1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
(RULE 14A-101)14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A)14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec. 240.14a-11(c) or sec. 240.14a-12
TYLER CORPORATION
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-12
Tyler Technologies, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in itsIn Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(l)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
- -------------------------------------------------------------------------------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- -------------------------------------------------------------------------------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set(set forth the amount on which the
filing fee is calculated and state how it was determined):
- -------------------------------------------------------------------------------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- -------------------------------------------------------------------------------------------------------------------------------------------------------
(5) Total fee paid:
- -------------------------------------------------------------------------------------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
- -------------------------------------------------------------------------------------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
- -------------------------------------------------------------------------------------------------------------------------------------------------------
(3) Filing Party:
- -------------------------------------------------------------------------------------------------------------------------------------------------------
(4) Date Filed:
- -------------------------------------------------------------------------------------------------------------------------------------------------------
2
[TYLER CORPORATIONTECHNOLOGIES, INC. LOGO]
March 27, 1998May 7, 2001
Dear Stockholder:
You are cordially invited to attend the annual meeting of stockholders
of Tyler CorporationTechnologies, Inc. to be held on Tuesday, April 28, 1998,June 5, 2001, at San Jacinto Tower,
2121 San Jacinto Street, Suite 2820,the Park
Cities Hilton Hotel, 5954 Luther Lane, Dallas, Texas, commencing at 10:00 a.m.
At this meeting you will be asked to elect sixseven directors for the ensuing year and
to consider and vote upon a proposal to amend the Tyler Corporation Stock Option
Plan.year.
It is important that your shares be represented at the meeting whether
or not you are personally in attendance, and I urge you to sign, date, and
return the enclosed proxy at your earliest convenience.
Yours very truly,
/s/ LOUIS A.A WATERS
LOUIS A. WATERS
Chairman of the Board
3
TYLER CORPORATIONTECHNOLOGIES, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD APRIL 28, 1998JUNE 5, 2001
To the Stockholders of
TYLER CORPORATION:TECHNOLOGIES, INC.:
Tyler CorporationTechnologies, Inc. ("Tyler" or the "Company") will hold its annual
meeting of stockholders (the "Annual Meeting") at San
Jacinto Tower, 2121 San Jacinto Street, Suite 2820,the Park Cities Hilton Hotel,
5954 Luther Lane, Dallas, Texas, on Tuesday, April 28, 1998,June 5, 2001, at 10:00 a.m., Dallas
time, for the following purposes:
(a)(1) to elect sixseven directors to serve until the next annual meeting of
stockholders or until their respective successors are duly elected and
qualified; (b) to consider and
vote upon a proposal to amend the Tyler Corporation
Stock Option Plan; and
(c)(2) to transact such other business as may properly come before the meetingAnnual
Meeting or any adjournment thereof.
Only stockholders of record at the close of business on March 10, 1998,April 6, 2001 are
entitled to notice of, and to vote at, the meetingAnnual Meeting or any adjournment
thereof. A list of stockholders entitled to vote at the meetingAnnual Meeting will be
available for examination at the offices of Tyler Corporation, 2121 San Jacinto Street, Suite
3200,the Company, 2800 W. Mockingbird
Lane, Dallas, Texas 75235, for the ten daysday period immediately before the meeting.Annual
Meeting.
PLEASE DATE AND SIGN THE ENCLOSED PROXY CARD AND RETURN IT PROMPTLY IN THE
ENCLOSED ENVELOPE. No postage is required if the proxy card is mailed in the
United States. Prompt response by our stockholders will reduce the time and
expense of solicitation.
By Order of the Board of Directors,
/s/ JAMES E. RUSSELL
JAMES E. RUSSELL
Secretary
Dallas, Texas
March 27, 1998
4
TYLER CORPORATION
2121 SAN JACINTO STREET
SUITE 3200
DALLAS, TEXAS 75201
PROXY STATEMENT
FOR
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD APRIL 28, 1998
Tyler Corporation, a Delaware corporation (the "Company"), furnishes this
Proxy Statement to its stockholders in connection with the solicitation on
behalf of the Board of Directors of the Company (the "Board") of proxies to be
used at the annual meeting of stockholders of the Company to be held April 28,
1998 (the "Meeting"). Proxies in the form enclosed will be voted at the Meeting
if properly executed, returned to the Company before the Meeting, and not
revoked. You may revoke the proxy at any time before it is exercised by
delivering written notice of revocation to the Secretary of the Company, by
delivering a subsequently dated proxy, or by attending the Meeting, withdrawing
your proxy, and voting your shares personally. The approximate date on which
this Proxy Statement and the enclosed proxy card will first be sent to
stockholders is March 27, 1998.
The enclosed 19972000 Annual Report of the Company does not form any part of the proxy
solicitation material.
OUTSTANDING CAPITAL STOCKBy Order of the Board of Directors
/s/ H. LYNN MOORE, JR.
H. Lynn Moore, Jr.
Vice President, General Counsel, and
Secretary
Dallas, Texas
May 7, 2001
1
4
THE ANNUAL MEETING
PLACE, DATE, AND TIME
The Annual Meeting will be held at the Park Cities Hilton Hotel, 5954
Luther Lane, Dallas, Texas on Tuesday, June 5, 2001, at 10:00 a.m., Dallas time.
MATTERS TO BE CONSIDERED
At the Annual Meeting, the stockholders of Tyler will be asked to consider
and vote upon proposals to (i) elect a board of directors to serve until the
next annual meeting of stockholders or until their successors are duly elected
and qualified; and (ii) transact such other business as may properly come before
the Annual Meeting or any adjournment thereof.
Proposal One - Election of Directors
At the Annual Meeting, the stockholders of the Company will be asked to
elect a board of seven directors. The nominees for director are Ben T. Morris,
Ulrich Otto, G. Stuart Reeves, Glenn A. Smith, Louis A. Waters, John D. Woolf
and John M. Yeaman. Messrs. Waters and Yeaman currently serve on the Company's
Board of Directors (the "Tyler Board"). For more information regarding the
nominees for director to the Tyler Board, see "Tyler Management - Directors,
Nominees for Director, and Executive Officers."
Shares represented by proxies returned duly executed will be voted, unless
otherwise specified, in favor of the seven nominees for the Tyler Board as
described herein. The proxies cannot be voted for more than seven nominees. The
nominees have indicated that they are able and willing to serve as directors. If
any (or all) such persons should be unable to serve, the persons named in the
enclosed proxy will vote the shares covered thereby for such substitute nominee
(or nominees) as the Tyler Board may select. Stockholders may withhold authority
to vote for any nominee by entering the name of such nominee in the space
provided for such purpose on the proxy card.
THE TYLER BOARD UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE FOR
EACH OF THE NOMINEES FOR DIRECTOR.
RECORD DATE AND VOTING
Only holders of record date for stockholdersof Common Stock on April 6, 2001 (the "Record Date")
are entitled to notice of, and to vote at, the annual meeting of stockholders is the close of business on March 10, 1998. At
the close of business on that date, the Company hadAnnual Meeting. There were issued
and outstanding and
entitled to vote at the Meeting 33,981,70947,179,371 shares of Common Stock $.01 par
value ("Common Stock").
As of March 10, 1998,on the following entities were known by the Company to
own beneficially more than 5% of the Common Stock of the Company:
NUMBER OF SHARES PERCENT
BENEFICIALLY OF
NAME AND ADDRESS OF BENEFICIAL OWNER OWNED NATURE OF BENEFICIAL OWNERSHIP CLASS
- ------------------------------------ ---------------- ------------------------------ --------
William D. Oates 6,565,000 Sole voting and 25.8
2800 West Mockingbird Lane investment power
Dallas, Texas 75235 2,200,000(1) Sole voting power
Richmond Partners, Ltd. 4,000,000(2) Sole voting and 11.1
10375 Richmond Ave., Suite 1615 investment power
Houston, Texas 77042
Gabelli Funds, Inc. 2,161,500(3) Sole voting and 6.4
One Corporate Center investment power
Rye, New York 10580 6,500(3) Sole investment power
William H. Oates 2,000,000(1) Sole investment power 5.9
2800 West Mockingbird Lane
Dallas, Texas 75235
- ---------------
(1) Voting power and record ownership of these shares is retained by Mr. Oates
pursuant to collateral pledge arrangements securing payment for these shares
sold to family members (including William H. Oates) and a former in-law.
5
(2) Includes a warrant to purchase 2,000,000 shares of the Company's Common
Stock at $2.50 per share. Louis A. Waters is deemed to have beneficial
ownership of these shares.
(3) Share amounts are as of January 27, 1998. Shares are held by Gabelli Funds,
Inc. and its affiliate, GAMCO Investors, Inc. Also, Mr. Mario J. Gabelli is
deemed to have beneficial ownership of these shares.
ACTION TO BE TAKEN AT THE MEETING
The presence, in person or by proxy, of the holders of a majority of the
outstanding shares of the Common Stock is necessary to constitute a quorum at
the Meeting. Abstentions shall be treated as shares of the Common Stock that are
present and entitled to vote for purposes of determining the presence of a
quorum. In deciding all questions, aRecord Date. Each
holder of Common Stock iswill be entitled to one vote, in person or by proxy, for
each share heldof Common Stock standing in his or her name on the record date.
The accompanying proxy, unlessbooks of Tyler on
the stockholder otherwise specifies therein,
will be voted (i) for the election as directors of the Company of the six
persons designated under the caption "Directors and Executive
Officers -- Nominees for Director", (ii) for the amendment to the Tyler
Corporation Stock Option Plan (the "Stock Option Plan") and (iii) at the
discretion of the proxy holdersRecord Date on any other matter that may properly come
before the Meeting or any adjournment thereof.
To be electedsubmitted to a director, each nominee must receive a plurality of all the
votes cast at the meeting for the election of directors. Any abstentions or
broker non-votes will have no effect on the election of directors. Should any
nominee become unable or unwilling to accept nomination or election, the proxy
holders may vote for the election in his stead of any other person the Board may
recommend. Each nominee has expressed to the Board his intention to serve the
entire term for which his election is sought.
A favorable vote of the Company's stockholders.
The presence, in person or by proxy, of holders of record of a majority of the
shares entitled to vote constitutes a quorum for action at the Annual Meeting.
Abstentions and broker nonvotes are counted for purposes of determining the
presence or absence of a quorum for transaction of business. Abstentions are
counted in tabulations of the votes cast on proposals presented to the
stockholders to determine total number of votes cast. Abstentions are not
counted as votes for or against any proposal. Broker nonvotes are not counted as
votes cast for purposes of determining whether a proposal has been approved.
VOTE REQUIRED
The affirmative vote of the holders of shares of Common Stock, presenthaving a
plurality of the voting power of the Company, in person or represented by proxy, and entitled to vote at the Meeting is required
for approval and adoptionto elect directors.
PROXY SOLICITATION, REVOCATION, AND EXPENSE
The accompanying proxy is being solicited on behalf of the amendmentTyler Board. All
proxies that are properly completed, signed, and returned prior to the Stock Option Plan.
Abstentions will have the same effect as a vote against the adoption of the
amendment to the Stock Option Plan, while broker non-votes will have no effect
on the vote on the amendment to the Stock Option Plan.
Where stockholders have appropriately specified how their proxies are to be
voted, the proxiesAnnual
Meeting will be voted accordingly.as indicated on the proxy. If the enclosed proxy is signed
and returned, it may, nevertheless, be revoked at any other mattertime prior to the voting
2
5
thereof at the pleasure of the stockholder signing it, either by (i) filing a
written notice of revocation received by the person or business is
brought beforepersons named therein,
(ii) the stockholder attending the Annual Meeting and voting the shares covered
thereby in person, or (iii) delivering another duly executed proxy dated
subsequent to the date thereof to the addressee named in the enclosed proxy.
Shares represented by duly executed proxies in the accompanying form will
be voted in accordance with the instructions indicated on such proxies, and, if
no such instructions are indicated thereon, will be voted in favor of each of
the proposals considered and of each of the nominees for director named therein.
The Company will bear the expense of preparing, printing, and mailing the
proxy holderssolicitation material and the proxy. In addition to use of the mail,
proxies may votebe solicited by personal interview, telephone, and telegram by
directors, officers, and employees of the proxies at their
discretion.Company. The Board does not knowCompany may also engage
the services of a proxy solicitation firm to assist in the solicitation of
proxies. The Company estimates that the fee of any such firm will not exceed
$5,000 plus reimbursement of reasonable out-of-pocket expenses. Arrangements may
also be made with brokerage houses and other matter or business.
2
6
SECURITY OWNERSHIP OFcustodians, nominees, and
fiduciaries for the forwarding of solicitation material to the beneficial owners
of stock held of record by such persons, and the Company may reimburse them for
reasonable out-of-pocket expenses incurred by them in connection therewith.
TYLER MANAGEMENT
DIRECTORS, NOMINEES FOR DIRECTOR, AND EXECUTIVE OFFICERS
The following table sets forth the beneficial ownershipis a brief description of the Company's
Common Stock as of March 10, 1998, by each director, and named executive officer
and the directors and executive officers of the Company as a group:
SHARES OF COMPANY PERCENT
NAME COMMON STOCK OF CLASS
---- ----------------- --------
Ernest H. Lorch............................................ 50,000 *
Frederick R. Meyer......................................... 227,349 *
Brian K. Miller............................................ -- --
William D. Oates(1)........................................ 8,765,000 25.8
Harold W. Parkison......................................... 12,500 *
E. Peter Raisbeck(2)....................................... -- --
C.A. Rundell, Jr........................................... 368,657 1.1
James E. Russell........................................... 257,543 *
Louis A. Waters(3)......................................... 4,000,000 11.1
Bruce W. Wilkinson(4)...................................... 133,333 *
All directors and executive officers of the Company as a
group (10 persons)....................................... 13,814,382 38.1
- ---------------
* Less than 1% of the outstanding Common Stock
(1) Includes 2,200,000 shares of Common Stock over which Mr. Oates has sole
voting power, but no investment power, pursuant to collateral pledge
arrangements securing paymentnominee for the sale of such shares to family members
and a former in-law.
(2) Until June 1997, Mr. Raisbeck served as Chief Executive Officer and
President of Institutional Financing Services, Inc. ("IFS"), a former
subsidiary of the Company which was sold in October 1997.
(3) Includes 2,000,000 shares owned by Richmond Partners, Ltd. ("Richmond") and
2,000,000 shares subject to a warrant issued to Richmond at an exercise
price of $2.50 per share. Mr. Waters is the sole general partner of Richmond
and deemed beneficial owner of these shares.
(4) Mr. Wilkinson served as President and Chief Executive Officer of the Company
from March 1997 to October 1997.
The number of shares of Common Stock beneficially owned by some officers
and directors of the Company includes certain shares they have the right to
acquire pursuant to options granted under the Company's Stock Option Plan and
through a warrant to purchase Common Stock. Shares subject to options and a
warrant exercisable within 60 days after March 10, 1998, are held by the
following persons and group: Mr. Parkison -- 12,500; Mr. Rundell -- 167,288; Mr.
Wilkinson -- 133,333; Mr. Waters -- 2,000,000; and all directors and executive
officers of the Company as a group -- 2,313,121.
Unless noted above, each
director, and executive officer of the Company may
be deemed to have sole voting and investment power over the shares of Common
Stock reflected as beneficially owned.
3
7
DIRECTORS AND EXECUTIVE OFFICERS
A brief description of each nominee for director and of each executive
officer of the Company is provided below.Company. Directors hold office until the
next annual meeting of stockholders or until their successors are elected and
qualified. Executive officers are elected by the Tyler Board of Directors at its annual
meeting and hold office until its next annual meeting.
NOMINEES FOR DIRECTORmeeting or until their successors
are elected and qualified.
Directors, Nominees for Director, and Executive Officers of Tyler
Name / Age Present Position Served Since
- ---------- ---------------- ------------
Louis A. Waters, 62 Co-Chief Executive Officer 2000
Chairman of the Board 1997
John M. Yeaman, 60 Co-Chief Executive Officer 2000
President 1998
Director 1999
Ernest H. Lorch, 68 Director 1993
William D. Oates, 60 Director 1998
Ben T. Morris, 55 Nominee for Director --
Ulrich Otto, 51 Nominee for Director --
G. Stuart Reeves, 61 Nominee for Director --
Glenn A. Smith, 47 Nominee for Director --
John D. Woolf, 56 Nominee for Director --
Theodore L. Bathurst, 51 Vice President and Chief Financial Officer 1998
Brian K. Miller, 42 Vice President - Finance 1999
Treasurer 1997
H. Lynn Moore, Jr., 33 Vice President and Secretary 2000
General Counsel 1998
Business Experience of Directors, Nominees for Director, and Executive Officers
Louis A. Waters has been Chairman of the Board of the Company since October
1997, after being elected director of the Company in August 1997. In March 2000,
Mr. Waters was also elected Co-Chief Executive Officer of the Company. Mr.
Waters is currently a member of the Executive Committee and the Compensation
Committee of the Tyler Board. Mr. Waters was the founding Chairman of the Board
and Chief Executive Officer of Browning-Ferris Industries, Inc. ("BFI"). He
recently directed BFI's international activities, serving as Chairman and Chief
Executive Officer of BFI International, Inc. from
3
6
1991 to March 1997, at which time he retired from full-time employment with BFI.
From 1988 to March 1997, Mr. Waters was Chairman of the BFI Finance Committee,
and from 1980 through 1988, he was Chairman of the BFI Executive Committee. Mr.
Waters also served as Chairman of the Board and Chief Executive Officer of BFI
from 1969 through 1980. Mr. Waters is also a director of Team, Inc.
John M. Yeaman is President and Co-Chief Executive Officer of the Company,
a position he has held since March 2000. From December 1998 until March 2000,
Mr. Yeaman was President and Chief Executive Officer of the Company. Mr. Yeaman
was elected to the Tyler Board in February 1999. Mr. Yeaman was previously
employed by Electronic Data Systems Corporation ("EDS"), where he served as the
director of a worldwide Strategic Support Unit managing $2 billion in real
estate assets. Prior to that position, Mr. Yeaman had been associated with EDS
as a service provider since 1980. Mr. Yeaman began his career with Eastman Kodak
Company. Mr. Yeaman also serves on the Board of Directors of Park Cities Bank in
Dallas, Texas.
Ernest H. Lorch.Lorch was elected to the Tyler Board in October 1993, and he
currently serves as a member of the Compensation Committee and as Chairman of
the Audit Committee of the Tyler Board. Mr. Lorch age 65, is counsel to the law firm of
Whitman Breed Abbott & Morgan LLP, a position he has held since December 1992.
HeMr. Lorch retired as Chairman of the Board and Chief Executive Officer of
Dyson-Kissner-Moran Corporation ("DKM"), a private investment company, in
December 1992, a position he held since January 1990. Mr. Lorch was President
and Chief Operating Officer of DKM from June 1984 to January 1990. He iswas also
Senior Chairman of the Board of Varlen Corporation anduntil 1999 when Varlen was
acquired by a director of Dorsey Trailers, Inc. Mr. Lorch was
elected to the Board of Directors of the Company in October 1993, and is a
member of the Compensation Committee and the Audit Committee of the Board of
Directors.
Frederick R. Meyer. Mr. Meyer, age 70, has since July 1985 been Chairman of
the Board of Aladdin Industries, Inc., a diversified company principally engaged
in the manufacture of children's lunch kits, thermosware, insulated food
delivery systems and related products. He has also been President and Chief
Executive Officer of Aladdin Industries, Inc. from October 1995 to present and
from May 1987 to September 1994. He was President of Tyler Corporation from
August 1983 through December 1986. Mr. Meyerthird party.
William D. Oates has been a director of the Company since 19671998 and is a
member of the CompensationExecutive Committee of the Board of
Directors. He is also a director of Arvin Industries, Inc., Palm Harbor Homes,
Inc., and Southwest Securities Group, Inc.
William D. Oates.Tyler Board. Since August 2000, Mr.
Oates age 58, has beenserved as Chairman of the Board, President, and PresidentChief Executive
Officer of eiStream, Inc., a holding company with subsidiaries that are engaged
in the business of providing software systems and solutions in the areas of
document management, imaging, and workflow. Mr. Oates was appointed director of
the Company in February 1998 following the Company's acquisition of Business
Resources Corporation, ("Resources") since its inception in
1993.a former affiliate of the Company. Mr. Oates served as
President of Resources from 1993 until September 1998. From 1987 through 1994,
Mr. Oates acquired or formed and served as President or a principal executive
officer of American Title Company, of Dallas, Austin Title Company, Commercial Abstract and
Title Company, and other title insurance agencies in Texas, as well as a title
insurance underwriting company.
Mr. Oates held these companies through American Title Company of Dallas, of
which he wasBen T. Morris has been nominated by the principal owner and President until his sale of the company in
November 1994. Mr. Oates was appointedTyler Board to serve as a director
of the Company in February
1998 following the Company's acquisition of Resources2001. In 1987, Mr. Morris co-founded Sanders Morris Harris
("SMH"), a full service investment banking, money management, and is a member of the
Executive Committee of the Board of Directors.
C. A. Rundell, Jr. Mr. Rundell, age 66, was electedprincipal
investor organization based in Houston, Texas, where he has served as its
President and Chief Executive Officer of the Company in October 1997. From Octobersince 1996, and from 1987 to October
1997, Mr. Rundell1996, he
served as Chairman of the Board and from October 1996 to March
1997 served as Interim Chiefits Executive Officer of the Company. Mr. Rundell has
also served as President of Rundell Enterprises, a venture capital and
investment company, since June 1988 and as Chairman of the Board of NCI Building
Systems, Inc. since April 1989. Mr. Rundell served as Chief Executive Officer of
Cronus Industries, Inc. from April 1977 to June 1988 as well as its President
from April 1977 to April 1987 and its Chairman of the Board from April 1987 to
April 1988. Mr. Rundell has been a director of the Company since 1966 and is a
member of the Executive Committee of the Board of Directors. He is also a
director of Dain Rauscher Corporation and Tandy Brands Accessories, Inc.
James E. Russell. Mr. Russell, age 62, was elected Vice President Chief
Financial Officer and Secretary& Director of the Company in October 1997.Investment Banking. From
1980 to 1986, Mr. Russell has
been a director of the Company since May 1990 and has been affiliated with the
Company for more than 25 years. HeMorris served as Vice President of the Company from
January 1992 to August 1995 and was Chairman of the Board of Tyler Pipe
Industries, Inc. ("Tyler Pipe"), a former subsidiary, until his retirement in
August 1995. He was President and Chief Executive Officer of Tyler Pipe from
December 1988 to December 1991 and was President and Chief Operating Officer of Tatham
Corporation, a corporation principally engaged in the transportation and
marketing of natural gas. From 1973 to 1980, Mr. Morris served in various
executive capacities, including President and Chief Financial Officer, of Mid
American Oil and Gas Inc., a company engaged in the business of oil and gas
exploration and transportation. Prior to 1973, Mr. Morris was an accountant with
Price Waterhouse & Co. Mr. Morris also serves as a director of Pinnacle Global
Group, the parent corporation of SMH, Capital Title Group, and American Equity
Investment Life Holding Company. Mr. Morris is a certified public accountant.
Ulrich Otto has been nominated by the Tyler Pipe from February 1988Board to December 1988.
4
8
Louis A. Waters. Mr. Waters, age 59, was elected Chairman of the Board in
October 1997 after being appointedserve as a director of
the Company in August 1997.2001. Since 1997, Mr. Waters is a member of the Executive Committee, the Audit Committee, and the
Compensation Committee of the Board of Directors. Mr. Waters was the foundingOtto has been Chairman of the Board and
Chief Executive Officer of Browning-Ferris Industries,
Inc.Otto Holding, B.V. ("BFI"Otto Holding"). He recently directed BFI's, an international
activities, serving as
Chairmandiversified holding company based in the Netherlands with subsidiaries devoted
to the waste container systems business, which maintain an active presence in
over 30 countries; venture capital transactions, including investments in
software companies, with offices located in Paris, France, Tel Aviv, Israel, and
Chief Executive Officer of BFI International, Inc. from 1991 to
March 1997 at which time he retired from full-time employmentSingapore; and corporate finance, also with BFI. From
1988 to March of 1997 he was Chairman of the BFI Finance Committeeoffices in Paris, France and
from 1980
through 1988 he was Chairman of the BFI Executive Committee.Singapore. Since 1990, Mr. WatersOtto has also served as Chairman of the Board and
Chief Executive Officer of Otto Holding International B.V., also an
international diversified holding company based in Germany with similar business
lines as Otto Holding. Since 1980, Mr. Otto has served as Managing Partner of
Gebr. Otto KG, Koln, Germany. During the past fifteen years, Mr. Otto has also
held positions with various international councils, associations, supervisory
boards, and management boards, some of which include Vice Chairman of the
Supervisory Board of Interseroh AG, Koln, Germany, from 1993 to 2000; Vice
Chairman of the Bundesverband der Deutschen Entsorgungswirtchaft e.V., Koln,
Germany, from 1992 to 1996 and in which he was a member of the Managing Board of
Directors from 1996 to 1999; member of the Board of Directors of BFI from 1969
through 1980.
OTHER EXECUTIVE OFFICERS
Harold W. Parkison.1994
to 1997; Vice Chairman of the Federation Europeenne des Activites du Dechet,
Brussells, Belgium from 1996 to 1998; member of the General Assembly and Foreign
Trade Committee of the Chamber of Industry and Commerce, Koln, Germany, from
1992 to 1999 and in which he was Chairman from 1996 to 1999; member of the
Central and Management Committee of the Chamber of Industry and Commerce, Koln,
Germany, from 1996 to 1999; member of the Council of INSEAD, Hamburg, Germany,
since 1995; and member of the Land Advisory Board Northrhine-Westfalia of
Commerzbank AG, Dusseldorf, Germany, since 1985. Mr. Parkison, age 49,Otto also holds a law
degree.
4
7
G. Stuart Reeves has been nominated by the Tyler Board to serve as a
director of the Company in 2001. From 1967 to 1999, Mr. Reeves worked for
Electronic Data Systems Corporation ("EDS"), a professional services company
that offers its clients a portfolio of related systems worldwide within the
broad categories of systems and technology services, business process
management, management consulting, and electronic business. During his 32 years
of service for EDS, Mr. Reeves held a variety of positions, including Executive
Vice President, North and South America, from 1996 to 1999; Senior Vice
President, Europe, Middle East, and Africa, from 1990 to 1996; Senior Vice
President, Government Services Group, from 1988 to 1990; Corporate Vice
President, Human Resources, from 1984 to 1988; Corporate Vice President,
Financial Services Division, from 1979 to 1984; Project Sales Team Manager, from
1974 to 1979; and Systems Engineer and Sales Executive, from 1967 to 1974. Mr.
Reeves also served on the EDS Board of Directors from 1988 until 1996. Mr.
Reeves retired from EDS in 1999. Mr. Reeves also serves on the Board of
Governors of Oklahoma State University Foundation and the Board of Directors of
Park Cities Bank.
Glenn A. Smith has been nominated by the Tyler Board to serve as a director
of the Company in 2001. Mr. Smith currently serves as President of The Software
Group, Inc. ("TSG"), a principal subsidiary of the Company that was co-founded
by Mr. Smith in 1981 and acquired by the Company in 1998. TSG develops and
markets a wide range of software products and related services for county
governments, with a focus on integrated judicial management and law enforcement
systems. Prior to founding TSG, Mr. Smith was employed at Distributed Data
Systems of Raleigh, North Carolina, in a software development project management
capacity and, prior to that, at Texas Instruments Incorporated in Dallas, Texas
as a software developer.
John D. Woolf has been nominated by the Tyler Board to serve as a director
of the Company in 2001. Since August 2000, Mr. Woolf has served as a director
and as Executive Vice President and Chief ExecutiveFinancial Officer of Forest City Auto Parts Company ("Forest City") since
February 1997.eiStream, Inc.,
a holding company with subsidiaries that are engaged in the business of
providing software systems and solutions in the areas of document management,
imaging, and workflow. From December 1999 until August 2000, Mr. Parkison had previously beenWoolf served
as Senior Vice President-International
Store Development at Federal-MogulPresident -- Administration of the Company. From 1994 until
December 2000, Mr. Woolf also served as Executive Vice President and Chief
Financial Officer of Business Resources Corporation, since March 1995. Priora former affiliate of the
Company. From 1987 to March
1995, he was1994, Mr. Woolf served as a director and as Executive
Vice President-Merchandise Manager at Auto Express from 1993. From
1991 to 1993 he held the positionPresident and Chief Financial Officer of Vice President-Automotive for Kmart
Corporation. Between 1971 and 1991 he held various management positions at
Goodyear Tire and Rubber Company.
Brian K. Miller.American Title. Mr. Miller, age 39,Woolf is a
certified public accountant.
Theodore L. Bathurst has been Vice President and Chief AccountingFinancial Officer of
the Company since October 1998. Mr. Bathurst was previously an audit partner in
the Dallas office of KPMG Peat Marwick LLP ("KPMG"), where he served as
engagement partner on the accounts of a variety of information, communications,
and high technology companies. Mr. Bathurst was also designated by KPMG as a
Securities and Exchange Commission ("SEC") partner responsible for the review of
filings made by public companies with the SEC. Mr. Bathurst, a certified public
accountant, serves as a board member of the Texas Society of CPAs.
Brian K. Miller has been Vice President - Finance and Treasurer of the
Company since May 1999 and was Vice President - Chief Accounting Officer and
Treasurer of the Company from December 1997.1997 to April 1999. From June 1986
through December 1997, Mr. Miller held various senior financial management
positions at Metro Airlines, Inc. ("Metro"), a regional airline holding company.
Mr. Miller was Chief Financial Officer of Metro from May 1991 to December 1997
and also held the office of President of Metro from January 1993 to December
1997. From March 1994 to November 1995, Mr. Miller also held the position of
Vice President and Chief Financial Officer of Lone Star Airlines, a regional
airline. Mr. Miller is a certified public accountant.
H. Lynn Moore, Jr. has been General Counsel of the Company since September
1998 and has been Vice President and Secretary of the Company since October
2000. From August 1992 to August 1998, Mr. Moore was associated with the law
firm of Hughes & Luce, L.L.P. in Dallas, Texas where he represented numerous
publicly-held and privately-owned entities in various corporate and securities,
finance, litigation, and other legal related matters.
COMMITTEES AND MEETINGS OF THE TYLER BOARD
The business of the Company is managed under the Tyler Board. The Tyler
Board meets periodically during the fiscal year to review significant
developments affecting the Company and to act on matters requiring Tyler Board
approval. The Tyler Board met eleven times during 2000. Each member of the Tyler
Board participated in at least 75% of all Tyler Board and committee meetings
held during 2000 that he served as a director and/or committee member.
The Tyler Board has established an Audit Committee, Compensation Committee,
and Executive Committee to devote attention to specific subjects and to assist
the Tyler Board in the discharge of its responsibilities. The functions of these
committees are described below. The Company has no nominating
5
8
committee; instead, the entire Tyler Board is responsible for selecting nominees
for election as directors and executive officers.
Audit Committee. During 2000, the Audit Committee was comprised of Ernest
H. Lorch and Frederick R. Meyer, each of whom is "independent" as defined by the
New York Stock Exchange Listing Standards. The Audit Committee's duties include
considering the independence of the independent auditors before the Company
engages them; reviewing with the independent auditors the fee, scope, and timing
of the audit; reviewing the completed audit with the independent auditors
regarding any significant accounting adjustments, recommendations for improving
internal controls, appropriateness of accounting policies, appropriateness of
accounting and disclosure decisions with respect to significant unusual
transactions or material obligations and significant findings during the audit;
reviewing the Company's financial statements and related regulatory filings with
the independent auditors; and meeting periodically with the Company's management
to discuss internal accounting and financial controls. The Audit Committee met
six times during 2000. On May 11, 2000, the Tyler Board adopted the Tyler Audit
Committee Charter, which is attached hereto as Appendix A. Immediately following
the Annual Meeting, the Tyler Board intends to appoint a minimum of three of its
"independent" directors to the Audit Committee for 2001. For more information on
the Audit Committee's activities during 2000, see "Report of the Audit
Committee."
Compensation Committee. During 2000, the Compensation Committee was
comprised of Ernest H. Lorch and Louis A. Waters. The Compensation Committee has
final authority on all executive compensation and periodically reviews
compensation, employee benefit plans, and other benefits paid to or provided for
officers and directors of the Company. The Compensation Committee also approves
annual salaries and bonuses for Company officers to ensure that the recommended
salaries and bonuses are not unreasonable. The Compensation Committee met once
during 2000.
Executive Committee. During 2000, the Executive Committee was comprised of
William D. Oates (Chairman), C.A. Rundell, Jr., and Louis A. Waters. The
Executive Committee has authority, as delegated by the Tyler Board, to act for
the Tyler Board, but may not commit the Company to an expenditure in excess of
$10,000,000 without full Tyler Board approval. The Executive Committee meets
periodically throughout the year.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's directors, executive officers, and holders of more than 10% of the
Company's Common Stock to file with the SEC and New York Stock Exchange initial
reports of ownership and reports of changes in ownership of the Company's Common
Stock. Such persons are required by SEC regulations to furnish the Company with
copies of all Section 16(a) reports they file with the SEC. Based solely on the
Company's review of the copies of such forms it has received during the year,
the Company believes that during the year ended December 31, 2000, all the
Company's directors, officers, and holders of more than 10% of the Company's
Common Stock complied with all Section 16(a) filing requirements.
6
9
SECURITY OWNERSHIP OF DIRECTORS, EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLEOFFICERS, AND PRINCIPAL STOCKHOLDERS
The following table sets forth certain information concerning the
beneficial ownership of the Company's Common Stock as of April 6, 2001 by (i)
each of the "Named Executive Officers" (as defined in Regulation S-K of the
Securities Act of 1933, as amended), (ii) each director or nominee for director
of the Company, (iii) each beneficial owner of more than 5% of the outstanding
shares of Common Stock, and (iv) all executive officers and directors of the
Company as a group.
Name and Address of Beneficial Owner(1) Amount and Nature of Ownership Percent of Class (2)(3)
- --------------------------------------- ------------------------------ -----------------------
William D. Oates 6,220,374(4) 13.18%
2911 Turtle Creek Blvd., Suite 1100
Dallas, Texas 75219
Ulrich Otto 3,866,378(5) 8.20%
Louis A. Waters 2,509,900(6) 5.10%
Glenn A. Smith 927,571 1.97%
John M. Yeaman 548,850(7) 1.16%
Ben T. Morris 389,980(8) *
John P. Harvell 220,000 *
John D. Woolf 150,000 *
Theodore L. Bathurst 125,000(9) *
H. Lynn Moore, Jr 76,000(10) *
G. Stuart Reeves 65,000 *
Ernest H. Lorch 65,000(11) *
Brian K. Miller 56,000(12) *
Directors, nominees, and executive officers as a group (13 persons) 15,220,053(13) 30.53%
- ----------
* Less than one percent of the outstanding Common Stock
(1) Unless otherwise noted herein, the address of each beneficial owner is
the address of the Company's principal place of business located at
2800 W. Mockingbird Lane, Dallas, Texas 75235.
(2) Reported in accordance with the beneficial ownership rules of the SEC.
Unless otherwise noted, the stockholders listed in the table have both
sole voting power and sole investment power with respect to such
shares, subject to community property laws where applicable and the
information contained in the other footnotes to the table.
(3) Based on 47,179,371 shares of Common Stock issued and outstanding at
April 6, 2001. Each owner's percentage is calculated by dividing (a)
the number of shares beneficially held by such owner by (b) the sum of
(i) 47,179,371 plus (ii) the number of shares such owner has the right
to acquire within sixty days.
(4) Includes beneficial ownership of 1,600,000 shares of Common Stock over
which Mr. Oates has sole voting power, but no investment power,
pursuant to collateral pledge agreements securing payment for the sale
of such shares.
(5) Includes beneficial ownership of 3,383,600 shares of Common Stock held
in various investment entities in which Mr. Otto has sole voting and
investment power.
7
10
(6) Includes beneficial ownership of 2,000,000 shares of Common Stock
subject to a warrant issued to Richmond Partners, Ltd. at an exercise
price of $2.50 per share. Mr. Waters is the sole general partner of
Richmond and deemed the beneficial owner of these shares.
(7) Includes beneficial ownership of 125,000 shares of Common Stock
issuable upon the exercise of stock options granted pursuant to the
Tyler Technologies, Inc. Stock Option Plan (the "Tyler Option Plan")
that are exercisable within sixty days and 7,300 shares of Common Stock
owned by a foundation in which Mr. Yeaman is deemed to have shared
voting power.
(8) Includes beneficial ownership of 333,380 shares of Common Stock subject
to a warrant issued to SMH, of which Mr. Morris is President and Chief
Executive Officer and is therefore deemed to have investment power over
the shares.
(9) Includes beneficial ownership of 115,000 shares of Common Stock
issuable upon the exercise of stock options granted pursuant to the
Tyler Option Plan that are exercisable within sixty days.
(10) Includes beneficial ownership of 26,000 shares of Common Stock issuable
upon the exercise of stock options granted pursuant to the Tyler Option
Plan that are exercisable within sixty days.
(11) Includes beneficial ownership of 15,000 shares of Common Stock issuable
upon the exercise of stock options granted pursuant to the Tyler Option
Plan that are exercisable within sixty days.
(12) Includes beneficial ownership of 55,000 shares of Common Stock issuable
upon the exercise of stock options granted pursuant to the Tyler Option
Plan that are exercisable within sixty days.
(13) Includes 2,333,380 shares of Common Stock subject to warrants, 336,000
shares of Common Stock that are issuable upon the exercise of stock
options granted pursuant to the Tyler Option Plan that are exercisable
within sixty days, and 4,990,900 shares of Common Stock held in
investment entities, foundations, and other arrangements in which named
persons have sole or shared voting and/or investment power.
8
11
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth certain information regarding compensation
paid or accrued for all services rendered to the Company and its subsidiaries for the last threein all
capacities during fiscal years 2000, 1999, and 1998 by the ChiefCompany's "Named
Executive Officer, former Chief Executive Officer, retired
Chief Executive Officer of a former subsidiary and the three highest-paid
executive officersOfficers" (as defined in Regulation S-K of the Company:Securities Act of 1933,
as amended) whose total annual salary and bonus earned during fiscal year 2000
exceeded $100,000.
SUMMARY COMPENSATION TABLE
ANNUAL COMPENSATION LONG-TERM COMPENSATION AWARDS
ANNUAL COMPENSATION -----------------------
----------------------------------------------------------------------------------- -----------------------------
OTHER SECURITIES
OTHERANNUAL RESTRICTED UNDERLYING
ANNUALNAME AND PRINCIPAL COMPEN- STOCK OPTIONS/ ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION(1)SATION(1) AWARDS SARS COMPENSATION
- ----------------------------- ----- -------- -------- --------------------------------- ---- ---------- ---------- ---------- ---------- ---------- ------------
C.Louis A. Rundell, Jr. 1997Waters 2000 $ 80,077 $461,250(3) 350,000233,077(2) $ -- $ -- $ -- $ -- $ --
Chairman and Co- 1999 -- -- -- -- -- --
Chief Executive 1998 -- -- -- -- -- --
Officer
John M. Yeaman 2000 225,000 -- -- -- -- --
President and Chief 1996 01999 225,000 200,000 -- -- 25,000 --
Co-Chief Executive 1998 76,302(3) 100,000 Executive-- -- 250,000 --
Officer
of the
Company(2)
Bruce W. Wilkinson 1997 143,077 $347,180 40,625(5) 666,666
Former President and Chief
Executive Officer of the
Company(4)
James E. Russell 1997 81,409Theodore L. Bathurst 2000 252,400 -- -- -- -- --
Vice President and 1999 252,400 125,000 -- -- 15,000 --
Chief Financial 1998 57,841(4) 40,000 -- -- 250,000 --
Officer
of the
Company(6)John P. Harvell 2000 180,000 150,000(6) -- 168,750(7) -- --
Vice President - 1999 156,923 90,000 -- -- 15,000 --
Chief Technology 1998 120,000 50,000 -- -- -- --
Officer(5)
H. Lynn Moore, Jr 2000 120,000 80,000 -- -- -- --
Vice President, 1999 120,000 90,000 -- -- 10,000 --
General Counsel, 1998 40,000(3) 30,000 -- -- 40,000 --
and Secretary
Brian K. Miller 1997 10,795 50,0002000 162,400 8,500 -- -- -- --
Vice President and Chief
Accounting Officer of the
Company(7)
Harold W. Parkison 1997 183,333 $170,000 75,000 50,000
President and Chief
Executive Officer of Forest
City(8)
Peter Raisbeck 1997 208,719
Chief Executive 1996 320,000 $40,980
Officer and President of
IFS, 1995 305,011 49,412
a former subsidiary(9)- 1999 149,908 81,200 -- -- 25,000 --
Finance 1998 140,000 35,000 -- -- -- --
- -------------------------
(1) Certain of the Company's executive officers receive personal benefits in
addition to salary. The aggregate amount of the personal benefits, however,
does not exceed the lesser of $50,000 or 10% of the total annual salary for
the named executive officer and therefore has been omitted.
(2) Mr. Rundell has served as President and ChiefWaters was elected Co-Chief Executive Officer in March 2000.
(3) Employment commenced in September 1998.
(4) Employment commenced in October 1998.
(5) Resigned from the Company effective December 2000 upon consummation of the
Company since October 1997 at an annual salary of $210,000. From October
1996 to October 1997, he served as Chairman of the Board, and from October
1996 to March 1997 served as Interim Chief Executive Officer of the Company.
He elected not to accept remuneration for his services from October 1996 to
March 1997.
(3) On October 8, 1997, Mr. Rundell was granted 125,000 sharessale of the Company's operating unit Business Resources Corporation ("BRC")
to Affiliated Computer Services, Inc. ("ACS").
(6) Bonus compensation relates to services provided to the Company during 2000
and for services provided in connection with the sale of BRC to ACS in
December 2000 for $71,000,000.
9
12
(7) Restricted shares of Company Common Stock with a market value of $3.69 per share. Mr. Rundell will vestgranted in these shares in increments of 25,000 shares every six months beginning
April 8, 1998 and ending April 8, 2000.
(4) Mr. Wilkinson served as President and Chief Executive Officer ofDecember 2000 for
services provided to the Company from March 1997during 2000 and for services provided in
connection with the sale of BRC to October 1997. Mr. Wilkinson's other annual compensation
includes $260,000 for stock appreciation rights and $87,180 for amounts
reimbursed for payment of taxes.
(5) In March 1997, Mr. Wilkinson was granted 125,000 shares with a market value
of $1.625 per share. The shares were to vest over 30 months. Upon Mr.
Wilkinson's resignation as President and Chief Executive Officer of the
Company in October 1997, 100,000 shares, the unvested portion of the grant,
were forfeited. The 25,000 vested shares were purchased by the Company for
$86,250, valued at the market value of $3.45 per share at the time of
repurchase.
6
10
(6) Mr. Russell has served as Vice President and Chief Financial Officer of the
Company since October 1997.
(7) Mr. Miller joined the CompanyACS in December 1997.
(8) Mr. Parkison has served as President and Chief Executive Officer of Forest
City since February 1997. In connection with his move to Cleveland, Ohio,
Mr. Parkison was paid $75,000 in compensation2000 for expenses resulting from
transportation of household items, disposition of current residence,
acquisition of a new residence and other related expenses associated with
his move.
(9) Mr. Raisbeck retired in June 1997 from IFS, a subsidiary of the Company
which was sold in October 1997.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
The following table shows stock option grants during 1997 to any named
executive officer:
PERCENT OF
NUMBER OF TOTAL
SECURITIES OPTIONS/SARS EXERCISE
UNDERLYING GRANTED TO PRICE GRANT DATE
OPTION/SARS EMPLOYEES IN PER EXPIRATION PRESENT
NAME GRANTED FISCAL YEAR SHARE DATE VALUE $(1)
---- ----------- ---------------- --------- ---------- ----------
C. A. Rundell, Jr.(2)............... 350,000 23% $3.69 10/07/07 $1.95
Bruce W. Wilkinson(3)............... 666,666 44% $1.50 03/27/07 $ .79
James E. Russell.................... -- -- -- -- --
Brian K. Miller..................... 50,000 3% $5.25 12/11/07 $2.82
Harold W. Parkison.................. 50,000 3% $2.13 02/02/07 $1.11
E. Peter Raisbeck................... -- -- -- -- --
- ---------------
(1) The present value was determined using the Black-Scholes option-pricing
model and assuming an expected life of seven years and a dividend yield of
$0. In addition, expected volatility and risk-free interest rates,
respectively, were assumed to be as follows: Mr. Rundell -- .40 and 6.1%;
Mr. Wilkinson -- .38 and 6.9%; Mr. Miller -- .42 and 5.8%; and Mr.
Parkison -- .38 and 6.4%.
(2) Includes 132,199 options granted as incentive stock options and 217,801
options granted as non-qualified stock options.
(3) As a result of Mr. Wilkinson's resignation as President and Chief Executive
Officer of the Company in October 1997, he cannot vest in 400,000 options
included in his total options granted.$71,000,000.
OPTION/SAR EXERCISES DURING 19972000 AND YEAR-END OPTION/SAR VALUES
The following table shows stock option exercises during 19972000 by each of the
named executive officers"Named Executive Officers" and the value of unexercised options at December 31,
1997:2000:
NUMBER OF
VALUE OF UNEXERCISED
NUMBER OF IN-THE-MONEY
UNEXERCISED IN-THE-MONEY OPTIONS/SARS AT OPTIONS/SARS AT
SHARESNUMBER OF DECEMBER 31, 1997(1)2000 DECEMBER 31, 1997(2)
EXERCISED2000(1)
SHARES VALUE ---------------------------------------------------- -------------------------
NAME AS SARSEXERCISED REALIZED EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE
---- --------- -------- ----------------------------------- ---------- -------------------------- -------------------------
C.A. Rundell..................... 137,677/312,323 $396,596/$575,280
Bruce W. Wilkinson............... 133,333 $260,000 0/133,333Louis A. Waters ............ -- -- -- --
John M. Yeaman ............. -- -- 116,667 / 158,333 --
Theodore L. Bathurst ....... 5,000 $ 0/$533,332
James E. Russell.................7,187 110,000 / 145,000 --
John P. Harvell(2) ......... -- -- --(3) --
H. Lynn Moore, Jr .......... -- -- 22,667 / 27,333 --
Brian K. Miller.................. 0/ 50,000 $ 0/$ 12,500
Harold W. Parkison............... 0/ 50,000 $ 0/$168,750
E. Peter Raisbeck................Miller ............ -- -- 46,667 / 28,333 --
- -------------------------
(1) As of December 31, 1997, options to purchase an aggregate of 695,933 shares
of Common Stock were outstanding with a weighted average exercise price per
share of $3.04 and expiring between January 28, 2003, and December 11, 2007.
(2) Amount is based on a year-end market value of $5.50$1.69 per share.
7
11(2) Mr. Harvell resigned from the Company in December 2000 in connection with
the sale of BRC to ACS.
(3) Pursuant to the Tyler Option Plan, the unvested options of Mr. Harvell were
forfeited upon his resignation in December 2000, and his vested and
unexercised options (all of which were unexercised) were forfeited 60 days
thereafter.
COMPENSATION OF DIRECTORS
Each non-employee director receives an annual fee of $15,000, plus $1,000
for each Tyler Board meeting and $500 for each committee meeting attended.
The Tyler Board further approved discretionary grants of stock options to
non-employee directors of the Tyler Board. On May 11, 2000, the Tyler Board
granted options to purchase 20,000 shares of Company Common Stock to Ernest H.
Lorch at an exercise price of $4.8125 per share, which options vest in equal
installments on the date of grant and on the first and second anniversary of the
date of grant. On June 28, 2000, the Tyler Board granted options to purchase
5,000 shares of Company Common Stock to Ernest H. Lorch at an exercise price of
$3.1875 per share, which options vest in equal installments on the first,
second, and third anniversary of the date of grant.
EMPLOYMENT NONCOMPETITION AGREEMENTS AND AGREEMENTS WITH NAMED EXECUTIVE
OFFICERSCONTRACTS
On October 8, 1997,7, 1998, the Company entered into an employment agreement with
C. A. Rundell, Jr.Theodore L. Bathurst, which provides that the Company will pay Mr. Rundell an
annual salary of $210,000Bathurst for his
services as Vice President and Chief ExecutiveFinancial Officer of the Company and allows him toa salary
of $250,000. Mr. Bathurst will participate in performance bonus or incentive
compensation plans made available to comparable level employees of the Company
and its subsidiaries. Mr. Rundell will alsosubsidiaries and receive certain otherall employee benefits and perquisites normally
offered to the executive employees of the Company.
In addition,On December 9, 1998, the Company granted Mr. Rundell 125,000 shares of
Common Stock. He will vest in these shares in increments of 25,000 shares every
six months beginning April 8, 1998, and ending April 8, 2000. The agreement also
granted him options to purchase 350,000 shares of Common Stock at $3.69 per
share, the closing price on October 8, 1997, of which (i) 132,199 incentive
stock options of which 23,727 will vest and be exercisable on January 1, 1998,
and 27,118 will vest and be exercisable on each of January 1, 1999-2002 and (ii)
217,801 non-qualified stock options, of which 43,561 will vest and be
exercisable on October 8, 1997, and 43,560 will vest and be exercisable on each
of October 8, 1998-2001. Both the stock grant and the 350,000 stock options to
purchase Common Stock fully vest in the event of a change of control of the
Company.
The Company entered into ana five-year employment
agreement in February 1997, with Harold W. ParkisonH. Lynn Moore, Jr., which provides that the Company pay Mr. ParkisonMoore
for his services as President and Chief Executive OfficerGeneral Counsel of Forest City,the Company a minimum salary of $200,000,$120,000
and a guaranteedminimum bonus of $60,000 for 1997$80,000 per year. Mr. Moore will participate in
additional performance bonus or incentive compensation plans made available to
comparable
10
13
level employees of the Company and eligibility for an
additional bonus in 1997 if certain profit objectives were achieved. The
agreement also provides for a cash payment of $200,000 if during the first three
years of his employment there is a change in control of Forest City or the
Company. In addition, Mr. Parkison received $75,000 in compensation for expenses
that would be incurred in connection with his move to Cleveland, Ohio, such as
moving expensesits subsidiaries and real estate fees associated with the disposition of his
current residence and acquisition of a new residence. Mr. Parkison is also
eligible to receive all employee
benefits and perquisites normally offered to the executive employees of Forest City.
In connection with Bruce W. Wilkinson's resignation as a director and
President and Chief Executive Officer of the Company effective October 8, 1997,
the Company purchased 447,609 shares of the Company's common stock owned by Mr.
Wilkinson for $1,544,000. Mr. Wilkinson purchased these shares in the second
quarter of 1997 as a condition of his employment. In addition, the Company also
made payments to Mr. Wilkinson of approximately $346,000 relating to various
stock compensation plans as provided for under the terms of his resignation as
President and Chief Executive Officer of the
Company. Mr. Wilkinson will
continue as an employee until March 31, 1998 (or earlier, if he so elects) atThe agreement provides for a monthly salaryseverance payment equal to the amount of
$8,333.
The Company has a consulting agreement with James E. Russell that began in
September 1995, part of which expired in August 1997 andcompensation due for the remainder of which
may be terminated upon 30 days' notice. The agreement provides the Company will
pay Mr. Russell $20,000 per year through August 1997 and an additional $4,167
monthly for his services to the Company. In October 1997, Mr. Russell assumed
the duties of Vice President, Chief Financial Officer and Secretary of the
Company and his monthly payment was increased from $4,167 to $8,333 to reflect
these additional responsibilities.
Effective February 19, 1998, the Company entered into an employment,
confidentiality, nonsolicitation and noncompetition agreement with William D.
Oates which provides that the Company will pay Mr. Oates a salary of at least
$200,000 per year for his services to the Company as President and Chief
Executive Officer of Resources. In addition, Mr. Oates is eligible to
participate in performance bonus or incentive compensation plans made available
to comparable level employees of the Company and its subsidiaries. Mr. Oates
will also receive all employee benefits and perquisites normally offered to the
executive employees of Resources. The employment and confidentiality portionsterm of the agreement expire February 19, 2001, and the nonsolicitation and
noncompetition portionsif he is
terminated for any reason other than cause or upon a change in control of the
agreement expire the later of February 19, 2003,
or the third anniversary of Mr. Oates' termination.
8
12Company.
In December 1997, the Company entered into an employment agreement with
Brian K. Miller, which provides that the Company pay Mr. Miller a salary of
$140,000 for his services as Vice President and Chief Accounting Officer for the
Company.- Finance. In addition, Mr. Miller
will participate in performance bonus or incentive compensation plans made
available to comparable level employees of the Company and its subsidiaries and
receive all employee benefits and perquisitesprerequisites normally offered to the
executive employees of the Company. The agreement also provides for a severance
payment equal to one year of his current base salary if he is terminated for any
reason other than cause, as specified in the agreement.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Members of the Compensation Committee of the Tyler Board are Ernest H.
Lorch Frederick R.
Meyer and Louis A. Waters. Mr. Meyer was previously an officerWaters is Co-Chief Executive Officer of the
Company.
REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS ON EXECUTIVE
COMPENSATION
The Compensation Committee, a committee of the Tyler Board, of Directors, has the
responsibility for final approval for all compensation to officers and directors
of the Company, including primarily, the duty to ensure that compensation paid to executive
officers does not exceed reasonable amounts and is based on objective standards.
The Compensation Committee approves or disapproves the recommendations of
management regarding compensation according to the guidelines set forth below.
The Company's personnel policy is to employ outstanding management in order
to obtain outstanding results. To attract and retain high-level individuals, the
Company may pay above-median compensation or provide stock ownership and stock
option incentives to its executive officers. From time to time, salaries,
bonuses, and other compensation of executive officers are evaluated by reference
to nationwide comparisons for the industries in which the Company operates.
A substantial portion of each executive officer's potential total
compensation is in the form of bonuses and options which are awarded only when
indicated by superior accomplishment. The Company feels very strongly thatoptions. Annual bonuses must be earned, and when results are not superior, no bonuses are paid.
In nine of the past thirteen years, including 1997, no bonuses have been paid to
corporate officers as results have not warranted payment of such bonuses. As a
result of excellent performance andvary
significantly based on the purchase contract, Forest City
officers received bonuses for 1991, 1992Company's results and 1993revenue growth, the achievement
of strategic objectives of the Company, and an additional bonus in
1996 for cumulative operating profits achieved since 1991. In addition, the
President andeach individual's contribution
toward that performance.
Chief Executive Officer Compensation
Louis A. Waters was elected Co-Chief Executive Officer of Forest City receivedthe Company in
March 2000. In 2000, Mr. Waters' cash compensation consisted of a bonus for 1997base salary of
$300,000 with no bonus. In determining Mr. Waters' cash compensation in accordance with2000,
the termsCompensation Committee considered several factors, including the Company's
strategic goal to reduce its outstanding indebtedness, the Company's decision to
exit the information and property records services segment of his employmentits business, the
Company's decision to focus its core business on its software systems and
in recognitionservices segment, Mr. Waters' contributions to the achievement of 1997
performance.
For 1998,these
strategic initiatives, and the levels of compensation of chief executive
officers of operating subsidiaries will be measured on
the resultscompanies of that subsidiary and,similar size in the case of Resources, The Software
Group, Inc. and Interactive Computer Designs, Inc., will be measured on the
combined results of those companies. The primary criteria for bonus payments for
subsidiary companies in 1998 will be achievement of certain levels of operating
income, which will be evaluated relative to the operating plan established in
December 1997 and approved by Tyler's Board of Directors. In order to be
eligible to receive the maximum bonus, the applicable operation(s) must earn
130% of par (plan operating income plus bonuses). The minimum threshold for
bonuses is 90% of par. Below that level, no bonuses will be paid.
The Company is in the process of redesigning the bonus program for
corporate officers for 1998 in recognition of recent changes in the Company's
business, particularly its entry into the information management services
business. The new program, which must be approved by the Compensation Committee,
is expected to be based on different criteria for measuring the Company's
performance than those previously used, although return on net assets (the
primary factor historically used in determination of bonuses) may still be one
of the criteria considered.
Occasionally, bonuses are paid when specific return targets are not met.
These cases are based on particular contributions to shareholder value or
Company performance. Such bonus payments are not the rule
9
13
and are generally associated with increases in shareholder value which the
Compensation Committee deems should be recognized with an out-of-the-ordinary
bonus.
CHIEF EXECUTIVE OFFICER COMPENSATION
C.A. Rundell, Jr.similar industries.
John M. Yeaman was elected President and Chief Executive Officer of the
Company effective October 8, 1997, upon the resignation of Bruce W. Wilkinson.in December 1998, and in March 2000, Mr. Rundell had previously served as Interim ChiefYeaman shared his Co-Chief
Executive Officer without
salary from October 1996 through March 1997.
Effective October 8, 1997,duties with Mr. Rundell'sWaters. In 2000, Mr. Yeaman's cash
compensation consistsconsisted of a base annual salary of $210,000. Mr. Rundell also receives certain health and
insurance benefits provided to executive officers of the Company.$225,000 with no bonus. In
determining Mr. Rundell's salary,Yeaman's cash compensation in 2000, the Compensation Committee
considered several factors, including Mr. Rundell's experience and his ability to enhance the long-term
value of the Company, particularly in light of the Company's strategic plangoal to grow through acquisitions inreduce its
outstanding indebtedness, the Company's decision to exit the information managementand
property records services business. The
committee also considered Mr. Rundell's considerable experience with
acquisitions.
Mr. Rundell was granted options to purchase 350,000 sharessegment of its business, the Company's Common Stockdecision to
focus its core business on October 8, 1997, which options vest over a periodits software systems and services segment, Mr.
Yeaman's contributions to the achievement of 48 months.
In addition, Mr. Rundell was granted 125,000 sharesthese strategic initiatives, and
the levels of the Company's Common
stock on October 8, 1997, with a market value on that datecompensation of $3.69 per share.
Mr. Rundell will vestchief executive officers of companies of similar
size in these shares in increments of 25,000 shares every six
months beginning April 8, 1998 and ending on April 8, 2000. Including stock
options granted in 1996, Mr. Rundell has a total of 450,000 stock options which
combined with his stock grant of 125,000 shares and his direct ownership of
76,369 shares give him a total potential ownership of 651,369 shares once he
completes all respective vesting requirements. The Compensation Committee
believes that the options and grant align the interest of management with those
of the shareholders.
As noted above, the Company is in the process of redesigning the bonus
program for corporate officers. The new program, which must be approved by the
Compensation Committee, will be effective for 1998. Mr. Rundell will participate
in that program. By making a substantial portion of the Chief Executive
Officer's potential total compensation in the form of bonuses that are based on
objective performance measures, the Compensation Committee believes that it will
provide for rewards only when indicated by superior accomplishment. Mr. Rundell
did not receive a bonus for 1997.similar industries.
11
14
This report is submitted by the Compensation Committee.
Ernest H. Lorch
Louis A. Waters
REPORT OF THE AUDIT COMMITTEE
The Audit Committee oversees the Company's financial reporting process on
behalf of the Tyler Board. Management has the primary responsibility for the
financial statements and the reporting process, including the systems of
internal controls. In fulfilling its oversight responsibilities, the Audit
Committee reviewed the audited financial statements in the Annual Report with
management, including a discussion of the quality, not just the acceptability,
of the accounting principles, the reasonableness of the significant judgments,
and the clarity of disclosures in the financial statements.
The Audit Committee reviewed with the independent auditors, who are
responsible for expressing an opinion on the conformity of those audited
financial statements with generally accepted accounting principles, their
judgments as to the quality, not just the acceptability, of the Company's
accounting principles and such other matters as are required to be discussed
with the Audit Committee under generally accepted auditing standards. In
addition, the Audit Committee has discussed with the independent auditors the
auditors' independence from management and the Company, including the matters in
the written disclosures required by the Independence Standards Board and
considered the compatibility of non audit services with the auditors'
independence.
The Audit Committee discussed with the Company's independent auditors the
overall scope and plans for their respective audits. The Audit Committee meets
with the independent auditors, with and without management present, to discuss
the results of their examinations, their evaluations of the Company's internal
controls, and the overall quality of the Company's financial reporting. The
Audit Committee met six times during 2000.
In reliance on the reviews and discussions referred to above, the Audit
Committee recommended to the Tyler Board (and the Tyler Board approved) that the
audited financial statements be included in the Annual Report on Form 10-K for
the fiscal year ended December 31, 2000 for filing with the Securities and
Exchange Commission.
This report is submitted by the Audit Committee
Ernest H. Lorch, Chairman
Frederick R. Meyer
Louis A. Waters
1012
1415
STOCK PERFORMANCE CHARTSCHART
The following two charts comparechart compares the return on the Company's Common Stock for
the last five and ten years with the Standard and Poors ("S&P&P") 500 Index and a Peer
Group Index which is comprised of companies with similar market capitalization
of approximately $50 million. A list of the S&P Consumer
Cyclicals-500 Index. Although Tyler's principal subsidiary from October 15, 1997Companies included in the Peer Group
Index is located at Appendix B. Prior to December 31, 1997,1998, the Company was a retailerdiversely based
enterprise selling products and services through a few distinctly different
operating companies. In 2000, the Company adopted a formal plan to dispose of
automotive partsits businesses and supplies,assets related to its information and property records
services segment and to focus the S&P
Consumer Cyclicals-500Company's resources on its software systems
and services segment and to reduce debt. The Company believes the Peer Group
Index was selected because it represents Tyler's past
philosophyis more representative of diversification.its current strategy and prior history. The
comparison assumes $100 was invested on December 31, 1992 and December 31, 19871995 in the Company's
Common Stock and in each of the foregoing indices and assumes reinvestment of
dividends and distributions.
[STOCK PERFORMANCE CHART]
Consumer
Measurement Period CyclicalsBASE YEARS ENDING
PERIOD ----------------------------------------------------------------------
COMPANY NAME / INDEX 1995 1996 1997 1998 1999 2000
- (Fiscal Year Covered) Tyler S&P 500 500
1992 100 100 100
1993 113.51 110.08 114.43
1994 70.27 111.53 104.49
1995 59.46 153.45 129.3
1996 40.54 188.68 149.37
1997 118.92 251.63 204.45
Consumer
Measurement Period Cyclicals -
(Fiscal Year Covered) Tyler S&P 500 500
1987 100.00 100.00 100.00
1988 152.31 116.61 123.26
1989 394.69 153.56 142.60
1990 389.38 148.79 127.09
1991 387.05 194.12 189.73
1992 622.65 208.91 258.69
1993 706.8 229.97 296.02
1994 437.54 233.00 270.30
1995 370.23 320.56 334.50
1996 252.43 394.16 388.28
1997 740.45 525.67 531.47
11
15
BENEFICIAL OWNERSHIP REPORTING COMPLIANCE SECTION 16(A)
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's directors, executive officers and holders of more than 10% of the
Company's Common Stock to file with the Securities and Exchange Commission
("SEC") and New York Stock Exchange initial reports of ownership and reports of
changes in ownership of the Company's Common Stock. Such persons are required by
SEC regulations to furnish the Company with copies of all Section 16(a) reports
they file with the SEC. Based solely on the Company's review of the copies of
such forms it has received during the year, the Company believes that during the
year ended December 31, 1997, all the Company's directors, officers, and holders
of more than 10% of the Company's Common Stock complied with all Section 16(a)
filing requirements.
CERTAIN TRANSACTIONS
In September 1997, Richmond Partners, Ltd., a Houston-based investment
partnership of which Louis A. Waters is the managing general partner, invested
$3,500,000 in a package of Tyler securities consisting of 2,000,000 common
shares and a warrant to acquire 2,000,000 common shares with an exercise price
of $2.50 per common share. Mr. Waters is currently Chairman of the Board of the
Company.
In connection with the Company's purchase of Resources on February 19,
1998, William D. Oates received approximately $15,250,000 in cash and 8,765,000
shares of the Company's Common Stock. In addition, pursuant to the terms of the
merger in which Resources was acquired, Mr. Oates may be entitled to receive
additional merger consideration of up to an aggregate $4,500,000 in cash if
certain contingencies are achieved on or before December 31, 1999 relating to
acquisitions of specified businesses for purposes of geographic expansion.
PROPOSAL FOR APPROVAL OF AMENDMENT TO
STOCK OPTION PLAN
The proposed amendment to the Tyler Corporation Stock Option Plan (the
"Stock Option Plan") is intended to enable the Company to provide additional
incentives to selected key employees of the Company and its subsidiaries whose
substantial contributions are important to the continued growth and
profitability of the Company's business. Stock options are designed to
strengthen the commitment of those key employees to the Company, its
subsidiaries and its stockholders, to motivate those key employees to perform
their assigned responsibilities diligently and skillfully, and to attract and
retain competent entrepreneurial-type management dedicated to the long-term
growth and profitability of the Company. The Company believes this can best be
accomplished by tying a portion of compensation to appreciation in the market
value of the Company's stock so that the management and key employees of the
Company and its subsidiaries are rewarded under the Stock Option Plan only if
the value of the stockholders' investment in the Company has appreciated.
PURPOSE OF THE PLAN
On March 13, 1990, the Company established the Stock Option Plan, pursuant
to which options could be granted to eligible employees for the purchase of a
maximum of 1,100,000 shares of Common Stock of the Company. The Stock Option
Plan was amended effective February 7, 1997, to increase the number of shares of
Common Stock of the Company that may be granted to eligible employees to a
maximum of 1,800,000.
AMENDMENT SUBMITTED FOR APPROVAL
The Board is submitting for stockholder approval an amendment to the Stock
Option Plan, effective October 8, 1997, (i) to increase the maximum number of
shares of Common Stock of the Company that may be purchased pursuant to options
granted to eligible employees under the Stock Option Plan from 1,800,000 shares
to 3,300,000 shares and (ii) to provide that any eligible employee may be
granted options up to the maximum number of shares authorized under the Stock
Option Plan.
12
16
The approval of the amendment to the Stock Option Plan requires the
favorable vote of the holders of a majority of the shares of Common Stock
present in person or represented by proxy and entitled to vote at the Meeting.
Stockholder approval is required in order for the options to constitute
performance-based compensation under Section 162(m) of the Code (as defined
below). Management recommends voting in favor of the amendment to the Stock
Option Plan.
If the amendment to the Stock Option Plan is not approved by the
stockholders, the Company will maintain the Stock Option Plan without giving
effect to the amendment, and any options for shares not available for grant
prior to the amendment will terminate. Copies of the Stock Option Plan may be
obtained from the Company upon request.
DESCRIPTION OF THE PLAN, AS AMENDED
The Stock Option Plan is designed to permit the appropriate administering
committee to grant options to key employees of the Company or its subsidiaries
to purchase shares of Common Stock of the Company. The Stock Option Plan
requires that the purchase price under each option will not be less than 100% of
the fair market value of the Common Stock at the time of the grant of the
option. The fair market value per share is the reported closing price of the
Common Stock on the New York Stock Exchange on the date of the grant of the
option, or if no sale of Common Stock shall have been reported on such date of
grant, on the next preceding day or the last day prior to the date of grant when
the sale was reported. The option period may not be more than ten years from the
date the option is granted. Except with respect to options granted to officers
and directors, the Executive Committee of the Board of Directors of the Company
grants options to eligible employees, determines the purchase price and option
period at the time the option is granted, and administers and interprets the
Stock Option Plan. The Compensation Committee of the Board of Directors grants
options and administers the Stock Option Plan with respect to officers and
directors of the Company. Options may be exercised in annual installments as
specified by the administering committee. All installments that become
exercisable are cumulative and may be exercised at any time after they become
exercisable until expiration of the option. The administering committee may
accelerate or terminate any or all outstanding options in the event the Company
sells all or substantially all of its assets or all or substantially all of the
outstanding Common Stock is sold or exchanged for or converted into securities
of another corporation or in the event of some other material corporate
restructuring.
The exercise price of options is paid in cash or by check at the time of
exercise. Shares of Common Stock deliverable upon exercise of the options may be
transferred from treasury or issued from authorized but unissued shares. The
Stock Option Plan provides that an option agreement may include a provision
granting stock appreciation rights ("SARs") to the optionee. If this provision
is in the option agreement, the administering committee may determine upon the
exercise of an option whether to issue the number of shares of Common Stock
called for by the option agreement after payment of the purchase price or to pay
cash, Common Stock or a combination of cash and Common Stock to the optionee
pursuant to the SARs provision.
Payment in accordance with the SARs provision would be in an amount equal
to the excess of the fair market value of the shares of Common Stock covered by
the option or portion thereof being exercised over the aggregate option price of
the shares. In addition, the Stock Option Plan provides that the administering
committee may offer to the holder of an option that does not contain a SARs
provision the right to receive cash, Common Stock or a combination of cash and
Common Stock in the amount of such excess rather than the number of shares of
Common Stock called for by the option agreement.
Unless sooner terminated by action of the Board of Directors of the
Company, the Stock Option Plan will terminate on February 6, 2007, and no
options may thereafter be granted under the Stock Option Plan. The Stock Option
Plan may be amended, altered or discontinued by the Board of Directors without
the approval of the stockholders, except that the Board of Directors does not
have the power or authority without stockholder approval to change the employees
or class of employees who are eligible to receive options or the aggregate
number of shares that may be issued under options. The administering committee,
however, may make appropriate adjustments in the number of shares covered by the
Stock Option Plan and the outstanding options, and in the option prices, to
reflect any stock dividend, stock split, share combination or other
13
17
recapitalization and, with respect to outstanding options and option prices, to
reflect any merger, consolidation, reorganization, liquidation or the like, of
or by the Company.
Options may be granted under the Stock Option Plan only to key employees of
the Company or its subsidiaries. Key employees are defined in the Stock Option
Plan to be those employees whose performance and responsibilities are determined
by the appropriate administering committee to be influential to the success of
the Company and its subsidiaries. Currently approximately 70 employees are
eligible to receive stock options under the Stock Option Plan. Directors who are
not employees of the Company or one of its subsidiaries are not eligible.
Additional options may be granted to persons to whom options have previously
been granted. There is no restriction in the Stock Option Plan on the maximum or
minimum number of shares of Common Stock covered by options that may be granted
to any person.
Both incentive stock options and nonqualified stock options may be granted
under the Stock Option Plan. Incentive stock options are options which meet the
requirements of Section 422 of the Internal Revenue Code of 1986, as amended
(the "Code") and nonqualified options are options which do not meet the
requirements of Section 422 of the Code. No incentive stock option, however, may
be granted under the Stock Option Plan to an employee who owns more than 10% of
the outstanding Common Stock unless the option price is at least 110% of the
fair market value of the Common Stock at the date of grant and the option is not
exercisable more than five years after it is granted. There is no limit on the
fair market value of incentive stock options that may be granted to an employee
in any calendar year, but no employee may be granted incentive stock options
that first become exercisable during a calendar year for the purchase of stock
with an aggregate fair market value (determined as of the date of grant of each
option) in excess of $100,000. An incentive stock option (or an installment
thereof) counts against the annual limitation only in the year it first becomes
exercisable.
The administering committee may provide for termination of options granted
under the Stock Option Plan in case of termination of employment, dishonesty or
any other reason the appropriate committee determines. If an option under the
Stock Option Plan expires or terminates before it has been exercised in full,
the shares of Common Stock allocable to the unexercised portion of that option
may be made the subject of future grants of options under the Stock Option Plan.
Upon termination of the employment of an optionee holding an option under the
Stock Option Plan, his option is exercisable for a period of 30 days after
termination, and thereafter his option terminates. Options may not be
transferred other than by will or the laws of descent and distribution and,
during the lifetime of the optionee, may be exercised only by him. If the
optionee dies before the termination of his right to exercise his option, the
legal representatives of his estate may exercise his option provided the option
is exercised prior to the date of expiration of the option period or one year
from the date of the optionee's death, whichever first occurs, and the option
may be exercised only as to those shares the optionee could have purchased under
the option on the date of death or other termination.
TAX STATUS OF OPTIONS
All stock options that qualify under the rules of Section 422 of the Code
will be entitled to "incentive stock option" treatment. To receive incentive
stock option treatment, an optionee must not dispose of the acquired stock
within two years after the option is granted or within one year after the
exercise. In addition, the individual must have been an employee of the Company
or one of its subsidiaries for the entire time from the date of granting of the
option until three months (one year if the employee is disabled) before the date
of the exercise. The requirement that the individual be an employee and the
two-year and one-year holding periods are waived in the case of death of the
employee. If all such requirements are met, no tax will be imposed upon exercise
of the incentive stock option, and any gain upon sale of the stock will be
entitled to capital gain treatment. The employee's gain on exercise (the excess
of the fair market value at the time of exercise over the exercise price) of an
incentive stock option is a tax preference item and, accordingly, is included in
the computation of alternative minimum taxable income.
If an employee does not meet the two-year and one-year holding requirement
(a "disqualifying disposition"), but does meet all other requirements, tax will
be imposed at the time of sale of the stock. In such event, the employee's gain
on exercise will be treated as ordinary income rather than capital gain and the
Company will be entitled to a corresponding deduction at the time of sale. Any
remaining gain on sale will be
14
18
short-term, mid-term or long-term capital gain, depending on the holding period
of the stock. If the amount realized on the disqualifying distribution is less
than the value at the date of exercise, the amount includable in gross income,
and the amount deductible by the Company, will equal the excess of the amount
realized on the sale or exchange over the exercise price.
An optionee, upon exercise of a nonqualified stock option that does not
qualify as an incentive stock option, recognizes ordinary income in an amount
equal to the gain on exercise. If the optionee receives cash or stock upon the
exercise of an SAR, instead of paying the exercise price for the shares of
Common Stock called for by his option agreement, the amount of cash or value of
stock he receives is ordinary income to him. The exercise of a nonqualified
stock option or SAR entitles the Company to a tax deduction in the same amount
as is includable in the income of the optionee for the year in which the
exercise occurred. Any gain or loss realized by an optionee on subsequent
disposition of shares generally is a capital gain or loss and does not result in
any tax deduction to the Company. The optionee has no taxable income, and the
Company is not entitled to a deduction, at the time of the grant of an option.
The foregoing statements are based upon present federal income tax laws and
regulations and are subject to change if the tax laws and regulations, or
interpretations thereof, are changed.
OUTSTANDING OPTIONS
Options may be exercised in annual installments as specified by the
administering committee. All installments that become exercisable are cumulative
and may be exercised at any time after they become exercisable until expiration
of the option. The administering committee may grant either nonqualified stock
options or incentive stock options, as defined by the Code.
The following table shows, as to certain executive officers and directors
of the Company and its subsidiaries and as to all executive officers as a group,
the following information with respect to stock options and SARs in tandem
therewith:
ALL EXECUTIVE
C.A. BRUCE W. BRIAN K. HAROLD W. OFFICERS AS A
COMMON STOCK RUNDELL, JR. WILKINSON MILLER PARKISON GROUP
------------ ------------ --------- -------- --------- --------------------------------- ---------- ---------- ---------- ---------- ---------- ----------
Granted
January 1, 1996 to December 31,
1997.............................. 450,000 666,666* 50,000 50,000 1,216,666
Number of options with SARs.......... 450,000 666,666* 50,000 50,000 1,216,666
Weighted average price per share..... $ 3.47 $ 1.50 $ 5.25 $ 2.13 $ 2.90
Exercised --
January 1, 1996 to December 31,
1997.............................. -- 133,333 -- -- 133,333
Market value of shares less exercise
price or cash received............ -- $260,000 -- -- $ 260,000
TYLER TECHNOLOGIES INC 100 68.18 200.00 222.73 200.00 61.38
S&P 500 INDEX 100 122.96 163.98 210.85 255.21 231.98
PEER GROUP 100 105.98 88.04 72.29 74.91 19.31
- ---------------
* Includes 400,000 optionsCERTAIN TRANSACTIONS
On September 29, 2000, the Company sold for cash certain net assets of
Kofile, Inc. ("Kofile") and another subsidiary, the Company's interest in a
certain intangible work product, and a building and related building
improvements to purchase Common Stock which terminated asinvestment entities beneficially owned by William D. Oates, a
resultprincipal shareholder who was also a director and Chairman of Mr. Wilkinson's resignation as President and Chiefthe Executive
OfficerCommittee of the Company in October 1997.
Duringat the periodtime of the sale. The Kofile sale was consistent
with the Company's decision to exit the information and property records
services segment of its business, focus the Company's resources on its software
systems and services segment of its business, and to reduce the Company's debt.
The cash sale price was $14.4 million, which was determined after lengthy
negotiations between Mr. Oates and the Tyler Board. The Company received an
opinion from January 1, 1996,an investment banker that the cash sale price was fair to December 31, 1997, employeesthe
Company from a financial point of view.
Periodically during 2000, the Company leased a private airplane owned by
William D. Oates, a former director of the Company, exercised options and SARs with a net value (market value of shares
less exercise price or cash received) of $792,045. As of December 31, 1997,
options to purchase an aggregate of 695,933 shares of Common Stock of the
Company were outstanding, with a weighted average exercise price per share of
$3.04 and expiring between January 28, 2003, and December 11, 2007.
15for business related trips,
for which payments aggregated approximately $325,000.
13
19
COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors of the Company has an Executive Committee, an Audit
Committee and a Compensation Committee to assist the Board in carrying out its
duties. The Executive Committee has authority, as delegated by the Board, to act
for the Board but may not commit the Company to an expenditure in excess of
$10,000,000 without Board approval. The Audit Committee's duties include
considering the independence of the independent auditors before the Company
engages them; reviewing with the independent auditors the fee, scope and timing
of the audit; reviewing the completed audit with the independent auditors
regarding any significant accounting adjustments, recommendations for improving
internal controls, appropriateness of accounting policies, appropriateness of
accounting and disclosure decisions with respect to significant unusual
transactions or material obligations and significant findings during the audit;
reviewing the Company's financial statements and related regulatory filings with
the independent auditors; and meeting periodically with the Company's management
to discuss internal accounting and financial controls. The Compensation
Committee has final authority on all executive compensation and periodically
reviews compensation, employee benefit plans and other benefits paid to or
provided for officers and directors of the Company. This committee approves
annual salaries and bonuses for Company officers to ensure that the recommended
salaries and bonuses are not unreasonable. The Company has no nominating
committee; the entire Board of Directors is responsible for selecting nominees
for election as directors.
During 1997, the Board of Directors of the Company met a total of eight
times. The Executive Committee met once, the Audit Committee met twice and the
Compensation Committee met three times.16
STOCKHOLDER PROPOSALS
Any proposals that stockholders of the Company desire to have presented at
the 19992002 annual meeting of stockholders must be received by the Company at its
principal executive offices not later than November 17, 1998.
16
20
MISCELLANEOUSFebruary 1, 2002.
INDEPENDENT AUDITORS
Ernst & Young LLP acted as the Company's independent auditors for 1997.2000.
Fees for the fiscal year 2000 annual audit were $412,000 and all other fees were
$215,000, including audit related services of $153,000 and non audit services of
$62,000. Audit related services generally include fees for business acquisitions
and/or dispositions, accounting consultations, SEC filings, and audit of the
Company's employee benefit plan.
One or more representatives of Ernst & Young LLP will attend the annual meeting,Annual
Meeting, will have an opportunity to make a statement, and will respond to
appropriate questions from stockholders. The Audit Committee has not yet
appointed the independent auditors for 1998.
The accompanying proxy is being solicited on behalf of the Board of
Directors of the Company. The Company will bear the expense of preparing,
printing and mailing the proxy solicitation material and the of proxy. In
addition to use of the mail, proxies may be solicited by personal interview,
telephone and telegram by directors and regular officers and employees of the
Company. The Company may also engage the services of a proxy solicitation firm
to assist in the solicitation of proxies. The Company estimates that the fee of
any such firm will not exceed $5,000 plus reimbursement of reasonable
out-of-pocket expenses. Arrangements may also be made with brokerage houses and
other custodians, nominees and fiduciaries for the forwarding of solicitation
material to the beneficial owners of stock held of record by such persons, and
the Company may reimburse them for reasonable out-of-pocket expenses incurred by
them in connection therewith.2001.
By Order of the Board of Directors,
/s/ JAMES E. RUSSELL
JAMES E. RUSSELLH. LYNN MOORE, JR.
H. Lynn Moore, Jr.
Vice President, General Counsel,
and Secretary
Dallas, Texas
March 27, 1998May 7, 2001
14
17
APPENDIX A
TYLER TECHNOLOGIES, INC.
AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
CHARTER
STATEMENT OF POLICY
The Audit Committee shall provide assistance to the Board of Directors in
fulfilling their oversight responsibility to the shareholders, potential
shareholders, the investment community, and others relating to the Company's
financial statements and the financial reporting process, the systems of
internal accounting and financial controls, the internal audit function (if
any), the annual independent audit of the Company's financial statements, and
the legal compliance and ethics programs as established by management and the
Board. In so doing, it is the responsibility of the committee to maintain free
and open communication between the committee, independent auditors, and
management of the Company. In discharging its oversight role, the committee is
empowered to investigate any matter brought to its attention with full access to
all books, records, facilities, and personnel of the Company and the power to
retain outside counsel, or other experts for this purpose.
The Audit Committee fulfills its oversight responsibilities by reviewing: the
financial reports and other financial information provided by the Corporation to
any governmental body or the public; the Corporation's systems of internal
controls regarding finance, accounting, legal compliance and ethics that
management and the Board have established; and the Corporation's auditing,
accounting and financial reporting processes generally. Consistent with this
function, the Audit Committee should encourage continuous improvement of, and
should foster adherence to, the corporation's policies, procedures and practices
at all levels. The audit committee's primary duties and responsibilities are to:
[ ] Serve as an independent and objective party to monitor the
Corporation's financial reporting process and internal control system.
[ ] Review and appraise the audit efforts of the Corporation's independent
accountants.
[ ] Provide an open avenue of communication among the independent
accountants, financial and senior management, and the Board of
Directors.
The Audit Committee will primarily fulfill these responsibilities by carrying
out the activities enumerated below.
COMPOSITION
By June 14, 2001, the Audit Committee shall be comprised of three or more
directors as determined by the Board, each of whom shall be independent
directors, and free from any relationship with management of the Company that,
in the opinion of the Board, would interfere with the exercise of his or her
independent judgment as a member of the Committee. Members of the committee
shall be considered independent if they have no relationship that may interfere
with the exercise of their independence from management and the Company. All
members of the Committee shall have a working familiarity with basic finance and
accounting practices, and at least one member of the Committee shall have
accounting or related financial management expertise. Committee members may
enhance their familiarity with finance and accounting by participating in
educational programs conducted by the Corporation or an outside consultant.
The members of the Committee shall be elected by the Board at the annual
organizational meeting of the Board or until their successors shall be duly
elected and qualified. Unless a Chair is elected by the full Board, the members
of the committee may designate a Chair by majority vote of the full Committee
membership.
15
18
MEETINGS
The Committee shall meet at least four times annually, or more frequently as
circumstances dictate. As part of its job to foster open communication, the
Committee should meet at least annually with management and the independent
accountants in separate executive sessions to discuss any matters that the
Committee or each of these groups believe should be discussed privately. In
addition, the Committee, or at least its Chair, shall review telephonically or
in person, the interim financial statements with management and the independent
auditors prior to the filing of the Company's Quarterly Report on Form 10-Q.
Also, the Committee shall discuss the results of the quarterly review and any
other matters required to be communicated to the committee by the independent
auditors under generally accepted auditing standards. The Committee shall review
with management and the independent auditors the financial statements to be
included in the Company's Annual Report on Form 10-K, including their judgment
about the quality, not just acceptability, of accounting principles, the
reasonableness of significant judgments, and the clarity of the disclosures in
the financial statements. Also, the Committee shall discuss the results of the
annual audit and any other matters required to be communicated to the committee
by the independent auditors under generally accepted auditing standards.
RESPONSIBILITIES, PROCESSES, AND DUTIES
The primary responsibility of the Audit Committee is to oversee the Company's
financial reporting process on behalf of the Board and report the results of
their activities to the Board. Management is responsible for preparing the
Company's financial statements, and the independent auditors are responsible for
auditing those financial statements. The Committee in carrying out its
responsibilities believes its policies and procedures should remain flexible, in
order to best react to changing conditions and circumstances. The Committee
should take the appropriate actions to set the overall corporate "tone" for
quality financial reporting, sound business risk practices, and ethical
behavior.
To fulfill its responsibilities and duties the Audit Committee shall:
DOCUMENTS/REPORTS REVIEW
1. Review and update this Charter periodically, at least annually,
as conditions dictate.
2. Review the Company's annual financial statements and any other
significant reports submitted to the Securities and Exchange
Commission and the New York Stock Exchange.
3. Review with financial management and the independent accountants
the Form 10-Q and Form 10-K prior to their filing or prior to the
release of earnings. The Chair of the Committee may represent the
entire Committee for purposes of the review of the Form 10-Q.
INDEPENDENT ACCOUNTANTS
4. Recommend to the Board of Directors on an annual basis the
selection of the independent accountants.
5. Provide a clear understanding to management and the independent
auditors that the independent auditors are ultimately accountable
to the Board and the Audit Committee, as representatives of the
Company's shareholders. The Committee shall have the ultimate
authority and responsibility to evaluate and, where appropriate,
replace the independent auditors.
6. Discuss with the independent auditors on an annual basis their
independence from management and the Company and the matters
included in the written disclosures required by the Independence
Standards Board.
7. Discuss with the independent auditors the overall scope and plans
for their respective audits including the adequacy of staffing
and compensation. Also, the Committee shall discuss with
management and the independent auditors the adequacy and
effectiveness of the accounting and financial controls, including
the Company's system to monitor and manage business risk, and
legal and ethical compliance programs. Further, the Committee
shall meet separately with the independent auditors, with and
without management present, to discuss the results of their
examinations.
16
19
8. Review the performance of the independent accountants and approve
any proposed discharge of the independent accountants when
circumstances warrant.
FINANCIAL REPORTING PROCESSES
9. In consultation with the independent accountants, review the
integrity of the Company's financial reporting processes, both
internal and external.
10. Consider the independent accountants' judgments about the quality
and appropriateness of the Corporation's accounting principles as
applied in its financial reporting.
11. Consider and approve, if appropriate, major changes to the
Corporation's auditing and accounting principles and practices as
suggested by the independent accountants or management.
PROCESS IMPROVEMENT
12. Establish regular and separate systems of reporting to the Audit
Committee by management and by the independent accountants
regarding any significant judgments made in management
preparation of the financial statements and the view of each as
to appropriateness of such judgments.
13. Following completion of the annual audit, review separately with
management and with the independent accountants any significant
difficulties encountered during the course of the audit,
including any restrictions on the scope of work or access to
required information.
14. Review any significant disagreement among management and the
independent accountants in connection with the preparation of the
financial statements.
15. Review with the independent accountants and management the extent
to which changes or improvements in financial or accounting
practices, as approved by the Audit Committee, have been
implemented.
ETHICAL AND LEGAL COMPLIANCE
16. Establish, review and update periodically a Code of Ethical
Conduct and ensure that management has established a system to
enforce this Code.
17. Ensure that management has the proper review system in place to
ensure that Corporation's financial statements, reports and other
financial information disseminated to governmental organizations,
and the public satisfy legal requirements.
18. Review, with the organization's counsel, legal compliance matters
including corporate securities trading policies.
19. Review, with the organization's counsel, any legal matter that
could have a significant impact on the Company's financial
statements.
20. Perform any other activities consistent with this Charter, the
Corporation's By-laws and governing law, as the Committee or the
Board deems necessary or appropriate.
17
20
APPENDIX B
PEER GROUP INDEX
ADVANCED POLYMER SYSTEMS
AFTERMARKET TECHNOLOGY CORP
AMERICA FIRST APT INVESTORS
APPLIED SIGNAL TECHNOLOGY
APPLIEDTHEORY CORP
AT PLASTICS INC
ATTUNITY LTD
AVITAR INC
BANK OF THE OZARKS INC
BAR HARBOR BANKSHARES
BIOJECT MEDICAL TECHNOL
BITWISE DESIGNS INC
BRIGHT STATION PLC-ADR
CAGLE'S INC-CLA
CANTEL MEDICAL CORP-CLB
CAPITAL CROSSING BANK
CAPITAL SENIOR LIVING CORP
CASCADE FINL CORP
CASTLE ENERGY CORP
CFM TECHNOLOGIES INC
CHAPARRAL RESOURCES INC
CHART HOUSE ENTERPRISES INC
CHATTEM INC
CLICKSOFTWARE TECHNOLOGIES LTD
CNB FLORIDA BANCSHARES INC
COLONIAL INSD MUN FD
COMPUTER MOTION INC
CORNELL COMPANIES INC
COVEST BANCSHARES INC
CRIIMI MAE INC
CYRK INC
DAN RIVER INC-CLA
DAXOR CORP
DECKERS OUTDOOR CORP
DELTA NATURAL GAS CO INC
E MEDSOFT.COM
EASTERN CO
EATON VANCE FL MUNI INC TR
ECONNECT
EDUTREK INTERNATIONAL INC-CLA
EMERGING MARKETS INCOME FD INC
ENCHIRA BIOTECHNOLOGY CORP
EPRISE CORP
18
21
FINANCIAL INDS CORP
FLORIDA PUBLIC UTILITIES CO
FNB FINANCIAL SERVICES CORP
FRANKLIN MULTI-INCOME TR
FUSION MED TECHNOLOGIES INC
GASTON FED BANCORP INC
GLOBAL VACATION GROUP INC
GLOBAL-TECH APPLIANCES INC
HAWK CORP
HEI INC
HISPANIC TV NETWORK INC
HOLLYWOOD ENTMT CORP
HOME STAKE OIL & GAS CO
HUNT CORP
INTERPHASE CORP
JOHNSON OUTDOORS INC-CLA
JPS INDUSTRIES INC
KVH INDUSTRIES INC
LANDEC CORP
LARSCOM INC-CLA
LASER MORTGAGE MGT INC
LAWRENCE SAVINGS BANK MA
LEAP TECHNOLOGY INC
MACATAWA BANK CORP
MAGIC SOFTWARE ENTERPRISES
MARINE PETROLEUM TRUST
MARKETWATCH.COM INC
MARTEN TRANSPORT LTD
MARVEL ENTERPRISES-CLA
MATRIX BANCORP INC
MATRIX SERVICE CO
MAXX PETROLEUM LTD
MEDIX RESOURCES INC
MFN FINANCIAL CORP
MICRO THERAPEUTICS INC
MICROCIDE PHARMACEUTICALS
MOMENTUM BUSINESS APPS INC
MPHASE TECHNOLOGIES INC
MUNIHOLDINGS FLA INSD FD V
MUNIHOLDINGS MICH INSD FD II
MYPOINTS.COM INC
NASTECH PHARMACEUTICAL
NATIONAL STEEL CORP-CLB
NATIONS BALANCD TARGT MAT FD
NEOGEN CORP
NEOTHERAPEUTICS INC
NESS ENERGY INTL INC
NETERGY NETWORKS INC
NETWORK COMMERCE INC
NEWMIL BANCORP INC
19
22
NORTHPOINT COMMUNICATIONS GP
NORTHWEST PIPE CO
OBIE MEDIA CORP
OEC COMPRESSION CORP
OREGON TRAIL FINANCIAL CORP
OWENS CORNING
PENNSYLVANIA COMM BANCORP
PETRIE STORES LIQUIDATION TR
PROFESSIONAL STAFF PLC -ADR
PROGRESSIVE RETURN FUND INC
PUTNAM INV GRADE MUNI TR III
QUALITY SYSTEMS INC
QUIPP INC
RAINMAKER SYSTEMS
REPEATER TECHNOLOGIES INC
ROYCE GLOBAL TRUST INC
RWD TECHNOLOGIES INC
SAUCONY INC-CLB
SCC COMMUNICATIONS CORP
SCIENTIFIC LEARNING CORP
SCOPE INDUSTRIES INC
SCUDDER GLOBAL HIGH INCM FD
SECURITY CAPITAL/DE-CLA
SHILOH INDUSTRIES INC
SHOP AT HOME INC
SIERRACITIES.COM INC
SOFTNET SYSTEMS INC
SOUTHERN MINERAL CORP
SPORTS CLUB COMPANY INC
SWISS ARMY BRANDS INC
SYNSORB BIOTECH INC
TEAMSTAFF INC
TEFRON LTD
TELEHUBLINK CORP
TEXOIL INC
THERMOGENESIS CORP
TRACK DATA CORP
TRADESTATION GROUP INC
TRANSMEDIA NETWORK
TURKISH INVT FD INC
TWINLAB CORP
UGLY DUCKLING CORP
USLIFE INCOME FUND
VAN KAMPEN HIGH INCOME TR II
VENTRO CORP
VISIONICS CORP
WINTON FINANCIAL CORP
WISER OIL CO
WOLOHAN LUMBER CO
ZEMEX CDA CORP
20
23
PROXY
TYLER CORPORATIONTECHNOLOGIES, INC.
THIS PROXY IS SOLICITED ON BEHALF OF
THE BOARD OF DIRECTORS OF THE COMPANY
The undersigned hereby (1) acknowledges receipt of the Notice dated March
27, 1998May 7,
2001 of the annual meeting of stockholders of Tyler CorporationTechnologies, Inc. (the
"Company") to be held at Suite 2820, San Jacinto Tower, 2121 San Jacinto Street,the Park Cities Hilton, 5954 Luther Lane, Dallas,
Texas, on Tuesday, April 28, 1998,June 5, 2001, at 10:0010.00 a.m., Dallas time, and the proxy
statement in connection therewith, and (2) appoints Louis A. Waters and C.A. Rundell, Jr.,John M.
Yeaman, and each of them, his proxies with full power of substitution and
revocation, for and in the name, place and stead of the undersigned, to vote
upon and act with respect to all of the shares of Common Stock of the Company
standing in the name of the undersigned or with respect to which the undersigned
is entitled to vote and act at said meeting and at any adjournment thereof, and
the undersigned directs that his proxy be voted as indicated on the reverse side
hereof. If only one of the above proxies shall be present in person or by
substitute at such meeting or at any adjournment thereof, that proxy so present
and voting, either in person or by substitute, shall exercise all of the powers
hereby given.
The undersigned hereby revokes any proxy or proxies heretofore given to
vote upon or act with respect to such stock and hereby ratifies and confirms all
that said proxies, their substitutes or any of them may lawfully do by virtue
hereof.
- ----------- -----------
SEE REVERSE SIDE SEE REVERSE
SIDE CONTINUED AND TO BE SIGNED ON REVERSE SIDE [X]PLEASE MARK VOTE AS IN THIS EXAMPLE.
THIS PROXY WILL BE VOTED AS SPECIFIED BELOW. IF NO SPECIFICATION IS MADE,
THIS PROXY WILL BE VOTED FOR THE MATTERS SPECIFICALLY REFERRED TO BELOW.
1. Election of Directors:
NOMINEES: Lorch, Meyer, Oates, Rundell, Russell, Waters
[ ]FOR ALL NOMINEES
[ ]WITHHOLD AUTHORITY FOR ALL NOMINEES
[ ]
--------------------------------------------------
TO WITHHOLD AUTHORITY TO VOTE FOR ANY NOMINEE(S),
MARK ABOVE AND WRITE NOMINEE'S NAME(S) IN SPACE
PROVIDED.
2. Approval of Tyler Corporation Stock Option Plan, as amended and restated
as of February 19, 1998.
[ ]For [ ] AGAINST [ ]ABSTAIN
3. In their discretion, the proxies are authorize to vote upon such other
business as may properly come before the meeting or any adjournments
thereof.
MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT [ ]
Please date this proxy and sign your name exactly as it appears hereon. Where
there is more than one owner, each should sign. When signing as an attorney,
administrator, executor, guardian or trustee, please add your title as such.
If executed by a corporation, the proxy should be signed by a duly authorized
officer.
Please sign this proxy and return it promptly whether or not you expect to
attend the meeting. You may nevertheless vote in person if you do attend.
Signature: Date:
--------------------- ---------
Signature: Date:
--------------------- ---------SIDE
- ----------- -----------
24
[TYLER LETTERHEAD] VOTE BY INTERNET-www.proxyvote.com
Use the internet to transmit your voting
instructions and for electronic delivery of
information up until 11:59 P.M. Eastern Time
the day before the cut-off date or meeting
date. Have your proxy card in hand when you
access the web site. You will be prompted to
enter your 12-digit Control Number, which is
located below, to obtain your records and to
create an electronic voting instruction form.
VOTE BY MAIL
Mark, sign, and date your proxy card and
return it in the postage-paid envelope we
have provided or return it to Tyler
Technologies, Inc., c/o ADP, 51 Mercedes
Way, Edgewood, NY 11717.
YOUR VOTE IS IMPORTANT!
Do not return your Proxy Card if you are
voting by Telephone or Internet.
Please sign this proxy and return it promptly
whether or not you expect to attend the
meeting. You may nevertheless vote in person
if you do attend.
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: TYLER1 KEEP THIS PORTION FOR YOUR RECORDS
- ------------------------------------------------------------------------------------------------------------------------------------
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. DETACH AND RETURN THIS PORTION ONLY
TYLER TECHNOLOGIES, INC.
THIS PROXY WILL BE VOTED AS SPECIFIED BELOW,
IF NO SPECIFICATION IS MADE, THIS PROXY
WILL BE VOTED FOR THE MATTERS SPECIFICALLY
REFERRED TO BELOW. For Withhold For All To withhold authority to vote, mark "For
All All Except All Except" and write the nominees's
1. Election of Directors [ ] [ ] [ ] number on the line below.
NOMINEES: 01) Ben T. Morris, 02) Ulrich
Otto, 03) G. Stuart Reeves,
04) Glenn A. Smith, 05) Louis A. Waters, ----------------------------------------
06) John D. Woolf, 07) John M. Yeaman
2. In their discretion, the proxies are
authorized to vote upon such other business
as may properly come before the meeting or
any adjournments thereof.
Please date this proxy and sign your name exactly
as it appears hereon. Where there is more than one
owner, each should sign. When signing as an attorney,
administrator, executor, guardian or trustee, please
add your title as such. If executed by a corporation,
the proxy should be signed by a duly authorized officer.
MARK HERE FOR ADDRESS CHANGE AND NOTE ON REVERSE [ ]
- ---------------------------------------------------- ------------------------------------------------
Signature [PLEASE SIGN WITHIN BOX] Date Signature [Joint Owners] Date