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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
MICROS Systems, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
MICROS Systems, Inc.
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] No filing fee.
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act 0-11:(1)
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4) Proposed maximum aggregate value of transaction:
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(1)Set forth the amount on which the filing fee is calculated and state how it
was determined.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
-------------------------------------
2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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MICROS SYSTEMS, INC.
12000 BALTIMORE AVENUE
BELTSVILLE, MARYLAND 20705-1291
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON NOVEMBER 19, 1999
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of
MICROS Systems, Inc., ("MICROS" or the "Company") will be held at 11:00 a.m.
Eastern Standard Time on Friday, November 19, 1999, at the Greenbelt Marriott,
6400 Ivy Lane, Greenbelt, Maryland, 20770 for the following purposes:
(1) To elect six directors to serve for a one year term (Proposal
1); and
(2) To approve the appointment of PricewaterhouseCoopers LLP as
independent public accountants for the 2000 fiscal year
(Proposal 2); and
(3) To approve an amendment to the Company's 1991 Stock Option
Plan, which serves to authorize the issuance of an additional
1,000,000 shares of Common Stock under the Option Plan, for a
total of 5,500,000 shares of Common Stock (Proposal 3); and
(4) To transact such other business as may properly come before
the Annual Meeting or any adjournments thereof.
The close of business on October 4, 1999, has been fixed as the
record date for the determination of stockholders entitled to notice of and to
vote at the Annual Meeting. Only holders of Common Stock of record at the close
of business on that date will be entitled to notice of and to vote at the Annual
Meeting or any adjournments thereof. The transfer books of the Company will not
be closed.
By Order of the Board of Directors,
/s/ JUDITH F. WILBERT
Judith F. Wilbert
Corporate Secretary
Beltsville, Maryland
October 22, 1999
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. THEREFORE, WHETHER OR NOT YOU
PLAN TO BE PRESENT IN PERSON AT THE ANNUAL MEETING, PLEASE SIGN AND DATE THE
ENCLOSED PROXY AND RETURN IT IN THE ENCLOSED ENVELOPE WHICH REQUIRES NO POSTAGE
IF MAILED IN THE UNITED STATES.
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MICROS SYSTEMS, INC.
12000 BALTIMORE AVENUE
BELTSVILLE, MARYLAND 20705-1291
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
NOVEMBER 19, 1999
VOTING RIGHTS AND PROXY SOLICITATION
This Proxy Statement is furnished to stockholders of MICROS Systems,
Inc. ("MICROS" or the "Company") in connection with the solicitation by the
Board of Directors of MICROS of proxies to be used at the Annual Meeting of
Stockholders to be held on Friday, November 19, 1999, 11:00 a.m. Eastern
Standard Time, at the Greenbelt Marriott, 6400 Ivy Lane, Greenbelt, Maryland,
20770, and at any adjournments thereof.
It is anticipated that this Proxy Statement and form of proxy will
initially be mailed to stockholders on or about October 22, 1999.
If the enclosed form of proxy is properly executed and returned to
the Company in time to be voted at the Annual Meeting, the shares represented
thereby will be voted in accordance with the instructions marked thereon.
EXECUTED BUT UNMARKED PROXIES WILL BE VOTED FOR THE ELECTION OF MANAGEMENT'S
NOMINEES FOR DIRECTORS AND FOR ALL OTHER PROPOSALS. If any other matters are
properly brought before the Annual Meeting, the persons named in the
accompanying proxy will vote the shares represented by such proxies on such
matters in their best judgment.
The presence of a stockholder at the Annual Meeting will not
automatically revoke such stockholder's proxy. Stockholders may, however, revoke
a proxy at any time prior to its exercise by filing with the Secretary of the
Company a written notice of revocation, by delivering to the Company a duly
executed proxy bearing a later date, or by attending the Annual Meeting and
voting in person.
The cost of solicitation of proxies in the form enclosed herewith
will be borne by the Company. In addition to the solicitation of proxies by
mail, the Company, through its Directors, officers and regular employees, may
also solicit proxies personally or by telephone or facsimile. The Company will
request persons, firms and corporations holding shares in their names or in the
names of their nominees, which are beneficially owned by others, to send proxy
materials to and obtain proxies from such beneficial owners and will reimburse
such holders for their reasonable out-of-pocket expenses in doing so. The
Company may retain a proxy solicitor if it were to determine subsequently that
such action is appropriate.
The securities which can be voted at the Annual Meeting consist of
shares of Common Stock of the Company with each share entitling its owner to one
vote. The close of business on October 4, 1999, has been fixed as the record
date for determination of stockholders entitled to vote at the meeting. The
number of shares outstanding on October 4, 1999, was 16,420,209. The presence in
person or by proxy of stockholders holding of record a majority of all votes
entitled to be cast at the Annual Meeting is necessary to constitute a quorum.
A majority of all votes cast at the meeting, a quorum being present,
is required for the adoption of each of the Proposals. Under applicable Maryland
law, proxies marked as abstentions and broker non-votes (where a nominee holding
shares for a beneficial owner has not received voting instructions from the
beneficial owner with respect to a particular matter and such nominee does not
possess or choose to exercise discretionary authority with respect thereto) will
be considered as present at the meeting for purposes of determining the
existence of a
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quorum. With respect to Proposals 2 and 3, broker non-votes and abstentions
shall have no effect. A proxy marked to withhold a vote from a nominee in the
case of election of Directors shall have the effect of a negative vote. Each
stockholder of record on the record voting date is entitled to one vote per
share. There are no cumulative voting rights.
A COPY OF THE COMPANY'S ANNUAL REPORT TO STOCKHOLDERS FOR ITS FISCAL
YEAR ENDED JUNE 30, 1999, ACCOMPANIES THIS PROXY STATEMENT. THE COMPANY HAS
FILED AN ANNUAL REPORT ON FORM 10-K FOR ITS FISCAL YEAR ENDED JUNE 30, 1999,
WITH THE SECURITIES AND EXCHANGE COMMISSION. STOCKHOLDERS MAY OBTAIN, FREE OF
CHARGE, A COPY OF SUCH ANNUAL REPORT ON FORM 10-K BY WRITING TO THE CORPORATE
SECRETARY AT THE COMPANY'S ADDRESS SET FORTH ABOVE.
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
Set forth below is the number of shares of the Company's Common
Stock and the percentage of total outstanding shares beneficially owned by each
Director of the Company, the Chief Executive Officer, the four most highly
compensated executive officers (other than the Chief Executive Officer), all
Directors and executive officers as a group and, to the knowledge of the
Company, all persons beneficially owning more than 5% of the Company's Common
Stock as of August 31, 1999. Also set forth below is the address of each such
beneficial owner of more than 5% of the Company's Common Stock.
NUMBER OF
SHARES
OF COMMON STOCK
BENEFICIALLY
OWNED AS
OF AUGUST 31, PERCENT OF
INDIVIDUAL OR GROUP (1) 1999 (2) CLASS
- ----------------------- -------- -----------
Louis M. Brown, Jr. 105,866 (3) Less than 1%
Director, Chairman of the Board
Daniel Cohen 20,000 Less than 1%
Director
A. L. Giannopoulos 236,000 (4) 1.4%
Director, President and Chief Executive Officer
F. Suzanne Jenniches 2,762 Less than 1%
Director
John G. Puente 14,000 (5) Less than 1%
Director
Dwight S. Taylor 500 Less than 1%
Director
Bernard Jammet 72,000 (6) Less than 1%
Executive Vice President, Product Development
Gary C. Kaufman 110,600 (7) Less than 1%
Executive Vice President, Finance and Administration and Chief
Financial Officer
Ronald J. Kolson 195,000 (8) 1.1%
Executive Vice President, Procurement and Logistics
Thomas L. Patz 69,999 (9) Less than 1%
Senior Vice President, General Counsel
Directors and Executive 883,053 (10) 5.2%
Officers as a Group (11 persons, including the above-named
persons)
Dresdner RCM Global Investors 2,293,600 14.1%
4 Embarcadero Center, Suite 3000
San Francisco, CA 94111
SAFECO Asset Management Company 1,810,648 11.1%
SAFECO Plaza
Seattle, WA 98185
Wanger Asset Management 1,747,900 10.7%
227 West Monroe, Suite 3000
Chicago, IL 60606
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(1) As of August 31, 1999, CEDE & Co., nominee for Stock Clearing Corporation,
Box 20, Bowling Green Station, New York, New York, a central certificate
service, held of record 16,060,151 shares, representing 98.6% of the outstanding
shares of Common Stock. Those shares are believed to be owned beneficially by a
large number of beneficial owners and, except as indicated in this table, the
Company is not aware of any other individual or group owning beneficially more
than 5% of the outstanding Common Stock.
(2) Information with respect to beneficial ownership is based on information
furnished by each shareholder. Sole voting and sole investing power is exercised
by each individual.
(3) Includes options to purchase 84,866 shares exercisable within 60 days.
(4) Includes options to purchase 230,000 shares exercisable within 60 days.
(5) Does not include 1,000 shares of Common Stock held by his wife, with respect
to which Mr. Puente disclaims any beneficial interest.
(6) Includes options to purchase 70,000 shares exercisable within 60 days.
(7) Includes options to purchase 109,000 shares exercisable within 60 days.
(8) Includes options to purchase 138,000 shares exercisable within 60 days.
(9) Includes options to purchase 68,999 shares exercisable within 60 days.
(10) Includes stock options for the purchase of 743,191 shares of Common Stock
exercisable within 60 days, and assumes 17,023,836 shares outstanding upon the
exercise of such options.
ELECTION OF DIRECTORS
(PROPOSAL 1)
Six directors are to be elected at the Annual Meeting, each to hold
office for a one year term and until his or her successor is elected and
qualified. Unless authority to vote is withheld, proxies received pursuant to
this solicitation will be voted for the election of the six nominees named
below.
It is the intention of the persons named in the proxy to vote the
shares represented by each properly executed proxy for the election of the
Director nominees listed below. Management believes that all such nominees will
stand for election and will serve if elected as Directors. If any of the
nominees should for any reason not be available for election, proxies will be
voted for the election of the remaining nominees and such substitute nominees as
may be designated by the Board of Directors.
Pursuant to the Company's By-Laws, the number of Directors shall be
no less than five and no more than nine. There are currently six Directors and
the Board has nominated six individuals for election. Proxies cannot be voted
for a greater number of persons than the six nominees named.
During the fiscal year ended June 30, 1999, the Board of Directors
held five regular meetings. Each incumbent Director attended more than 75% of
the aggregate of the total number of meetings of the Board of Directors, and
meetings of committees of the Board of Directors of which he or she was a
member.
The Board of Directors had an Audit Committee for fiscal 1999. The
Audit Committee was chaired by Ms. Jenniches, and included Mr. Puente and Mr.
Taylor. The Audit Committee reviews the financial statements
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of the Company and the scope of the independent annual audit and internal
audits. It also reviews the Company's internal accounting procedures and the
independent accountants' recommendations to management concerning the
effectiveness of the Company's internal financial and accounting controls. In
addition, the Audit Committee reviews and recommends to the Board of Directors
the firm to be engaged as the Company's independent accountants. The Audit
Committee also examines and considers other matters relating to the financial
affairs of the Company as it determines appropriate. The Audit Committee met two
times during the fiscal year ended June 30, 1999. Representatives of
PricewaterhouseCoopers LLP attended both meetings of the Audit Committee in
fiscal 1999.
Additionally, the Board of Directors had a Compensation Committee
for fiscal 1999, comprised of Mr. Puente, who is the Compensation Committee
chairman, Ms. Jenniches and Mr. Taylor. The Compensation Committee met two times
during the fiscal year ended June 30, 1999. The Board of Directors has assigned
the Compensation Committee with the function of analyzing and approving, among
other things, executive compensation, bonuses, and the issuance of stock options
under the 1991 Option Plan.
Further, the Board of Directors has established a Nominating
Committee, comprised of Mr. Giannopoulos, who is the Nominating Committee
chairman, Mr. Brown and Mr. Taylor. The Nominating Committee has been assigned
with the responsibility of identifying and interviewing individuals who may be
qualified to serve as new Board members. The Nominating Committee shall act
unilaterally, and accordingly, will not currently consider proposed
recommendations from stockholders. The Nominating Committee did not hold any
formal meetings in the fiscal year ended June 30, 1999.
At the Annual Meeting on November 20, 1998, the holders of
16,119,766 outstanding shares of Common Stock were eligible to cast votes in the
election of Directors. Of such shares, 85% were present in person or by proxy
and voted or withheld authority to vote in the election of Directors.
INFORMATION AS TO NOMINEES
The following table sets forth the names of management's nominees
for election as Directors to serve until the next Annual Meeting and until their
successors are elected and qualified. Also set forth is certain other
information, some of which has been obtained from the Company's records and some
of which has been supplied by the nominees, with respect to each nominee's
principal occupation or employment, his/her background, his/her age as of August
31, 1999, the periods during which he/she has served as a Director of the
Company and positions held with the Company, if any.
NOMINEES FOR DIRECTOR POSITION
DIRECTORS SINCE HELD IN MICROS
- ------------ -------- --------------
Louis M. Brown, Jr. 1977 Director, Chairman of the Board
Daniel Cohen 1992 Director
A.L. Giannopoulos 1992 Director, President and Chief Executive Officer
F. Suzanne Jenniches 1996 Director
John G. Puente 1996 Director
Dwight S. Taylor 1997 Director
Louis M. Brown, Jr., age 56, has been a Director of the Company
since 1977. Mr. Brown held the position of President and Chief Executive Officer
from January 1986 until his appointment as Chairman of the Board in January
1987. He also serves as President and a director of IDEAS, Inc., a supplier of
high technology, custom-engineered products and services. Mr. Brown serves as
Chairman of Autometric, Inc. and of Planning Systems, Inc. He is a graduate of
The Johns Hopkins University (B.E.S.-E.E.).
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Daniel Cohen, age 44, has been a Director of the Company since
November 1992. Mr. Cohen currently serves as President of Bartech Systems
International, Inc., a Delaware corporation. Until June 30, 1997, Mr. Cohen was
Managing Director of Fidelio-MICROS France, S.A., a subsidiary of MICROS
Systems, Inc. and distributor of the Company's products. Formerly, Mr. Cohen was
Managing Director and principal shareholder of D.A.C. Systemes/MICROS France, a
company he founded in 1986 and which MICROS acquired in 1995. Mr. Cohen is a
graduate of the Hotel School of Lausanne, Switzerland, from which he holds a
Masters degree in Hotel Administration.
A. L. Giannopoulos, age 59, has been a Director since March 1992 and
was elected President and Chief Executive Officer in May 1993. Effective as of
June 1, 1995, Mr. Giannopoulos resigned as General Manager of the Westinghouse
Information and Security Systems Divisions, having been with Westinghouse for 30
years, and was hired by the Company pursuant to an Employment Agreement to
terminate December 31, 1999, subsequently amended to terminate on June 30, 2005.
In prior assignments at Westinghouse, Mr. Giannopoulos was General Manager of
the Automation Division and National Industrial Systems Sales Force, Industries
Group. Mr. Giannopoulos currently serves as a Trustee of Capitol College and as
a director of V-One Corporation, a public company engaged in the software
development of virtual private networks. Mr. Giannopoulos is a graduate of Lamar
University with a Bachelor of Science degree in Electrical Engineering.
F. Suzanne Jenniches, age 51, has been a Director of the Company
since October 1996. She is Vice President of Communications Systems for the
Electronic Sensors and Systems Sector of Northrop Grumman, which designs and
develops advanced communications systems for both government and commercial
applications. Ms. Jenniches is past President of the national Society of Women
Engineers, has served on the Board of Governors for the American Association of
Engineering Societies, and is currently a board member of the State of
Maryland's Greater Baltimore Committee Technology Council. Ms. Jenniches is a
graduate of Clarion College and holds a Masters degree in Environmental
Engineering from The Johns Hopkins University.
John G. Puente, age 69, has been a Director since May 1996. He is
the Chairman of E-Cargo (Internet Cargo Services, Inc.), a company that
coordinates product shipments over the Internet. Until August 1999, Mr. Puente
served as Chairman of Telogy Networks, Inc., a developer of communications
software products, at which time it was acquired by Texas Instruments. Mr.
Puente is on the Board of Directors of Primus Telecommunications, a long
distance telecommunications service provider. Previously, he was Chairman and
Chief Executive Officer of Orion Network Systems, a company which provides
satellite services and facilities. Prior to joining Orion, Mr. Puente was Vice
Chairman of M/A-Com, a supplier of microwave components and systems to the
telecommunications industry. He was a founder and Chairman of Digital
Communications Corporation (now Hughes Network Systems) and SouthernNet, a fiber
optic long distance company which merged to form Telecom USA and was later
acquired by MCI. Mr. Puente is a graduate of Polytechnic Institute of New York
and now serves on the Board of Trustees of that institution, and he holds a
Masters degree from Stevens Institute of Technology. He is Chairman of the Board
of Trustees of Capitol College.
Dwight S. Taylor, age 54, has been a Director of the Company since
1997. He is President of Corporate Development Services, LLC ("CDS"), a
commercial real estate development firm with offices in Columbia, Maryland, and
a subsidiary of Corporate Offices Properties Trust. Mr. Taylor has been employed
by CDS (or Constellation Real Estate, Inc., an entity with which CDS merged in
1998) in various capacities for the last 15 years. Mr. Taylor is also a member
of the Board of Directors of the Associated Black Charities, of which he was
formerly its Chairman, and the National Association of Industrial and Office
Properties. Mr. Taylor is a 1968 graduate of Lincoln University with a Bachelor
of Science degree in Economics.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ELECTION OF THE SIX
NOMINEES AS DIRECTORS.
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EXECUTIVE COMPENSATION
The following table sets forth the total annual compensation paid or accrued by
the Company for services in all capacities for the Chief Executive Officer and
the four most highly compensated executive officers of the Company whose
aggregate compensation exceeded $100,000.
SUMMARY COMPENSATION TABLE
LONG-TERM
ANNUAL COMPENSATION COMPENSATION
---------------------------------------------- -----------------
NAME AND OTHER SECURITIES
PRINCIPAL ANNUAL UNDERLYING ALL OTHER
POSITION YEAR SALARY BONUS (1) COMPENSATION (2) OPTIONS (#) COMPENSATION (3)
-------- ---- ------ --------- ---------------- ----------- ----------------
A. L. Giannopoulos 1999 $300,865 $130,000 $0 84,000 $5,469
President and Chief 1998 263,510 111,180 0 90,000 4,461
Executive Officer 1997 250,962 112,000 0 130,000 5,680
Gary C. Kaufman 1999 190,534 77,000 237,838 60,000 3,820
Executive Vice 1998 173,204 64,600 0 66,000 3,797
President, Finance and 1997 139,128 55,000 0 102,000 41,710
Administration and Chief
Financial Officer
Ronald J. Kolson 1999 190,593 71,500 91,500 50,000 2,941
Executive Vice 1998 178,230 64,600 0 72,000 3,052
President, 1997 144,478 64,000 0 116,000 50,331
Procurement and
Logistics
Bernard Jammet (4) 1999 182,145 75,000 0 60,000 0
Executive Vice 1998
President, Product 1997
Development
Thomas L. Patz 1999 170,307 70,000 0 40,000 3,969
Senior Vice President 1998 140,236 40,800 0 42,000 3,213
General Counsel 1997 117,723 32,000 0 66,000 2,912
(1) Bonuses were paid to all recipients pursuant to decisions made by the
Compensation Committee of the Board of Directors, based on financial performance
of the Company, including profitability and growth of the Company as measured by
pre-tax income and net revenue, and satisfaction of individual performance
objectives.
(2) Represents the aggregate difference between the actual exercise price of
options granted and the fair market value of the Common Stock as of the date of
option exercise.
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(3) All Other Compensation includes the Company's contributions to the 401(k)
savings plan for the named executives. Also included in this column relating to
fiscal 1997 is the Westinghouse incentive bonus payments of $47,173 for Mr.
Kolson and $38,268 for Mr. Kaufman. Specifically, Westinghouse, as an incentive
to 11 key officers to remain with the Company for a period of two years
following June 1, 1995, agreed to make payments to such officers aggregating up
to approximately $1.25 million, payable in three equal installments promptly
after such date (subject to the officer remaining employed by the Company on the
relevant payment date). In June 1997, the final installment of $360,800 was paid
to the remaining key officers. Even though such payments were funded by
Westinghouse and did not require any use of the Company's cash, for accounting
purposes, they are required to be reflected as compensation expense in the
Company's financial statements.
(4) Mr. Jammet was appointed an executive officer in fiscal 1999.
EMPLOYMENT AGREEMENTS
The Company has entered into an Employment Agreement with Mr.
Giannopoulos that, as amended, expires on June 30, 2005. The Agreement, as
amended, provides that Mr. Giannopoulos will be paid an annual salary of
$445,500 for fiscal 2000 and is eligible for a bonus targeted at $250,000 for
fiscal 2000. The actual amount of the bonus is tied to certain performance
criteria but cannot exceed 200% of the targeted amount. The annual salary and
target bonus may be increased each year of the Agreement in a manner determined
by the Compensation Committee.
The Company has entered into an Employment Agreement with Mr.
Kaufman that expires on September 30, 2002. The Employment Agreement will be
automatically renewed for a one-year period, unless either party elects to
terminate such. The Agreement provides that Mr. Kaufman will be paid a base
annual salary, and is eligible for a bonus. The actual amount of the bonus is
tied to certain performance criteria but cannot exceed 200% of the targeted
amount. The annual salary and target bonus may not be reduced.
The Company has entered into an Employment Agreement with Mr. Kolson
that expires on May 28, 2000. The Agreement provides that Mr. Kolson will be
paid a base annual salary, and is eligible for a bonus. The actual amount of the
bonus is tied to certain performance criteria but cannot exceed 200% of the
targeted amount. The annual salary and target bonus may not be reduced.
The Company has entered into an Employment Agreement with Mr. Patz
that expires on September 30, 2002. The Employment Agreement will be
automatically renewed for a one-year period, unless either party elects to
terminate such. The Agreement provides that Mr. Patz will be paid a base annual
salary, and is eligible for a bonus. The actual amount of the bonus is tied to
certain performance criteria but cannot exceed 200% of the targeted amount. The
annual salary and target bonus may not be reduced.
STOCK OPTIONS
Certain full-time, salaried officers and employees of the Company
and its subsidiaries, and non-employee Company Directors are eligible to
participate in the 1991 Option Plan which provides for the issuance of incentive
stock options, non-qualified stock options and stock appreciation rights.
An option may not be exercised within one year after the date of
grant and becomes exercisable in installments during its term as determined by
the Board of Directors or Compensation Committee, in accordance with the terms
of the Option Plan. If an option holder dies or becomes disabled, his or her
option becomes fully exercisable and may be exercised for one year following the
termination of employment. If the option holder retires after attaining age 62,
his or her option becomes fully exercisable and may be exercised for three
months following retirement. If termination occurs for any other reason, an
option may be exercised, to the extent
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exercisable at termination, for 30 days after termination of employment. No
option may be exercised after the expiration of its term.
The exercise price of the shares of Common Stock covered by an
option may not be less than the fair market value of the Common Stock on the
date of grant, which is defined under the Option Plan to be not less than the
average of the highest bid and lowest asked prices of the Common Stock on NASDAQ
on the date of grant.
The following table sets forth the details of stock options granted
to the individuals listed in the Summary Compensation Table during fiscal 1999.
The second table in this section shows the value of exercised and unexercised
options for the individuals listed in the Summary Compensation Table.
OPTION GRANTS TABLE
POTENTIAL REALIZABLE VALUE AT
ASSUMED ANNUAL RATES OF
STOCK PRICE APPRECIATION FOR
INDIVIDUAL GRANTS OPTION TERM
--------------------------------------------------------------------------------------------------------
% OF TOTAL
OPTIONS
GRANTED TO EXERCISE
OPTIONS EMPLOYEES PRICE EXPIRATION
NAME GRANTED (1) IN 1999 PER SHARE DATE 5% ($) 10%($)
---- ----------- ------- --------- ---- ------ ------
A. L. Giannopoulos 84,000 8.3% $26.8125 11/20/08 $1,416,428 $3,589,506
Gary C. Kaufman 60,000 5.9 26.8125 11/20/08 1,011,734 2,563,933
Ronald J. Kolson 50,000 5.0 26.8125 11/20/08 843,112 2,136,611
Bernard Jammet 60,000 5.9 26.8125 11/20/08 1,011,734 2,563,933
Thomas L. Patz 40,000 4.0 26.8125 11/20/08 674,489 1,709,289
(1) Options to purchase 1,009,750 shares of Common Stock were granted to Company
employees and one non-employee director during fiscal 1999.
OPTION EXERCISES AND YEAR-END VALUE TABLE
NUMBER OF VALUE OF
SECURITIES UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
SHARES ACQUIRED VALUE OPTIONS AT 6/30/99 OPTIONS AT 6/30/99 (2)
NAME ON EXERCISE (#) REALIZED (1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- --------------- ------------ ----------- ------------- ----------- -------------
A. L. Giannopoulos 0 $0 220,666 127,334 $3,764,755 $1,591,620
Gary C. Kaufman 15,000 237,838 103,000 138,000 1,934,063 1,720,375
Ronald J. Kolson 6,000 91,500 131,332 136,668 2,492,636 1,782,489
Bernard Jammet 0 0 68,000 100,000 1,281,250 1,106,437
Thomas L. Patz 0 0 64,999 90,001 1,234,042 1,117,583
(1) Represents market value of the Company's Common Stock at exercise date less
the exercise price.
(2) Represents market value of the Company's Common Stock at June 30, 1999, less
the exercise price.
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DIRECTOR COMPENSATION
Directors received a fee of $2,500 per quarter during fiscal 1999
and an additional $1,000 for each Board of Directors meeting attended. The
compensation for Directors for fiscal 1999 has been set at $2,500 per quarter
and $1,000 for each Board of Directors meeting attended. The compensation for
Audit Committee members, Compensation Committee members, and Nominating
Committee members for fiscal 1999 was $1,000 per meeting, and shall remain at
this level for fiscal 2000. Members of the Board of Directors are reimbursed for
travel and other reasonable out-of-pocket expenses. Directors who are full-time,
salaried employees of the Company or any of its subsidiaries or affiliates do
not receive any fees for their services as members of the Board of Directors or
any of its committees. Additionally, Mr. Brown does not receive any compensation
for serving on the Board-appointed committees.
In addition to the above-mentioned fees, Mr. Brown was compensated
$241,000 and $230,000 in fiscal 1999 and 1998, respectively, for consulting
services provided to the Company. See "Certain Relationships and Related
Transactions" below.
In addition to the above-mentioned fees, Mr. Cohen was compensated
$97,000 in fiscal 1998 for consulting services and management provided to the
Company. Additionally, pursuant to the terms of the Purchase Agreement dated
August 25, 1995 under which the Company purchased from Mr. Cohen and his family
the remaining 77% of D.A.C. Systemes/MICROS France and AD-Maintenance
Informatique ("ADMI") the Company did not already own, the Company owed
approximately $408,000 and $466,000 during fiscal 1999 and 1998, respectively.
See "Certain Relationships and Related Transactions" below.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During fiscal 1999, none of the members of the Compensation
Committee is or was an employee or officer of the Company, or has any
relationship with the Company requiring additional special disclosure.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
In fiscal 1999, the Company's compensation for executives, including
grants under the Stock Option Plan, was administered by the Compensation
Committee. In fiscal 1999, there were two meetings of the Compensation
Committee. Set forth below is a report submitted by Mr. Puente, Ms. Jenniches
and Mr. Taylor, as members of the Company's Compensation Committee, addressing
the Company's compensation policies for the last completed fiscal year, as they
affected Mr. Giannopoulos, in his capacity as President and Chief Executive
Officer of the Company, and the four executive officers other than Mr.
Giannopoulos, who, for the last completed fiscal year, were the Company's most
highly compensated executives (collectively with Mr. Giannopoulos, the "Named
Executive Officers").
COMPONENTS OF EXECUTIVE COMPENSATION
The basic premise of the Company's executive compensation policy is
to ensure a link between executive compensation and the creation of stockholder
value, while motivating and retaining key employees. The primary components of
the compensation packages offered to the Company's executive officers by the
Company for the last completed fiscal year consisted of three basic elements -
base salary, annual incentive bonus, and long-term incentives in the form of
stock options.
BASE SALARY
Base salaries of the executive officers, including the Named
Executive Officers, reflect the evaluation of the Compensation Committee of the
performance of the Company's executive officers in the point-of-sale and
property management and central reservation systems industry (specifically,
information systems for the hospitality industry) on an international, rather
than a national, regional or local level. Although there is no fixed
relationship between corporate performance and base salary, the Compensation
Committee considers several
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factors in determining base salaries of the Company's executive officers,
including corporate performance, the increasing importance of their role in the
Company's operations on a consolidated basis, achievement of personal
objectives, and the general effect of increases in the cost of living. Moreover,
the Company engaged an outside compensation consulting firm in fiscal 1997 to
evaluate the level of compensation paid to both Named Executive Officers and all
other employees. The firm made recommendations as to how the Company may adjust
salary in certain situations to pay a level of compensation at least equal to
the average of other companies of similar size and in similar industries to that
of MICROS. In fiscal 1999, the Compensation Committee continued to evaluate
compensation levels offered by other companies similarly positioned to MICROS in
terms of both size (revenue and income) and industry.
The Compensation Committee continues to attempt to offer
compensation to the Company's Named Executive Officers in amounts equal to that
of other companies in competitive industries and with comparable levels of
revenue. Currently, the Compensation Committee considers the base salary and
incentive bonus components of total compensation to be generally in the middle
range of compensation as compared to compensation levels of other senior
executives of companies in similar industries. Moreover, the Company considers
that the compensation levels are comparable to those companies in the computer
software and services peer group.
INCENTIVE BONUSES
Bonuses for the last completed fiscal year were determined by the
Compensation Committee based on the assessment of the Compensation Committee of
various factors relating to both corporate and individual performance, as
further discussed below.
STOCK OPTIONS
Stock options for the purchase of 294,000 shares were granted to
Named Executive Officers during fiscal 1999. The Compensation Committee
allocated options on the basis of various factors, including the employee's
current position, performance based on both objective and subjective factors,
seniority, and Company performance in general. The Compensation Committee
attempts to achieve an equitable allocation of the grant of options, to both the
Named Executive Officers, other senior officers, and non-executive employees of
the Company and its subsidiaries. Stock options constitute the element of
executive compensation most linked to stockholder value inasmuch as their value
increases directly with any increase in the price of the Company's Common Stock.
The real value recognized by the award recipient is directly related to future
corporate performance. The stock option grants tie executive compensation to
stock performance, since the stock options will only have value if and to the
extent the market price of the Company's stock increases from the exercise price
of the stock options. Recommendations with respect to recipients and the number
of options to be granted thereto are made by the President and CEO based on
performance. The Compensation Committee evaluates the recommendations, analyzing
both the quantity of the proposed grants and the identities of the proposed
recipients. The Compensation Committee will then, in its sole discretion,
approve, reject or modify the proposed allocation of stock options.
COMPENSATION POLICIES TOWARD EXECUTIVE OFFICERS
The Compensation Committee executive compensation policies are
designed to provide competitive levels of compensation by integrating into total
compensation the Company's annual and long-term performance goals. The
Compensation Committee acknowledges and emphasizes the importance of stock
ownership by management and, accordingly, stock option compensation
arrangements. Stock-based incentives create a nexus between stockholder and
management interests by providing motivation for executives over the long term.
The Company's 1991 Option Plan is designed to attract, motivate and retain the
valuable executive talent necessary to ensure the continued success of the
Company. As a result of the use of long-term compensation as part of executive
officers' total compensation, actual compensation levels in any particular year
may be above or below those of the Company's competitors, depending upon the
Company's overall performance.
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RELATIONSHIP OF CORPORATE PERFORMANCE TO EXECUTIVE COMPENSATION
The determination of bonuses for the last completed fiscal year was
based primarily on corporate performance as measured by pre-tax income and net
revenue. Accordingly, the Compensation Committee performs a mathematical
analysis based on actual performance compared to budgeted performance. Actual
bonuses paid to the Named Executive Officers equal to a large extent the
targeted bonus, established in the beginning of the fiscal year, times the
factor calculated comparing actual and budgeted performance. Additionally,
individual non-financial performance items were taken into consideration as
well.
In reviewing corporate performance, pre-tax income and net revenue
serve as the focal points in the analysis by the Compensation Committee. The
pre-tax income and net revenue are evaluated both on a consolidated basis and a
business unit basis. Additionally, the Compensation Committee considers the
competitive climate in which the Company must operate. It is the Compensation
Committee's policy that the total compensation package, the sum total of base
salaries and incentive bonuses, for executive officers, including the Named
Executive Officers, eligible for incentive compensation should be equal to
competitive average total compensation as presented in appropriate wage surveys.
Target bonus amounts vary according to salary levels and positions comparable to
those established in the previous fiscal year. The total amount of the incentive
bonuses can vary from zero to six percent of the pre-tax income of the Company
when positive operating income is achieved.
The financial position of the Company is reviewed annually to
determine which aspects of the executive officers' performance need to be
emphasized, and accordingly, which factors will be taken into consideration in
the determination of the incentive bonuses. The measures of corporate
performance that were considered by the Compensation Committee for the last
completed fiscal year included pre-tax income and net revenue. In addition to
these performance factors, the Compensation Committee considered the
"individual" factor. This factor is based on the recommendation of the Chief
Executive Officer and may be quantitative or qualitative, depending on emphasis
desired, but not necessarily derived from normal financial reports. The
non-financial objectives also generally include achieving certain pre-designated
non-financial event or objective, such as consummating a transaction with a key
customer, or completing a certain software development milestone.
As in most other executive compensation packages, the subjective
factor of human judgment plays a key role in determining the Company's incentive
bonuses. Individual bonuses are reviewed and judgment is applied by the
Compensation Committee based upon the executive's individual contribution to the
performance of the Company as a whole and his or her primary area of
responsibility in particular. No bonuses are paid where an executive fails to
perform duties in accordance with the Company's Code of Business Practices.
CHIEF EXECUTIVE OFFICER COMPENSATION
The Company considers that the compensation level of the Chief
Executive Officer should be comparable to those companies in the computer
software and services peer group. Effective June 1, 1995, Mr. Giannopoulos
entered into an Employment Agreement with the Company, which, as amended, is in
effect until June 30, 2005. Under the Agreement for fiscal 1999, as amended, Mr.
Giannopoulos was eligible to receive a base salary of $300,000 and a bonus of
$200,000. In determining Mr. Giannopoulos' fiscal 1999 bonus, the Compensation
Committee considered a number of factors, including the Company's revenue
growth, income before taxes and certain personal performance factors. The
Compensation Committee also evaluated Mr. Giannopoulos' execution and management
of several significant infrastructure modifications, including certain
management changes and enhancements, restructuring of the development
organization, and restructuring of certain distribution channels.
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The Committee has considered the impact of the provisions of the
Internal Revenue Code that, in certain circumstances, disallow compensation
deductions in excess of $1 million for any year with respect to the Company's
CEO and four other most highly compensated officers. These disallowance
provisions do not apply to performance based compensation. The Company expects
that these provisions will not limit its tax deductions for executive
compensation in the near term.
JOHN G. PUENTE
F. SUZANNE JENNICHES DWIGHT S. TAYLOR
Members of the Compensation Committee
STOCK PERFORMANCE GRAPH
The following line graph compares (1) the cumulative total
stockholder return on the Company's Common Stock during the past five fiscal
years, based on the market price of MICROS Systems, Inc. Common Stock, with (2)
the cumulative total yearly return of the S&P 500 Index and (3) the S&P Computer
Software and Services composite index.
STOCKHOLDER RETURNS
COMPANY/INDEX JUN-94 JUN-95 JUN-96 JUN-97 JUN-98 JUN-99
- ------------- ------ ------ ------ ------ ------ ------
MICROS SYSTEMS, INC 100 124.53 105.19 158.49 249.77 256.60
S&P 500 INDEX 100 126.07 158.85 213.97 278.51 341.88
COMPUTER SOFTWARE AND 100 155.67 207.35 344.58 534.40 820.83
SERVICES
Note to graph:
Assumes $100 invested on June 30, 1994, in MICROS Systems, Inc. Common Stock,
and an identical amount in the S&P 500 Index and the Computer Software and
Services composite index, and the reinvestment of dividends.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
During fiscal 1998, Daniel Cohen was compensated $97,000 in
consideration for his provision of consulting services to the Company. Mr.
Cohen's consultant agreement with the Company terminated on June 30, 1998.
Additionally, pursuant to the terms of the Purchase Agreement dated August 25,
1995 under which the Company purchased from Mr. Cohen and his family the
remaining 77% of D.A.C. Systemes/MICROS France and AD-Maintenance Informatique
("ADMI") the Company did not already own, the Company owed approximately
$408,000 and $466,000 for fiscal 1999 and 1998, respectively. The payments are
made during the first fiscal quarter of the following year per the agreement.
During fiscal 1999 and 1998, the Company compensated Louis M. Brown,
Jr., Chairman of the Board, $241,000 and $230,000, respectively, for consulting
services provided to the Company. Effective June 30, 1995, the Company and Mr.
Brown entered into a Consulting Agreement terminating June 30, 2000, pursuant to
which Mr. Brown is to provide on the average 20 hours per week of consulting
services to the Company in exchange for a base consulting fee and target bonus.
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APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
(PROPOSAL 2)
The Company's Board of Directors has selected the firm of
PricewaterhouseCoopers LLP as the independent public accountants for the Company
for the year ending June 30, 2000. The approval of its selection is to be voted
upon at the Annual Meeting. PricewaterhouseCoopers LLP has served in this role
since August 1990, and its selection was approved by the stockholders at the
last Annual Meeting. It is expected that representatives of
PricewaterhouseCoopers LLP will be present at the Annual Meeting and available
to respond to appropriate questions, and will have the opportunity to make a
statement if they so desire.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE APPROVAL OF
PRICEWATERHOUSECOOPERS LLP AS INDEPENDENT PUBLIC ACCOUNTANTS FOR THE 2000 FISCAL
YEAR.
AMENDMENT TO THE
1991 STOCK OPTION PLAN
(PROPOSAL 3)
INTRODUCTION
The MICROS Systems, Inc. 1991 Stock Option Plan (the "1991 Option
Plan") was initially approved by stockholders at the 1991 Annual Meeting. Under
the 1991 Option Plan, 500,000 shares were originally authorized pursuant to
stockholder approval at the 1991 Annual Meeting; additional amendments over the
last 8 years, authorized pursuant to stockholder approval, in addition to a
two-for-one stock split effected in the form of a stock dividend in the fourth
quarter of fiscal year 1998, have served to increase the number of shares to the
current level of 4,500,000. At this Annual Meeting, the stockholders are being
requested to consider and approve the adoption of an amendment to the 1991
Option Plan which serves to authorize the issuance of an additional 1,000,000
shares of Common Stock under the Option Plan, for a total of 5,500,000 shares of
Common Stock.
The affirmative vote of a majority of all votes cast by stockholders
at a meeting at which a quorum is present is required in order to adopt the
amendment to the 1991 Option Plan. As of the record date, Directors and officers
of the Company have the power to vote approximately 5.2% of the outstanding
shares of Common Stock. All of the Directors and officers have expressed an
intent to vote in favor of the proposed amendment to the 1991 Option Plan.
The principal features of the 1991 Option Plan are summarized below.
The summary is qualified by reference to the complete text of the 1991 Option
Plan, which is attached as Exhibit A.
PURPOSE
The purpose of the 1991 Option Plan is to provide a performance
incentive to certain officers and other key employees of the Company and its
subsidiaries in order that such persons may acquire a (or increase their)
proprietary interest in the Company and to encourage such persons to remain in
the employ of the Company and its subsidiaries. In addition, non-employee
Directors may participate in the 1991 Option Plan.
ADMINISTRATION
The 1991 Option Plan may be administered by either the Compensation
Committee or by the Board of Directors itself (individually and collectively,
the "Administrating Committee"). It is intended that at all times the 1991
Option Plan will be administered by Directors who are "non-employee directors"
within the meaning of Rule 16b-3 promulgated by the Securities and Exchange
Commission under the Securities Exchange Act of 1934 (the "1934 Act").
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In general, the Administrating Committee determines the persons to
whom options are granted, the terms of the options and the number of shares
covered by each option.
DURATION, AMENDMENT AND TERMINATION
The 1991 Option Plan became effective as of September 23, 1991 and
will terminate on September 23, 2001, unless sooner terminated by the Board of
Directors.
In addition to the power to terminate the 1991 Option Plan at any
time, the Board of Directors also has the power to amend the 1991 Option Plan;
provided, no amendment to the 1991 Option Plan may be made without stockholder
approval if the amendment would (i) change the minimum option prices set forth
in the 1991 Option Plan, (ii) increase the maximum term of options, (iii)
materially increase the benefits accruing to the participants under the 1991
Option Plan, or (iv) materially modify the requirements as to eligibility under
the 1991 Option Plan.
ELIGIBILITY
The 1991 Option Plan provides for the grant of options to
non-employee directors, officers and other key employees of the Company and its
subsidiaries. As described below, non-employee directors may be granted only
non-qualified options. As of August 31, 1999, 3,811,367 options have been
granted under the 1991 Option Plan. Pursuant to Section 5 of the Plan, if all or
part of an expired option is unexercised, the shares which were not exercised
may again be available for grant.
AWARDS UNDER THE 1991 OPTION PLAN
The 1991 Option Plan currently reserves a total of 4,500,000 shares
of the Company's Common Stock which may be issued pursuant to options under the
1991 Option Plan since its inception. As of October 4, 1999, the closing market
price for the Company's Common Stock was $40.313 per share. The 1991 Option Plan
provides for the grant of incentive stock options as defined under Section 422
of the Internal Revenue Code of 1986, as amended (the "Code"), and non-qualified
options. The amendment of the 1991 Option Plan authorizes and reserves for
issuance an additional 1,000,000 shares of Company's Common Stock, which would
increase the total number of shares of Company Common Stock which may be issued
pursuant to the 1991 Option Plan to 5,500,000, subject to adjustments made by
the Board of Directors, in its discretion, for future stock splits and other
capital structure changes. If an option expires without being exercised in full,
such shares of Company Common Stock which were not exercised are again available
for grant under the 1991 Option Plan.
The type and terms of each option granted under the 1991 Option Plan
are determined by the Compensation Committee. The option price per share shall
not be less than the fair market value of the Company's Common Stock at the date
of grant of the option. Fair market value will be determined by the Compensation
Committee pursuant to the criteria set forth in the 1991 Option Plan. An option
may contain such terms as are deemed appropriate by the Administrating
Committee, including a provision that allows the Company to re-acquire an option
for cash.
EXERCISE OF OPTIONS
An option may be exercised by an optionee by delivery to the Company
of the exercise price which must be paid either: (i) in cash or cash equivalent;
or (ii) in the discretion of the Compensation Committee, by delivery of
previously owned shares of Common Stock or by a combination of cash and Common
Stock.
The term of an option may not exceed ten (10) years. An option is
exercisable in such installments and at such times during its term as determined
by the Compensation Committee. To the extent not exercised, installments are
cumulative and may be exercised in whole or in part at any time after becoming
exercisable until the option expires.
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With respect to Incentive Stock Options, the aggregate fair market
value of shares that may be exercised by an optionee for the first time during
any year may not exceed $100,000.
TERMINATION OF EMPLOYMENT
In the event the optionee's employment (or service as a non-employee
Director) terminates by reason of death, all options become fully exercisable
and may be exercised by the optionee's estate within one year after the date of
such death but not later than the date on which such options would otherwise
expire.
If the optionee's employment (or service as a non-employee Director)
is terminated as a result of disability, all options become fully exercisable
and may be exercised within one year after such termination but not later than
the date on which such options would otherwise expire.
If an optionee's employment is terminated on or after age 62 in
accordance with the Company's normal retirement policies, all options become
fully exercisable and may be exercised for a period of three months after such
termination, but not later than the date on which the options would otherwise
expire.
If an optionee's employment (or service as a non-employee Director)
terminates other than for retirement, death or disability, the options held by
such optionee, to the extent exercisable as of the date of termination, may be
exercised at any time during the thirty (30) day period immediately following
the date of termination, but not after the date on which such options would
otherwise expire. However, if termination is on account of cause, all options
expire as of the date of termination.
An optionee's estate means the optionee's legal representative or
any person who acquires the right to exercise an option by reason of the
optionee's death.
RESTRICTION ON TRANSFER
Options are transferable only by will or by the laws of descent and
distribution. During an optionee's lifetime, an option may be exercised only by
the optionee.
FEDERAL INCOME TAX TREATMENT
Incentive Stock Options
Incentive stock options under the 1991 Option Plan are intended to
meet the requirements of Section 422 of the Code. There are no tax liabilities
to the optionee upon the grant of an incentive stock option. In general, if an
optionee acquires stock upon the exercise of an incentive stock option, no
income will result to the optionee upon such exercise and the Company will not
be allowed a deduction as a result of such exercise provided the optionee makes
no disposition of the stock within two years from the date of grant and one year
after the option is exercised. The basis to the optionee of shares acquired on
the exercise of an incentive stock option will be equal to the exercise price.
Any gain or loss realized upon the sale of the shares acquired will be treated
as capital gains or loss, as applicable.
If the optionee fails to satisfy the one or two-year holding periods
described above, the optionee will be treated as having received ordinary income
at the time of the disposition of the stock generally equal to the excess of the
value of the stock on the date of exercise (or, if less, the amount realized
from the disposition) over the exercise price. Any gain in excess of the amount
treated as ordinary income will be treated as capital gain. The Company will be
entitled to a deduction for the amount taxable to the optionee as ordinary
income.
Although the exercise of an incentive stock option will not result
in regular income tax liability to an optionee, it may subject the optionee to
liability for the "alternative minimum tax."
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Non-Qualified Options
There are no tax liabilities to the optionee upon the grant of a
non-qualified option. In general, an optionee who exercises a non-qualified
option will realize ordinary income in an amount equal to the difference between
the option price and the fair market value of the shares on the date of exercise
and the Company will be entitled to a deduction in the same amount. The Company
will withhold federal and state income and employment taxes due on this
compensation from amounts otherwise payable to the optionee. The optionee's
basis in such shares will generally be the fair market value on the date of
exercise, and when he/she disposes of the shares he/she will recognize capital
gain or loss.
THE BOARD OF DIRECTORS BELIEVES THAT APPROVAL OF AN INCREASE IN THE
NUMBER OF SHARES ISSUABLE UNDER THE MICROS SYSTEMS, INC. 1991 STOCK OPTION PLAN
IS IN THE BEST INTERESTS OF ALL STOCKHOLDERS AND RECOMMENDS A VOTE FOR THE
PROPOSAL.
NEW PLAN BENEFITS
The following table sets forth the number of shares of Common Stock
subject to options granted to each of the following under the 1991 Option Plan
during fiscal 1999. Future awards under the 1991 Option Plan as proposed to be
amended are not determinable at this time. The Company does not believe that the
amount of awards granted during fiscal 1999 or since the inception of the 1991
Option Plan would have been different if the 1991 Option Plan had been amended
at the time such grants were made.
NAME AND POSITION 1991 OPTION
----------------- -----------
PLAN
----
A. L. Giannopoulos. . . . . . . . . . . . . . . . 84,000
President and Chief Executive Officer
Gary C. Kaufman. . . . . . . . . . . . . . . . . 60,000
Executive Vice President, Finance and
Administration and Chief Financial Officer
Ronald J. Kolson. . . . . . . . . . . . . . . . . . 50,000
Executive Vice President, Procurement and Logistics
Bernard Jammet. . . . . . . . . . . . . . . . . . . 60,000
Executive Vice President, Product Development
Thomas L. Patz. . . . . . . . . . . . . . . . . . . 40,000
Senior Vice President, General Counsel
Executive Officers as a Group. . . . . . . . . . 314,000
(6 executive officers, including those named
above)
Non-Executive Director Group (5 persons) 40,000
Non-Executive Officer Employee Group 655,750
(1) A copy of such plan, as amended, is included as Exhibit A.
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SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities and Exchange Act of 1934 requires
the Company's executive officers and directors, and persons who own more than
10% of a registered class of the Company's equity securities, to file reports of
ownership and changes in ownership with the Securities and Exchange Commission
(the "SEC"). Executive officers, directors and greater than 10% beneficial
owners are required by SEC regulation to furnish the Company with copies of all
Section 16(a) forms they file.
Based solely on its review of the copies of such forms received by
it, the Company believes that during fiscal 1999 all filing requirements
applicable to its executive officers, directors and greater than 10% beneficial
owners have been satisfied.
SUBMISSION OF STOCKHOLDER PROPOSALS
Stockholder proposals intended to be presented at the fiscal 2000
Annual Meeting of Stockholders must be received by the Company by June 24, 2000,
to be considered for inclusion in the proxy statement and form of proxy relating
to that meeting.
OTHER MATTERS
The Board of Directors is not aware of any matters other than those
discussed herein, which are to be presented for action at the Annual Meeting. If
any other business properly comes before the Annual Meeting, the persons named
in the accompanying form of proxy will vote in regard thereto according to their
best judgment.
By Order of The Board of Directors
/s/ JUDITH F. WILBERT
Judith F. Wilbert
Corporate Secretary
Beltsville, Maryland
October 22, 1999
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EXHIBIT A
MICROS SYSTEMS, INC.
1991 STOCK OPTION PLAN
1. PURPOSE OF PLAN. The purpose of the MICROS Systems, Inc. 1991 Stock
Option Plan, as amended (the "Plan"), is to serve as a performance incentive and
to encourage the ownership of MICROS Systems, Inc. (the "Company") stock by key
employees of the Company and its subsidiaries (including officers and directors)
so that the person to whom the option is granted may acquire a (or increase his
or her) proprietary interest in the Company and its subsidiaries and in order to
encourage such person to remain in the employ of the Company or its
subsidiaries. In addition, nonemployee directors may participate in the Plan as
provided herein. Options granted pursuant to the Plan may consist of incentive
stock options ("ISOs") (within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended (the "Code")) and nonqualified options.
2. ADMINISTRATION. The Plan shall be administered by a committee (the
"Committee") appointed by the Board of Directors; except that if and to the
extent that no Committee exists which has the authority to administer the Plan,
the functions of the Committee shall be exercised by the Board of Directors. The
Committee shall consist of not less than two (2) members of the Board of
Directors. Members of the Committee shall be "non-employee directors" (within
the meaning of Rule 240.16(b)-3 of the Securities and Exchange Commission).
The Committee shall determine the purchase price of the stock covered by
each option, the employees and nonemployee directors to whom, and the time or
times at which, options shall be granted, the number of shares to be covered by
each option, and the term of each option. In addition, the Committee shall have
the power and authority to interpret the Plan, to prescribe, amend and rescind
rules and regulations relating to the Plan, to determine the terms and
provisions of the respective option agreements (which need not be identical) and
to make all other determinations deemed necessary or advisable for the
administration of the Plan.
If the Committee is appointed, the Board of Directors shall designate one
of the members of the Committee as chairman and the Committee shall hold
meetings at such times and places as it shall deem advisable. A majority of the
Committee members shall constitute a quorum. All determinations of the Committee
shall be made by a majority of its members. Any decision or determination
reduced to writing and signed by all the Committee members shall be fully as
effective as if it had been made by a vote at a meeting duly called and held.
The Committee shall keep minutes of its meetings and shall make such rules and
regulations for the conduct of its business as it shall deem advisable.
3. EFFECTIVENESS AND TERMINATION OF PLAN.
(a) The Plan shall become effective as of September 23, 1991.
(b) This Plan shall terminate on the earliest of (i) the tenth anniversary
of the effective date (i.e., September 23, 2001), (ii) the date when all shares
of the Company's Common Stock (the "Shares") reserved for issuance under the
Plan have been acquired through the exercise of options granted under the Plan,
or (iii) such earlier date as determined by the Board of Directors. Any option
outstanding under the Plan at the time of the Plan's termination shall remain in
effect in accordance with its terms and conditions and those of the Plan.
4. GRANTEES. Subject to Section 2, options may be granted to key employees
(including directors and officers) and nonemployee directors of the Company and
its subsidiaries as determined by the Committee (each such employee or director,
a "Grantee"); provided, however, ISOs shall only be granted to employees.
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5. THE SHARES. Subject to Section 7, the aggregate number of Shares which
may be issued under the Plan shall be 5,500,000. Such number of Shares may be
set aside out of the authorized but unissued Common Stock not reserved for any
other purpose or out of Common Stock held in or acquired for the treasury of the
Company. If all or part of an expired option is unexercised, the Shares which
were not exercised may again be available for grant under the Plan.
6. GRANT, TERMS AND CONDITIONS OF OPTIONS. Options may be granted by the
Committee at any time and from time to time prior to the termination of the
Plan. Except as hereinafter provided, options granted pursuant to the Plan shall
be subject to the following terms and conditions.
(a) Price. The purchase price of the Shares subject to an option shall be
no less than the fair market value of the Shares at the time of grant; provided,
however, if an ISO is granted to a person owning Common Stock of the Company
possessing more than 10% of the total combined voting power of all classes of
stock of the Company as defined in Section 422 of the code ("10% Stockholder"),
the purchase price shall be no less than 110% of the fair market value of the
Shares. The fair market value of the Shares shall be determined by and in
accordance with procedures to be established by the Committee, whose
determination shall be final.
Notwithstanding the foregoing, if the Company's Common Stock is admitted
to quotation on the National Association of Securities Dealers Automated
Quotation system on the date the option is granted, fair market value shall not
be less than the average of the highest bid and lowest asked prices of the
Common Stock on such system on such date. If the Common Stock is admitted to
trading on a national securities exchange on the date the option is granted,
fair market value shall not be less than the last sales price reported for the
Common Stock on such exchange on such date or on the last date preceding such
date on which a sale was reported.
The exercise price shall be paid in full in United States dollars in cash
or by check at the time of exercise. At the discretion of the Committee, the
exercise price may be paid with (i) Common Stock already owned by, and in
possession of, the Grantee or (ii) any combination of United States dollars or
Common Stock. Anything contained herein to the contrary notwithstanding, any
required withholding tax shall be paid by the Grantee in full at the time of
exercise of an option. Common Stock used to satisfy the exercise price of an
option shall be valued at its fair market as of the close of business on the day
of exercise. The exercise price shall be subject to adjustment, but only as
provided in Section 7 hereof.
(b) Limit on Incentive Option Amount. Notwithstanding any provisions
contained herein to the contrary, the Shares covered by an ISO granted to a
Grantee which are exercisable for the first time during any calendar year shall
not exceed the $100,000 limitation in Section 422 of the Code.
(c) Duration and Exercise of Options. An option may be granted for a term
as determined by the Committee but not exceeding ten (10) years from the date of
grant; provided, however, the term of an ISO granted to a 10% Stockholder may
not exceed five (5) years. Options shall be exercised at such time and in such
amounts (up to the full amount thereof) as may be determined by the Committee at
the time of grant. If an option is exercisable in installments, the Committee
shall determine what events, if any, will accelerate the exercise of the option.
The Plan shall be subject to approval by the Company's stockholders within
one (1) year from the date on which it was adopted. Prior to such stockholder
approval, options may be granted under the Plan, but any such option shall not
be exercisable prior to such stockholder approval. If the Plan is not approved
by the Company's stockholders, the Plan shall terminate and all options
theretofore granted under the Plan shall terminate and become null and void.
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(d) Termination of Employment. Except as otherwise determined by the
Committee, upon the termination of a Grantee's employment (or service as a
nonemployee director), the Grantee's rights to exercise an option shall be as
follows:
i) If the Grantee's employment (or service as a nonemployee
director) is terminated on account of total and permanent disability (pursuant
to the Company's long-term disability plan for Grantees who are employees) and
as defined in Section 22(e)(3) of the Code), any option shall become fully
(100%) vested as of the date of termination and may be exercised by the Grantee
(or by the Grantee's estate if the Grantee dies after termination) at any time
within one (1) year after termination on account of disability but in no event
after the expiration of the term of the option.
ii) In the case of a Grantee whose employment (or service as a
nonemployee director) is terminated by death, any option shall become fully
(100%) vested as of the date of death and the Grantee's estate shall have the
right for a period of one (1) year following the date of such death to exercise
the option but in no event after the expiration of the term of the option.
iii) In the case of a Grantee who retires from the Company and its
subsidiaries after attaining age 62, an option shall become fully (100%) vested
as of the date of retirement and the Grantee may, within the three-month period
following retirement, exercise such option but in no event after the expiration
of the term of the option. If the Grantee dies during such three-month period,
the Grantee's estate may exercise such option during the period ending on the
first anniversary of the Grantee's retirement but in no event after the
expiration of the term of the option.
iv) In the case of a Grantee whose employment with the Company and
its subsidiaries (or service as a nonemployee director) is terminated for any
reason other than death, disability or retirement, the Grantee (or the Grantee's
estate in the event of the Grantee's death after such termination) may, within
the 30-day period following such termination, exercise an option to the extent
the right to exercise had accrued prior to such termination but in no event
after the expiration of the term of the option. Notwithstanding the foregoing,
if the Grantee's termination of employment is on account of misconduct or any
act that is adverse to the Company, the Grantee's option shall expire as of the
date of termination of employment.
v) A Grantee's "estate" shall mean the Grantee's legal
representative or any person who acquires the right to exercise an option by
reason of the Grantee's death. The Committee may in its discretion require the
transferee of a Grantee to supply it with written notice of the Grantee's death
or disability and to supply it with written notice of the Grantee's death or
disability and to supply it with a copy of the will (in the case of the
Grantee's death) or such other evidence as the Committee deems necessary to
establish the validity of the transfer of an option. The Committee may also
require the agreement of the transferee to be bound by all of the terms and
conditions of the Plan.
(e) Transferability of Option. Options shall be transferable only by will
or the laws of descent and distribution and shall be exercisable during the
Grantee's lifetime only by the Grantee.
(f) Form, Modification, Extension and Renewal of Options. Subject to the
terms and conditions and within the limitations of the Plan, an option shall be
evidenced by such form of agreement as is approved by the Committee, and
consistent with the terms hereof. Notwithstanding the foregoing, no modification
of an option shall, without the consent of the Grantee, alter or impair any
rights or obligations under any option theretofore granted under the Plan nor
shall any modification be made which shall adversely affect the status of an ISO
as an incentive stock option under Section 422 of the Code.
(g) Minimum Number of Shares. The minimum number of Shares for which an
option may be exercised at any time shall be 100 shares, unless the unexercised
portion of the option covers a lesser number of Shares.
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(h) Maximum Number of Shares. Subject to adjustments as provided in
Section 7(a) hereof, the maximum number of Shares subject to options that may be
granted hereunder during any one fiscal year of the Company to any one
individual shall be limited to 200,000 Shares.
(i) Other Terms and Conditions. Options may contain such other provisions,
which shall not be inconsistent with any of the foregoing terms of the Plan, as
the Committee shall deem appropriate, including a provision permitting the
Company or a subsidiary to reacquire an option for cash.
7. CAPITAL STRUCTURE CHANGES.
(a) If the outstanding shares of the Company's Common Stock are increased,
decreased or changed into, or exchanged for a different number or kind of shares
or securities of the Company, whether through merger, consolidation,
reorganization, recapitalization, reclassification, stock dividend, stock split,
combination of shares, exchange of shares, change in corporate structure or the
like, the Board of Directors shall make appropriate and proportionate
adjustments in the number, kinds and limits of shares available for options
pursuant to the Plan or subject to any outstanding options and in the purchase
price therefor. The determination of the Board of Directors as to such
adjustments shall be conclusive.
(b) Fractional Shares resulting from any adjustment in options pursuant to
Section 7 shall be eliminated at the time of exercise by rounding-down for
fractions less than one-half (1/2) and rounding-up for fractions equal to or
greater than one-half (1/2). No cash settlements shall be made with respect to
fractional Shares eliminated by rounding. Notice of any adjustments shall be
given by the Committee to each Grantee whose option has been adjusted and such
adjustment (whether or not such notice is given) shall be effective and binding
for all purposes of the Plan.
(c) Upon dissolution or liquidation of the Company, or upon a
reorganization, merger or consolidation in which the Company is not the
surviving corporation, or upon the sale of substantially all of the property of
the Company to another corporation, the Plan and options issued thereunder shall
terminate, unless provision is made in connection with such transaction for the
assumption of options theretofore granted, or the substitution for such options
of new options of the successor employer corporation or a parent or subsidiary
thereof, with appropriate adjustment as to the number and kinds of shares and
the per share exercise price. In the event of such termination, all outstanding
options shall be exercisable in full for at least 30 days prior to the
termination date whether or not otherwise exercisable during such period.
(d) Options may be granted under this Plan from time to time in
substitution for similar options held by employees of corporations who become or
are about to become employees of the Company or a subsidiary as the result of a
merger or consolidation, the acquisition by the Company or a subsidiary of the
assets of the employing corporation, or the acquisition by the Company or a
subsidiary of the fifty percent (50%) or more of the stock of the employing
corporation causing it to become a subsidiary.
8. SECURITIES LAW REQUIREMENTS. No option granted pursuant to this Plan
shall be exercisable in whole or in part nor shall the Company be obligated to
sell any Shares subject to any such option if such exercise or sale, in the
opinion of counsel for the Company, violates the Securities Act of 1933 (or
other federal or state statutes having similar requirements). Each option shall
be subject to the further requirement that, if at any time the Committee shall
determine in its discretion that the listing, registration or qualification of
the Shares subject to such option under any securities exchange requirements or
under any applicable law, or the consent or approval of any governmental
regulatory body, is necessary as a condition of, or in connection with, the
granting of such option or the issuance of Shares thereunder, such option may
not be exercised in whole or in part unless such listing, registration,
qualification, consent or approval shall have been effected or obtained free of
any conditions not acceptable to the Committee. The Committee may require each
person purchasing Shares pursuant to an option to represent to and agree with
the Company in writing that he is acquiring the Shares without a
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view to distribution thereof. The certificates for such Shares may include any
legend which the Committee deems appropriate to reflect any restrictions on
transfer. All certificates for Shares delivered under the Plan shall be subject
to stop-transfer orders and other restrictions as the Committee may deem
advisable under the rules, regulations, and other requirements of the Securities
and Exchange Commission, any stock exchange upon which the Common Stock is then
listed, and any applicable federal or state securities law, and the Committee
may cause a legend or legends to be put on any such certificates to make
appropriate reference to such restrictions.
9. AMENDMENTS. The Board of Directors may amend or terminate the Plan in
whole or in part as it deems appropriate and proper; provided, however, except
as provided in Section 7, (i) without stockholder approval no action may be
taken which changes the minimum option price, increases the maximum term of
options, materially increases the benefits accruing to Grantees under the Plan,
materially increases the number of Shares which may be subject to options
pursuant to this Plan, or materially modifies the requirements as to eligibility
for participation hereunder, and (ii) without the consent of the Grantee, no
action may be taken which adversely affects the rights of such Grantee
concerning an option.
10. NO EMPLOYMENT RIGHT. Neither this Plan nor any action taken hereunder
shall be construed as giving any right to any individual to be retained as an
officer or employee of the Company or any of its subsidiaries.
11. INDEMNIFICATION. Each person who is or at any time serves as a member
of the Board of Directors or the Committee shall be indemnified and held
harmless by the Company against and from (i) any loss, cost, liability or
expense that may be imposed upon or reasonably incurred by such person in
connection with or resulting from any claim, action, suit or proceeding to which
such person may be a party or in which such person may be involved by reason of
any action or failure to act under this Plan and (ii) any and all amounts paid
by such person in satisfaction of judgment in any such action, suit or
proceeding relating to this Plan.
Each person covered by this indemnification shall give the Company an
opportunity, at its own expense, to handle and defend the same before such
person undertakes to handle and defend the same on such person's own behalf. The
foregoing persons may be entitled under the charter or by-laws of the Company or
any of its subsidiaries, as a matter of law, or otherwise, or any power that the
Company or a subsidiary may have to indemnify such person or hold such person
harmless.
12. GOVERNING LAW. Except to the extent preempted by federal law, all
matters relating to this Plan or to options granted hereunder shall be governed
by the laws of the State of Maryland.
13. EXPENSES; PROCEEDS. The expenses of implementing and administering
this Plan shall be borne by the Company and its subsidiaries. Proceeds from the
sale of Common Stock under the Plan shall constitute general funds of the
Company.
14. TITLES AND HEADINGS. The titles and headings of the Sections in this
Plan are for convenience of reference only; in the event of any conflict, the
text of this Plan, rather than such titles or headings, shall control.
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[X] PLEASE MARK VOTES REVOCABLE PROXY
AS IN THIS EXAMPLE MICROS SYSTEMS, INC.
WITH- FOR ALL
FOR HOLD EXCEPT
THIS PROXY IS SOLICITED ON BEHALF OF 1. Election of Directors (Proposal 1) [ ] [ ] [ ]
THE BOARD OF DIRECTORS
The undersigned stockholder of MICROS Systems, Inc. Louis M. Brown, Jr., Daniel Cohen, A.L. Giannopoulos,
(the "Company") hereby appoints Louis M. Brown, Jr. and A.L F. Suzanne Jenniches, John G. Puente, Dwight S. Taylor
Giannopoulos as Proxies, each with the power to appoint his
substitute, and hereby authorizes either of them to represent INSTRUCTION: To withhold authority to vote for any individual
and to vote, as designated below, all the shares of Common Stock nominee, mark "For all Except" and write that nominee's name in
of the Company held on record by the undersigned on October 4, the space provided below.
1999, at the Annual Meeting of Stockholders to be held at 11:00
AM on November 19, 1999, at the Greenbelt Marriot, 6400 Ivy Lane, ---------------------------------------------------------------
Greenbelt, Maryland 20770 or at any adjournments thereof. The
Board of Directors recommends votes FOR Proposals 1 through 3.
FOR AGAINST ABSTAIN
2. Proposal to approve the appointment [ ] [ ] [ ]
of PricewaterhouseCoopers LLP as
the independent public accountants
of the Company (Proposal 2)
FOR AGAINST ABSTAIN
3. Proposal to approve the amendment [ ] [ ] [ ]
to the Company's 1991 Stock Option
Plan (Proposal 3)
This proxy will be voted as directed by the undersigned
stockholder. UNLESS CONTRARY DIRECTION IS GIVEN, THIS PROXY WILL
BE VOTED FOR PROPOSALS 1,2, AND 3. The Proxies are authorized, in
their discretion, to vote upon such other business as may properly
Please be sure to sign and date [Date ] come before the Annual Meeting or any adjournments thereof. The
this Proxy in the box below. undersigned stockholder may revoke this proxy at any time before it
is voted by delivering to the Secretary of the Company either a
written revocation of the proxy or a duly executed proxy bearing a
later date, or by appearing at the Annual Meeting and voting in
Stockholder sign above Co-holder (if any) sign above person. The undersigned stockholder hereby acknowledges receipt of
*Sign your name exactly as it appears above. the Notice of Annual Meeting and Proxy Statement.
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/\ Detach above card, sign, date and mail in postage paid envelope provided. /\
MICROS SYSTEMS, INC.
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PLEASE ACT PROMPTLY
SIGN, DATE & MAIL YOUR PROXY CARD TODAY
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If you receive more than one proxy card, please sign and return all cards
in the accompanying envelope. When signing as attorney, executor, administrator,
trustee or guardian, please give full title as such. If a corporation,
please sign in full corporate name by President or other authorized officer. If
a partnership, please sign in partnership name by authorized person.