grants to officers of the Company must be comprised of
disinterested non-employee members of the Board of Directors. Subject to the
terms of the Employees' Plan, the Committee determines the persons to whom
awards are granted, the type of award granted, the number of shares granted,
the vesting schedule, the type of consideration to be paid to the Company
upon exercise of options and the term of any option (which cannot exceed ten
years). No participant may be granted awards in any one calendar year with
respect to more than 1,000,000 shares of Common Stock. Under the Employees'
Plan, the Committee may grant awards of restricted stock, stock options and
supplemental bonuses or any combination thereof.
Under the Employees' Plan, the Committee may grant both incentive
stock options ("ISOs") intended to qualify under Section 422 of the Internal
Revenue Code of 1986, as amended (the "Code"), and options that are not
qualified as incentive stock options ("NSOs"). ISOs may only be granted to
persons who are employees of the Company. ISOs may not be granted under the
Employees' Plan at an exercise price of less than the fair market value of
the Common Stock on the date of grant and the term of these options cannot
exceed ten years. The exercise price of an ISO granted to a holder of more
than 10% of the Common Stock must be at least 110% of the fair market value
of the Common Stock on the date of grant, and the term of these options
cannot exceed five years. The exercise price of NSOs may, at the discretion
of the Committee, be granted at less than the fair market value of the Common
Stock on the date of grant. No options under the Employees' Plan may be
granted after January 2004.
Under the performance award component of the Employees' Plan,
participants may be granted an award denominated in shares of Common Stock or
in dollars. Achievement of the performance target, or multiple performance
targets, established by the Committee relating to corporate, group, unit or
individual performance, based upon standards set by the Committee, will
entitle the participant to payment of the full amount specified with respect
to the award, subject to adjustment at the discretion of the Committee in the
event of performance exceeding the minimum performance targets, but below the
maximum performance target applicable to such award. Payment may be made in
cash, Common Stock or any combination thereof, as determined by the Committee
before the end of a performance cycle by reason of death, disability or
retirement.
Under the restricted stock component of the Employees' Plan, the
Committee may, in selected cases, issue to a participant a given number of
shares of restricted stock. Restricted stock under the Employees' Plan is
Common Stock restricted as to sale pending fulfillment of such vesting
schedule and employment requirements as the Committee determines. Prior to
the fulfilling of the restrictions, the participant will nevertheless be
entitled to
13
<PAGE>
receive distributions in liquidation and dividends on, and to vote the shares
of, the restricted stock. The Employees' Plan provides for forfeiture of
restricted stock for breach of conditions of grant.
The Board may amend or terminate the Employees' Plan at any time
without approval of the shareholders. However, shareholder approval is
required for any amendment to the Employees' Plan if shareholder approval is
required to enable the plan to satisfy any applicable statutory requirements,
which includes an amendment that increases the number of shares for which
options may be granted or changes the person eligible to participate in the
Plan. However, no action by the Board or shareholders may alter or impair any
award previously granted without the consent of the award holder.
Through September 10, 1999, options to purchase up to an aggregate
of 10,102,580 shares of Common Stock have been granted under the Employees'
Plan, of which options to purchase 2,055,758 shares of Common Stock have been
exercised and options for 2,116,221 shares have been canceled. Options to
purchase shares of Common Stock issued under the Employees' Plan to all Named
Executive Officers as a group during fiscal years 1997, 1998 and 1999 were as
follows for the years indicated: 1997 - 160,000 shares; 1998 - 880,800
shares; and 1999 - 270,000 shares. The market value of the Common Stock
underlying the currently outstanding options is $108,974,793 based upon the
closing price of $18.375 on September 10, 1999.
FEDERAL INCOME TAX CONSEQUENCES OF THE EMPLOYEES' PLAN
The following is a general summary of the federal income tax
consequences that may apply to recipients of options, restricted stock,
performance shares and performance units under the Employees' Plan. Because
the application of the tax laws may vary according to individual
circumstances, a participant should seek professional tax advice concerning
the tax consequences to him or her of participation in the Employees' Plan,
including the potential application and effect of state, local and foreign
tax laws and estate and gift tax considerations.
INCENTIVE STOCK OPTIONS. A participant who is granted an ISO
recognizes no taxable income when the ISO is granted and generally recognizes
no taxable income upon exercise of the ISO, but will recognize alternative
minimum income upon such exercise (see below). A participant who exercises an
ISO recognizes taxable gain or loss when he or she sells these shares
purchased pursuant to the ISO. Any gain or loss recognized on the sale of
shares acquired upon exercise of an ISO is taxed as capital gain or loss if
the shares have been held for at least one year from the date the option was
exercised and for at least two years after the option was granted. In this
event, the Company receives no deduction with respect to the ISO shares. If
the participant disposes of the shares before the required holding periods
have elapsed (a "disqualifying disposition"), he or she is taxed as though he
or she exercised an NSO (see below), except that the compensation income on
exercise of the option is recognized in the year of the disqualifying
disposition, and the compensation income may not exceed the excess of the
amount realized on the sale of the stock over the exercise price for such
stock.
EFFECT OF ALTERNATIVE MINIMUM TAX. For purposes of determining the
alternative minimum taxable income ("AMTI") of an individual, ISOs exercised
during a taxable year will give rise to AMTI to the extent of the excess of
the fair market value of the shares acquired pursuant to such ISO over the
exercise price paid. Therefore, although generally an individual will have no
regular taxable income associated with the exercise of an ISO, such
individual may have AMTI and, depending upon his or her specific facts and
circumstances for such tax year, a resulting tax liability.
NON-STATUTORY STOCK OPTIONS. The tax treatment of NSOs differs
significantly from the tax treatment of ISOs. Although, no taxable income is
recognized when an NSO is granted, upon the exercise of an NSO, the
difference between the fair market value of the shares on the date of
exercise and the exercise price of the option is taxable as ordinary
compensation income to the recipient. In addition, subject to certain
limitations attributable to payments of excess compensation, the Company is
entitled to a compensation deduction for the amount of ordinary income
recognized by the option holder.
WITHHOLDING. The Company may withhold any taxes required by any law
or regulation of any governmental authority, whether federal, state or local,
in connection with any stock option or other award under the Employees' Plan,
including, but not limited to withholding of any portion of any payment or
withholding from other compensation payable to the participant, unless such
person reimburses the Company for such amount.
14
<PAGE>
IMPLEMENTATION. If the proposed amendment to the Employees' Plan is
adopted by the shareholders, it will become effective immediately and be
reflected in the amended Employees' Plan, which Plan will be filed in the
Company's minutes book.
The full text of the proposed amendment to the Equity Incentive Plan
and the current Plan are attached to this proxy statement as Appendix A and
should be read in its entirety.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE APPROVAL
OF THE INCREASE IN THE NUMBER OF SHARES OF COMMON STOCK
RESERVED FOR ISSUANCE UNDER THE EMPLOYEES' PLAN
INDEPENDENT AUDITORS
Representatives of KPMG LLP are expected to attend the Meeting. The
representatives will have an opportunity to make a statement and will be
available to respond to appropriate questions.
SHAREHOLDER PROPOSALS FOR NEXT ANNUAL MEETING
Shareholders may submit proposals on matters appropriate for
shareholder action at the Company's annual shareholder meetings. Such proposals
must be received by the Company not later than May 26, 2000 to be considered for
inclusion in the proxy statement and proxy relating to the 2000 Annual Meeting
of Shareholders. Proposals submitted after August 9, 2000 are considered
untimely. The persons named in the Company's proxies will have discretionary
authority to vote all proxies with respect to any untimely proposals. Any
shareholder proposals should be addressed to: Corporate Secretary, CIBER, Inc.,
5251 DTC Parkway, Suite 1400, Englewood, CO 80111.
ANNUAL REPORT TO SHAREHOLDERS, MANAGEMENT'S DISCUSSION
AND ANALYSIS AND CONSOLIDATED FINANCIAL STATEMENTS
The 1999 Annual Report of the Company, as filed with the Commission,
is being mailed to the shareholders with this Proxy Statement. The 1999
Annual Report is not to be considered part of the soliciting material.
Management's Discussion and Analysis of Financial Condition and
Results of Operations and the Company's audited consolidated financial
statements and notes thereto, as contained in the Company's Annual Report on
Form 10-K for the fiscal year ended June 30, 1999, are included herein on
pages P-1 through ______.
By order of the Board of Directors
Bobby G. Stevenson
Chairman of the Board
Englewood, Colorado
September 24, 1999
15
<PAGE>
APPENDIX A
PROPOSED OCTOBER 28, 1999 AMENDMENT TO CIBER'S EQUITY INCENTIVE PLAN
Section 4.1 of the Company's Equity Incentive Plan, as amended and
restated as of May 4, 1998, shall be deleted in its entirety and replaced
with the following:
4.1 NUMBER OF SHARES. Subject to adjustment as provided in
Section 4.3, 10,500,000 Shares are authorized for issuance under the Plan in
accordance with the provisions of the Plan and subject to such restrictions
or other provisions as the Committee may from time to time deem necessary;
provided, however, that no Participant may be granted Awards in any one
calendar year with respect to more than 1,000,000 Shares. The Shares may be
divided among the various Plan components as the Committee shall determine.
Shares which may be issued upon the exercise of Options shall be applied to
reduce the maximum number of Shares remaining available for use under the
Plan. The Company shall at all times during the term of the Plan and while
any Options are outstanding retain as authorized and unissued Stock, or as
treasury Stock, at least the number of Shares from time to time required
under the provisions of the Plan, or otherwise assure itself of its ability
to perform its obligations hereunder.
THE FULL TEXT OF THE CURRENT EQUITY INCENTIVE PLAN
PRIOR TO APPROVAL OF THE AMENDMENT IS SET FORTH BELOW
CIBER, INC.
EQUITY INCENTIVE PLAN
(Amended and Restated as of May 4, 1998)
SECTION 1
INTRODUCTION
1.1 ESTABLISHMENT. CIBER, Inc. hereby amends and restates
the CIBER, Inc. Equity Incentive Plan (the "Plan") for certain officers,
employees and consultants of the Company.
1.2 PURPOSES. The purposes of the Plan are to provide the
officers, employees and consultants of the Company selected for participation
in the Plan with added incentives to continue in the long-term service of the
Company and to create in such persons a more direct interest in the future
success of the operations of the Company by relating incentive compensation
to increases in stockholder value, so that the income of such persons is more
closely aligned with the income of the Company's stockholders. The Plan is
also designed to enhance the ability of the Company to attract, retain and
motivate officers, employees and consultants by providing an opportunity for
investment in the Company.
SECTION 2
DEFINITIONS
2.1 DEFINITIONS. The following terms shall have the
meanings set forth below:
(a) "AFFILIATED CORPORATION" means (i) any
corporation or other entity (including but not limited to a partnership) that
directly, or through one or more intermediaries controls, is controlled by,
or is under common control with, CIBER, Inc., or (ii) any entity in which the
Company has a significant equity interest, as determined by the Committee.
(b) "AWARD" means a grant made under this Plan in
the form of Stock, Options, Restricted Stock, Performance Shares, or
Performance Units.
(c) "BOARD" means the Board of Directors of the
Company.
(d) "COMMITTEE" means (i) the Board, or (ii) one
or more committees of the Board to whom the Board has delegated all or part
of its authority under this Plan. Any committee under clause (ii) hereof
which makes grants to "officers" of the Company (as that term is defined in
Rule 16a-1(f) promulgated under the Exchange Act) shall be composed of not
less than the minimum number of persons from time to time required by
A-1
<PAGE>
Rule 16b~3, each of whom, to the extent necessary to comply with Rule 16b~3
only, shall be a "non~employee director" within the meaning of Rule
16b~3(b)(3)(i).
(e) "COMPANY" means CIBER, Inc., a Delaware
corporation, together with its Affiliated Corporations except where the
context otherwise requires.
(f) "EFFECTIVE DATE" means January 31, 1994.
(g) "ELIGIBLE EMPLOYEES" means full-time key
employees (including, without limitation, officers and directors who are also
employees) of the Company or any Affiliated Corporation or any division
thereof, upon whose judgment, initiative and efforts the Company is, or will
be, important to the successful conduct of its business.
(h) "EXCHANGE ACT" shall mean the Securities
Exchange Act of 1934, as amended.
(i) "FAIR MARKET VALUE" means, as of any date, the
value of the Stock determined as follows:
(i) If the Stock is listed on any
established stock exchange or a national market system, its Fair Market Value
shall be the closing sales price for such Stock (or the closing bid, if no
sales were reported) as quoted on such exchange or system for the last market
trading day prior to the time of determination, as reported in The Wall
Street Journal or such other source as the Committee deems reliable;
(ii) If the Stock is regularly quoted by a
recognized securities dealer but selling prices are not reported, the Fair
Market Value of a Share shall be the mean between the high bid and low asked
prices for the Stock on the last market trading day prior to the day of
determination, as reported in The Wall Street Journal or such other source as
the Committee deems reliable;
(iii) In the absence of an established
market for the Stock, the Fair Market Value shall be determined in good faith
by the Committee.
(j) "INCENTIVE STOCK OPTION" means any Option
designated as such and granted in accordance with the requirements of Section
422 of the Internal Revenue Code.
(k) "INTERNAL REVENUE CODE" means the Internal
Revenue Code of 1986, as it may be amended from time to time, and the rules
and regulations promulgated thereunder.
(l) "NON-STATUTORY OPTION" means any Option other
than an Incentive Stock Option.
(m) "OPTION" means a right to purchase Stock at a
stated price for a specified period of time.
(n) "OPTION PRICE" means the price at which shares
of Stock subject to an Option may be purchased, determined in accordance with
Section 7.2(b).
(o) "PARTICIPANT" means an Eligible Employee or
part-time employee of, or consultant to, the Company designated by the
Committee from time to time during the term of the Plan to receive one or
more Awards under the Plan.
(p) "PERFORMANCE CYCLE" means the period of time
as specified by the Committee over which Performance Share or Performance
Units are to be earned.
(q) "PERFORMANCE SHARES" means an Award made
pursuant to Section 9 which entitles a Participant to receive Shares, their
cash equivalent or a combination thereof based on the achievement of
performance targets during a Performance Cycle.
A-2
<PAGE>
(r) "PERFORMANCE UNITS" means an Award made
pursuant to Section 9 which entitles a Participant to receive cash, Stock or
a combination thereof based on the achievement of performance targets during
a Performance Cycle.
(s) "PLAN YEAR" means each 12~month period
beginning July 1 and ending the following June 30, except that for the first
year of the Plan it shall begin on the Effective Date and extend to June 30
of that year.
(t) "RESTRICTED STOCK" means Stock granted under
Section 8 that is subject to restrictions imposed pursuant to said Section.
(u) "RULE 16b~3" shall mean Rule 16b~3 as
promulgated by the Securities and Exchange Commission under the Exchange Act,
or any successor rule or regulation thereto as in effect from time to time.
(v) "SERVICE PROVIDER" means an employee of or
consultant to the Company.
(w) "SHARE" means a share of Stock.
(x) "STOCK" means the common stock, $.01 par
value, of the Company.
(y) GENDER AND NUMBER. Except when otherwise
indicated by the context, the masculine gender shall also include the
feminine gender, and the definition of any term herein in the singular shall
also include the plural.
SECTION 3
PLAN ADMINISTRATION
3.1 AUTHORITY OF COMMITTEE. The Plan shall be
administered by the Committee. Subject to the terms of the Plan and
applicable law, and in addition to other express powers and authorizations
conferred on the Committee by the Plan, the Committee shall have full power
and authority to: (i) designate Participants; (ii) determine the type or
types of Awards to be granted to eligible Participants; (iii) determine the
number of Shares to be covered by, or with respect to which payments, rights,
or other matters are to be calculated in connection with, Awards; (iv)
determine the terms and conditions of any Award; (v) determine whether, to
what extent, and under what circumstances Awards may be settled or exercised
in cash, Shares, other securities, other Awards or other property, or
canceled, forfeited, or suspended and the method or methods by which Awards
may be settled, exercised, canceled, forfeited, or suspended; (vi) determine
whether, to what extent, and under what circumstances cash, shares, other
securities, other Awards, other property, and other amounts payable with
respect to an Award shall be deferred either automatically or at the election
of the holder thereof or of the Committee; (vii) correct any defect, supply
any omission, reconcile any inconsistency and otherwise interpret and
administer the Plan and any instrument or agreement relating to the Plan or
any Award hereunder; (viii) establish, amend, suspend, or waive such rules
and regulations and appoint such agents as it shall deem appropriate for the
proper administration of the Plan; and (ix) make any other determination and
take any other action that the Committee deems necessary or desirable for the
administration of the Plan. To the extent necessary or appropriate, the
Committee may adopt sub-plans consistent with the Plan to conform to
applicable state or foreign securities or tax laws. A majority of the members
of the Committee may determine its actions and fix the time and place of its
meetings.
3.2 DETERMINATIONS UNDER THE PLAN. Unless otherwise
expressly provided in the Plan all designations, determinations,
interpretations, and other decisions under or with respect to the Plan or any
Award shall be within the sole discretion of the Committee, may be made at
any time and shall be final, conclusive, and binding upon all persons,
including the Company, any Affiliated Corporation, any Participant, any
holder or beneficiary of any Award, and any shareholder. No member of the
Committee shall be liable for any action, determination or interpretation
made in good faith, and all members of the Committee shall, in addition to
their rights as directors, be fully protected by the Company with respect to
any such action, determination or interpretation.
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SECTION 4
STOCK SUBJECT TO THE PLAN
4.1 NUMBER OF SHARES. Subject to adjustment as provided
in Section 4.3, 8,000,000 Shares are authorized for issuance under the Plan
in accordance with the provisions of the Plan and subject to such
restrictions or other provisions as the Committee may from time to time deem
necessary; provided, however, that no Participant may be granted Awards in
any one calendar year with respect to more than 1,000,000 Shares. The Shares
may be divided among the various Plan components as the Committee shall
determine. Shares which may be issued upon the exercise of Options shall be
applied to reduce the maximum number of Shares remaining available for use
under the Plan. The Company shall at all times during the term of the Plan
and while any Options are outstanding retain as authorized and unissued
Stock, or as treasury Stock, at least the number of Shares from time to time
required under the provisions of the Plan, or otherwise assure itself of its
ability to perform its obligations hereunder.
4.2 UNUSED AND FORFEITED STOCK. Any Shares that are
subject to an Award under this Plan which are not used because the terms and
conditions of the Award are not met, including any Shares that are subject to
an Option which expires or is terminated for any reason, any Shares which are
used for full or partial payment of the purchase price of Shares with respect
to which an Option is exercised and any Shares retained by the Company
pursuant to Section 15.2 shall automatically become available for use under
the Plan. Notwithstanding the foregoing, any Shares used for full or partial
payment of the purchase price of the Shares with respect to which an Option
is exercised and any Shares retained by the Company pursuant to Section 15.2
that were originally Incentive Stock Option Shares must still be considered
as having been granted for purposes of determining whether the Share
limitation provided for in Section 4.1 has been reached for purposes of
Incentive Stock Option grants.
4.3 ADJUSTMENTS FOR STOCK SPLIT, STOCK DIVIDEND, ETC. If
the Company shall at any time increase or decrease the number of its
outstanding Shares of Stock or change in any way the rights and privileges of
such Shares by means of the payment of a stock dividend or any other
distribution upon such Shares payable in Stock, or through a stock split,
subdivision, consolidation, combination, reclassification or recapitalization
involving the Stock, then in relation to the Stock that is affected by one or
more of the above events, the numbers, rights and privileges of (i) the
shares of Stock as to which Awards may be granted under the Plan, and (ii)
the Shares of Stock then included in each outstanding Option, Performance
Share or Performance Unit granted hereunder, shall be increased, decreased or
changed in like manner as if they had been issued and outstanding, fully paid
and nonassessable at the time of such occurrence.
4.4 DIVIDEND PAYABLE IN STOCK OF ANOTHER CORPORATION,
ETC. If the Company shall at any time pay or make any dividend or other
distribution upon the Stock payable in securities of another corporation or
other property (except money or Stock), a proportionate part of such
securities or other property shall be set aside and delivered to any
Participant then holding an Award for the particular type of Stock for which
the dividend or other distribution was made, upon exercise thereof in the
case of Options, and the vesting thereof in the case of other Awards. Prior
to the time that any such securities or other property are delivered to a
Participant in accordance with the foregoing, the Company shall be the owner
of such securities or other property and shall have the right to vote the
securities, receive any dividends payable on such securities, and in all
other respects shall be treated as the owner. If securities or other property
which have been set aside by the Company in accordance with this Section are
not delivered to a Participant because an Award is not exercised or otherwise
vested, then such securities or other property shall remain the property of
the Company and shall be dealt with by the Company as it shall determine in
its sole discretion.
4.5 OTHER CHANGES IN STOCK. In the event there shall be
any change, other than as specified in Sections 4.3 and 4.4, in the number or
kind of outstanding shares of Stock or of any stock or other securities into
which the Stock shall be changed or for which it shall have been exchanged,
and if the Committee shall in its discretion determine that such change
equitably requires an adjustment in the number or kind of Shares subject to
outstanding Awards or which have been reserved for issuance pursuant to the
Plan but are not then subject to an Award, then such adjustments shall be
made by the Committee and shall be effective for all purposes of the Plan and
on each outstanding Award that involves the particular type of stock for
which a change was effected.
4.6 RIGHTS TO SUBSCRIBE. If the Company shall at any time
grant to the holders of its Stock rights to subscribe pro rata for additional
shares thereof or for any other securities of the Company or of any other
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corporation, there shall be reserved with respect to the Shares then subject
to an Award held by any Participant of the particular class of Stock
involved, the Stock or other securities which the Participant would have been
entitled to subscribe for if immediately prior to such grant the Participant
had exercised his entire Option, or otherwise vested in his entire Award. If,
upon exercise of any such Option or the vesting of any other Award, the
Participant subscribes for the additional Stock or other securities, the
Participant shall pay to the Company the price that is payable by the
Participant for such Stock or other securities.
4.7 GENERAL ADJUSTMENT RULES. If any adjustment or
substitution provided for in this Section 4 shall result in the creation of a
fractional Share under any Award, the Company shall, in lieu of selling or
otherwise issuing such fractional Share, pay to the Participant a cash sum in
an amount equal to the product of such fraction multiplied by the Fair Market
Value of a Share on the date the fractional Share would otherwise have been
issued. In the case of any such substitution or adjustment affecting an
Option, the total Option Price for the shares of Stock then subject to an
Option shall remain unchanged but the Option Price per shall under each such
Option shall be equitably adjusted by the Committee to reflect the greater or
lesser number of shares of Stock or other securities into which the Stock
subject to the Option may have been changed.
4.8 DETERMINATION BY COMMITTEE, ETC. Adjustments under
this Section 4 shall be made by the Committee, whose determinations with
regard thereto shall be final and binding upon all persons.
SECTION 5
REORGANIZATION OR LIQUIDATION
In the event that the Company is merged or consolidated with
another corporation (other than a merger or consolidation in which the
Company is the continuing corporation and which does not result in any
reclassification or change of outstanding Shares), or if all or substantially
all of the assets or more than 50% of the outstanding voting stock of the
Company is acquired by any other corporation, business entity or person
(other than a sale or conveyance in which the Company continues as a holding
company of an entity or entities that conduct the business or businesses
formerly conducted by the Company), or in case of a reorganization (other
than a reorganization under the United States Bankruptcy Code) or liquidation
of the Company, and if the provisions of Section 10 do not apply, the
Committee, or the board of directors of any corporation assuming the
obligations of the Company, shall, have the power and discretion to prescribe
the terms and conditions for the exercise, or modification, of any
outstanding Awards granted hereunder. By way of illustration, and not by way
of limitation, the Committee may provide for the complete or partial
acceleration of the dates of exercise of the Options, or may provide that
such Options will be exchanged or converted into options to acquire
securities of the surviving or acquiring corporation, or may provide for a
payment or distribution in respect of outstanding Options (or the portion
thereof that is currently exercisable) in cancellation thereof. The Committee
may remove restrictions on Restricted Stock and may modify the performance
requirements for any other Awards. The Committee may provide that Stock or
other Awards granted hereunder must be exercised in connection with the
closing of such transaction, and that if not so exercised such Awards will
expire. Any such determinations by the Committee may be made generally with
respect to all Participants, or may be made on a case-by-case basis with
respect to particular Participants. The provisions of this Section 5 shall
not apply to any transaction undertaken for the purpose of reincorporating
the Company under the laws of another jurisdiction, if such transaction does
not materially affect the beneficial ownership of the Company's capital stock.
SECTION 6
PARTICIPATION
Participants in the Plan shall be those Eligible Employees,
part-time employees or consultants who, in the judgment of the Committee, are
performing, or during the term of their incentive arrangement will perform,
important services in the management, operation and development of the Company,
and significantly contribute, or are expected to significantly contribute, to
the achievement of long-term corporate economic objectives. Participants may be
granted from time to time one or more Awards; provided, however, that the grant
of each such Award shall be separately approved by the Committee, and receipt of
one such Award shall not result in automatic receipt of any other Award, written
notice shall be given to such person, specifying the terms, conditions, rights
and duties related thereto; and further provided that Incentive Stock Options
shall not be granted to (i) consultants, (ii) part-time employees or (iii)
Eligible Employees of any partnership or other entity which is included within
the definition of an Affiliated Corporation but whose employees are not
permitted to receive Incentive Stock
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Options under the Internal Revenue Code. Each Participant shall enter into an
agreement with the Company, in such form as the Committee shall determine and
which is consistent with the provisions of the Plan, specifying such terms,
conditions, rights and duties. Awards shall be deemed to be granted as of the
date specified in the grant resolution of the Committee, which date shall be
the date of any related agreement with the Participant. In the event of any
inconsistency between the provisions of the Plan and any such agreement
entered into hereunder, the provisions of the Plan shall govern.
SECTION 7
STOCK OPTIONS
7.1 GRANT OF OPTIONS. Coincident with or following
designation for participation in the Plan, a Participant may be granted one
or more Options. The Committee in its sole discretion shall designated
whether an Option is to be considered an Incentive Stock Option or a
Non-Statutory Option. The Committee may grant both an Incentive Stock Option
and a Non-Statutory Option to the same Participant at the same time or at
different times. Incentive Stock Options and Non-Statutory Options, whether
granted at the same or different times, shall be deemed to have been awarded
in separate grants, shall be clearly identified, and in no event shall the
exercise of one Option affect the right to exercise any other Option or
affect the number of Shares for which any other Option may be exercised.
7.2 OPTION AGREEMENTS. Each Option granted under the Plan
shall be evidenced by a written stock option agreement which shall be entered
into by the Company and the Participant to whom the Option is granted (the
"Option Holder"), and which shall contain the following terms and conditions,
as well as such other terms and conditions not inconsistent therewith, as the
Committee may consider appropriate in each case.
(a) NUMBER OF SHARES. Each stock option agreement
shall state that it covers a specified number of Shares, as determined by the
Committee. To the extent that the aggregate Fair Market Value of Shares with
respect to which Options designated as Incentive Stock Options are
exercisable for the first time by any Participant during any year (under all
plans of the Company and any Affiliated Corporation) exceeds $100,000, such
Options shall be treated as not being Incentive Stock Options. The foregoing
shall be applied by taking Options into account in the order in which they
were granted. For the purposes of the foregoing, the Fair Market Value of any
Share shall be determined as of the time the Option with respect to such
Share is granted. In the event the foregoing results in a portion of an
Option designated as an Incentive Stock Option exceeding the $100,000
limitation, only such excess shall be treated as not being an Incentive Stock
Option.
(b) PRICE. The price at which each Share covered
by an Option may be purchased shall be determined in each case by the
Committee and set forth in the stock option agreement, but in no event shall
the Option Price for each Share covered by an Incentive Stock Option be less
than the Fair Market Value of the Stock on the date the Option is granted;
provided, however, that the Option Price for each Share covered by a
Non-Statutory Option may be granted at any price less than Fair Market Value,
in the sole discretion of the Committee; and provided further that the Option
Price for each Share covered by an Incentive Stock Option granted to an
Eligible Employee who then owns stock possessing more than 10% of the total
combined voting power of all classes of stock of the Company or any parent or
subsidiary corporation of the Company must be at least 110% of the Fair
Market Value of the Stock subject to the Incentive Stock Option on the date
the Option is granted.
(c) DURATION OF OPTIONS. Each stock option
agreement shall state the period of time, determined by the Committee, within
which the Option may be exercised by the Option Holder (the "Option Period").
The Option Period must expire, in all cases, not more than ten years from the
date an Option is granted; provided, however, that the Option Period of an
Incentive Stock Option granted to an Eligible Employee who then owns stock
possessing more than 10% of the total combined voting power of all classes of
stock of the Company or any parent or subsidiary corporation of the Company
must expire not more than five years from the date such an Option is granted.
Each stock option agreement shall also state the periods of time, if any, as
determined by the Committee, when incremental portions of each Option shall
vest. If any Option is not exercised during its Option Period, it shall be
deemed to have been forfeited and or no further force or effect.
(d) TERMINATION OF SERVICE, DEATH, DISABILITY,
ETC. Except as otherwise determined by the Committee, each stock option
agreement shall provide as follows with respect to the exercise of the Option
upon an Option Holder ceasing to be a Service Provider or on the death or
disability of the Option Holder:
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(i) If the Option Holder ceases to be a
Service Provider within the Option Period for cause, as determined by the
Company, the Option shall thereafter be void for all purposes. As used in
this Section 7.2(d), "cause" shall mean a gross violation, as determined by
the Company, of the Company's established policies and procedures. The effect
of this Section 7.2(d)(i) shall be limited to determining the consequences of
a termination, and nothing in this Section 7.2(d)(i) shall restrict or
otherwise interfere with the Company's discretion with respect to the
termination of any Service Provider.
(ii) If the Option Holder ceases to be a
Service Provider with the Company in a manner determined by the Board, in its
sole discretion, to constitute retirement (which determination shall be
communicated to the Option Holder within 10 days of such termination), the
Option may be exercised by the Option Holder, or in the case of death by the
persons specified in clause (iii) of this Section 7.2(d), within three months
following his or her retirement if the Option is an Incentive Stock Option or
within twelve months following his or her retirement if the Option is a
Non-Statutory Stock Option (provided in each case that such exercise must
occur within the Option Period), but not thereafter. In any such case, the
Option may be exercised only as to the Shares as to which the Option had
become exercisable on or before the date the Option Holder ceases to be a
Service Provider.
(iii) If the Option Holder dies (A) while he
or she is a Service Provider, (B) within the three-month period referred to
in clause (v) below, or (C) within the three or twelve-month period referred
to in clause (ii) above, the Option may be exercised by those entitled to do
so under the Option Holder's will or by the laws of descent and distribution
within twelve months following the Option Holder's death (provided that such
exercise must occur within the Option Period), but not thereafter. In any
such case, the Option may be exercised only as to the Shares as to which the
Option had become exercisable on or before the date of the Option Holder's
death or at such time as the Option Holder ceased to be a Service Provider,
whichever is earlier.
(iv) If the Option Holder becomes disabled
(within the meaning of Section 22(e) of the Internal Revenue Code) while a
Service Provider, Incentive Stock Options held by the Option Holder may be
exercised by the Option Holder within twelve months following the date the
Option Holder ceases to be a Service Provider (provided that such exercise
must occur within the Option Period), but not thereafter. If the Option
Holder becomes disabled (within the meaning of Section 22(e) of the Internal
Revenue Code) while a Service Provider or within three-month period referred
to in clause (v) below or within the twelve month period following his or her
retirement as provided in clause (ii) above, Non-Statutory Options held by
the Option Holder may be exercised by the Option Holder within twelve months
following the date of the Option Holder's disability (provided that such
exercise must occur within the Option Period), but not thereafter. In any
such case, the Option may be exercised only as to the Shares as to which the
Option had become exercisable on or before the date the Option Holder ceased
to be a Service Provider.
(v) If the Option Holder ceases to be a
Service Provider (which for this purpose means that the Option Holder is no
longer employed by or consulting with the Company or an Affiliated
Corporation) within the Option Period for any reason other than cause,
retirement as provided in clause (ii) above, disability as provided in clause
(iv) above or the Option Holder's death, the Option may be exercised by the
Option Holder within three months following the date of such cessation
(provided that such exercise must occur within the Option Period), but not
thereafter. In any such case, the Option may be exercised only as to the
Shares as to which the Option had become exercisable on or before the date
that the Option Holder ceases to be a Service Provider.
(e) TRANSFERABILITY. Except as otherwise determined by the
Committee, Options shall not be transferable by the Option Holder except by
will or pursuant to the laws of descent and distribution or pursuant to a
"qualified domestic relations order" as defined by the Internal Revenue Code
or Title I of the Employee Retirement Income Security Act of 1974 ("ERISA");
each Option shall be exercisable during the Option Holder's lifetime only by
him or her, or in the event of disability or incapacity, by his or her
guardian or legal representative; and Shares issuable pursuant to any Option
shall be delivered only to or for the account of the Option Holder, or in the
event of disability or incapacity, by his or her guardian or legal
representative.
(f) EXERCISE, PAYMENTS, ETC.
(i) Each stock option agreement shall provide that
the method for exercising the Option granted therein shall be by delivery to
the Corporate Secretary of the Company of written notice specifying the
number of Shares with respect to which such Option is exercised (which must
be in a minimum amount of 25
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Shares) and payment of the Option Price. Such notice shall be in a form
satisfactory to the Committee and shall specify the particular Option (or
portion thereof) which is being exercised and the number of Shares with
respect to which the Option is being exercised. The exercise of the Option
shall be deemed effective upon receipt of such notice by the Corporate
Secretary and payment to the Company. The purchase of such Stock shall take
place at the principal offices of the Company upon delivery of such notice,
at which time the purchase price of the Stock shall be paid in full by any of
the methods or any combination of the methods set forth in (ii) below. A
properly executed certificate or certificates representing the Stock shall be
issued by the Company and delivered to the Option Holder. If certificates
representing Stock are used to pay all or part of the Option Price, separate
certificates for the same number of shares of Stock shall be issued by the
Company and delivered to the Option Holder representing each certificate used
to pay the Option Price, and an additional certificate shall be issued by the
Company and delivered to the Option Holder representing the additional
shares, in excess of the Option Price, to which the Option Holder is entitled
as a result of the exercise of the Option.
(ii) The exercise price shall be paid by any of the
following methods or any combination of the following methods:
(A) in cash;
(B) by cashier's check payable to the order
of the Company;
(C) by delivery to the Company of
certificates representing the number of Shares then owned by the Option
Holder, the Fair Market Value of which equals the purchase price of the Stock
purchased pursuant to the Option, properly endorsed for transfer to the
Company; provided however, that Shares used for this purpose must have been
held by the Option Holder for such minimum period of time as may be
established from time to time by the Committee; and provided further that the
Fair Market Value of any Shares delivered in payment of the purchase price
upon exercise of the Option shall be the Fair Market Value as of the exercise
date, which shall be the date of delivery of the certificates for the Stock
used as payment of the Option Price; or
(D) by delivery to the Company of a
properly executed notice of exercise together with irrevocable instructions
to a broker to deliver to the Company promptly the amount of the proceeds of
the sale of all or a portion of the Stock or of a loan from the broker to the
Option Holder necessary to pay the exercise price.
(iii) In the discretion of the Committee, the Company
may guaranty a third-party loan obtained by a Participant to pay part or all of
the Option Price of the Shares provided that such loan or the Company's
guaranty is secured by the Shares.
(g) DATE OF GRANT. An option shall be considered as having
been granted on the date specified in the grant resolution of the Committee.
(h) WITHHOLDING.
(A) NON-STATUTORY OPTIONS. Each stock option
agreement covering Non-Statutory Options shall provide that, upon exercise of
the Option, the Option Holder shall make appropriate arrangements with the
Company to provide for the amount of additional withholding required by
applicable federal and state income tax laws, including payment of such taxes
through delivery of Stock or by withholding Stock to be issued under the
Option, as provided in Section 15.
(B) INCENTIVE OPTIONS. In the event that a
Participant makes a disposition (as defined in Section 424(c) of the Internal
Revenue Code) of any Stock acquired pursuant to the exercise of an Incentive
Stock Option prior to the later of (i) the expiration of two years from the
date on which the Incentive Stock Option was granted or (ii) the expiration
of one year from the date on which the Option was exercised, the Participant
shall send written notice to the Company at its principal office in Denver,
Colorado (Attention: Corporate Secretary) of the date of such disposition,
the number of shares disposed of, the amount of proceeds received from such
disposition, and any other information relating to such disposition as the
Company may reasonably request. The Participant shall, in the event of such a
disposition, make appropriate arrangements with the Company to provide for
the amount of additional withholding, if any, required by applicable federal
and state income tax laws.
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(i) ADJUSTMENT OF OPTIONS. Subject to the
limitations contained in Sections 7 and 14, the Committee may make any
adjustment in the Option Price, the number of shares subject to, or the terms
of, an outstanding Option and a subsequent granting of an Option by amendment
or by substitution of an outstanding Option. Such amendment, substitution, or
re-grant may result in terms and conditions (including Option Price, number
of shares covered, vesting schedule or exercise period) that differ from the
terms and conditions of the original Option. The Committee may not, however,
adversely affect the rights of any Participant to previously granted Options
without the consent of such Participant. If such action is affected by
amendment, the effective date of such amendment shall be the date of the
original grant.
7.3 STOCKHOLDER PRIVILEGES. No Option Holder shall have
any rights as a stockholder with respect to any Shares covered by an Option
until the Option Holder becomes the holder of record of such Stock, and no
adjustments shall be made for dividends or other distributions or other
rights as to which there is a record date preceding the date such Option
Holder becomes the holder of record of such Stock, except as provided in
Section 4.
SECTION 8
RESTRICTED STOCK AWARDS
8.1 AWARDS GRANTED BY COMMITTEE. Coincident with or
following designation for participation in the Plan, a Participant may be
granted one or more Restricted Stock Awards consisting of Shares. The number
of Shares granted as a Restricted Stock Award shall be determined by the
Committee.
8.2 RESTRICTIONS. A Participant's right to retain a
Restricted Stock Award granted to him under Section 8.1 shall be subject to
such restrictions, including but not limited to his continuing to perform as
a Service Provider for a restriction period specified by the Committee, or
the attainment of specified performance goals and objectives, as may be
established by the Committee with respect to such Award. The Committee may in
its sole discretion require different periods of service or different
performance goals and objectives with respect to (i) different Participants,
(ii) different Restricted Stock Awards, or (iii) separate, designated
portions of the Shares constituting a Restricted Stock Award.
8.3 PRIVILEGES OF A STOCKHOLDER, TRANSFERABILITY. A
Participant shall have all voting, dividend, liquidation and other rights
with respect to Stock in accordance with its terms received by him as a
Restricted Stock Award under this Section 8 upon his becoming the holder of
record of such Stock; provided, however, that the Participant's right to
sell, encumber or otherwise transfer such Stock shall be subject to the
limitations of Section 11.2 hereof.
8.4 ENFORCEMENT OF RESTRICTIONS. The Committee may in its
sole discretion require one or more of the following methods of enforcing the
restrictions referred to in Section 8.2 and 8.3:
(a) placing a legend on the stock certificates
referring to the restrictions;
(b) requiring the Participant to keep the stock
certificates, duly endorsed, in the custody of the Company while the
restrictions remain in effect; or
(c) requiring that the stock certificates, duly
endorsed, be held in the custody of a third party while the restrictions
remain in effect.
8.5 TERMINATION OF SERVICE, DEATH, DISABILITY, ETC. In the
event of the death or disability (within the meaning of Section 22(e) of the
Internal Revenue Code) of a Participant, or the retirement of a Participant
as provided in Section 7.2(d)(ii), all service period and other restrictions
applicable to Restricted Stock Awards then held by him shall lapse, and such
Awards shall become fully nonforfeitable. Subject to Sections 5 and 10, in
the event a Participant ceases to be a Service Provider for any other reason,
any Restricted Stock Awards as to which the service period or other
restrictions have not been satisfied shall be forfeited.
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SECTION 9
PERFORMANCE SHARES AND PERFORMANCE UNITS
9.1 AWARDS GRANTED BY COMMITTEE. Coincident with or
following designation for participation in the Plan, a Participant may be
granted Performance Shares or Performance Units.
9.2 AMOUNT OF AWARD. The Committee shall establish a
maximum amount of a Participant's Award, which amount shall be denominated in
Shares in the case of Performance Shares or in dollars in the case of
Performance Units.
9.3 COMMUNICATION OF AWARD. Written notice of the maximum
amount of a Participant's Award and the Performance Cycle determined by the
Committee shall be given to a Participant as soon as practicable after
approval of the Award by the Committee.
9.4 AMOUNT OF AWARD PAYABLE. The Committee shall
establish maximum and minimum performance targets to be achieved during the
applicable Performance Cycle. Performance targets established by the
Committee shall relate to corporate, group, unit or individual performance
and may be established in terms of earnings, growth in earnings, ratios of
earnings to equity or assets, or such other measures or standards determined
by the Committee. Multiple performance targets may be used and the components
of multiple performance targets may be given the same or different weighting
in determining the amount of an Award earned, and may relate to absolute
performance or relative performance measured against other groups, units,
individuals or entities. Achievement of the maximum performance target shall
entitle the Participant to payment (subject to Section 9.6) at the full or
maximum amount specified with respect to the Award; provided, however, that
notwithstanding any other provisions of this Plan, in the case of an Award of
Performance Shares the Committee in its discretion may establish an upper
limit on the amount payable (whether in cash or Stock) as a result of the
achievement of the maximum performance target. The Committee may also
establish that a portion of a full or maximum amount of a Participant's Award
will be paid (subject to Section 9.6) for performance which exceeds the
minimum performance target but falls below the maximum performance target
applicable to such Award.
9.5 ADJUSTMENTS. At any time prior to payment of a
Performance Share or Performance Unit Award, the Committee may adjust
previously established performance targets or other terms and conditions to
reflect events such as changes in laws, regulations, or accounting practice,
or mergers, acquisitions or divestitures.
9.6 PAYMENTS OF AWARDS. Following the conclusion of each
Performance Cycle, the Committee shall determine the extent to which
performance targets have been attained, and the satisfaction of any other
terms and conditions with respect to an Award relating to such Performance
Cycle. The Committee shall determine what, if any, payment is due with
respect to an Award and whether such payment shall be made in cash, Stock or
some combination. Payment shall be made in a lump sum or installments, as
determined by the Committee, commencing as promptly as practicable following
the end of the applicable Performance Cycle, subject to such terms and
conditions and in such form as may be prescribed by the Committee.
9.7 TERMINATION OF EMPLOYMENT. If a Participant ceases to
be a Service Provider before the end of a Performance Cycle by reason of his
death, disability as provided in Section 7.2(d)(iv), or retirement as
provided in Section 7.2(d)(ii), the Performance Cycle for such Participant
for the purpose of determining the amount of the Award payable shall end at
the end of the calendar quarter immediately preceding the date on which such
Participant ceased to be a Service Provider. The amount of an Award payable
to a Participant to whom the preceding sentence is applicable shall be paid
at the end of the Performance Cycle and shall be that fraction of the Award
computed pursuant to the preceding sentence the numerator of which is the
number of calendar quarters during the Performance Cycle during all of which
said Participant was a Service Provider and the denominator of which is the
number of full calendar quarters in the Performance Cycle. Upon any other
termination of Participant's services as a Service Provider during a
Performance Cycle, participation in the Plan shall cease and all outstanding
Awards of Performance Shares or Performance Units to such Participant shall
be canceled.
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SECTION 10
CHANGE IN CONTROL
10.1 OPTIONS, RESTRICTED STOCK. In the event of a change
in control of the Company as defined in Section 10.3, then the Committee may,
in its sole discretion, without obtaining stockholder approval, to the extent
permitted in Section 14, take any or all of the following actions: (a)
accelerate the exercise dates of any outstanding Options or make all such
Options fully vested and exercisable; (b) grant a cash bonus award to any
Option Holder in an amount necessary to pay the Option Price of all or any
portion of the Options then held by such Option Holder; (c) pay cash to any
or all Option Holders in exchange for the cancellation of their outstanding
Options in an amount equal to the different between the Option Price of such
Options and the greater of the tender offer price for the underlying Stock or
the Fair Market Value of the Stock on the date of the cancellation of the
Options; (d) make any other adjustments or amendments to the outstanding
Options; and (e) eliminate all restrictions with respect to Restricted Stock
and deliver Shares free of restrictive legends to any Participant.
10.2 PERFORMANCE SHARES AND PERFORMANCE UNITS. Under the
circumstances described in Section 10.1, the Committee may, in its sole
discretion, and without obtaining stockholder approval, to the extent
permitted in Section 14, provide for payment of outstanding Performance
Shares and Performance Units at the maximum award level or any percentage
thereof.
10.3 DEFINITION. For purposes of the Plan, a "change in
control" shall be deemed to have occurred if: (a) any "person" or "group"
(within the meaning of Sections 13(d) and 14(d)(2) of the Exchange Act),
other than a trustee or other fiduciary holding securities under an employee
benefit plan of the Company or under a trust, the grantor of which is Bobby
G. Stevenson, or Bobby G. Stevenson, is or becomes the "beneficial owner" (as
defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of
more than 33% of the then outstanding voting stock of the Company; or (b) at
any time during any period of three consecutive years (not including any
period prior to the Effective Date), individuals who at the beginning of such
period constitute the Board (and any new director whose election by the Board
or whose nomination for election by the Company's stockholders was approved
by a vote of at least two-thirds of the directors then still in office who
either were directors at the beginning of such period or whose election or
nomination for election was previously so approved) cease for any reason to
constitute a majority thereof; or (c) the stockholders of the Company approve
a merger or consolidation of the Company with any other corporation, other
than 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) at least 80% of the combined voting power of the
voting securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation, or the stockholders 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.
SECTION 11
RIGHTS OF EMPLOYEES; PARTICIPANTS
11.1 EMPLOYMENT. Nothing contained in the Plan or in any
Award granted under the Plan shall confer upon any Participant any right with
respect to the continuation of his or her services as a Service Provider, or
interfere in any way with the right of the Company, subject to the terms of
any separate employment or consulting agreement to the contrary, at any time
to terminate such services or to increase or decrease the compensation of the
Participant from the rate in existence at the time of the grant of an Award.
Whether an authorized leave of absence, or absence in military or government
service, shall constitute a termination of Participant's services as a
Service Provider shall be determined by the Committee at the time.
11.2 NONTRANSFERABILITY. Except as provided in Section
11.3, no right or interest of any Participant in an Award granted pursuant to
the Plan shall be assignable or transferable during the lifetime of the
Participant except pursuant to a "qualified domestic relations order" as
defined by the Internal Revenue Code or Title I of ERISA, either voluntarily
or involuntarily, or be subjected to any lien, directly or indirectly, by
operation of law, or otherwise, including execution, levy, garnishment,
attachment, pledge or bankruptcy. In the event or a Participant's death, a
Participant's rights and interests in Options shall, to the extent provided
in Section 7, be transferable by testamentary will or the laws of descent and
distribution, and payment of any amounts due under the Plan shall be made to,
and exercise of any Options may be made by, the Participant's legal
representatives, heirs or legatees. If, in the opinion of the Committee, a
person entitled to payments or to exercise rights with respect to the
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Plan is disabled from caring for his affairs because of mental condition,
physical condition or age, payment due such person may be made to, and such
rights shall be exercised by, such person's guardian, conservator or other
legal personal representative upon furnishing the Committee with evidence
satisfactory to the Committee of such status. Transfers shall not be deemed
to include transfers to the Company or "cashless exercise" procedures with
third parties who provide financing for the purpose of (or who otherwise
facilitate) the exercise of Awards consistent with applicable laws and the
authorization of the Committee.
11.3 PERMITTED TRANSFERS. Pursuant to conditions and
procedures established by the Committee from time to time, the Committee may
permit Awards to be transferred to, exercised by and paid to certain persons
or entities related to a Participant, including but not limited to members of
the Participant's immediate family, charitable institutions, or trusts or
other entities whose beneficiaries or beneficial owners are members of the
Participant's immediate family and/or charitable institutions. In the case of
initial Awards, at the request of the Participant, the Committee may permit
the naming of the related person or entity as the Award recipient. Any
permitted transfer shall be subject to the condition that the Committee
receive evidence satisfactory to it that the transfer is being made for
estate and/or tax planning purposes on a gratuitous or donative basis and
without consideration (other than nominal consideration). Notwithstanding the
foregoing, Incentive Stock Options shall only be transferable to the extent
permitted by Section 422 of the Internal Revenue Code and the treasury
regulations thereunder.
SECTION 12
GENERAL RESTRICTIONS
12.1 INVESTMENT REPRESENTATIONS. The Company may require
any person to whom an Option or other Award is granted, as a condition of
exercising such Option or receiving Stock under the Award, to give written
assurances in substance and form satisfactory to the Company and its counsel
to the effect that such person is acquiring the Stock subject to the Option
or the Award for his own account for investment and not with any present
intention or selling or otherwise distributing the same, and to such other
effects as the Company deems necessary or appropriate in order to comply with
federal and applicable state securities laws. Legends evidencing such
restrictions may be placed on the certificates evidencing the Stock.
12.2 COMPLIANCE WITH SECURITIES LAWS. Each Award shall be
subject to the requirement that, if at any time counsel to the Company shall
determine that the listing, registration or qualification of the Shares
subject to such Award upon any securities exchange or under any state or
federal law, or the consent or approval of any governmental or regulatory
body, is necessary as a condition of, or in connection with, the issuance or
purchase of Shares thereunder, such Award may not be accepted or exercised in
whole or in part unless such listing, registration, qualification, consent or
approval shall have been effected or obtained on conditions acceptable to the
Committee. Nothing herein shall be deemed to require the Company to apply for
or to obtain such listing, registration or qualification.
12.3 STOCK RESTRICTION AGREEMENT. The Committee may
provide that shares of Stock issuable upon the exercise of an Option shall,
under certain conditions, be subject to restrictions whereby the Company has
a right of first refusal with respect to such shares or a right or obligation
to repurchase all or a portion of such shares, which restrictions may survive
a Participant's cessation or termination as a Service Provider.
SECTION 13
OTHER EMPLOYEE BENEFITS
The amount of any compensation deemed to be received by a
Participant as a result of the exercise of an Option or the grant or vesting
of any other Award shall not constitute "earnings" with respect to which any
other benefits of such Participant are determined, including without
limitation benefits under any pension, profit sharing, life insurance or
salary continuation plan.
SECTION 14
PLAN AMENDMENT, MODIFICATION AND TERMINATION
The Board may at any time terminate, and from time-to-time may
amend or modify, the Plan; provided, however, that no amendment or
modification may become effective without approval of the amendment or
modification by the stockholders if stockholder approval is required to
enable the Plan to satisfy any applicable
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statutory or regulatory requirements, or if the Company, on the advice of
counsel, determines that stockholder approval is otherwise necessary or
desirable.
No amendment, modification or termination of the Plan shall in
any manner adversely affect any Awards theretofore granted under the Plan,
without the consent of the Participant holding such Awards.
SECTION 15
WITHHOLDING
15.1 WITHHOLDING REQUIREMENT. The Company's obligations to
deliver Shares upon the exercise of an Option, or upon the vesting of any
other Award, shall be subject to the Participant's satisfaction of all
applicable federal, state and local income and other tax withholding
requirements.
15.2 WITHHOLDING WITH STOCK. At the time the Committee
grants an Award, it may, in its sole discretion, grant the Participant an
election to pay all such amounts of tax withholding, or any part thereof, by
electing to transfer to the Company, or to have the Company withhold from
Shares otherwise issuable to the Participant, Shares having a value equal to
the amount required to be withheld or such lesser amount as may be elected by
the Participant. All elections shall be subject to the approval or
disapproval of the Committee. The value of Shares to be withheld shall be
based on the Fair Market Value of the Stock on the date that the amount of
tax to be withheld is to be determined (the "Tax Date"). Any such elections
by Participants to have Shares withheld for this purpose will be subject to
the following restrictions:
(a) All elections must be made prior to the Tax Date;
(b) All elections shall be irrevocable; and
(c) If the Participant is an officer or director of the
Company within the meaning of Section 16 of the Exchange Act ("Section 16"),
the Participant must satisfy the requirements of such Section 16 and any
applicable rules thereunder with respect to the use of Stock to satisfy such
tax withholding obligation.
SECTION 16
SECTION 162(m) PROVISIONS
16.1 LIMITATIONS. Notwithstanding any other provision of
this Plan, if the Committee determines at the time any Restricted Stock Award
or Performance Award is granted to a Participant that such Participant is, or
is likely to be at the time he or she recognizes income for federal income
tax purposes in connection with such Award, a Covered Employee (within the
meaning of Section 162(m)(3) of the Internal Revenue Code), then the
Committee may provide that this Section 16 is applicable to such Award.
16.2 PERFORMANCE GOALS. If an Award is subject to this
Section 16, then the lapsing of restrictions thereon and the distribution of
cash, Shares or other property pursuant thereto, as applicable, shall be
subject to the achievement of one or more objective performance goals
established by the Committee, which shall be based on the attainment of one
or any combination of the following: specified levels of earnings per share
from continuing operations, operating income, revenues, gross margin, return
on operating assets, return on equity, economic value added, stock price
appreciation, total stockholder return (measured in terms of stock price
appreciation and dividend growth), or cost control, of the Company or
Affiliated Corporation (or any division thereof) for or within which the
Participant is primarily employed. Such performance goals also may be based
upon the attaining specified levels of Company performance under one or more
of the measures described above relative to the performance of other
corporations. Such performance goals shall be set by the Committee within the
time period prescribed by, and shall otherwise comply with the requirements
of, Section 162(m) of the Internal Revenue Code and the regulations
thereunder.
16.3 ADJUSTMENTS. Notwithstanding any provision of the
Plan other than Section 10, with respect to any Award that is subject to this
Section 16, the Committee may not adjust upwards the amount payable pursuant
to such Award, nor may it waive the achievement of the applicable performance
goals except in the case of the death or disability of the Participant.
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<PAGE>
16.4 OTHER RESTRICTIONS. The Committee shall have the
power to impose such other restrictions on Awards subject to this Section 16
as it may deem necessary or appropriate to ensure that such Awards satisfy
all requirements for "performance-based compensation" within the meaning of
Section 162(m)(4)(B) of the Internal Revenue Code or any successor thereto.
SECTION 17
BROKERAGE ARRANGEMENTS
The Committee, in its discretion, may enter into arrangements
with one or more banks, brokers or other financial institutions to facilitate
the disposition of shares acquired upon exercise of Stock Options, including,
without limitation, arrangements for the simultaneous exercise of Stock
Options and sale of the Shares acquired upon such exercise.
SECTION 18
NONEXCLUSIVITY OF THE PLAN
Neither the adoption of the Plan by the Board nor the
submission of the Plan to stockholders of the Company for approval shall be
construed as creating any limitations on the power or authority of the Board
to adopt such other or additional incentive or other compensation
arrangements of whatever nature as the Board may deem necessary or desirable
or preclude or limit the continuation of any other plan, practice or
arrangement for the payment of compensation or fringe benefits to employees
or consultants generally, or to any class or group of employees or
consultants, which the Company or any Affiliated Corporation now has lawfully
put into effect, including, without limitation, any retirement, pension,
savings and stock purchase plan, insurance, death and disability benefits and
executive short-term incentive plans.
SECTION 19
REQUIREMENTS OF LAW
19.1 REQUIREMENTS OF LAW. The issuance of Stock and the
payment of cash pursuant to the Plan shall be subject to all applicable laws,
rules and regulations.
19.2 RULE 16b-3. Transactions under the Plan and within
the scope of Rule 16b-3 are intended to comply with all applicable conditions
of Rule 16b~3. To the extent any provision of the Plan or any action by the
Committee under the Plan fails to so comply, such provision or action shall,
without further action by any person, be deemed to be automatically amended
to the extent necessary to effect compliance with Rule 16b~3; provided,
however, that if such provision or action cannot be amended to effect such
compliance, such provision or action shall be deemed null and void to the
extent permitted by law and deemed advisable by the Committee.
19.3 GOVERNING LAW. The Plan and all agreements hereunder
shall be construed in accordance with and governed by the laws of the State
of Delaware.
SECTION 20
DURATION OF THE PLAN
No Award shall be granted under the Plan after ten years from
the Effective Date; provided, however, that any Award theretofore granted
may, and the authority of the Board or the Committee to amend, alter, adjust,
suspend, discontinue, or terminate any such Award or to waive any conditions
or rights under any such Award shall, extend beyond such date.
Dated: May 4, 1998.
CIBER, Inc.
By: /s/ Mac J. Slingerlend
---------------------------------------------
Mac J. Slingerlend
President and Chief Executive Officer
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[LOGO]
CIBER, INC., 5251 DTC PARKWAY, SUITE 1400 ENGLEWOOD, COLORADO 80111
The undersigned hereby appoints Bobby G. Stevenson and Mac J. Slingerlend, or
either of them, with full power of substitution, as attorneys-in-fact, agents
and proxies (the "Proxies") to vote on behalf of the undersigned all shares of
common stock, $.01 par value, of CIBER, Inc. (the "Company"), that the
undersigned is entitled to vote at the 1999 Annual Meeting of Shareholders (the
"Meeting"), to be held at Glenmoor Country Club, 110 Glenmoor Drive, Cherry
Hills Village, Colorado, on Thursday, October 28, 1999, at 10:00 a.m. (local
time), and at any and all adjournments or postponements thereof, as follows:
1. The election of the following nominees for Class II directors: Mac J.
Slingerlend, James A. Rutherford and Paul E. Rudolph.
/ / FOR / / WITHHOLD
INSTRUCTIONS: To withhold your vote for any individual nominee, mark FOR
above and strike out the nominee's or nominees' name(s).
2. The amendment to the Company's Certificate of Incorporation to increase the
number of authorized shares of Common Stock from 80,000,000 to 100,000,000
shares.
/ / FOR / / AGAINST / / ABSTAIN
3. The increase in number of shares of Common Stock reserved for issuance
pursuant to the Company's Equity Incentive Plan from 8,000,000 to
10,500,000 shares.
/ / FOR / / AGAINST / / ABSTAIN
4. In their discretion, such Proxies are authorized to vote upon such other
business as may properly come before the Meeting or any adjournments or
postponements thereof.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ALL OF THE ABOVE
LISTED PROPOSITIONS.
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE SPECIFIED, THIS
PROXY WILL BE VOTED FOR EACH OF THE PROPOSITIONS STATED. IF ANY OTHER BUSINESS
IS PRESENTED AT SUCH MEETING, THIS PROXY WILL BE VOTED BY THE PROXIES IN THEIR
BEST JUDGMENT. AT THE PRESENT TIME, THE BOARD OF DIRECTORS KNOWS OF NO OTHER
BUSINESS TO BE PRESENTED AT THE MEETING. THIS PROXY IS SOLICITED BY THE BOARD OF
DIRECTORS.
Should the undersigned be present and elect to vote at the Meeting, or at any
adjournments or postponements thereof, and after notification to the
Secretary of the Company at the Meeting of the shareholder's decision to
terminate this proxy, the power of the Proxies shall be deemed terminated and
of no further force and effect. The undersigned may also revoke this proxy by
filing a subsequently dated proxy or by notifying the Secretary of the
Company of his or her decision to terminate this proxy prior to the final
tabulation of the votes. The undersigned acknowledges receipt from the
Company prior to the execution of this proxy of the Notice of the Meeting and
a Proxy Statement.
Dated: ___________________________, 1999
----------------------------------------
----------------------------------------
Please sign exactly as your name appears
on this Proxy card.
When signing as attorney, executor,
administrator, agent, trustee or
guardian, please give your full title.
If shares are held jointly, each holder
should sign. If signing on behalf of a
corporation, the full corporate name
should be indicated and an authorized
corporate officer should sign.
PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY PROMPTLY
IN THE ENCLOSED POSTAGE PREPAID ENVELOPE.
