<PAGE>
As filed with the Securities and Exchange Commission on July 16, 1999
Registration No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------
AMX CORPORATION
(Exact name of Registrant as specified in its charter)
TEXAS 75-1815822
(State of other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
11995 FORESTGATE DRIVE
DALLAS, TEXAS 75243
(Address, including zip code, of principal executive offices)
---------------
AMX CORPORATION
1999 EQUITY INCENTIVE PLAN
(Full title of the plan)
---------------
JOE HARDT
PRESIDENT AND CHIEF EXECUTIVE OFFICER
AMX CORPORATION
11995 FORESTGATE DRIVE
DALLAS, TEXAS 75243
(Name and address of agent for service)
(972) 644-3048
(Telephone number, including area code, of agent for service)
---------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
============================== ============== ======================== ========================== ====================
<S> <C> <C> <C> <C>
Title of securities to be Amount to be Proposed maximum Proposed maximum Amount of
registered registered offering aggregate registration
price per share offering price fee
- ------------------------------ -------------- ------------------------ -------------------------- --------------------
Common Stock, par value $.01 3,000,000
per share............... shares $18.32 (1) $54,960,000 (1) $15,279
============================== ============== ======================== ========================== ====================
(1) Estimated pursuant to Rules 457(c) and (h) of the Securities Act of 1933, as amended, solely for purposes of
computing the registration fee based upon the average of the high and low sales prices per share for the
Common Stock reported on The Nasdaq National Market on July 9, 1999 (which was $18.32) for all shares being
registered. Because there are options still available for grant under the AMX Corporation 1999 Equity
Incentive Plan and the exercise prices thereof may be based on the fair market value of the Common Stock on
the date of grant, it is not possible as of the date hereof to determine the maximum offering price
per share of the shares of Common Stock to be offered under the plan and such prices may be more or less than
$18.32 per share.
======================================================================================================================
</TABLE>
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
NOTE: The document(s) containing the information concerning the AMX
Corporation 1999 Equity Incentive Plan (the "Plan"), required by Item 1 of Form
S-8 and the statement of availability of registrant information and information
relating to the Plan and other information required by Item 2 of Form S-8 will
be sent or given to employees of the Registrant and its subsidiaries, as
applicable, as specified by Rule 428(b)(1) under the Securities Act of 1933, as
amended (the "Securities Act"). In accordance with Rule 428 and the requirements
of Part I of Form S-8, such documents are not being filed with the Securities
and Exchange Commission (the "Commission") either as part of this Registration
Statement or as prospectuses or prospectus supplements pursuant to Rule 424. The
registrant shall maintain a file of such documents in accordance with the
provisions of Rule 428. Upon request, the registrant shall furnish to the
Commission or its staff a copy or copies of any or all of the documents included
in such file.
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<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents, which AMX Corporation (the "Company") has
previously filed with the Commission pursuant to the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), are incorporated in this
Registration Statement by reference and shall be deemed to be a part hereof:
(i) The Company's Annual Report on Form 10-K for the fiscal year
ended March 31, 1999, as filed on June 29, 1999 with the
Commission pursuant to the Securities Act (Commission File No.
0-26924), which contains audited financial statements for the
Company's fiscal year ended March 31, 1999, which is the
Company's latest fiscal year for which audited financial
statements have been filed;
(ii) The Company's Current Report on Form 8-K filed with the
Commission on April 6, 1999; and
(iii) The description of the Common Stock of the Company contained
in the Company's Registration Statement on Form 8-A
(Commission File No. 0-26924), as filed with the Commission
pursuant to the Exchange Act on October 5, 1995, as may be
amended, modified or superseded by any report or amendment
filed with the Commission for the purpose of updating such
description.
All documents filed by the Company with the Commission pursuant to
Sections 13(a), 13(c), 14, and 15(d) of the Exchange Act subsequent to the date
of this Registration Statement and prior to the filing of a post-effective
amendment to this Registration Statement that indicates that all securities
offered hereby have been sold or that deregisters all securities then remaining
unsold, shall be deemed to be incorporated in this Registration Statement by
reference and to be a part hereof from the date of filing of such documents.
Any statement contained in this Registration Statement, in an amendment
hereto or in a document incorporated by reference herein shall be deemed to be
modified or superseded for purposes of this Registration Statement to the extent
that a statement contained herein, in any subsequently filed amendment to this
Registration Statement, or in any document that also is incorporated by
reference herein modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Registration Statement.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Munsch Hardt Kopf & Harr, P.C. will render an opinion with respect to
the validity of the shares of Common Stock being registered pursuant to this
Registration Statement. Joe Hardt, the President, Chief Executive Officer and a
director of the Company, is a former shareholder of Munsch Hardt Kopf & Harr,
P.C. Mr. Hardt has retired from the practice of law.
II-1
<PAGE>
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article VIII of the Company's Amended and Restated Articles of
Incorporation provides the following:
"A director of the Corporation shall not be liable to the Corporation
or its shareholders for monetary damages for an act or omission in the
director's capacity as a director, except that this Article shall not
authorize the elimination or limitation of the liability of a director
to the extent the director is found liable for:
(1) a breach of the director's duty of loyalty to the
Corporation or its shareholders;
(2) an act or omission not in good faith that constitutes
breach of duty of the director to the Corporation or an act or
omission that involves intentional misconduct or a knowing
violation of the law;
(3) a transaction from which the director received an
improper benefit, whether or not the benefit resulted from an
action taken within the scope of the director's office; or
(4) an act or omission for which the liability of a
director is expressly provided by an applicable statute."
Article IX of the Company's Amended and Restated Articles of
Incorporation, as amended, provides the following:
"The directors and officers of the Corporation shall be indemnified by
the Corporation in a manner and to the extent permitted by applicable
state or federal law as in effect from time to time."
Section 7.06 of the Company's Amended and Restated Bylaws, as amended
provides the following:
"The Corporation shall have the authority to and shall indemnify and
advance expenses to the Directors, officers, employees, and agents of
the Corporation or any other persons serving at the request of the
Corporation in such capacities in a manner and to the maximum extent
permitted by applicable state or federal law. The Corporation may
purchase and maintain liability insurance or make other arrangements
for such obligations to the extent permitted by the Texas Business
Corporation Act."
The Company currently has in effect a directors and officers liability
insurance policy covering the directors and executive officers of the Company
and its subsidiaries.
The Texas Business Corporation Act permits, and in some cases requires,
corporations to indemnify officers, directors, agents and employees who are or
have been a party to or are threatened to be made a party to litigation against
judgments, penalties (including excise and similar taxes), fines, settlements
and reasonable expenses under certain circumstances.
The Underwriting Agreement, a copy of which is filed as Exhibit 1.1 to
the Company's Registration Statement on Form S-1, as amended (Registration No.
33-96886), provides for indemnification by the underwriters of the Company's
initial public offering of Common Stock of its officers and directors for
certain liabilities arising under the Securities Act or otherwise.
II-2
<PAGE>
As a result of these provisions or agreements, the Company and its
shareholders may be unable to obtain monetary damages from a director or officer
for breach of the duty of care. Although shareholders may continue to seek
injunctive or other equitable relief for an alleged breach of fiduciary duty by
a director or officer, shareholders may not have any effective remedy against
the challenged conduct if equitable remedies are unavailable.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
EXHIBIT
NUMBER DOCUMENT DESCRIPTION
------- --------------------
4.1 Amended and Restated Articles of Incorporation of
the Company (incorporated by reference to Exhibit
4.1 to the Company's Form S-8 filed March 11, 1996,
File No. 333-2202).
4.2* Amended and Restated Bylaws of the Company, as
amended.
4.3 Specimen certificate for the Company's Common Stock
(incorporated by reference to Exhibit 4.1 to the
Company's Registration Statement on Form S-1, as
amended, filed September 13, 1995, File No.
33-96886).
4.4* AMX Corporation 1999 Equity Incentive Plan
5.1* Opinion of Munsch Hardt Kopf & Harr, P.C.
23.1 Consent of Munsch Hardt Kopf & Harr, P.C. (included
in the opinion filed as Exhibit 5.1 to this
Registration Statement).
23.2* Consent of Ernst & Young LLP, independent public
accountants.
24.1 Powers of Attorney (included on the signature page of
this Registration Statement).
- -------------------
*Filed herewith.
ITEM 9. UNDERTAKINGS.
(a) The Company hereby undertakes:
(1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this Registration
Statement:
(i) To include any prospectus required by
Section 10(a)(3) of the Securities Act;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of this Registration
Statement (or the most recent post-effective amendment
thereof)
II-3
<PAGE>
which, individually or in the aggregate, represent a
fundamental change in the information set forth in this
Registration Statement (notwithstanding the foregoing, any
increase or decrease in the volume of the securities offering
(if the total dollar value of the securities offered would not
exceed that which was registered) and any deviation from the
low or high end of the estimated maximum offering range may be
reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the "Calculation
of Registration Fee" table in this Registration Statement);
(iii) To include any material information with
respect to the plan of distribution not previously disclosed
in this Registration Statement or any material change in the
information set forth in this Registration Statement;
PROVIDED, HOWEVER, that paragraphs (a)(1)(i) and (a)(1)(ii) do
not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic
reports filed by the Company pursuant to Section 13 or Section 15(d) of
the Exchange Act that are incorporated by reference in this
Registration Statement.
(2) That, for the purpose of determining any liability
under the Securities Act, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a
post-effective amendment any of the securities being registered which
remain unsold at the termination of the offering.
(b) The Company hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the Company's
annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act
(and, where applicable, each filing of an employee benefit plan's annual report
pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference
in this Registration Statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Company pursuant to the foregoing provisions, or otherwise, the Company
has been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Company of expenses incurred or paid
by a director, officer or controlling person of the Company in the successful
defense of any action, suit or proceeding) is asserted by such director, officer
or controlling person in connection with the securities being registered, the
Company will, unless in the opinion of its counsel the matter has been settled
by controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Company
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Dallas, State of Texas, on July 15, 1999.
AMX CORPORATION
By: /s/ JOE HARDT
----------------------------------------
Joe Hardt, President and Chief Executive
Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated. Each person whose signature appears below
in so signing also makes, constitutes and appoints Joe Hardt and David E. Chisum
and each of them acting alone, his true and lawful attorney-in-fact, with full
power of substitution, for him in any and all capacities, to execute and cause
to be filed with the Securities and Exchange Commission any and all amendments
and post-effective amendments to this Registration Statement, with exhibits
thereto and other documents in connection therewith and hereby ratifies and
confirms all that said attorney-fin-fact or his substitute or substitutes may do
or cause to be done by virtue hereof.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ John F. McHale
----------------------------
John F. McHale Chairman of the Board and Director July 15, 1999
/s/ Joe Hardt
----------------------------
Joe Hardt President, Chief Executive Officer and Director July 15, 1999
(Principal Executive Officer)
/s/ Peter D. York
----------------------------
Peter D. York Vice Chairman of the Board and Director July 15, 1999
Chief Financial Officer, Secretary and
/s/ David E. Chisum Treasurer (Principal Financial
---------------------------- and Accounting Officer)
David E. Chisum July 15, 1999
----------------------------
Thomas S. Roberts Director July 15, 1999
/s/ Harvey B. Cash
----------------------------
Harvey B. Cash Director July 15, 1999
/s/ Scott D. Miller
----------------------------
Scott D. Miller Director July 15, 1999
----------------------------
J. Otis Winters Director July 15, 1999
</TABLE>
II-5
<PAGE>
AMENDED AND RESTATED BYLAWS
OF
AMX CORPORATION
<PAGE>
AMENDED AND RESTATED BYLAWS
OF
AMX CORPORATION
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
ARTICLE I. Offices.
1.01. Principal Office.
1.02. Other Offices.
ARTICLE II. Meetings of Shareholders.
2.01. Place of Meetings.
2.02. Annual Meeting.
2.03. List of Shareholders.
2.04. Special Meetings.
2.05. Notice.
2.06. Quorum.
2.07. Voting on Matters Other than the Election of Directors.
2.08. Voting in the Election of Directors.
2.09. Voting Procedure.
2.10. Action Without a Meeting.
2.11. Telephone Meetings.
ARTICLE III. Directors.
3.01. Management.
3.02. Number; Election.
3.03. Change in Number.
3.04. Election of Directors.
3.05. Place of Meetings.
3.06. First Meetings.
3.07. Regular Meetings.
3.08. Special Meetings.
3.09. Quorum.
3.10. Removal.
3.11. Vote of Directors to Fill Vacancy.
3.12. Vote of Shareholders to Fill Vacancy.
3.13. Action Without Meeting; Telephone Meetings.
3.14. Chairman of the Board.
3.15. Compensation.
3.16. Committees.
(i)
<PAGE>
TABLE OF CONTENTS
(Continued)
ARTICLE IV. Notices.
4.01. Method.
4.02. Waiver.
ARTICLE V. Officers.
5.01. Officers.
5.02. Election.
5.03. Compensation.
5.04. Removal and Vacancies.
5.05. President.
5.06. Vice Presidents.
5.07. Secretary.
5.08. Assistant Secretaries.
5.09. Treasurer.
5.10. Assistant Treasurers.
ARTICLE VI. Certificates Representing Shares.
6.01. Certificates.
6.02. Lost Certificates.
6.03. Transfer of Shares.
6.04. Registered Shareholders.
6.05. Fixing Record Date for Matters Other Than Consents to Action.
6.06. Fixing Record Date for Consents to Action.
6.07. Distribution Held in Suspense.
6.08. Joint Owners of Shares.
ARTICLE VII. General Provisions.
7.01. Distributions.
7.02. Reserves.
7.03. Checks.
7.04. Fiscal Year.
7.05. Seal.
7.06. Indemnification.
7.07. Transactions with Directors and Officers.
7.08. Amendments.
7.09. Table of Contents; Headings.
</TABLE>
(ii)
<PAGE>
AMENDED AND RESTATED BYLAWS
OF
AMX CORPORATION
(THE "CORPORATION")
ARTICLE I.
OFFICES
Section 1.01. PRINCIPAL OFFICE. The principal business office of the
Corporation shall be at 11995 Forestgate Drive, Dallas, Texas 75243
Section 1.02. OTHER OFFICES. The Corporation may also have offices at
such other places, both within and without the State of Texas, as the Board of
Directors may from time to time determine or the business of the Corporation may
require.
ARTICLE II.
MEETINGS OF SHAREHOLDERS
Section 2.01. PLACE OF MEETINGS. Meetings of shareholders for all
purposes may be held at such time and place, within or without the State of
Texas, as shall be stated in the notice of the meeting or in a duly executed
waiver of notice thereof.
Section 2.02. ANNUAL MEETING. An annual meeting of the shareholders shall
be held at such time as the Board of Directors may decide, at which meeting they
shall elect a Board of Directors and transact such other business as may
properly be brought before the meeting.
Section 2.03. LIST OF SHAREHOLDERS. The officer or agent having charge of
the share transfer records shall make, at least ten (10) days before each
meeting of the shareholders, a complete list of the shareholders entitled to
vote at said meeting, arranged in alphabetical order with the address of and the
number of voting shares held by each, which list, for a period of ten (10) days
prior to such meeting, shall be kept on file at the registered office or
principal place of business of the Corporation and shall be subject to
inspection by any shareholder at any time during usual business hours. Such
list shall be produced and kept open at the time and place of the meeting during
the whole time thereof, and shall be subject to the inspection of any
shareholder who may be present. The original share transfer records shall be
prima facie evidence as to the shareholders who are entitled to examine such
list or transfer records or to vote at any such meeting of shareholders.
Section 2.04. SPECIAL MEETINGS. Special meetings of the shareholders, for
any purpose or purposes, unless otherwise prescribed by statute or by the
Articles of Incorporation or by these Bylaws, may be called by the President,
the Board of Directors, or the holders of not less than ten
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<PAGE>
percent (10%) of all shares entitled to vote at the meetings. Business
transacted at all special meetings shall be confined to the purposes stated
in the notice of the meeting.
Section 2.05. NOTICE. Written or printed notice stating the place, day
and hour of the meeting, and, in case of a special meeting, the purpose or
purposes for which the meeting is called, shall be delivered not less than ten
(10) nor more than sixty (60) days before the date of the meeting, either
personally or by mail by or at the direction of the President, the Secretary or
the officer or person calling the meeting, to each shareholder entitled to vote
at the meeting; provided, however, in the event of a merger or consolidation,
such notice shall be delivered not less than twenty (20) days before the
meeting.
Section 2.06. QUORUM. Unless otherwise provided in the Articles of
Incorporation, a quorum shall be present at a meeting of shareholders if the
holders of a majority of the shares entitled to vote are represented at the
meeting in person or by proxy. Unless otherwise provided in the Articles of
Incorporation or these Bylaws, once a quorum is present at a meeting of
shareholders, the shareholders represented in person or by proxy at the meeting
may conduct such business as may be properly brought before the meeting until it
is adjourned, and the subsequent withdrawal from the meeting of any shareholder
or the refusal of any shareholder represented in person or by proxy to vote
shall not affect the presence of a quorum at the meeting. Unless otherwise
provided in the Articles of Incorporation, the shareholders represented in
person or by proxy at a meeting of shareholders at which a quorum is not present
may adjourn the meeting until such time and to such place as may be determined
by a vote of the holders of a majority of the shares represented in person or by
proxy at that meeting.
Section 2.07. VOTING ON MATTERS OTHER THAN THE ELECTION OF DIRECTORS.
With respect to any matter other than the election of Directors or a matter for
which the affirmative vote of the holders of a specified portion of the shares
entitled to vote is required by law, the affirmative vote of the holders of a
majority of the shares entitled to vote on that matter and represented in person
or by proxy at a meeting of shareholders at which a quorum is present shall be
the act of the shareholders unless otherwise provided in the Articles of
Incorporation or these Bylaws.
Section 2.08. VOTING IN THE ELECTION OF DIRECTORS. Directors shall be
elected by a plurality of the votes cast by the holders of shares entitled to
vote in the election of Directors at a meeting of shareholders at which a quorum
is present unless otherwise provided in the Articles of Incorporation or these
Bylaws.
Section 2.09. VOTING PROCEDURE. Each outstanding share of common stock
shall be entitled to one (1) vote on each matter submitted to a vote at a
meeting of shareholders, except to the extent that the voting rights of the
shares of any class or classes are limited or denied by the Articles of
Incorporation. At any meeting of the shareholders, every shareholder having the
right to vote shall be entitled to vote either in person or by proxy executed in
writing subscribed by the shareholder. A telegram, telex, cablegram or similar
transmission by the shareholder, or a photographic, photostatic, facsimile or
similar reproduction of a writing executed by the shareholder shall be treated
as an execution in writing for purposes of this section. No proxy shall be
valid after eleven (11) months from the date of its execution, unless otherwise
provided in the proxy. Each proxy shall be revocable
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<PAGE>
unless the proxy form conspicuously states that the proxy is irrevocable and
the proxy is coupled with an interest.
Section 2.10. ACTION WITHOUT A MEETING. Except as otherwise provided
below, any action required or permitted to be taken at a meeting of the
shareholders of the Corporation may be taken without a meeting if a consent in
writing setting forth the action so taken shall be signed by all of the
shareholders entitled to vote with respect to the subject matter thereof, and
such consent shall have the same force and effect as a unanimous vote of the
shareholders.
The Articles of Incorporation may provide that any action required by the
Texas Business Corporation Act to be taken at any annual or special meeting of
shareholders, or any action that may be taken at any annual or special meeting
of shareholders, may be taken without a meeting, without prior notice, and
without a vote, if a consent or consents in writing, setting forth the action so
taken, shall be signed by the holder or holders of shares having not less than
the minimum number of votes that would be necessary to take such action at a
meeting at which the holders of all shares entitled to vote on the action were
present and voted. If the Articles of Incorporation make such a provision, then
such written consent shall bear the date of signature of each shareholder who
signs the consent. No written consent shall be effective to take the action
that is the subject of the consent unless, within sixty (60) days after the date
of the earliest dated consent delivered to the Corporation in the manner
required by the Texas Business Corporation Act, a consent or consents signed by
the holder or holders of shares having not less than the minimum number of votes
that would be necessary to take the action that is the subject of the consent
are delivered to the Corporation by delivery to its registered office, its
principal place of business, or an officer or agent of the Corporation having
custody of the books in which proceedings of meetings of shareholders are
recorded. Delivery shall be by hand or certified or registered mail, return
receipt requested. Delivery to the Corporation's principal place of business
shall be addressed to the president or principal executive officer of the
Corporation.
A telegram, telex, cablegram, or similar transmission by a shareholder, or
a photographic, photostatic, facsimile or similar reproduction of a writing
signed by a shareholder shall be regarded as signed by the shareholder for
purposes of this section. Prompt notice of the taking of any action by
shareholders without a meeting by less than unanimous written consent shall be
given to those shareholders who did not consent in writing to the action.
Section 2.11. TELEPHONE MEETINGS. Subject to applicable notice provisions
and unless otherwise restricted by the Articles of Incorporation, shareholders
may participate in and hold a meeting by means of conference telephone or
similar communications equipment by means of which all persons participating in
the meeting can hear each other, and participation in such meeting shall
constitute presence in person at such meeting, except where a person's
participation is for the express purpose of objecting to the transaction of any
business on the ground that the meeting is not lawfully called or convened.
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<PAGE>
ARTICLE III.
DIRECTORS
Section 3.01. MANAGEMENT. The powers of the Corporation shall be
exercised by or under the authority of, and the business affairs of the
Corporation shall be managed under the direction of the Board of Directors that
may exercise all such powers of the Corporation and do all such lawful acts and
things as are not by statute or by the Articles of Incorporation or by these
Bylaws directed or required to be exercised or done by the shareholders. The
Board of Directors shall keep regular minutes of its proceedings.
Section 3.02. NUMBER; ELECTION. The Directors of the Corporation shall
consist of not less than one (1) Director, as determined from time to time by
resolution of the shareholders of the Corporation. Directors need not be
shareholders or residents of the State of Texas. The Directors shall be elected
at the annual meeting of the shareholders by the holders of shares entitled to
vote in the election of Directors and, except as hereinafter provided, each
Director elected shall hold office for the term for which such Director is
elected and until such Director's successor shall have been elected and shall
qualify.
Section 3.03. CHANGE IN NUMBER. The number of Directors may be increased
or decreased from time to time by amendment to these Bylaws, but no decrease
shall have the effect of shortening the term of any incumbent Director.
Section 3.04. ELECTION OF DIRECTORS. Directors shall be elected by a
plurality of the votes cast by the holders of shares entitled to vote in the
election of Directors at a meeting of shareholders at which a quorum is present
unless otherwise provided in the Articles of Incorporation or these Bylaws. At
every election of Directors, each shareholder shall have the right to vote in
person or by proxy the number of voting shares owned by such shareholder for as
many persons as there are Directors to be elected and for whose election such
shareholder has a right to vote. Cumulative voting shall be prohibited.
Section 3.05. PLACE OF MEETINGS. The Directors of the Corporation may
hold their meetings, both regular and special, either within or without the
State of Texas.
Section 3.06. FIRST MEETINGS. The first meeting of each newly elected
Board shall be held without further notice immediately following the annual
meeting of shareholders, and at the same place, unless by unanimous consent of
the Directors then elected and serving, such time or place shall be changed.
Section 3.07. REGULAR MEETINGS. Regular meetings of the Board of
Directors may be held without notice at such time and place as shall from time
to time be determined by the Board.
Section 3.08. SPECIAL MEETINGS. Special meetings of the Board of
Directors may be called by the President on three (3) days' notice to each
Director, either personally or by mail or by telegram and shall be called by the
President or any officer in like manner and on like notice on the written
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<PAGE>
request of two (2) or more of the Directors. Except as may be otherwise
expressly provided by law or by the Articles of Incorporation or by these
Bylaws, neither the business to be transacted at nor the purpose of any special
meeting need be specified in a notice or waiver of notice of such meeting.
Section 3.09. QUORUM. At all meetings of the Board of Directors, the
presence of a majority of the number of the Directors fixed by or in the manner
provided in the Articles of Incorporation or these Bylaws shall constitute a
quorum for the transaction of business unless a greater number is required by
law, the Articles of Incorporation or the Bylaws. The act of a majority of the
Directors present at any meeting at which there is a quorum shall be the act of
the Board of Directors unless the act of a greater number is required by law,
the Articles of Incorporation or by these Bylaws. If a quorum shall not be
present at any meeting of Directors, the Directors present thereat may adjourn
the meeting from time to time, without notice other than announcement at the
meeting, until a quorum shall be present.
Section 3.10. REMOVAL. At any meeting of the shareholders called
expressly for such purpose, any Director or the entire Board of Directors may be
removed either with or without cause by the affirmative vote of the holders of a
majority of the shares entitled to vote at an election of such Directors.
Section 3.11. VOTE OF DIRECTORS TO FILL VACANCY. Any vacancy occurring in
the initial Board of Directors before the issuance of shares may be filled by
the affirmative vote or written consent of a majority of the incorporators or by
the affirmative vote of a majority of the remaining Directors though less than a
quorum of the Board of Directors. Any vacancy subsequently occurring in the
Board of Directors after the issuance of shares may be filled in accordance with
Section 3.12 of this Article III or may be filled by the affirmative vote of a
majority of the remaining Directors though less than a quorum of the Board of
Directors. A Director elected to fill a vacancy shall be elected for the
unexpired term of such Director's predecessor in office. A directorship to be
filled by reason of an increase in the number of Directors may be filled in
accordance with Section 3.12 of this Article III or may be filled by the Board
of Directors for a term of office continuing only until the next election of one
(1) or more Directors by the shareholders; provided that the Board of Directors
may not fill more than two (2) such directorships during the period between any
two (2) successive annual meetings of the shareholders.
Section 3.12. VOTE OF SHAREHOLDERS TO FILL VACANCY. Any vacancy occurring
in the Board of Directors or any directorship to be filled by reason of an
increase in the number of Directors may be filled by election at any annual or
special meeting of shareholders called for that purpose.
Section 3.13. ACTION WITHOUT MEETING; TELEPHONE MEETINGS. Unless
otherwise restricted by the Articles of Incorporation or these Bylaws, any
action required or permitted to be taken at a meeting of the Board of Directors
or of any committee designated by the Board of Directors may be taken without a
meeting if a consent in writing, setting forth the action so taken is signed by
all the members of the Board of Directors or committee, as the case may be.
Such consent shall have the same force and effect as a unanimous vote at a
meeting and may be stated as such in any document or instrument filed with the
Secretary of State. Subject to applicable notice provisions and unless
otherwise restricted by the Articles of Incorporation or these Bylaws, members
of the Board of Directors or members of any committee designated by the Board of
Directors may participate in and
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hold a meeting by means of conference telephone or similar communications
equipment by means of which all persons participating in the meeting can hear
each other, and participation in such meeting shall constitute presence in
person at such meeting, except where a person participates in the meeting for
the express purpose of objecting to the transaction of any business on the
ground that the meeting is not lawfully called or convened.
Section 3.14. CHAIR OF THE BOARD. The Board of Directors may elect a
Chair of the Board to preside at their meetings and perform such other duties as
the Board may from time to time assign to the Chair.
Section 3.15. COMPENSATION. Directors, as such, shall not receive any
stated salary for their services, but, by resolution of the Board a fixed sum
and expenses of attendance, if any, may be allowed for attendance at each
regular or special meeting of the Board; provided that nothing herein contained
shall be construed to preclude any Director from serving the Corporation in any
other capacity and receiving compensation therefor. Members of any committee
designated by the Board may, by resolution of the Board of Directors, be allowed
like compensation for attending committee meetings.
Section 3.16. COMMITTEES. The Board of Directors, by resolution adopted
by a majority of the full Board of Directors, may designate from among its
members one (1) or more committees, each of which shall be comprised of one (1)
or more of its members and may designate one (1) or more of its members as
alternate members of any committee, who may, subject to any limitations imposed
by the Board of Directors, replace absent or disqualified members at any meeting
of that committee. Any such committee, except to the extent provided in said
resolution, shall have and may exercise all of the authority of the Board of
Directors in the management of the business and affairs of the Corporation,
except where action of the full Board of Directors is required by law or by the
Articles of Incorporation. Any member of the committees may be removed by the
Board of Directors by the affirmative vote of a majority of the Board of
Directors, whenever in its judgment the best interests of the Corporation will
be served thereby. The committees shall keep regular minutes of their
proceedings and report the same to the Board of Directors when required.
ARTICLE IV.
NOTICES
Section 4.01. METHOD. Whenever by statute, the Articles of Incorporation
or these Bylaws, notice is required to be given to any Director or shareholder,
and no provision is made as to how such notice shall be given, it shall not be
construed to mean personal notice, but any such notice may be given in writing,
either personally or by mail, postage prepaid, addressed to such Director or
shareholder at such address as appears on the share transfer records of the
Corporation or in any other method permitted by law. Any notice required or
permitted to be given by mail shall be deemed to be given at the time when the
same shall be thus deposited in the United States mail as aforesaid.
Section 4.02. WAIVER. Whenever any notice is required to be given to any
shareholder or Director of the Corporation by law, the Articles of Incorporation
or these Bylaws, a waiver thereof
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in writing signed by the person or persons entitled to such notice, whether
before or after the time stated in such notice, shall be deemed equivalent to
the giving of such notice. Attendance of a shareholder or Director at a
meeting shall constitute a waiver of notice of such meeting, except where a
shareholder or Director attends for the express purpose of objecting to the
transaction of any business on the ground that the meeting is not lawfully
called or convened. Consent in writing by a shareholder or Director to any
action taken or resolution adopted by the shareholders or Directors of the
Corporation shall constitute a waiver of any and all notices required to be
given in connection with such action or resolution.
ARTICLE V.
OFFICERS
Section 5.01. ELECTED OFFICERS. The elected officers of the Corporation
shall be a Chairman of the Board (if the Board of Directors shall determine the
election of such officer to be appropriate), President, and one or more Vice
Presidents as may be determined from time to time by the Board (and, in the case
of each such Vice President, with such descriptive title, if any, as the Board
of Directors shall deem appropriate), a Secretary, and a Treasurer. The
Chairman of the Board, if any, shall be a member of the Board of Directors. No
other elected officer of the Corporation need be a member of the Board of
Directors. The Board of Directors may appoint such other officers and agents as
it shall deem necessary, who shall be appointed for such terms and shall
exercise such powers and perform such duties as shall be determined from time to
time by the Board of Directors.
Section 5.02. ELECTION. So far as is practicable, all elected officers
shall be elected by the Board of Directors at its first meeting after each
annual meeting of shareholders.
Section 5.03. APPOINTIVE OFFICERS. The Board of Directors may also
appoint one or more Assistant Secretaries and Assistant Treasurers and such
other officers and assistant officers and agents (none of whom need be a member
of the Board) as it shall from time to time deem necessary, who shall exercise
such powers and perform such duties as shall be set forth in these Bylaws or
determined from time to time by the Board of Directors or the Executive
Committee.
Section 5.04. TWO OR MORE OFFICES. Any two (2) or more offices may be held
by the same person.
Section 5.05. COMPENSATION. The compensation of all officers of the
Corporation shall be fixed from time to time by the Board of Directors or the
Executive Committee. The Board of Directors or the Executive Committee may
from time to time delegate to the President the authority to fix the
compensation of any or all of the other officers of the Corporation.
Section 5.06. TERM OF OFFICE; REMOVAL; FILLING OF VACANCIES. Each elected
officer of the Corporation shall hold office until his successor is chosen and
qualified in his stead or until his earlier death, resignation, retirement,
disqualification or removal from office. Each appointive officer shall hold
office at the pleasure of the Board of Directors without the necessity of
periodic reappointment. Any officer or agent elected or appointed by the Board
of Directors may be removed at any time by
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the Board of Directors whenever in its judgment the best interests of the
Corporation will be served thereby, but such removal shall be without
prejudice to the contract rights, if any, of the person so removed. Election
or appointment of an officer or agent will not of itself create contract
rights. If the office of any officer becomes vacant for any reason, the
vacancy may be filled by the Board of Directors.
Section 5.07. CHAIR OF THE BOARD. The Board of Directors may elect a
Chair of the Board to preside at their meetings and perform such other duties as
the Board may from time to time assign to the Chair.
Section 5.08. CHIEF EXECUTIVE OFFICER. The Chief Executive Officer shall
preside at all meetings of the shareholders and the Board of Directors unless
the Board shall choose to elect a Chairman of the Board, in which event the
Chief Executive Officer shall preside at Board of Directors' meetings in the
absence of the Chairman of the Board of Directors. The Chief Executive Officer
shall have general and active management of the business and affairs of the
Corporation, shall see that all orders and resolutions of the Board are carried
into effect, and shall perform such other duties as the Board of Directors shall
prescribe.
Section 5.09. CHIEF OPERATING OFFICER. The Chief Operating Officer shall
have general and active management of the day-to-day operations of the
Corporation and shall perform such other duties as the Board of Directors shall
prescribe.
Section 5.10. CHIEF FINANCIAL OFFICER. The Chief Financial Officer shall
have principal responsibility for the financial, tax and accounting affairs of
the Corporation and shall discharge such specific responsibilities in connection
therewith, including, without limitation, preparation of periodic financial
statements of the Corporation, as may be assigned to such person from time to
time by the Board of Directors, the Chief Executive Officer or the Chief
Operating Officer.
Section 5.11. PRESIDENT. The President shall be ex-officio a member of
all standing committees and shall have general powers of oversight, supervision
and management of the business and affairs of the Corporation. The President
shall see that all orders and resolutions of the Board of Directors are carried
into effect. The President shall have such other powers and duties as usually
pertain to such office or as may be prescribed by the Board of Directors. The
President shall execute bonds, mortgages, instruments, contracts, agreements,
and other documentation, except where the signing and execution thereof shall be
expressly delegated by the Board of Directors to some other officer or agent of
the Corporation.
Section 5.12. VICE PRESIDENTS. Each Vice President shall have such titles
as may be prescribed by the Board of Directors, and shall generally assist the
President and shall have such powers and perform such duties and services as
shall from time to time be prescribed or delegated to him by the Chief Executive
Officer, the Chief Operating Officer, the President, the Board of Directors or
the Executive Committee.
Section 5.13. TREASURER. The Treasurer shall have the care and custody of
all monies, funds and securities of the Corporation; shall deposit or cause to
be deposited all such funds in and with such depositories as the Board of
Directors or the Executive Committee shall from time to time direct
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or as shall be selected in accordance with procedure established by the Board
or the Executive Committee; shall advise upon all terms of credit granted by
the Corporation; and shall be responsible for the collection of all its
accounts and shall cause to be kept full and accurate accounts of all
receipts and disbursements of the Corporation. He shall have the power to
endorse for deposit or collection or otherwise all checks, drafts, notes,
bills of exchange or other commercial papers payable to the Corporation and
to give proper receipts or discharges for all payments to the Corporation.
The Treasurer shall generally perform all the duties usually appertaining to
the office of treasurer of a corporation. In the absence or disability of
the Treasurer, his duties shall be performed and his powers may be exercised
by the Assistant Treasurers in the order of their seniority, unless otherwise
determined by the Treasurer, the Chairman of the Board, the Chief Executive
Officer, the Chief Operating Officer, the Chief Financial Officer, the
President, the Board of Directors or the Executive Committee. If required by
the Board of Directors, he shall give the Corporation a bond in such form, in
such sum, and with such surety or sureties as shall be satisfactory to the
Board for the faithful performance of the duties of his office.
Section 5.14. ASSISTANT TREASURERS. Each Assistant Treasurer shall
generally assist the Treasurer and shall have such powers and perform such
duties and services as shall from time to time be prescribed or delegated to him
by the Treasurer, the Chairman of the Board, the Chief Executive Officer, the
Chief Operating Officer, The Chief Financial Officer, the President, the Board
of Directors, or the Executive Committee.
Section 5.15. SECRETARY. The Secretary shall see that notice is given of
all meetings of the shareholders and special meetings of the Board of Directors
and shall keep and attest true records of all proceedings at all meetings of the
shareholders and the Board. He shall have charge of the corporate seal and have
authority to attest any and all instruments or writings to which the same may be
affixed. He shall keep and account for all books, documents, papers and records
of the Corporation except those for which some other officer or agent is
properly accountable. He shall have authority to sign stock certificates and
shall generally perform all the duties usually appertaining to the office of
secretary of a corporation. In the absence or disability of the Secretary, his
duties shall be performed and his powers may be exercised by the Assistant
Secretaries in the order of their seniority, unless otherwise determined by the
Secretary, the Chairman of the Board, the Chief Executive Officer, the Chief
Operating Officer, the President, the Board of Directors, or the Executive
Committee.
Section 5.16. ASSISTANT SECRETARIES. Each Assistant Secretary shall
generally assist the Secretary and shall have such powers and perform such
duties and services as shall from time to time be prescribed or delegated to him
by the Secretary, the Chairman of the Board, the Chief Executive Officer, the
Chief Operating Officer, the President, the Board of Directors or the Executive
Committee.
Section 5.17. ADDITIONAL POWERS AND DUTIES. In addition to the foregoing
especially enumerated duties, services, and powers, the several elected and
appointive officers of the Corporation shall perform such other duties and
services and exercise such further powers as may be provided by statute, the
Articles of Incorporation or these Bylaws or as the Board of Directors or the
Executive Committee may from time to time determine or as may be assigned to
them by any competent superior officer.
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ARTICLE VI.
CERTIFICATES REPRESENTING SHARES
Section 6.01. CERTIFICATES. Certificates in such form as may be
determined by the Board of Directors shall be delivered representing all shares
to which shareholders are entitled. Such certificates shall be consecutively
numbered and shall be entered in the books of the Corporation as they are
issued. Each certificate shall state on the face thereof the holder's name, the
number and class of shares, and the par value of such shares or a statement that
such shares are without par value. They shall be signed by the President or a
Vice President and the Secretary or an Assistant Secretary and may be sealed
with the seal of the Corporation or a facsimile thereof. If any certificate is
countersigned by a transfer agent, or an assistant transfer agent or registered
by a registrar, other than the Corporation or an employee of the Corporation,
the signature of any such officer may be facsimile. Shares may not be issued
until the full amount of the consideration, fixed as provided by law, has been
paid.
Section 6.02. LOST CERTIFICATES. The Board of Directors may direct a new
certificate representing shares to be issued in place of any certificate
theretofore issued by the Corporation alleged to have been lost or destroyed,
upon the making of an affidavit of that fact by the person claiming the
certificate to be lost or destroyed. When authorizing such issue of a new
certificate, the Board of Directors, in its discretion and as a condition
precedent to the issuance thereof, may require the owner of such lost or
destroyed certificate, or such owner's legal representative, to advertise the
same in such manner as it shall require and/or give the Corporation a bond in
such form, in such sum, and with such surety or sureties as it may direct as
indemnity against any claim that may be made against the Corporation with
respect to the certificate alleged to have been lost or destroyed.
Section 6.03. TRANSFER OF SHARES. Except as is otherwise provided in
these Bylaws, shares of stock shall be transferable only on the books of the
Corporation by the holder thereof in person or by such holder's duly authorized
attorney. Upon surrender to the Corporation or the transfer agent of the
Corporation of a certificate representing shares duly endorsed or accompanied by
proper evidence of succession, assignment or authority to transfer, it shall be
the duty of the Corporation or the transfer agent of the Corporation to issue a
new certificate to the person entitled thereto, cancel the old certificate and
record the transaction upon its books.
Section 6.04. REGISTERED SHAREHOLDERS. Unless otherwise provided by
statute, the Corporation may regard the person in whose name any shares issued
by the Corporation are registered in the share transfer records of the
Corporation at any particular time (including, without limitation as of a record
date fixed pursuant to Sections 6.05 and 6.06) as the owner of those shares at
that time for purposes of voting those shares, receiving distributions thereon
or notices in respect thereof, transferring those shares, exercising rights of
dissent with respect to those shares, exercising or waiving any preemptive right
with respect to those shares, entering into agreements with respect to those
shares in accordance with the Texas Business Corporation Act or giving proxies
with respect to those shares. Neither the Corporation nor any of its officers,
Directors, employees or agents shall be liable for regarding that person as the
owner of those shares at that time for those purposes, regardless of whether
that person possesses a certificate for those shares.
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Section 6.05. FIXING RECORD DATE FOR MATTERS OTHER THAN CONSENTS TO
ACTION. For the purpose of determining shareholders entitled to notice of or to
vote at any meeting of shareholders or any adjournment thereof, or entitled to
receive a distribution by the Corporation (other than a distribution involving a
purchase or redemption by the Corporation of any of its own shares) or a share
dividend, or in order to make a determination of shareholders for any other
proper purpose (other than determining shareholders entitled to consent to
action by shareholders proposed to be taken without a meeting of shareholders),
the Board of Directors may provide that the share transfer records shall be
closed for a stated period but not to exceed, in any case, sixty (60) days. If
the share transfer records shall be closed for the purpose of determining
shareholders entitled to notice of or to vote at a meeting of shareholders, such
records shall be closed for at least ten (10) days immediately preceding such
meeting. In lieu of closing the share transfer records, the Board of Directors
may fix in advance a date as the record date for any such determination of
shareholders, such date in any case to be not more than sixty (60) days, and, in
the case of a meeting of shareholders, not less than ten (10) days, prior to the
date on which the particular action requiring such determination of shareholders
is to be taken. If the share transfer records are not closed and no record date
is fixed for the determination of shareholders entitled to notice of or to vote
at a meeting of shareholders, or shareholders entitled to receive a distribution
(other than a distribution involving a purchase or redemption by the Corporation
of any of its own shares) or a share dividend, the date on which such notice of
the meeting is mailed or the date on which the resolution of the Board of
Directors declaring such distribution or share dividend is adopted, as the case
may be, shall be the record date for such determination of shareholders. When a
determination of shareholders entitled to vote at any meeting of shareholders
has been made as provided in this Section, such determination shall apply to any
adjournment thereof, except where the determination has been made through the
closing of the share transfer records and the stated period of closing has
expired.
Section 6.06. FIXING RECORD DATE FOR CONSENTS TO ACTION. Unless a record
date shall have previously been fixed or determined pursuant to this Article VI,
whenever action by shareholders is proposed to be taken by consent in writing
without a meeting of shareholders, the Board of Directors may fix a record date
for the purpose of determining shareholders entitled to consent to that action,
which record date shall not precede, and shall not be more than ten (10) days
after, the date upon which the resolution fixing the record date is adopted by
the Board of Directors. If no record date has been fixed by the Board of
Directors and the prior action of the Board of Directors is not required by the
Texas Business Corporation Act, the record date for determining shareholders
entitled to consent to action in writing without a meeting shall be the first
date on which a signed written consent setting forth the action taken or
proposed to be taken is delivered to the Corporation by delivery to its
registered office, its principal place of business, or an officer or agent of
the Corporation having custody of the books in which proceedings of meetings of
shareholders are recorded. Delivery shall be by hand or by certified or
registered mail, return receipt requested. Delivery to the Corporation's
principal place of business shall be addressed to the President or the principal
executive officer of the Corporation. If no record date shall have been affixed
by the Board of Directors and prior action of the Board of Directors is required
by statute, the record date for determining shareholders entitled to consent to
action in writing without a meeting shall be at the close of business on the
date on which the Board of Directors adopts resolution taking such prior action.
Section 6.07. DISTRIBUTION HELD IN SUSPENSE. Distributions made by the
Corporation, including those that were payable but not paid to a holder of
shares or to such holder's heirs,
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successors or assigns, and have been held in suspense by the Corporation or
were paid or delivered by it into an escrow account or to a trustee or
custodian, shall be payable by the Corporation, escrow agent, trustee or
custodian to the holder of the shares as of the record date determined for
that distribution as provided in Section 6.05, or to such holder's heirs,
successors or assigns.
Section 6.08. JOINT OWNERS OF SHARES. When shares are registered on the
books of the Corporation in the names of two (2) or more persons as joint owners
with the right of survivorship, after the death of a joint owner and before the
time that the Corporation receives actual written notice that parties other than
the surviving joint owner or owners claim an interest in the shares or any
distributions thereon, the Corporation may record on its books and otherwise
effect the transfer of those shares to any person, firm, or Corporation
(including that surviving joint owner individually) and pay any distributions
made in respect of those shares, in each case as if the surviving joint owner or
owners were the absolute owners of the shares. The Corporation permitting such
a transfer by and making any distribution to such a surviving joint owner or
owners before the receipt of written notice from other parties claiming an
interest in those shares or distributions is discharged from all liability for
the transfer or payment so made; provided, however, that the discharge of the
Corporation from liability and the transfer of full legal and equitable title of
the shares in no way affects, reduces, or limits any cause of action existing in
favor of any owner of an interest in those shares or distributions against the
surviving owner or owners.
ARTICLE VII.
GENERAL PROVISIONS
Section 7.01. DISTRIBUTIONS. Distributions upon the outstanding shares of
the Corporation, subject to the provisions of the Articles of Incorporation, may
be declared by the Board of Directors at any regular or special meeting.
Distributions may be paid in cash, in property or in shares of the Corporation,
subject to the provisions of the statutes and the Articles of Incorporation.
Section 7.02. RESERVES. There may be created by resolution of the Board
of Directors out of the surplus of the Corporation such reserve or reserves as
the Directors from time to time, in their discretion, think proper to provide
for contingencies, or to equalize distributions, or to repair or maintain any
property of the Corporation, or for such other purposes as the Board of
Directors shall think beneficial to the Corporation, and the Board of Directors
may modify or abolish any such reserve in the manner in which it was created.
Section 7.03. CHECKS. All checks or demands for money and notes of the
Corporation shall be signed by such officer or officers or such other person or
persons as the Board of Directors may from time to time designate.
Section 7.04. FISCAL YEAR. The fiscal year of the Corporation shall be
fixed by resolution of the Board of Directors.
Section 7.05. SEAL. The corporate seal shall be kept in the safe custody
of the Secretary of the Corporation and shall have inscribed thereon the name of
the Corporation and may be in such
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form as the Board of Directors may determine. Said seal may be used by
causing it or a facsimile thereof to be impressed or affixed or reproduced or
otherwise.
Section 7.06. INDEMNIFICATION. The Corporation shall have the authority
to and shall indemnify and advance expenses to the Directors, officers,
employees, agents of the Corporation or any other persons serving at the request
of the Corporation in such capacities in a manner and to the maximum extent
permitted by applicable state or federal law. The Corporation may purchase and
maintain liability insurance or make other arrangements for such obligations to
the extent permitted by the Texas Business Corporation Act.
Section 7.07. TRANSACTIONS WITH DIRECTORS AND OFFICERS. No contract or
transaction between the Corporation and one (1) or more of its Directors or
officers, or between the Corporation and any other Corporation, partnership,
association, or other organization in which one (1) or more of its directors or
officers are Directors or officers or have a financial interest, shall be void
or voidable solely for this reason, solely because the Director or officer is
present at or participates in the meeting of the Board of Directors or committee
thereof that authorizes the contract or transaction, or solely because his, her,
its or their votes are counted for such purpose, if:
(1) The material facts as to such person's relationship or interest
and as to the contract or transaction are disclosed or are known to the
Board of Directors or the committee, and the Board of Directors or
committee in good faith authorizes the contract or transaction by the
affirmative vote of a majority of the disinterested Directors, even though
the disinterested Directors be less than a quorum; or
(2) The material facts as to such person's relationship or interest
and as to the contract or transaction are disclosed or are known to the
shareholders entitled to vote thereon, and the contract or transaction is
specifically approved in good faith by vote of the shareholders; or
(3) The contract or transaction is fair as to the Corporation as of
the time it is authorized, approved or ratified by the Board of Directors,
a committee thereof, or the shareholders.
Common or interested Directors may be counted in determining the presence of a
quorum at a meeting of the Board of Directors or of a committee that authorizes
the contract or transaction.
Section 7.08. AMENDMENTS. The Board of Directors may amend or repeal the
Bylaws of the Corporation or adopt new Bylaws, unless: (1) the Articles of
Incorporation or the Texas Business Corporation Act reserves the power
exclusively to the shareholders in whole or part; or (2) the shareholders in
amending, repealing or adopting a particular bylaw expressly provide that the
Board of Directors may not amend or repeal that bylaw. Unless the Articles of
Incorporation or a bylaw adopted by the shareholders provides otherwise as to
all or some portion of the Bylaws, the shareholders may amend, repeal or adopt
the Bylaws even though the Bylaws may also be amended, repealed or adopted by
the Board of Directors.
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Section 7.09. TABLE OF CONTENTS; HEADINGS. The Table of Contents and
headings used in these Bylaws have been inserted for convenience only and do not
constitute matters to be construed in interpretation.
CERTIFICATE BY ASSISTANT SECRETARY
The undersigned, being the Assistant Secretary of the Corporation, hereby
certifies that the foregoing code of Bylaws was duly adopted by the Director of
said Corporation effective on March __, 1995.
/s/ Sylvia Griffin
-------------------
Assistant Secretary
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AMENDMENTS TO THE BYLAWS
OF
AMX CORPORATION
(the "Corporation")
1. The following Amendments to Sections 5.08, 5.09, 5.10 and 5.11 of the
Bylaws was adopted by the Board of Directors of the Corporation on
September 11, 1995.
RESOLVED, that Sections 5.08, 5.09, 5.10 and 5.11 of the Bylaws
of the Corporation be amended, changed and altered so as to read in
their entirety as follows:
"Section 5.08. CHIEF EXECUTIVE OFFICER. The Board of
Directors may, but shall not be required to, elect a Chief
Executive Officer. If so elected, the Chief Executive
Officer shall preside at all meetings of the shareholders
and the Board of Directors unless the Board shall choose to
elect a Chairman of the Board, in which event the Chief
Executive Officer shall preside at Board of Directors'
meetings in the absence of the Chair of the Board of
Directors. The Chief Executive Officer shall have general
and active management of the business and affairs of the
Corporation, shall see that all orders and resolutions of
the Board are carried into effect, and shall perform such
other duties as the Board of Directors shall prescribe.
Such duties shall be performed by the President of the
Corporation if the Board of Directors does not elect a Chief
Executive Officer.
Section 5.09. CHIEF OPERATING OFFICER. The Board of
Directors may, but shall not be required to, elect a Chief
Operating Officer. If so elected, the Chief Operating
Officer shall have general and active management of the
day-to-day operations of the Corporation and shall perform
such other duties as the Board of Directors shall prescribe.
Such duties shall be performed by the President of the
Corporation if the Board of Directors does not elect a
Chief Operating Officer.
Section 5.10. CHIEF FINANCIAL OFFICER. The Board of
Directors may, but shall not be required to, elect a Chief
Financial Officer. If so elected, the Chief Financial
Officer shall have principal responsibility for the
financial, tax and accounting affairs of the Corporation and
shall discharge such specific responsibilities in connection
therewith, including, without limitation, preparation of
periodic financial statements of the Corporation, as may be
assigned
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to such person from time to time by the Board of
Directors, the Chief Executive Officer, the Chief Operating
Officer or the President. Such duties shall be performed by
the Treasurer of the Corporation if the Board of Directors
does not elect a Chief Financial Officer.
Section 5.11. PRESIDENT. The President shall have general
powers of oversight, supervision and management of the
business and affairs of the Corporation. The President
shall see that all orders and resolutions of the Board of
Directors are carried into effect. The President shall have
such other powers and duties as usually pertain to such
office or as may be prescribed by the Board of Directors.
The President shall execute bonds, mortgages, instruments,
contracts, agreements, and other documentation, except where
the signing and execution thereof shall be expressly
delegated by the Board of Directors to some other officer or
agent of the Corporation."
RESOLVED FURTHER, that the remaining terms and provisions of the
Bylaws shall continue as originally adopted.
/s/ Peter D. York, Secretary
----------------------------
Peter D. York, Secretary
-16-
<PAGE>
JULY 11, 1997 AMENDMENT TO THE BYLAWS
OF
AMX CORPORATION
(the "Corporation")
1. The following Amendment to Section 3.02 of the Bylaws was adopted by the
Board of Directors of the Corporation as of July 11, 1997.
RESOLVED, that the first sentence of Section 3.02 of the Bylaws was
amended by the Board of Directors of the Corporation as of July 11, 1997 as
set forth below with the remainder of Section 3.02 being unaltered.
"Section 3.02. NUMBER; ELECTION. The Directors of the
Corporation shall consist of not less than one (1) Director,
as determined from time to time by resolution of the
Shareholders or the Directors of the Corporation. Directors
need not be shareholders or residents of the State of Texas.
The Directors shall be elected at the annual meeting of the
shareholders by the holders of shares entitled to vote in
the election of Directors and, except as hereinafter
provided, each Director elected shall hold office for the
term for which such Director is elected and until such
Director's successor shall have been elected and shall
qualify."
RESOLVED FURTHER, that the remaining terms and provisions of the Bylaws
shall continue as previously adopted.
/s/ Peter D. York, Secretary
----------------------------
Peter D. York, Secretary
-17-
<PAGE>
AMX CORPORATION
1999 EQUITY INCENTIVE PLAN
Adopted February 9, 1999
1. PURPOSE OF THE PLAN.
The purpose of the Plan is to provide a means by which selected
Employees of and Consultants to the Company and its Affiliates may be given
an opportunity to acquire a proprietary interest in the Company. Under the
Plan, the Company may provide various types of long-term incentive awards,
including Stock Options, Stock Appreciation Rights, Restricted Stock,
Deferred Stock, Stock Reload Options and Other Stock-Based Awards, in order
to retain the services of persons who are now Employees of or Consultants to
the Company and its Affiliates, to secure and retain the services of new
Employees and Consultants, and to provide incentives for such persons to
exert maximum efforts for the success of the Company and its Affiliates.
Stock Options granted under the Plan may be Incentive Stock Options or
Nonqualified Stock Options, as determined by the Committee at the time of
grant of an Option and subject to the applicable provisions of Section 422 of
the Code and the regulations promulgated thereunder.
2. DEFINITIONS.
As used herein, the following definitions shall apply:
(a) "Affiliate" means, with respect to any Person, any Parent or
Subsidiary of such Person, whether such Parent or Subsidiary is now or
hereafter existing.
(b) "Agreement" means the agreement between the Company and the
Holder setting forth the terms and conditions of an Award under the Plan.
(c) "Applicable Laws" means the legal requirements relating to the
administration of stock option plans under U.S. state corporate laws, U.S.
federal and state securities laws, the Code and the applicable laws of any
foreign country or jurisdiction where Options are, or will be, granted under
the Plan.
(d) "Award" means an award of Options, Stock Appreciation Rights,
Restricted Stock, Deferred Stock, Stock Reload Options or Other Stock-Based
Awards under the Plan.
(e) "Beneficial Owner" means a "beneficial owner" as defined in
Rule 13d-3 of the Exchange Act.
(f) "Board" means the Board of Directors of the Company.
(g) "Code" means the Internal Revenue Code of 1986, as amended.
<PAGE>
(h) "Change of Control" means the occurrence of (i) any Person or
Group of Persons becoming for the first time the Beneficial Owner, directly
or indirectly, of more than fifty percent (50%) of the total combined voting
power of all classes of capital stock of the Company normally entitled to
vote for the election of directors of the Company ("Voting Stock"), other
than as a result of a transfer or series of related transfers of Voting Stock
from a Person or Group of Persons who immediately prior to such transfer or
transfers was the Beneficial Owner, and who after giving effect to such
transfer or transfers continues to be the Beneficial Owner, of more than
fifty percent (50%) of the Voting Stock of the Company; (ii) a merger or
consolidation of the Company with or into another Person or the merger of
another Person into the Company as a consequence of which those Persons who
held all of the Voting Stock of the Company immediately prior to such merger
or consolidation do not hold either directly or indirectly a majority of the
Voting Stock of the Company (or, if applicable, the surviving company of such
merger or consolidation) after the consummation of such merger or
consolidation; (iii) the sale of all or substantially all of the assets of
the Company to any Person or Group of Persons (other than to an entity which
owns a majority or more of the Common Stock of the Company, a Subsidiary of
the Company, or to an entity whose equity interests are owned directly or
indirectly by the Company or by an entity which owns directly or indirectly a
majority or more of the Common Stock of the Company); or (iv) any event or
series of events (which event or series of events must include a proxy fight
or proxy solicitation with respect to the election of directors of the
Company made in opposition to the nominees recommended by the Continuing
Directors) during any period of 12 consecutive months, as a result of which a
majority of the Board of Directors of the Company consists of individuals
other than Continuing Directors.
(i) "Committee" means the Compensation Committee of the Board of
Directors.
(j) "Common Stock" means the Common Stock, par value $.01 per
share, of the Company.
(k) "Company" means AMX Corporation.
(l) "Consultant" means (i) any person who is engaged by the Company
or any Parent or Subsidiary to render consulting or advisory services and is
compensated for such services and (ii) any Director of the Company, whether
such Director is compensated for such services or not.
(m) "Continuous Status as an Employee or Consultant" means that the
employment or consulting relationship with the Company or any Affiliate is
not interrupted or terminated. Continuous Status as an Employee or Consultant
shall not be considered interrupted in the case of (i) any leave of absence
approved by the Company or (ii) transfers between locations of the Company or
between the Company or any Affiliate or any successor. A leave of absence
approved by the Company shall include sick leave, military leave, or any
other personal leave approved by an authorized representative of the Company.
For purposes of Incentive Stock Options, no such leave may exceed 90 days,
unless reemployment upon expiration of such leave is guaranteed by statute or
contract. If reemployment upon expiration of a leave of absence approved by
the Company is not so guaranteed, on the 91st day of such leave any Incentive
Stock Option held by the Holder shall cease to be treated
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<PAGE>
for tax purposes as an Incentive Stock Option and shall be treated for tax
purposes as a Nonqualified Stock Option.
(n) "Deferred Stock" means Stock to be received at the end of a
specified deferral period under an Award made pursuant to Section 10 below.
(o) "Director" means a member of the Board of Directors of the
Company.
(p) "Employee" means any person, including Officers and Directors,
employed by the Company or any Affiliate of the Company. The payment of a
Director's fee by the Company shall not be sufficient to constitute
"employment" by the Company.
(q) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
(r) "Fair Market Value" means, as of any date, the value of Common
Stock determined as follows:
(i) If the Common Stock is listed on any established stock
exchange or a national market system, including without limitation the
Nasdaq National Market or The Nasdaq SmallCap Market of The Nasdaq
Stock Market, 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 Common Stock is regularly quoted by a recognized
securities dealer but selling prices are not reported, its Fair Market
Value shall be the mean between the high bid and low asked prices for
the Common Stock on the last market trading day prior to the day of
determination; or
(iii) In the absence of an established market for the Common
Stock, the Fair Market Value thereof shall be determined in good faith
by the Committee.
(s) "Group" means a "group" as such term is used in Section
13(d)(3) of the Exchange Act.
(t) "Holder" means a person who has received an Award under the
Plan.
(u) "Incentive Stock Option" means an Option intended to qualify as
an incentive stock option within the meaning of Section 422 of the Code.
(v) "Nonqualified Stock Option" means an Option not intended to
qualify as an Incentive Stock Option.
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<PAGE>
(w) "Officer" means a person who is an officer of the Company
within the meaning of Section 16 of the Exchange Act and the rules and
regulations promulgated thereunder.
(x) "Option" means a Stock Option granted pursuant to the Plan.
(y) "Option Agreement" shall mean the written option agreement,
substantially in the form attached hereto as Exhibit A (or such other form as
may be approved by the Committee for use under the Plan pursuant to Section
3(b)(v) hereof), between the Company and Holder evidencing the grant of an
Option.
(z) "Optioned Stock" means the Common Stock subject to an Option.
(aa) "Other Stock-Based Awards" means awards (other than Stock
Options, Stock Appreciation Rights, Restricted Stock, Deferred Stock and
Stock Reload Options) denominated or payable in, valued in whole or in part
by reference to, or otherwise based on, or related to shares of Common Stock.
(bb) "Parent" means a "parent corporation," whether now or hereafter
existing, as defined in Section 424(e) of the Code.
(cc) "Person" means an individual or entity.
(dd) "Plan" means this 1999 Equity Incentive Plan.
(ee) "Restricted Stock" means Stock, received under an Award made
pursuant to Section 9 below, that is subject to restrictions under said
Section 9.
(ff) "Rule 16b-3" means Rule 16b-3 promulgated under the Exchange
Act or any successor rule thereto.
(gg) "Section 16(b)" means Section 16(b) of the Exchange Act.
(hh) "SAR Value" means the excess of the Fair Market Value of one
share of Common Stock over the exercise price per share specified in a
related Stock Option in the case of a Stock Appreciation Right granted in
tandem with a Stock Option and the Stock Appreciation Right price per share
in the case of a Stock Appreciation Right awarded on a free standing basis,
in each case multiplied by the number of shares in respect of which the Stock
Appreciation Right shall be exercised, on the date of exercise.
(ii) "Share" means a share of the Common Stock of the Company.
(jj) "Stock" means the Common Stock of the Company.
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<PAGE>
(kk) "Stock Appreciation Right" means the right, pursuant to an
Award granted under Section 8 hereof, to recover an amount equal to the SAR
Value.
(ll) "Stock Option" means any Option to purchase shares of Stock
which is granted pursuant to the Plan.
(mm) "Stock Reload Option" means any option granted under Section
7(e) as a result of the payment of the exercise price of a Stock Option
and/or the withholding tax related thereto in the form of Stock owned by the
Holder or the withholding of Stock by the Company.
(nn) "Subsidiary" "Subsidiary" means a "subsidiary corporation,"
whether now or hereafter existing, as defined in Section 424(f) of the Code,
including without limitation, in the case of the Company, PHAST Corporation,
Axcess Technology, Ltd., and AMX Control Systems, Ltd. Pte.
(oo) "Tandem Stock Appreciation Right" means a Stock Appreciation
Right granted in tandem with all or part of any Stock Option granted under
the Plan.
3. ADMINISTRATION OF THE PLAN.
(a) PLAN ADMINISTRATION. The Plan at all times shall be
administered by the Committee, which shall be comprised solely of not less
than two members who shall be (i) "Non-Employee Directors" within the meaning
of Rule 16b-3 and (ii) unless otherwise determined by the Board of Directors,
"outside directors" within the meaning of Treasury Regulation Section
1.162-27(e)(3) under Section 162(m) of the Code.
(b) POWERS OF THE COMMITTEE. Subject to the provisions of the Plan
and subject to the approval of any relevant authorities, including the
approval, if required, of any stock exchange upon which the Common Stock is
listed, the Committee shall have the full authority to award: (i) Stock
Options, (ii) Stock Appreciation Rights, (iii) Restricted Stock, (iv)
Deferred Stock, (v) Stock Reload Options and/or (vi) Other Stock-Based
Awards. For purposes of illustration and not of limitation, the Committee
shall have the authority (subject to the express provisions of the Plan):
(i) to determine the Fair Market Value of the Common Stock;
(ii) to select the Consultants and Employees to whom Awards
may from time to time be granted hereunder;
(iii) to determine whether and to what extent Awards or any
combination thereof are granted hereunder;
(iv) to determine the number of Shares to be covered by each
such Award granted hereunder;
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<PAGE>
(v) to approve forms of agreement for use under the Plan;
(vi) to determine the terms and conditions, not inconsistent
with the terms of the Plan, of any Award granted hereunder. Such terms
and conditions include, but are not limited to, the exercise price of an
Option; any specified performance goals or other criteria which must be
attained for the vesting of an Award; any restrictions or limitations;
and any vesting, exchange, surrender, cancellation, acceleration,
termination, exercise or forfeiture provisions; and
(vii) to construe and interpret the terms of the Plan and Awards
granted pursuant to the Plan.
(c) EFFECT OF COMMITTEE'S DECISION. All decisions, determinations and
interpretations of the Committee shall be final and binding on all Holders of
any Awards. No member of the Board or any Committee administering the Plan shall
be liable for any action taken or determination made in good faith with respect
to the Plan or any Option granted hereunder.
4. STOCK SUBJECT TO THE PLAN.
The maximum aggregate number of Shares that may be acquired by Holders of
any Awards granted under the Plan is 3,000,000 Shares and the maximum number of
Shares that may be acquired by an individual Holder under the Plan shall not
exceed 1,500,000 (in each case subject to adjustment as provided in Section 12
of the Plan). The Shares may be authorized but unissued or reacquired Common
Stock.
If any shares of Stock that have been granted pursuant to a Stock Option
cease to be subject to a Stock Option, or if any shares of Stock that are
subject to any Stock Appreciation Right, Restricted Stock, Deferred Stock award,
Reload Stock Option or Other Stock-Based Award granted hereunder are forfeited
or any such award otherwise terminates without a payment being made to the
Holder in the form of Stock, such shares shall again be available for
distribution in connection with future grants and awards under the Plan. Only
net shares issued upon a stock-for-stock exercise (including stock used for
withholding taxes) shall be counted against the number of shares available under
the Plan.
5. ELIGIBILITY.
(a) Awards may be made or granted to key employees, officers,
directors and consultants of the Company who are deemed to have rendered or to
be able to render significant services to the Company or its Subsidiaries and
who are deemed to have contributed or to have the potential to contribute to the
success of the Company. No Incentive Stock Option shall be granted to any person
who is not an employee of the Company or a Subsidiary at the time of grant.
6
<PAGE>
(b) Each Option shall be designated in the Option Agreement as either
an Incentive Stock Option or a Nonqualified Stock Option. However,
notwithstanding such designation, to the extent that the aggregate Fair Market
Value of the Shares with respect to which Incentive Stock Options are
exercisable for the first time by the Optionee during any calendar year (under
all plans of the Company or any Affiliate) exceeds $100,000, such Options shall
be treated for tax purposes as Nonqualified Stock Options. For purposes of this
Section 5(b), Incentive Stock Options shall be taken into account in the order
in which they were granted. For purposes of this Section 5(b), the Fair Market
Value of the Shares shall be determined as of the time the Option with respect
to such Shares is granted.
(c) Neither the Plan nor any Award shall confer upon any Holder any
right with respect to continuation of his or her employment or consulting
relationship with the Company or any Affiliate, nor shall it interfere in any
way with his or her right or the Company's right to terminate his or her
employment or consulting relationship at any time, with or without cause.
6. OPTION EXERCISE PRICE AND CONSIDERATION.
(a) The per Share exercise price for the Shares to be issued upon
exercise of an Option shall be such price as is determined by the Committee, but
in the case of an Incentive Stock Option:
(i) granted to an Employee who, at the time of grant of such
Option, owns stock representing more than ten percent (10%) of the voting
power of all classes of stock of the Company or any Affiliate, the per
Share exercise price shall not be less than 110% of the Fair Market Value
per Share on the date of grant; and
(ii) granted to any other Employee, the per Share exercise price
shall not be less than 100% of the Fair Market Value per Share on the
date of grant.
(b) The consideration to be paid for the Shares to be issued upon
exercise of an Option, including the method of payment, shall be determined by
the Committee (and, in the case of an Incentive Stock Option, shall be
determined at the time of grant). Such consideration shall be paid, to the
extent permitted by applicable statutes and regulations at the time the Option
is exercised, either (i) in cash or check, or (ii) at the discretion of the
Committee, in one or a combination of the following ways (which may be in
combination with or in lieu of payment by cash or check): (A) by delivery to the
Company of other Shares of Common Stock of the Company to be valued at their
Fair Market Value on the exercise date, (B) according to a deferred payment or
other arrangement with the Person to whom the Option is granted or to whom the
Option is transferred pursuant to Section 15, (C) withholding of Shares that
would otherwise be issued upon the exercise of the Option, valued at their Fair
Market Value on the exercise date, or (D) in any other form of legal
consideration that may be acceptable to the Committee. In making its
determination as to the type of consideration to accept, the Committee shall
consider if acceptance of such consideration may be reasonably expected to
benefit the Company. In addition, such consideration shall be accompanied by the
delivery by the Optionee of a properly executed exercise notice together with
such other documentation as the
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<PAGE>
Committee and a broker, if applicable, shall require to effect an exercise of
the Option and delivery to the Company of the sale or loan proceeds required
to pay the exercise price.
7. EXERCISE OF OPTION.
(a) PROCEDURE FOR EXERCISE; RIGHTS AS A SHAREHOLDER. Any Option
granted hereunder shall be exercisable at such times and under such conditions
as determined by the Committee, including performance criteria with respect to
the Company and/or the Optionee, and as shall be permissible under the terms of
the Plan. The total number of Shares subject to an Option may, but need not, be
allotted in periodic installments (which may, but need not, be equal). The
Option Agreement may provide that from time to time during each of such
installment periods, the Option may become exercisable with respect to some or
all of the Shares allotted to that period and may be exercised with respect to
some or all of the Shares allotted to such period and/or any prior period as to
which the Option became vested but was not fully exercised.
An Option may not be exercised for a fraction of a Share. Exercise of an
Option in any manner shall result in a decrease in the number of Shares that
thereafter may be available, both for purposes of the Plan and for sale under
the Option, by the number of Shares as to which the Option is exercised.
Subject to Section 18, an Option shall be deemed to be exercised when
written notice of such exercise has been given to the Company in accordance with
the terms of the Option Agreement by the Person entitled to exercise the Option
and full payment for the Shares with respect to which the Option is exercised
has been received by the Company. To the extent required by applicable federal,
state, local or foreign law, an Optionee shall make arrangements satisfactory to
the Company for the satisfaction of any withholding tax obligations that arise
by reason of an Option exercise or any sale of Shares, which obligations may, as
authorized by the Committee, consist of any consideration and method of payment
allowable under Section 6(b) hereof. Until the issuance (as evidenced by the
appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company) of the stock certificate evidencing such Shares, no right
to vote, receive dividends or any other rights as a shareholder shall exist with
respect to the Optioned Stock, notwithstanding the exercise of the Option. The
Company shall issue (or cause to be issued) such stock certificate promptly upon
exercise of the Option. No adjustment shall be made for a dividend or other
right for which the record date is prior to the date the stock certificate is
issued, except as provided in Section 12 hereof.
(b) TERMINATION OF EMPLOYMENT OR CONSULTING RELATIONSHIP. Subject to
paragraph (c) below, in the event of termination of an Optionee's Continuous
Status as an Employee or Consultant, such Optionee may exercise his or her
Option to the extent that the Optionee was entitled to exercise it at the date
of such termination; provided, however, that such Option may be exercised only
within such period of time as is determined by the Committee at the date of
grant. Such time period shall not, in the case of an Incentive Stock Option,
exceed three (3) months after the date of such termination and shall not, in any
case, be later than the expiration date of the term of such
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<PAGE>
Option as set forth in the Option Agreement. To the extent that the Optionee
was not entitled to exercise the Option at the date of such termination, or
if the Optionee does not exercise such Option to the extent so entitled
within the time specified herein, the Option shall terminate, and the Shares
covered by such Option shall revert to the Plan. An Optionee's Continuous
Status as an Employee or Consultant shall not be terminated in the event of
Optionee's change of status from an Employee to a Consultant or from a
Consultant to an Employee; provided, however, that in the event of an
Optionee's change of status from an Employee to a Consultant, any Incentive
Stock Option granted to such Employee shall automatically cease to be treated
for tax purposes as an Incentive Stock Option and shall be treated for tax
purposes as a Nonqualified Stock Option on the day three months and one day
following such change of status.
(c) DISABILITY OF OPTIONEE. In the event of termination of an
Optionee's Continuous Status as an Employee or Consultant as a result of his or
her disability, the Optionee may, but only within twelve (12) months from the
date of such termination (and in no event later than the expiration date of the
term of such Option as set forth in the Option Agreement), exercise the Option
to the extent he or she otherwise was entitled to exercise it at the date of
such termination. If such disability is not a "disability" as such term is
defined in Section 22(e)(3) of the Code, then in the case of an Incentive Stock
Option such Incentive Stock Option shall automatically cease to be treated for
tax purposes as an Incentive Stock Option and shall be treated for tax purposes
as a Nonqualified Stock Option on the day three months and one day following
such termination. To the extent that the Optionee was not entitled to exercise
the Option at the date of termination, or if the Optionee does not exercise such
Option to the extent so entitled within the time specified herein, the Option
shall terminate, and the Shares covered by such Option shall revert to the Plan.
(d) DEATH OF OPTIONEE. In the event of the death of an Optionee, the
Option may be exercised at any time within twelve (12) months following the date
of death (but in no event later than the expiration date of the term of such
Option as set forth in the Option Agreement) by the Optionee's estate or by any
Person who acquired the right to exercise the Option by bequest or inheritance
(the "Option Beneficiary"), but only to the extent that the Optionee was
entitled to exercise the Option on the date of death. To the extent that, at the
time of death, the Optionee was not entitled to exercise the Option, or if the
Option Beneficiary does not exercise the Option within the time specified
herein, the Option shall terminate and the Shares covered by such Option shall
revert to the Plan.
(e) STOCK RELOAD OPTION. The Committee may also grant to the Holder
(concurrently with the grant of an Incentive Stock Option and at or after the
time of grant in the case of a Non-Qualified Stock Option) a Stock Reload Option
up to the amount of shares of Stock held by the Holder for at least six months
and used to pay all or part of the exercise price of an Option and, if any,
withheld by the Company as payment for withholding taxes. Such Stock Reload
Option shall have an exercise price of the Fair Market Value as of the date of
the Stock Reload Option grant. Unless the Committee determines otherwise, a
Stock Reload Option may be exercised commencing one year after it is granted and
shall expire on the date of expiration of the Option to which the Stock Reload
Option is related.
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8. STOCK APPRECIATION RIGHTS.
(a) GRANT AND EXERCISE. Stock Appreciation Rights may be granted in
tandem with (i.e., Tandem Stock Appreciation Right) or in conjunction with all
or part of any Stock Option granted under the Plan or may be granted on a
free-standing basis. In the case of a Non-Qualified Stock Option, a Tandem Stock
Appreciation Right may be granted either at or after the time of the grant of
such Non-Qualified Stock Option. In the case of an Incentive Stock Option, a
Tandem Stock Appreciation Right may be granted only at the time of the grant of
such Incentive Stock Option.
(b) TERMS AND CONDITIONS. Stock Appreciation Rights shall be subject
to the following terms and conditions:
(i) EXERCISABILITY. Tandem Stock Appreciation Rights shall be
exercisable only at such time or times and to the extent that the Stock
Options to which they relate shall be exercisable in accordance with the
provisions of Section 7 hereof and this Section 8 and may be subject to
the Code with respect to related Incentive Stock Options and such
additional limitations on exercisability as shall be determined by the
Committee and set forth in the Agreement. Other Stock Appreciation Rights
shall be exercisable at such time or times and subject to such terms and
conditions as shall be determined by the Committee and set forth in the
Agreement.
(ii) TERMINATION. A Tandem Stock Appreciation Right shall
terminate and shall no longer be exercisable upon the termination or
exercise of the related Stock Option, except that, unless otherwise
determined by the Committee at the time of grant, a Tandem Stock
Appreciation Right granted with respect to less than the full number of
shares covered by a related Stock Option shall not be reduced until after
the number of shares remaining under the related Stock Option equals the
number of shares covered by the Tandem Stock Appreciation Right.
(iii) METHOD OF EXERCISE. A Tandem Stock Appreciation Right may
be exercised by a Holder by surrendering the applicable portion of the
related Stock Option. Upon such exercise and surrender, the Holder shall
be entitled to receive such amount in the form determined pursuant to
Section 8(b)(iv) below. Stock Options which have been so surrendered, in
whole or in part, shall no longer be exercisable to the extent the
related Tandem Stock Appreciation Rights have been exercised.
(iv) RECEIPT OF SAR VALUE. Upon the exercise of a Stock
Appreciation Right, a Holder shall be entitled to receive up to, but not
more than, an amount in cash and/or shares of Stock equal to the SAR
Value with the Committee having the right to determine the form of
payment.
(v) SHARES AFFECTED UPON PLAN. Upon the exercise of a Tandem
Stock Appreciation Right, the Stock Option or part thereof to which such
Tandem Stock
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Appreciation Right is related shall be deemed to have been exercised for
the purpose of the limitation set forth in Section 4 hereof on the number
of shares of Common Stock to be issued under the Plan, but only to the
extent of the number of shares, if any, issued under the Tandem Stock
Appreciation Right at the time of exercise based upon the SAR Value.
9. RESTRICTED STOCK.
(a) GRANT. Shares of Restricted Stock may be awarded either alone or
in addition to other Awards granted under the Plan. The Committee shall
determine the eligible persons to whom, and the time or times at which, grants
of Restricted Stock will be awarded, the number of shares to be awarded, the
price (if any) to be paid by the Holder, the time or times within which such
Awards may be subject to forfeiture ("Restriction Period"), the vesting schedule
and rights to acceleration thereof, and all other terms and conditions of the
Awards.
(b) TERMS AND CONDITIONS. Each Restricted Stock Award shall be
subject to the following terms and conditions:
(i) CERTIFICATES. Restricted Stock, when issued, will be
represented by a stock certificate or certificates registered in the name
of the Holder to whom such Restricted Stock shall have been awarded.
During the Restriction Period, certificates representing the Restricted
Stock and any securities constituting Retained Distributions (as defined
below) shall bear a legend to the effect that ownership of the Restricted
Stock (and such Retained Distributions), and the enjoyment of all rights
appurtenant thereto, are subject to the restrictions, terms and
conditions provided in the Plan and the Agreement. Such certificates
shall be deposited by the Holder with the Company, together with stock
powers or other instruments of assignment, each endorsed in blank, which
will permit transfer to the Company of all or any portion of the
Restricted Stock and any securities constituting Retained Distributions
that shall be forfeited or that shall not become vested in accordance
with the Plan and the Agreement.
(ii) RIGHTS OF HOLDER. Restricted Stock shall constitute issued
and outstanding shares of Common Stock for all corporate purposes. The
Holder will have the right to vote such Restricted Stock, to receive and
retain all regular cash dividends and other cash equivalent distributions
as the Board may in its sole discretion designate, pay or distribute on
such Restricted Stock and to exercise all other rights, powers and
privileges of a holder of Common Stock with respect to such Restricted
Stock, with the exceptions that (A) the Holder will not be entitled to
delivery of the stock certificate or certificates representing such
Restricted Stock until the Restriction Period shall have expired and
unless all other vesting requirements with respect thereto shall have
been fulfilled; (B) the Company will retain custody of the stock
certificate or certificates representing the Restricted Stock during the
Restriction Period; (C) other than regular cash dividends and other cash
equivalent distributions as the Board may in its sole discretion
designate, pay or distribute, the Company will retain custody of all
distributions ("Retained Distributions") made or declared with
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respect to the Restricted Stock (and such Retained Distributions will be
subject to the same restrictions, terms and conditions as are applicable
to the Restricted Stock) until such time, if ever, as the Restricted
Stock with respect to which such Retained Distributions shall have been
made, paid or declared shall have become vested and with respect to which
the Restriction Period shall have expired; (D) a breach of any of the
restrictions, terms or conditions contained in this Plan or the Agreement
or otherwise established by the Committee with respect to any Restricted
Stock or Retained Distributions will cause a forfeiture of such
Restricted Stock and any Retained Distributions with respect thereto.
(iii) VESTING: FORFEITURE. Upon the expiration of the
Restriction Period with respect to each Award of Restricted Stock and the
satisfaction of any other applicable restrictions, terms and conditions
(A) all or part of such Restricted Stock shall become vested in
accordance with the terms of the Agreement, and (B) any Retained
Distributions with respect to such Restricted Stock shall become vested
to the extent that the Restricted Stock related thereto shall have become
vested. Any such Restricted Stock and Retained Distributions that do not
vest shall be forfeited to the Company and the Holder shall not
thereafter have any rights with respect to such Restricted Stock and
Retained Distributions that shall have been so forfeited.
10. DEFERRED STOCK.
(a) GRANT. Shares of Deferred Stock may be awarded either alone or in
addition to other Awards granted under the Plan. The Committee shall determine
the eligible persons to whom and the time or times at which grants of Deferred
Stock shall be awarded, the number of shares of Deferred Stock to be awarded to
any person, the duration of the period ("Deferral Period") during which, and the
conditions under which receipt of the shares will be deferred, and all the other
terms and conditions of the Awards.
(b) TERMS AND CONDITIONS. Each Deferred Stock Award shall be subject
to the following terms and conditions:
(i) CERTIFICATES. At the expiration of the Deferral Period (or
the Additional Deferral Period referred to in Section 10(b)(iii) below,
where applicable), share certificates shall be delivered to the Holder,
or his legal representative, representing the number equal to the shares
covered by the Deferred Stock Award.
(ii) VESTING; FORFEITURE. Upon the expiration of the Deferral
Period (or the Additional Deferral Period, where applicable) with respect
to each Award of Deferred Stock and the satisfaction of any other
applicable limitations, terms or conditions, such Deferred Stock shall
become vested in accordance with the terms of the Agreement. Any Deferred
Stock that does not vest shall be forfeited to the Company and the Holder
shall not thereafter have any rights with respect to such Deferred Stock
that has been so forfeited.
12
<PAGE>
(iii) ADDITIONAL DEFERRAL PERIOD. A Holder may request to,
and the Committee may at any time, defer the receipt of an Award (or
an installment of an Award) for an additional specified period or
until a specified event ("Additional Deferral Period"). Subject to any
exceptions adopted by the Committee, such request must generally be
made at least one year prior to expiration of the Deferral Period for
such Deferred Stock Award (or such installment).
11. OTHER STOCK-BASED AWARDS.
(a) GRANT AND EXERCISE. Other Stock-Based Awards may be awarded,
subject to limitations under applicable law, that are denominated or payable
in, valued in whole or in part by reference to, or otherwise based on, or
related to, shares of Common Stock, as deemed by the Committee to be
consistent with the purposes of the Plan, including, without limitation,
purchase rights, shares of Common Stock awarded which are not subject to any
restrictions or conditions, convertible or exchangeable debentures, or other
rights convertible into shares of Common Stock and Awards valued by reference
to the value of securities of or the performance of specified Subsidiaries.
Other Stock-Based Awards may be awarded either alone or in addition to or in
tandem with any other Awards under this Plan or any other plan of the
Company.
(b) ELIGIBILITY FOR OTHER STOCK-BASED AWARDS. The Committee shall
determine the eligible persons to whom and the time or times at which grants
of such Other Stock-Based Awards shall be made, the number of shares of
Common Stock to be awarded pursuant to such Awards, and all other terms and
conditions of the Awards.
(c) TERMS AND CONDITIONS. Each Other Stock-Based Award shall be
subject to such terms and conditions as may be determined by the Committee.
12. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION OR MERGER.
(a) CHANGES IN CAPITALIZATION. Subject to any required action by
the shareholders of the Company, the number of shares of Common Stock covered
by each outstanding Award, and the number of shares of Common Stock which
have been authorized for issuance under the Plan but as to which no Awards
have yet been granted or which have been returned to the Plan upon
cancellation or expiration of an Award, as well as the price per share of
Common Stock covered by each such outstanding Award, shall be proportionately
adjusted for any increase or decrease in the number of issued shares of
Common Stock resulting from a stock split, reverse stock split, stock
dividend, combination or reclassification of the Common Stock, or any other
increase or decrease in the number of issued shares of Common Stock effected
without receipt of consideration by the Company. The conversion of any
convertible securities of the Company shall not be deemed to have been
"effected without receipt of consideration." Such adjustment shall be made by
the Committee, whose determination in that respect shall be final, binding
and conclusive. Except as expressly provided herein, no issuance by the
Company of shares of stock of any class, or securities convertible or
exchangeable into shares of stock of any class, shall affect, and no
adjustment by reason thereof shall
13
<PAGE>
be made with respect to, the number or exercise price of shares of Common
Stock subject to an Award.
(b) DISSOLUTION OR LIQUIDATION. In the event of the proposed
dissolution or liquidation of the Company, the Committee shall notify the
Holder at least fifteen (15) days prior to such proposed action. To the
extent it has not been previously exercised, the Award shall terminate
immediately prior to the consummation of such proposed action; provided,
however, that the Committee may, in the exercise of its sole discretion in
such instances, declare that any Award shall terminate as of an earlier date
fixed by the Committee and give each Holder the right to exercise his or her
rights as to all or any part of the Award, including Shares as to which the
Award would not otherwise be exercisable.
(c) MERGER OR ASSET SALE. Subject to Section 12(d), in the event
of the merger of the Company into, or the consolidation of the Company with,
another corporation in which the shareholders of the Company receive cash or
securities of another issuer, or any combination thereof, in exchange for
their shares of Common Stock, or the sale of all or substantially all of the
assets of the Company, each outstanding Award shall be assumed or an
equivalent option or right substituted by the successor corporation or an
Affiliate of the successor corporation. In the event that the successor
corporation refuses to assume or substitute for the Award, the Holder shall
fully vest in and have the right to exercise the Award (provided it has not
already terminated), including Shares as to which it would not otherwise be
vested or exercisable. If an Award becomes fully vested and exercisable in
lieu of assumption or substitution in the event of a merger, consolidation or
sale of assets, the Committee shall notify the Holder that the Award shall be
fully exercisable for a period of fifteen (15) days from the date of such
notice, and the Award shall terminate upon the expiration of such period. For
the purposes of this paragraph, the Award shall be considered assumed if,
following the merger, consolidation or sale of assets, the option substituted
for such Award confers the right to purchase or receive, for each Share of
Stock subject to the Award immediately prior to the merger, consolidation or
sale of assets, the per Share consideration (whether stock, cash, or other
securities or property) received in the merger, consolidation or sale of
assets by holders of Common Stock (and if holders were offered a choice of
consideration, the type of consideration chosen by the holders of a majority
of the outstanding Shares); provided, however, that if such consideration
received in the merger, consolidation or sale of assets is not solely common
stock of the successor corporation or its Parent (if any), the Committee may,
with the consent of the successor corporation, provide for the consideration
to be received upon the exercise of the Award, for each Share of Stock
subject to the Award, to be solely common stock of the successor corporation
or its Parent (if any) equal in fair market value to the per Share
consideration received by holders of Common Stock in the merger,
consolidation or sale of assets.
(d) CHANGE OF CONTROL. Notwithstanding anything to the contrary,
the Committee may grant Awards which provide for the acceleration of the
vesting of Shares subject to the Award upon a Change of Control. Such
provisions shall be set forth in the Agreement.
14
<PAGE>
(e) FURTHER ADJUSTMENTS. In the event of any change of a type
described in paragraphs (a) or (c) above, the Committee shall make any
further adjustment to the maximum number of Shares which may be acquired
under the Plan pursuant to the exercise of Awards, the maximum number of
Shares for which Awards may be granted to any one Employee and the number of
Shares and price per Share subject to outstanding Awards as shall be
equitable to prevent dilution or enlargement of rights under such Awards, and
the determination of the Committee as to these matters shall be conclusive
and binding on the Holder; provided, however, that (i) each such adjustment
with respect to an Incentive Option shall comply with the rules of Section
424(a) of the Code (or any successor provision) and (ii) in no event shall
any adjustment be made which would render any Incentive Stock Option granted
hereunder other than an "incentive stock option" as defined in Section 422 of
the Code.
(f) NO LIMITATION ON RIGHT TO MERGE, ETC. The grant of Awards
pursuant to the Plan shall not restrict in any way the right or power of the
Company to make adjustments, reclassifications, reorganizations or changes of
its capital or business structure or to merge, consolidate, dissolve,
liquidate, or sell or transfer all or any part of its business or assets.
13. TERM OF PLAN.
The Plan shall become effective upon the earlier to occur of its
adoption by the Board of Directors or its approval by the shareholders of the
Company, as described in Section 21 of the Plan. It shall continue in effect
for a term of ten (10) years unless sooner terminated under Section 17 of the
Plan.
14. TERM OF OPTIONS.
The term of each Option shall be the term stated in the Option
Agreement; provided, however, that the term shall be no more than ten (10)
years from the date of grant thereof; and provided further that in the case
of an Incentive Stock Option granted to an Optionee who, at the time the
Option is granted, owns stock representing more than ten percent (10%) of the
voting power of all classes of stock of the Company or any Affiliate, the
term of the Option shall be no more than five (5) years from the date of
grant thereof.
15. NON-TRANSFERABILITY OF AWARDS.
An Incentive Stock Option shall not be transferrable except by will or
by the laws of descent and distribution and shall be exercisable during the
lifetime of the Person to whom the Incentive Stock Option is granted only by
such Person. Any other Award, including a Nonqualified Stock Option, shall
not be transferrable except by will or by the laws of descent and
distribution or pursuant to a qualified domestic relations order, as defined
by the Code or by Title I of the Employee Retirement Income Security Act of
1974, as amended, or the rules thereunder (a "QDRO"), and shall be
exercisable during the lifetime of the Person to whom the Option is granted
only by such Person or any transferee pursuant to a QDRO; provided, however,
that the Board of Directors or the
15
<PAGE>
Committee, as applicable, in its discretion, may allow for transferability of
Nonqualified Stock Options by a Holder to "Immediate Family Members." For
purposes of the Plan, "Immediate Family Members" means children,
grandchildren, spouse or common law spouse, siblings or parents of the Holder
or to bona fide trusts, partnerships or other entities controlled by and of
which the beneficiaries are Immediate Family Members of the Holder. Any
Nonqualified Stock Option grants that are transferable are further
conditioned on the Holder and Immediate Family Members agreeing to abide by
the Company's then current stock option transfer guidelines.
16. TIME OF GRANTING AWARDS.
The date of grant of an Award shall, for all purposes, be the date on
which the Committee makes the determination granting such Award, or such
other date as is determined by the Committee. Notice of the determination
shall be given to each Employee or Consultant to whom an Award is so granted
within a reasonable time after the date of such grant.
17. AMENDMENT AND TERMINATION OF THE PLAN.
The Board may amend or terminate the Plan in any respect whatsoever,
provided that any such amendment or termination of the Plan shall not affect
Award already granted and such Award shall remain in full force and effect as
if the Plan had not been amended or terminated. In addition, to the extent
necessary and desirable to comply with Rule 16b-3 (or any other applicable
law or regulation, including the requirements of the NASD or an established
stock exchange), the Company shall obtain shareholder approval of any Plan
amendment in such a manner and to such a degree as required.
18. CONDITIONS UPON ISSUANCE OF SHARES.
Shares shall not be issued pursuant to an Award unless the issuance
and delivery of such Shares pursuant thereto shall comply with all relevant
Applicable Laws, including, without limitation, the Securities Act of 1933,
as amended (the "Securities Act"), the Exchange Act, the rules and
regulations promulgated thereunder, and the requirements of any stock
exchange upon which the Shares may then be listed or any automatic quotation
system upon which the Shares may then be quoted, and shall be further subject
to the approval of counsel for the Company with respect to such compliance.
The Company may require any Optionee or other Holder, as a condition
of receiving Shares pursuant to an Award, (i) to give written assurances
satisfactory to the Company as to the Holder's knowledge and experience in
financial and business matters and/or to employ a purchaser representative
reasonably satisfactory to the Company who is knowledgeable and experienced
in financial and business matter, and that he or she is capable of
evaluating, alone or together with the purchaser representative, the merits
and risks of exercising the Award; (ii) to give written assurances
satisfactory to the Company stating that such Person is acquiring the Shares
subject to the Award for such Person's own account and not with any present
intention of selling or otherwise distributing such
16
<PAGE>
Shares; and (iii) to deliver such other documentation as may be necessary to
comply with federal and state securities laws. These requirements, and any
assurances given pursuant to such requirements, shall be inoperative if (i)
the issuance of the Shares upon the exercise of the Award has been registered
under a then currently effective registration statement under the Securities
Act and all applicable state securities laws, or (ii) as to any particular
requirement, a determination is made by counsel for the Company that such
requirement need not be met in the circumstances under the then applicable
securities laws. The Company may, upon advice of counsel to the Company,
place legends on stock certificates issued under the Plan as such counsel
deems necessary or appropriate in order to comply with applicable securities
laws, including, but not limited to, legends restricting the transfer of the
Shares, and may enter stop-transfer orders against the transfer of the Shares
issued upon the exercise of an Award.
The inability of the Company to obtain authority from any regulatory
body having jurisdiction, which authority is deemed by the Company's counsel
to be necessary to the lawful issuance and sale of any Shares hereunder,
shall relieve the Company of any liability in respect of the failure to issue
or sell such Shares as to which such requisite authority shall not have been
obtained.
19. RESERVATION OF SHARES.
The Company, during the term of the Plan, shall at all times reserve
and keep available such number of Shares as shall be sufficient to satisfy
the requirements of the Plan.
20. AGREEMENTS.
Options shall be evidenced by Option Agreements in such form as the
Committee shall approve from time to time. Other Awards shall be evidenced by
similar Agreements.
21. SHAREHOLDER APPROVAL.
Continuance of the Plan shall be subject to approval by the
shareholders of the Company within twelve (12) months before or after the
date the Plan is adopted. Such shareholder approval shall be obtained to the
extent and in manner required under Applicable Laws and the rules of any
stock exchange upon which the Common Stock is listed or any automatic
quotation system upon which the Common Stock is quoted.
22. USE OF PROCEEDS FROM STOCK.
Proceeds from the sale of stock pursuant to Options or other Awards
shall constitute general funds of the Company.
17
<PAGE>
23. MISCELLANEOUS.
(a) ACCELERATION OF VESTING. The Committee shall have the power to
accelerate the time at which an Award may first be exercised or the time
during which an Award or any part thereof will vest, notwithstanding the
provisions in the Award Agreement stating the time at which it may first be
exercised or the time during which it will vest.
(b) RULE 16b-3. With respect to Persons subject to Section 16 of
the Exchange Act, transactions under the Plan are intended to comply with all
applicable conditions of Rule 16b-3 and with respect to such Persons all
transactions shall be subject to such conditions regardless of whether they
are expressly set forth in the Plan or the Award Agreement. To the extent any
provision of the Plan or action by the Committee fails to so comply, it shall
not apply to such Persons or their transactions and shall be deemed null and
void, to the extent permitted by law and deemed advisable by the Committee.
(c) GRANTS EXCEEDING ALLOTTED SHARES. If the number of shares of
Stock subject to an Award granted pursuant to the Plan exceeds, as of the
date of grant, the number of Shares that may be issued under the Plan without
additional shareholder approval, such Award shall be void with respect to
such excess Shares, unless shareholder approval of an amendment sufficiently
increasing the number of Shares subject to the Plan is timely obtained in
accordance with Section 17 of the Plan.
(d) NOTICE. Any written notice to the Company required by any of
the provisions of the Plan shall be addressed to the Secretary of the Company
and shall become effective when it is received. Any written notice to Holders
required by any provisions of the Plan shall be addressed to the Holder at
the address on file with the Company and shall become effective three days
after it is mailed by certified mail, postage prepaid to such address or at
the time of delivery if delivered sooner by messenger or overnight courier.
(e) SAVINGS CLAUSE. Notwithstanding any other provision hereof,
the Plan is intended to qualify as a plan pursuant to which Incentive Stock
Options may be issued under Section 422 of the Code. If the Plan or any
provision of the Plan shall be held to be invalid or to fail to meet the
requirements of Section 422 of the Code or the regulations promulgated
thereunder, such invalidity or failure shall not affect the remaining parts
of the Plan, but rather it shall be construed and enforced as if the Plan or
the affected provision thereof, as the case may be, complied in all respects
with the requirements of Section 422 of the Code.
(f) GOVERNING LAW. The Plan and all rights and obligations
thereunder shall be construed in accordance with and governed by the laws of
the State of Texas without regard to its conflict of laws rules.
18
<PAGE>
EXHIBIT A
AMX CORPORATION
1999 EQUITY INCENTIVE PLAN
STOCK OPTION AGREEMENT
Unless otherwise defined herein, the terms defined in the Plan shall
have the same defined meanings in this Option Agreement.
I. NOTICE OF STOCK OPTION GRANT
[Optionee's name and address]
You have been granted an option to purchase Common Stock of the
Company, subject to the terms and conditions of this Option Agreement and the
Plan, including the provisions thereof relating to increases in the number of
shares covered by this Option upon the occurrence of certain specified
events, as follows:
<TABLE>
<CAPTION>
<S> <C>
Grant Number
-------------------------------------
Date of Grant
-------------------------------------
Vesting Commencement Date . . .
-------------------------------------
Exercise Price per Share . . . . $
-------------------------------------
Total Number of Shares Granted .
-------------------------------------
Total Exercise Price . . . . . . $
-------------------------------------
Type of Option: Incentive Stock Option
----
Nonqualified Stock Option
----
Term/Expiration Date:
(No more than 10 years from date
of grant, 5 years for certain
grants)
</TABLE>
VESTING SCHEDULE
This Option may be exercised, in whole or in part, in accordance with
the following schedule. Except only as specifically provided elsewhere herein
or in the Plan, this Option shall be exercisable in the following cumulative
installments:
[NOTE: TO BE COMPLETED UPON GRANT OF OPTIONS]
TERMINATION PERIOD
You may exercise this Option for three months (or such shorter period
provided for elsewhere herein) after your employment or consulting
relationship with the Company terminates, or for such
19
<PAGE>
longer period upon your death or disability as provided in the Plan. If your
status changes from Employee to Consultant or Consultant to Employee, this
Option Agreement shall remain in effect. In no case may you exercise this
Option after the Term/Expiration Date as provided above. Notwithstanding the
foregoing, in the event the Company terminates your employment for Cause (as
defined below), this Option will terminate on the date of the termination of
your employment and will not be exercisable thereafter. For purposes of this
Agreement, "Cause" means the occurrence of any of the following events or
reasons:
(a) Optionee's conviction for a felony offense or commission by
Optionee of any act abhorrent to the community that the Company considers
materially damaging to or tending to discredit the reputation of the Company;
(b) Dishonesty, fraud, willful misconduct, unlawful discrimination
or theft on the part of Optionee;
(c) Optionee's using for his or her own benefit any confidential or
proprietary information of the Company, or willfully or negligently divulging
any such information to third parties without the prior written consent of
the Company;
(d) Optionee's public drunkenness, public use of illegal substances
or drugs or the use, possession, distribution or being under the influence of
alcohol or illegal substances or drugs in the workplace (the only exception
is that Optionee may consume alcohol reasonably and responsibly, if he or she
so chooses, at legitimate business events and functions where alcohol is
legally available); or
(e) the determination by the Company that Optionee has continually
failed or refused to comply, after notice of and a reasonable opportunity to
cure such failure or refusal, with the policies, standards, regulations,
instructions, or directions of the Company as they currently exist or as they
may be modified from time to time.
II. AGREEMENT
1. GRANT OF OPTION. AMX Corporation (the "Company") hereby grants
to the Optionee named in Section I hereof (the "Optionee") an option
(the"Option") to purchase the total number of shares of Common Stock (the
"Shares") set forth in Section I hereof, at the exercise price per share set
forth in Section I hereof (the "Exercise Price") subject to the terms,
definitions and provisions of the 1999 Stock Option Plan (the "Plan") adopted
by the Company, which is incorporated herein by reference. Unless otherwise
defined herein, the terms defined in the Plan shall have the same defined
meanings in this Option Agreement.
If designated in Section I hereof as an Incentive Stock Option, this
Option is intended (subject to Section 5(b) of the Plan) to qualify as an
Incentive Stock Option as defined in Section 422 of the Code.
20
<PAGE>
2. EXERCISE OF OPTION.
(a) RIGHT TO EXERCISE. This Option shall be exercisable during its
term in accordance with the Vesting Schedule set out in Section I hereof and
with the applicable provisions of the Plan and this Option Agreement. In the
event of Optionee's death, disability or other termination of the employment
or consulting relationship, this Option shall be exercisable in accordance
with the applicable provisions of the Plan and this Option Agreement.
(b) METHOD OF EXERCISE. This Option shall be exercisable by
written notice (in the form attached hereto as Exhibit A) which shall state
the election to exercise the Option, the number of Shares in respect of which
the Option is being exercised, and such other representations and agreements
as to the holder's investment intent with respect to such shares of Common
Stock as may be required by the Company pursuant to the provisions of the
Plan. Such written notice shall be signed by the Optionee and shall be
delivered in person or by certified mail to the Secretary of the Company. The
written notice shall be accompanied by payment of the Exercise Price. This
Option shall be deemed to be exercised upon receipt by the Company of such
written notice accompanied by the Exercise Price.
The Optionee shall, upon notification of the amount due (if any) as a
result of the exercise of the Option and prior to or concurrent with delivery
of the certificate representing the Shares, pay to the Company as provided in
the Plan amounts necessary to satisfy applicable federal, state and local tax
withholding requirements.
No Shares will be issued pursuant to the exercise of an Option unless
such issuance and such exercise shall comply with all relevant provisions of
law and the requirements of any stock exchange upon which the Shares may then
be listed or any automatic quotation system upon which the Shares may then be
quoted. Assuming such compliance, for income tax purposes the Shares shall be
considered transferred to the Optionee on the date on which the Option is
exercised with respect to such Shares.
3. METHOD OF PAYMENT. The purchase price of Optioned Shares
acquired pursuant to the Option shall be paid as set forth in the Plan. THE
USE OF SHARES OF STOCK ACQUIRED OR TO BE ACQUIRED TO PAY FOR EXERCISED SHARES
MAY HAVE INCOME TAX CONSEQUENCES FOR THE OPTIONEE.
4. RESTRICTIONS ON EXERCISE. This Option may not be exercised
until such time as the Plan has been approved by the shareholders of the
Company, and may not be exercised if the issuance of such Shares upon such
exercise or the method of payment of consideration for such shares would
constitute a violation of any applicable federal or state securities or other
law or regulation, including any rule under Part 207 of Title 12 of the Code
of Federal Regulations as promulgated by the Federal Reserve Board.
21
<PAGE>
5. NON-TRANSFERABILITY OF OPTION. This Option may not be transferred
in any manner otherwise than by will or by the laws of descent or distribution
or as otherwise set forth in the Plan and may be exercised during the lifetime
of Optionee only by Optionee or a permitted transferee as set forth in the Plan.
The terms of the Plan and this Option shall be binding upon the executors,
administrators, heirs, successors and assigns of the Optionee.
6. TERM OF OPTION. This Option may be exercised only within the term
set out in Section I hereof, and may be exercised during such term only in
accordance with the Plan and the terms of this Option. The limitations set out
in Sections 5 and 6 of the Plan regarding Options designated as Incentive Stock
Options and Options granted to more than ten percent (10%) shareholders shall
apply to this Option.
7. TAX CONSEQUENCES. The grant and/or exercise of the Option will
have federal and state income tax consequences. THE OPTIONEE SHOULD CONSULT A
TAX ADVISER UPON THE GRANT OF THE OPTION AND BEFORE EXERCISING THE OPTION OR
DISPOSING OF THE SHARES ACQUIRED UPON EXERCISE, PARTICULARLY WITH RESPECT TO HIS
OR HER STATE'S TAX LAWS.
8. ENTIRE AGREEMENT; GOVERNING LAW. The Plan is incorporated herein
by reference. The Plan and this Option Agreement constitute the entire agreement
of the parties with respect to the subject matter hereof and supersede in their
entirety all prior undertakings and agreements of the Company and Optionee with
respect to the subject matter hereof, and this Option Agreement may not be
amended except by means of a writing signed by the Company and Optionee. This
Option Agreement is governed by Texas law except for that body of law pertaining
to conflict of laws.
9. WARRANTIES, REPRESENTATIONS AND COVENANTS. The undersigned
Optionee warrants and represents that he or she has reviewed the Plan and this
Option Agreement in their entirety, has had an opportunity to obtain the advice
of counsel prior to executing this Option Agreement and fully understands all
provisions of the Plan and Option Agreement. Optionee hereby agrees to accept as
binding, conclusive and final all decisions or interpretations of the Committee
upon any questions relating to the Plan and Option Agreement. Optionee further
agrees to notify the Company upon any change in the residence address indicated
below. OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO
THE OPTION HEREOF IS EARNED ONLY BY CONTINUING CONSULTANCY OR EMPLOYMENT AT THE
WILL OF THE COMPANY (NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED THIS
OPTION OR ACQUIRING SHARES HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES
THAT NOTHING IN THIS OPTION AGREEMENT, NOR IN THE PLAN, WHICH IS INCORPORATED
HEREIN BY REFERENCE, SHALL CONFER UPON OPTIONEE ANY RIGHT WITH RESPECT TO
CONTINUATION OF EMPLOYMENT OR CONSULTANCY BY THE COMPANY, NOR SHALL IT INTERFERE
IN ANY WAY WITH OPTIONEE'S RIGHT OR THE COMPANY'S RIGHT TO TERMINATE OPTIONEE'S
EMPLOYMENT OR CONSULTANCY AT ANY TIME, WITH OR WITHOUT CAUSE.
22
<PAGE>
AMX CORPORATION
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
OPTIONEE:
--------------------------------------
Signature
--------------------------------------
Print Name
--------------------------------------
Residence Address
--------------------------------------
Area Code/Telephone Number
23
<PAGE>
EXHIBIT A
AMX CORPORATION
1999 EQUITY INCENTIVE PLAN
EXERCISE NOTICE
AMX Corporation
11995 Forestgate Drive
Dallas, Texas 75243
Attention: Secretary
1. EXERCISE OF OPTION. Effective as of today, ________, 199__, the
undersigned ("Purchaser") hereby elects to purchase ______ shares (the "Shares")
of the Common Stock of AMX Corporation (the "Company") under and pursuant to the
1999 Stock Option Plan (the "Plan") and the Stock Option Agreement dated
_______, 199__ (the "Option Agreement"). The purchase price for the Shares shall
be $_____, as specified in the Option Agreement.
2. DELIVERY OF PAYMENT. Purchaser herewith delivers to the
Company the full purchase price for the Shares of _____________________________.
THE USE OF SHARES OF STOCK ACQUIRED OR TO BE ACQUIRED FOR EXERCISED SHARES MAY
HAVE INCOME TAX CONSEQUENCES FOR THE OPTIONEE.
3. REPRESENTATIONS OF PURCHASER. Purchaser acknowledges that
Purchaser has received, read and understood the Plan and the Option Agreement
and agrees to abide by and be bound by their terms and conditions.
4. RIGHTS AS SHAREHOLDER. The Purchaser shall not be deemed to be
the holder of, or to have any of the rights of a holder with respect to, any
Shares subject for which such Option is exercised including, but not limited to,
rights to vote or to receive dividends unless and until the Purchaser has
satisfied all requirements for exercise of the Option pursuant to its terms, the
certificates evidencing such Shares have been issued and the Purchaser has
become a record holder of such Shares. A share certificate for the number of
Shares so acquired shall be issued to the Optionee as soon as practicable after
exercise of the Option. No adjustment will be made for a dividend or other right
for which the record date is prior to the date all the conditions set forth
above are satisfied, except as provided in Section 12 of the Plan.
5. TAX CONSULTATION. Purchaser understands that Purchaser may suffer
adverse tax consequences as a result of Purchaser's purchase or disposition of
the Shares. Purchaser represents that Purchaser has consulted with any tax
consultants Purchaser deems advisable in connection with
24
<PAGE>
the purchase or disposition of the Shares and that Purchaser is not relying
on the Company for any tax advice.
6. ENTIRE AGREEMENT; GOVERNING LAW. The Plan and Option Agreement
are incorporated herein by reference. This Agreement, the Plan and the Option
Agreement constitute the entire agreement of the parties with respect to the
subject matter hereof and supersede in their entirety all prior undertakings and
agreements of the Company and Purchaser with respect to the subject matter
hereof, and this Agreement may not be amended except by means of a writing
signed by the Company and Purchaser. This Agreement is governed by Texas law
except for that body of law pertaining to conflict of laws.
Submitted by: Accepted by:
PURCHASER: AMX CORPORATION
By:
--------------------------------- ----------------------------------
Signature
Its:
--------------------------------- ---------------------------------
Print Name
ADDRESS: ADDRESS:
--------------------------------- 11995 Forestgate Drive
Dallas, Texas 75243
---------------------------------
25
<PAGE>
(214) 855-7580
July 16, 1999
AMX Corporation
11995 Forestgate Drive
Dallas, Texas 75243
Re: Registration of up to 3,000,000 shares of Common Stock,
par value $.01 per share, pursuant to a Registration Statement
on Form S-8
Gentlemen:
At the request of AMX Corporation, a Texas corporation (the "Company"),
this opinion is being furnished to the Company for filing as Exhibit 5.1 to
the Registration Statement on Form S-8 (the "Registration Statement") to be
filed by the Company with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the "Act"),
relating to up to 3,000,000 shares (the "Shares") of the Common Stock, par
value $.01 per share, of the Company that may be issued by the Company from
time to time to participants in the AMX Corporation 1999 Equity Incentive
Plan (the "Plan") pursuant to the provisions of the Plan.
In our capacity as counsel to the Company and for the purpose of
rendering the opinions hereinafter expressed, we have relied solely upon the
documents, certificates and other items described on EXHIBIT A attached
hereto and have made no other investigation or inquiry.
This opinion letter is governed by, and shall be interpreted in
accordance with, the Legal Opinion Accord (the "Accord") of the ABA Section
of Business Law (1991). As a consequence, it is subject to a number of
qualifications, exceptions, definitions, limitations on coverage and other
limitations, all as more particularly described in the Accord, and this
opinion letter should be read in conjunction therewith. The general
qualifications of the Accord apply to all of the opinions set forth herein.
Based solely upon the foregoing, and subject to the qualifications,
limitations, and assumptions set forth in the Accord and set forth below, we
are of the opinion that the Shares that may be issued and sold pursuant to
the Plan and, where required, authorized forms of agreements evidencing the
grant of stock options and other awards thereunder will be, when issued and
sold in accordance with the Plan and such authorized forms of agreements and
for a consideration at least equal to the par value of such Shares, duly
authorized and validly issued, fully paid, and nonassessable.
<PAGE>
For purposes of rendering the above opinion, we have assumed with
respect to shares of Common Stock issued after the date hereof, (i) the
receipt of proper consideration for the issuance thereof in excess of the par
value thereof, (ii) the availability of a sufficient number of shares of
Common Stock authorized by the Company's Amended and Restated Articles of
Incorporation then in effect, (iii) compliance with the terms of any
agreement entered into in connection with any options or shares of Common
Stock issued under the Plan, and (iv) that no change occurs in the applicable
law or the pertinent facts.
The opinion set forth above is limited to the substantive laws of the
State of Texas and no opinion is expressed herein as to matters governed by
any other law.
This opinion is rendered solely to you in connection with the foregoing
matters. This opinion may not be relied upon by you for any other purpose or
relied upon by or furnished to any other person without our prior written
consent.
We hereby consent to the filing of this opinion as Exhibit 5.1 to the
Registration Statement and also to the use of our name in the Registration
Statement and the prospectus that is deemed to be a part thereof under the
caption "Legal Matters" as having passed upon certain legal matters in
connection with the Shares. By so consenting, we do not thereby admit that
we come within the category of persons whose consent is required under
Section 7 of the Act or the rules and regulations of the Commission
promulgated thereunder.
Very truly yours,
MUNSCH HARDT KOPF & HARR, P.C.
By: /s/ Mark A. Kopidlansky
-----------------------------------
Mark A. Kopidlansky
<PAGE>
EXHIBIT A
1. Amended and Restated Articles of Incorporation of the Company.
2. Amended and Restated Bylaws of the Company, as amended.
3. Certificate of Existence of the Company issued by the Secretary of
State of Texas on July 15, 1999.
4. Certificate of Good Standing for the Company issued by the Comptroller
of Public Accounts of the State of Texas on July 15, 1999.
5. The Plan, together with authorized forms of agreements evidencing the
grant of stock options and other awards thereunder, where applicable.
6. The Registration Statement, together with all exhibits thereto.
7. Officer's Certificate, dated the date hereof, executed by the
President and Secretary of the Company certifying, among other things,
(i) the resolutions pursuant to which the Plan was adopted and amended
by the directors and shareholders of the Company, (ii) the resolutions
pursuant to which shares to be issued pursuant to the Plan were
reserved for issuance by the Board, (iii) the Amended and Restated
Articles of Incorporation and Bylaws of the Company, as amended, (iv)
the Plan, together with authorized forms of agreements evidencing the
grant of stock options and other awards thereunder, and (v) the
authorized Common Stock, the number of issued and outstanding shares
of Common Stock of the Company, and the number of shares of Common
Stock reserved for issuance by the Company under the Plan.
8. Telephone confirmation by the Secretary of State of Texas on the date
hereof that the Company is validly existing under the laws of the
State of Texas.
9. Telephone confirmation by the Comptroller of Public Accounts of the
State of Texas on the date hereof that the Company is in good standing
under the laws of the State of Texas.
<PAGE>
Exhibit 23.2
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration
Statement (Form S-8) pertaining to the AMX Corporation 1999 Equity Incentive
Plan of our report dated May 3, 1999, with respect to the consolidated
financial statements of AMX Corporation included in its Annual Report (Form
10-K) for the year ended March 31, 1999, filed with the Securities and
Exchange Commission.
ERNST & YOUNG LLP
Dallas, Texas
July 16, 1999
