PRELIMINARY
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF
THE SECURITIES EXCHANGE ACT OF 1934
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|X| Preliminary proxy statement
Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
Definitive proxy statement
Definitive additional materials
Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
AMERICAN MILLENNIUM CORPORATION, INC.
(Name of Registrant as Specified in Its Charter)
_____________________________________________
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
|X| No fee required.
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_________________________________________________________________
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_________________________________________________________________
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pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
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AMERICAN MILLENNIUM CORPORATION, INC.
1010 Tenth Street, Suite 100
Golden, Colorado 80401
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NOTICE OF 2003 ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD DECEMBER 10, 2002
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To our Shareholders:
The 2003 Annual Meeting of Shareholders of American Millennium Corporation,
Inc., a New Mexico corporation (the "Company"), will be held at 1010 Tenth
Street, Suite 100, in the city of Golden, Colorado 80401, on December 10, 2002,
at 10:00 a.m., Mountain Standard Time, for the transaction of the following
business:
(1) To elect five persons to serve as directors until their successors are
duly elected and qualified;
(2) To approve a change in the state of incorporation from New Mexico to
Delaware;
(3) To increase the number of authorized shares of common stock of the
Company from 60,000,000 to 100,000,000.
(4) To ratify the Board of Directors' appointment of Dohan and Company as
the Company's independent auditors for the 2003 fiscal year; and
(5) To transact such other business as may properly come before the meeting
or any adjournments thereof.
The foregoing items of business are more fully described in the proxy
statement accompanying this Notice. Included with the proxy statement is a copy
of the Company's annual report to shareholders. We encourage you to read the
annual report, as it includes information on the Company's operations, markets,
products and services, as well as audited financial statements.
Only shareholders of record at the close of business on October 30, 2002
are entitled to notice of and to vote at the meeting and any adjournments or
postponements thereof. A list of shareholders as of that date will be available
for inspection at the Annual Meeting. All shareholders eligible to vote at the
annual meeting are cordially invited to attend the meeting in person. Any
shareholder attending the meeting may vote in person even if such shareholder
previously signed and returned a proxy.
By Order of the Board of Directors
/s/ Ronald J. Corsentino
Corporate Secretary
Golden, Colorado
__________, 2002
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WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE AND SIGN
THE ENCLOSED PROXY AND MAIL IT PROMPTLY IN THE ENCLOSED ENVELOPE IN ORDER TO
ASSURE REPRESENTATION OF YOUR SHARES.
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1
AMERICAN MILLENNIUM CORPORATION, INC.
1010 Tenth Street
Suite 100
Golden, Colorado 80401
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PROXY STATEMENT FOR 2003 ANNUAL MEETING OF SHAREHOLDERS TO BE HELD
DECEMBER 10, 2002
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This proxy statement and accompanying form of proxy will first be mailed to
shareholders of American Millennium Corporation, Inc. (the "Company") on or
about _______________, 2002. These materials are being furnished in connection
with the solicitation by our Board of Directors (the "Board"), of proxies for
use at the Annual Meeting of our shareholders to be held on December 10, 2002,
at 10:00 a.m., Mountain Standard Time, at 1010 Tenth Street, Suite 100, Golden,
Colorado 80401, and at any adjournment.
At the Annual Meeting, our shareholders will be asked to consider and vote
upon: (1) the election of five directors to serve until the next Annual Meeting;
(2) to approve a change in the state of incorporation from New Mexico to
Delaware; (3) to increase the number of authorized shares of common stock of the
Company from 60,000,000 to 100,000,000; and (4) to ratify the Board of
Directors' appointment of Dohan and Company as the Company's independent
auditors for the 2003 fiscal year. The Board of Directors recommends you vote
"FOR" these four resolutions.
VOTING INFORMATION
The Board of Directors has fixed the close of business on October 30, 2002,
as the record date for determination of shareholders entitled to notice of, and
to vote at, the annual meeting and at any adjournment thereof. Accordingly, only
holders of record of common shares at the close of business on the record date
will be entitled to receive notice of, and to vote at, the meeting. On the
record date, ________________ common shares were issued and outstanding.
Shareholders who do not plan to be present at the annual meeting are
requested to date and sign the enclosed form of proxy and return it in the
envelope provided. All common shares which are represented at the meeting by
properly executed proxies received prior to or at the meeting and not revoked
will be voted in accordance with the instructions indicated in such proxies. If
no instructions are indicated, such proxies will be voted "FOR" election of each
of the five nominees listed therein as directors of the Company who will
constitute the entire Board of Directors of the Company; "FOR" the approval of
the Company's reincorporation from New Mexico to Delaware; "FOR" the increase in
the number of authorized shares of Common Stock of the Company from 60,000,000
to 100,000,000; and "FOR" the ratification of the Board of Directors'
appointment of Dohan and Company as the Company's independent auditors for the
2003 fiscal year.
All proxies presented at the annual meeting, whether given to vote in favor
of or against the foregoing proposals, will, unless contrary written
instructions are noted on the form of proxy, also entitle the persons named in
such proxy to vote such proxies in their discretion on any proposal to adjourn
the meeting or otherwise concerning the conduct of the meeting.
Shareholders have the right to revoke their proxies by notifying the
Secretary of the Company in writing at any time prior to the time the shares
represented thereby are actually voted. Proxies may be revoked by (i) filing
with the Secretary of the Company, before the vote is taken at the annual
meeting, either a written notice of revocation bearing a later date than the
proxy, or a duly executed proxy relating to the same shares bearing a later date
than the other proxy, or (ii) attending the annual meeting and voting in person
(although attendance at the meeting will not in and of itself constitute a
revocation of a proxy). Any written notice revoking a proxy or subsequent proxy
should be sent to American Millennium Corporation, Inc., 1010 Tenth Street,
Suite 100, Golden, Colorado 80401, Attention: Secretary.
Every common shareholder voting for the election of directors may exercise
cumulative voting rights and give one candidate a number of votes equal to the
number of directors to be elected multiplied by the number of votes to which the
shareholder's shares are entitled, or distribute such shareholder's votes on the
same principle among as many candidates as the shareholder may select. The proxy
holders may cumulate votes for the election of directors in their discretion. On
all other matters, each common shareholder is entitled to one vote per share.
If a quorum is present, directors will be elected by a plurality of the
votes cast. The affirmative vote of a majority of all outstanding shares of
Common Stock is required to approve the Company's reincorporation from New
Mexico to Delaware and to increase the number of authorized shares of the
Company's Common Stock from 60,000,000 to 100,000,000. The affirmative vote of a
majority of the votes represented at the meeting, in person or by proxy, and
entitled to vote, will be required in order to ratify the appointment of Dohan
and Company as the Company's independent auditors for the 2003 fiscal year.
Proxies are being solicited by and on behalf of the Board of Directors. The
cost of soliciting these proxies will be borne by the Company. In addition to
the solicitation of these proxies by mail, the Company will request banks,
brokers and other record holders to send proxies and proxy material to the
beneficial owners of the stock and secure their voting instructions. If
necessary, the Company may also use employees, who will not be specifically
compensated, to solicit proxies from shareholders, either personally or by
telephone, telegram, facsimile, special letter or other method.
Quorum, Abstentions, and Broker Nonvotes
The required quorum for the transaction of business at the Annual Meeting
is a majority of the shares of Common Stock outstanding on the Record Date.
Abstentions are included in the determination of shares present for quorum
purposes. If shares are held in "street name" through a broker or other nominee,
if the broker or nominee does not have discretion to vote your shares on a
particular proposal and you do not give the broker or nominee specific
instructions on how to vote your shares, the votes will be "broker non-votes,"
which will be included in the determination of shares present for quorum
purposes. With respect to the election of directors, abstentions and broker
non-votes will have no effect, except to the extent the failure to vote for a
nominee results in another nominee receiving a larger number of votes.
Abstentions and broker non-votes will have the effect of a vote AGAINST
Proposals Two and Three. Abstentions will have the effect of a vote AGAINST
proposal Four, and broker non-votes will not have any effect on the matter.
Dissenter's Rights
Under the New Mexico Business Corporation Act (the "NBCA"), shareholders
have certain dissenters' rights in connection with the Reincorporation Proposal.
Shareholders who perfect their dissenters' rights will be entitled to receive
from the Company the fair value of their Common Stock. In order for the
dissenting shareholders to perfect their dissenters' rights, they must follow
the procedures set forth in Section 53-15-4 of the NBCA, a copy of which is
attached as Exhibit D. Failure to follow any of these procedures may result in a
loss of dissenters' rights. See "Proposal Two - Dissenters' Rights."
2
PROPOSAL ONE
ELECTION OF DIRECTORS
Nominees
Five individuals are proposed to be elected to the Company's Board of
Directors. Unless Proposal Two regarding the reincorporation of the Company is
approved, all five directors will be elected at the Annual Meeting to serve for
a one-year term expiring at the Company's 2004 annual meeting or until their
successors have been elected and qualified, or until the earliest of their
death, resignation or retirement.
The Company expects each nominee for election as a director at the Annual
Meeting to be able to serve if elected. If any nominee is unable to serve if
elected, proxies will be voted in favor of the remainder of those nominated.
The Board has nominated Garrett L. Thomas, Bruce Bacon, Andrew F. Cauthen,
Steve Watwood and Ronald J. Corsentino to be elected at the Annual Meeting. With
the exception of Ronald J. Corsentino, all of the nominees are currently
directors of the Company. Shirley Harmon, a current director of the Company, has
decided not to stand for re-election.
Below, the principal occupation and certain other information are set forth
regarding such nominees and the other directors whose terms of office will
continue after the Annual Meeting. Information about the share ownership of the
nominees and other directors can be found on page 8.
Required Vote
Every shareholder voting for the election of directors may exercise
cumulative voting rights and give one candidate a number of votes equal to the
number of directors to be elected multiplied by the number of votes to which the
shareholder's shares are entitled, or distribute such shareholder's votes on the
same principle among as many candidates as the shareholder may select.
Directors will be elected by a plurality of the votes cast. Abstentions and
broker non-votes have no effect on the vote.
THE BOARD OF DIRECTORS RECOMMENDS
THE SHAREHOLDERS VOTE FOR EACH OF THE NOMINEES LISTED ABOVE
3
The Board of Directors
The Company's Board of Directors currently consists of five members. The
Board of Directors has nominated the following persons to be elected directors
at the Annual Meeting: Garrett L. Thomas, Bruce Bacon, Andrew F. Cauthen, Steve
Watwood and Ronald J. Corsentino. With the exception of Ronald J. Corsentino,
all of the nominees are currently directors of the Company. Shirley Harmon, a
current director of the Company, has decided not to stand for re-election.
The names of and certain other information regarding the directors and the
nominees as of October 1, 2002 are set forth in the table below. If Proposal Two
regarding reincorporation of the Company is approved, the classes and terms of
the directors will be changed as described in Proposal Two.
Year First
Name, Age Position with the Company Became Director
------------------------ ---------------------------------- ----------------
Garrett L. Thomas, 57 President and CEO 2001
Ronald J. Corsentino, 33 Chief Financial Officer, Treasurer - -
and Secretary
Bruce Bacon, 44 Vice President 1998
Steve Watwood, 53 Vice President 1997
Andrew F. Cauthen, 59 Director 1999
Shirley Harmon, 55 Director 1999
Garrett L. Thomas has been a Director since October 2001. He has been the
Company's President and CEO since October 2001. From 1999 to 2001, Mr. Thomas
was the CEO of QUAKE Global, Inc. Since leaving Quake, Mr. Thomas has been
providing consulting and legal services to various wireless telecommunication
entities and high technology startups in Southern California. Mr. Thomas served
as VP and General Counsel to TriTeal Corporation, a software development
enterprise, from 1997 to 1998. From 1987 to 1997 Mr. Thomas served as General
Counsel for the federal subsidiary of Sun Microsystems, Inc., a highly
successful Silicon Valley workstation manufacturer, where he was part of the
senior management team that grew Sun's federal subsidiary to $1 billion in
revenues in just over five years. Mr. Thomas received his Juris Doctor from
Georgetown University and also a Masters in Law from George Washington Law
School.
Ronald J. Corsentino has been Controller since June of 2000, CFO and
Treasurer since July 2001 and Secretary since September 2002. From June of 1993
to June of 2000, Mr. Corsentino served as Federal Tax Services Manager for KPMG
Peat Marwick, LLP in Albuquerque, NM and Denver, CO where he focused on the
cable and telecommunications industry. Mr. Corsentino received his BSBA in
Accounting from the University of Southern Colorado and his Masters of Taxation
from the University of Denver.
Bruce R. Bacon has been a Director since August of 1998. Mr. Bacon has been
the Company's CTO and VP of Engineering since August of 1998. From 1996 to 1998,
Mr. Bacon served as lead design engineer at RadiSys Corporation where he was
responsible for electrical system architecture design, writing specifications,
digital and analog circuit design, prototype debug, design validation, and
production release. Mr. Bacon has broad experience in field service, customer
technical support, in-house technical training, new product development, and
manufacturing operations. Mr. Bacon holds a degree in Electrical Engineering
from Montana State University where he was also a graduate research assistant in
the field of semiconductor laser frequency stability and linewidth reduction.
Steve Watwood has been a Director since August of 1997. He served as the
Company's President from August 1997 to September of 1999 and has been the VP of
Business Development since September of 1999. Mr. Watwood owned and operated a
successful commercial and residential construction company for 24 years where he
was directly responsible for project development, business planning, and
management. During that period, Mr. Watwood owned a solar power technology
company and was an early pioneer in designing and installing photo-voltaic
systems into remote locations.
4
Andrew F. Cauthen has been a Director since September of 1999. He served as
the Company's President and CEO from September of 1999 to September of 2001.
From 1997 to 1999, Mr. Cauthen served as a consultant with various enterprises.
Mr. Cauthen currently serves as an Executive Vice President with US Health
Advisors since October of 2002.
Shirley M. Harmon has been a Director since September of 1999. She has
served as the Company's Secretary from September of 1999 to September 2002. Ms.
Harmon retired from the United States Department of Navy in 1995. Ms. Harmon was
a civilian employee with 28 years in the financial division. Ms. Harmon has held
various positions and titles during this employment, which include the
following: Budget Analyst, and Management and Budget Analyst for the Ship Parts
Control Center, financial evaluating and executing various budget programs.
After leaving the Department of Navy, Ms. Harmon took a position with a private
trust.
If any nominee for director should become unavailable for election (which
the Board of Directors has no reason to believe will be the case), the shares
represented by the enclosed proxy will be voted for such substitute nominee as
may be nominated by the Board of Directors.
General Information Concerning the Board of Directors and its Committees
Our Board of Directors met five times during the last year, and all of the
directors attended these meetings. The Company does not currently have a
standing audit, nominating or compensation committee of the Board of Directors.
Compensation of Directors
Under the Company's Bylaws, directors, including directors also serving the
corporation in another capacity and receiving separate compensation, may receive
from the corporation as compensation for their services as directors such
compensation and reimbursement for expenses as the board may from time to time
determine. The directors of the Company currently receive no compensation for
their service as directors.
5
Executive Compensation
SUMMARY COMPENSATION TABLE
The following table summarizes the executive compensation for the fiscal
years ended July 31, 2002, 2001 and 2000 earned by or paid to the chief
executive officer, the three executive officers of the Company who received
total salary and bonus for the fiscal year ended July 31, 2002 in excess of
$100,000, and the former chief executive officer of the Company.
Annual Compensation Long Term
Compensation
_______________________
Securities
Name and Principal Fiscal Salary Other Annual Underlying
Position Year ($) Compensation Options Other
(#) Compensation
------------------------ ------ -------- ------------ --------- -------------
Garrett L. Thomas (1) 2002 $132,500 -- 1,000,000 $ 432 (2)
President 2001 -- -- -- --
Chief Executive Officer 2000 -- -- -- --
Director
Steve Watwood 2002 103,250 -- -- 103(3)
VP Business Development 2001 96,000 -- 1,715,040 --
Chairman of the Board 2000 96,000 -- -- --
Director
Bruce Bacon 2002 103,250 -- -- 8,489(4)
VP of Engineering 2001 96,000 -- 1,373,099 8,400
Chief Technology Officer 2000 96,000 -- -- 3,500
Director
Ronald J. Corsentino 2002 103,250 -- -- 55(5)
Chief Financial Officer 2001 78,000 -- 290,000 --
Treasurer 2000 10,000 -- -- --
Secretary
Andrew F. Cauthen (6) 2002 30,000 -- -- --
Director 2001 180,000 -- 486,491 --
2000 120,000 $27,000(7) 1,200,000 --
(1) Garrett Thomas was appointed President and CEO October 1, 2001.
Mr. Thomas' annualized salary for 2002 was $180,000.
(2) Represents premiums paid for term life insurance.
(3) Represents premiums paid for term life insurance.
(4) Includes $89 in premiums paid for term life insurance and $8,400 for
use of Mr. Bacon's Golden, Colorado townhouse.
(5) Represents premiums paid for term life insurance.
(6) Andrew Cauthen resigned as President and CEO effective September 30, 2001.
(7) On October 31, 1999, Andrew F. Cauthen was granted 100,000 shares of
Common Stock. The closing price of the Company's Common Stock on
October 29, 1999 was $0.27.
6
OPTION GRANTS IN LAST FISCAL YEAR
The following table shows information with respect to individual grants of
options to the executive officers named in the Summary Compensation Table above
during the 2002 fiscal year.
----------------- ------------------- ---------------- ------------- ----------
Number of Percent of Total
Securities Options/SARs Exercise of
Underlying Options to Employees in Base Price Expiration
Officer Granted (#) Fiscal Year ($/Sh) Date
----------------- ------------------- ---------------- ------------- ----------
----------------- ------------------- ---------------- ------------- ----------
Garrett L. Thomas 1,000,000 (1) 100% $0.19 10-01-2004
----------------- ------------------- ---------------- ------------- ----------
(1) Option grant was fully vested and exercisable on the date of grant.
AGGREGATE FISCAL YEAR END OPTION VALUES
Number of Securities Underlying
Unexercised Options at Fiscal Year End
Name
Exercisable Unexercisable
Garrett L. Thomas 1,000,000 --
Stephen F. Watwood 1,715,040 --
Bruce R. Bacon 1,373,099 --
Ronald J. Corsentino 290,000 --
Andrew F. Cauthen 1,686,491 --
No options were exercised last fiscal year by any of the persons named in
the Summary Compensation Table. No options held by any of the persons named in
the Summary Compensation Table were in-the-money at the end of the Company's
2002 fiscal year.
7
Security Ownership of Certain Beneficial Owners and Management
The following table contains information concerning security ownership of
management and those persons known to the Company to be the owners of more than
five percent of the outstanding common shares of the Company as of October 1,
2002:
Name and Address Percent Ownership of
of Beneficial Owner Shares of Common Stock (1) Class (2)
----------------------- ------------------------------- --------------------
Garrett L. Thomas 1,000,000 (3) 2.18% (3)
2195 Coast Avenue
San Marcos, CA 92069
Andrew F. Cauthen 1,704,376 (4) 3.67%(4)
14007 Lochshire Street
Houston, TX 77077
Stephen F. Watwood 2,811,442 (5) 6.05% (5)
17835 RCR 29
Oak Creek, CO 80467
Bruce R. Bacon 1,438,099 (6) 3.12% (6)
1001 8th Street
Golden, CO 80401
Ronald J. Corsentino 290,000 (7) *
1010 South Josephine Street
Denver, CO 80209
Shirley M. Harmon 151,872 (8) *
1947 NW 102nd Blvd.
Wildwood, FL 34785
Global Investments Ltd.,
Trustee 2,500,000 5.58%
Anthony Hulme, Director
Victoria House
P.O. Box 1066
The Valley, Anguilla
BWI
Rodney R. Shoemann, Sr. 5,778,723 12.90%
3904 Wheat Drive
Metairie, LA 70002
Jerry D. Kennett, MD 16,600,000 (9) 34.74% (9)
2801 Peppertree Lane
Columbia, MO 65201
All Executive Officers
and Directors as a Group 7,395,789 (10) 14.34% (10)
(6 persons)
8
*Holds less than 1% of the outstanding shares.
(1) Unless otherwise indicated below, each person named in the table has sole
voting and investment power with respect to all shares beneficially owned,
subject to applicable community property laws.
(2) All shares of common stock subject to options, warrants, conversion
privileges or other rights currently exercisable or exercisable within
60 days after July 31, 2002, are deemed to be outstanding for the purpose of
computing the percentage of ownership of the person holding such options,
warrants, conversion privileges or other rights, but are not deemed to be
outstanding for computing the percentage of ownership of any other person.
Percentage of ownership is based on 44,781,977 shares of common stock
outstanding as of October 1, 2002.
(3) Includes options for the purchase of 1,000,000 shares. Mr. Thomas is the
acting President, CEO, and a director of the Company.
(4) Includes options for the purchase of 1,686,491 shares. Mr. Cauthen is a
director of the Company.
(5) Includes options to Mr. Watwood's wife Phyllis Watwood for the purchase of
661,652 shares and an option to Mr. Watwood to purchase 1,715,040 shares.
Mr. Watwood is the acting Vice President of Business Development and a
director of the Company.
(6) Includes options for the purchase of 1,373,099 shares. Mr. Bacon is the
acting Vice President of Engineering, Chief Technology Officer and a
director of the Company.
(7) Includes options for the purchase of 290,000 shares. Mr. Corsentino is the
acting Chief Financial Officer, Treasurer and Secretary of the Company.
(8) Includes options for the purchase of 71,372 shares.
(9) Includes options for the purchase of 3,000,000 shares.
(10)Includes options held by such officers and directors for the purchase of
an aggregate of 6,797,654 shares.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's directors and executive officers, and persons who beneficially own
more than 10% of a registered class of the Company's equity securities, to file
reports of ownership on Form 3 and changes in ownership on Form 4 or 5 with the
Securities and Exchange Commission ("SEC"). Such officers, directors and 10%
shareholders are also required by SEC rules to furnish the Company with copies
of all Section 16(a) forms that they file. To the Company's knowledge, based
solely upon review of the copies of such reports and certain representations
furnished to it, no persons subject to Section 16(a) failed to file on a timely
basis reports required by Section 16(a) during the fiscal year ended July 31,
2002, except for Garrett L. Thomas, Ronald J. Corsentino, Andrew F. Cauthen,
Rodney R. Shoemann, Sr. and Jerry D. Kennett, M.D. Mr. Thomas, the Company's
President and CEO, failed to file a Form 3 and filed a late Form 5. Mr.
Corsentino, the Company's Chief Financial Officer, Treasurer and Secretary,
failed to file a Form 3 and filed a late Form 5. Mr. Cauthen, a director of the
Company, failed to file a Form 5. Mr. Shoemann, a 10% stockholder, failed to
file a Form 3 and a Form 4 for an acquisition of shares of Common Stock of the
Company and filed a late Form 5. Dr. Kennett, a 10% stockholder, failed to file
a Form 3 and Form 4s for six acquisitions of shares of Common Stock of the
Company and filed a late Form 5.
9
PROPOSAL TWO
REINCORPORATION OF THE COMPANY IN DELAWARE
AND RELATED CHANGES TO THE RIGHTS OF SHAREHOLDERS
Approval of Reincorporation in Delaware
The Board of Directors has approved a proposal to change the Company's
state of incorporation from New Mexico to Delaware. The Board of Directors
believes the change in domicile to be in the best interests of the Company and
its shareholders for several reasons. Principally, the Board of Directors
believes that reincorporation will enhance the Company's ability to attract and
retain qualified members of the Company's Board of Directors as well as
encourage directors to continue to make independent decisions in good faith on
behalf of the Company. The Company believes that the more favorable corporate
environment afforded by Delaware will enable it to compete more effectively with
other public companies, most of which are incorporated in Delaware.
Reincorporation in Delaware will also allow the Company the increased
flexibility and predictability afforded by Delaware law. Concurrent with the
reincorporation, the Company proposes to adopt or maintain certain measures
designed to make hostile takeovers of the Company more difficult. The Board
believes that adoption of these measures will enable the Board to consider fully
any proposed takeover attempt and to negotiate terms that maximize the benefit
to the Company and its shareholders.
In recent years, a number of major public companies have obtained the
approval of their shareholders to reincorporate in Delaware. For the reasons
explained in this proposal, the Company believes it is beneficial and important
that the Company likewise avail itself of Delaware law. For many years Delaware
has followed a policy of encouraging incorporation in that state. In furtherance
of that policy, Delaware has adopted comprehensive corporate laws that are
revised regularly to meet changing business circumstances. The Delaware
legislature is particularly sensitive to issues regarding corporate law and is
especially responsive to developments in modern corporate law. The Delaware
courts have developed considerable expertise in dealing with corporate issues as
well as a substantial body of case law construing Delaware's corporate law. As a
result of these factors, it is anticipated that Delaware law will provide
greater predictability in the Company's legal affairs than is presently
available under New Mexico law.
The interests of the Board of Directors of the Company, management and
affiliated shareholders in voting on the reincorporation proposal may not be the
same as those of unaffiliated shareholders. Delaware law does not afford
minority shareholders some of the rights and protections available under New
Mexico law. Reincorporation of the Company in Delaware may make it more
difficult for minority shareholders to elect directors and influence Company
policies. A discussion of the principal differences between New Mexico and
Delaware law as they affect shareholders begins on page 14 of this Proxy
Statement.
In addition, portions of the reincorporation proposal may have the effect
of deterring hostile takeover attempts. A hostile takeover attempt may have a
positive or a negative effect on the Company and its shareholders, depending on
the circumstances surrounding a particular takeover attempt. Takeover attempts
that have not been negotiated or approved by the board of directors of a
corporation can seriously disrupt the business and management of a corporation
and generally present to the shareholders the risk of terms which may be less
than favorable to all of the shareholders than would be available in a board
approved transaction. Board approved transactions may be carefully planned and
undertaken at an opportune time in order to obtain maximum value for the
corporation and all of its shareholders with due consideration to matters such
as the recognition or postponement of gain or loss for tax purposes, the
management and business of the acquiring corporation and maximum strategic
deployment of corporate assets.
10
The Board of Directors recognizes that hostile takeover attempts do not
always have the unfavorable consequences or effects described above and may
frequently be beneficial to the shareholders, providing all of the shareholders
with considerable value for their shares. However, the Board of Directors
believes that the potential disadvantages of unapproved takeover attempts are
sufficiently great that prudent steps to reduce the likelihood of such takeover
attempts are in the best interests of the Company and its shareholders.
Accordingly, the reincorporation plan includes certain proposals that may have
the effect of discouraging or deterring hostile takeover attempts.
Notwithstanding the belief of the Board of Directors as to the benefits to
shareholders of the changes, shareholders should recognize that one of the
effects of such changes may be to discourage a future attempt to acquire control
of the Company which is not presented to and approved by the Board of Directors,
but which a substantial number and perhaps even a majority of the Company's
shareholders might believe to be in their best interests or in which
shareholders might receive a substantial premium for their shares over the
current market prices. As a result, shareholders who might desire to participate
in such a transaction may not have an opportunity to do so.
Mechanics of the Reincorporation
The proposed reincorporation would be accomplished by merging the Company
into a newly-formed Delaware corporation (the "Delaware Company"), pursuant to
an Agreement and Plan of Merger (the "Merger Agreement"), a copy of which is
attached as Exhibit A to this Proxy Statement. Upon the effective date of the
merger, the Delaware Company's name will be American Millennium Corporation,
Inc. The reincorporation will not result in any change in the Company's
business, assets or liabilities, will not cause its corporate headquarters to be
moved and will not result in any relocation of management or other employees.
On the effective date of the proposed reincorporation, each outstanding
share of Common Stock of the Company will automatically convert into one share
of Common Stock of the Delaware Company, and shareholders of the Company will
automatically become shareholders of the Delaware Company. On the effective date
of the reincorporation, the number of outstanding shares of Common Stock and
Preferred Stock of the Delaware Company will be equal to the number of shares of
Common Stock and Preferred Stock of the Company outstanding immediately prior to
the effective date of the reincorporation. In addition, each outstanding option,
warrant or right to acquire shares of Common Stock of the Company will be
converted into an option, warrant or right to acquire an equal number of shares
of Common Stock of the Delaware Company, under the same terms and conditions as
the original options, warrants or rights. Each share of Common Stock or
Preferred Stock of the Delaware Company outstanding immediately after the
effective time of the reincorporation will be subject to the same restrictions
on sale, if any, as the corresponding shares of Common Stock or Preferred Stock
of the Company immediately prior to the reincorporation.
No action need be taken by shareholders to exchange their stock
certificates now; this will be accomplished at the time of the next transfer by
the shareholder. Certificates for shares in the Company will automatically
represent an equal number of shares in the Delaware Company upon completion of
the merger.
If approved by the shareholders, it is anticipated that the reincorporation
would be completed as soon thereafter as practicable. The reincorporation may be
abandoned or the Merger Agreement may be amended (with certain exceptions),
either before or after shareholder approval has been obtained, if in the opinion
of the Board of Directors, circumstances arise that make such action advisable;
provided, that any amendment that would effect a material change from the
charter provisions discussed in this Proxy Statement would require further
approval by the holders of a majority of the outstanding shares of the Common
Stock.
Dissenters' Rights
Shareholders have dissenters' rights in connection with this Proposal Two
to reincorporate in Delaware (the "Reincorporation Proposal"). If the
Reincorporation Proposal is approved at the Annual Meeting of Shareholders,
shareholders who perfect their dissenters' rights by fulfilling the requirements
of Section 53-15-4 of the New Mexico Business Corporation Act (Exhibit D to this
Proxy Statement) will be entitled to receive from the Company the fair value of
their Common Stock. Under New Mexico law, a shareholder who wishes to perfect
dissenters' rights is not required to vote against the Reincorporation Proposal
and a failure to vote against the Reincorporation Proposal will not constitute a
waiver of dissenters' rights. A proxy card returned by a shareholder desiring to
assert dissenters' rights which is marked "Abstain" will not result in a waiver
of dissenters' rights. However, a proxy card returned unmarked as to the
Reincorporation Proposal will be voted in favor of the Reincorporation Proposal
and will result in a waiver of dissenters' rights.
11
A record holder of shares may assert dissenters' rights as to less than all
of the shares registered in his name only if the holder dissents with respect to
all the shares beneficially owned by any one person and discloses the name and
address of the person or persons on whose behalf the holder dissents. In that
event, his rights will be determined as if the shares as to which he has
dissented and his other shares were registered in the names of different
shareholders. A beneficial owner of shares who is not the record holder may
assert dissenters' rights with respect to shares held on his behalf, and will be
treated as a dissenting shareholder if he submits to the Company at the time of
or before the assertion of these rights a written consent of the record holder.
The fair value of the shares will be determined as of the day prior to the date
on which a vote is taken, excluding any appreciation or depreciation in
anticipation of the reincorporation.
If the Company is required to purchase shares held by a person who
qualifies as a dissenting shareholder ("Dissenting Shares"), and if agreement
cannot be reached between the dissenting shareholder and the Company as to the
fair value of such Dissenting Shares, then the dissenting shareholder may seek
to have such value determined by a New Mexico court. Any shareholder
contemplating exercising dissenters' rights is urged to carefully review the
provisions of Section 53-15-4. Failure by a shareholder to precisely follow all
of the steps required by Section 53-15-4 for perfecting dissenters; rights may
result in the loss of those rights. The following is a summary of Section
53-15-4 and is qualified by reference to, and should be read in conjunction
with, the full text of Section 53-15-4, a copy of the relevant portion of which
is attached to this Proxy as Exhibit D.
Prior to or at the Annual Meeting of Shareholders, any shareholders
desiring to exercise dissenters' rights must file a written objection to the
Reincorporation Proposal with the Company at 1010 Tenth Street, Suite 100,
Golden, Colorado 80401, Attention: Secretary. If the Reincorporation Proposal is
approved by the required vote and the shareholder desiring to exercise
dissenters' rights has not voted in favor of the reincorporation, the
shareholder must make written demand upon the Company for payment of the fair
value of the shareholder's shares within 10 days after the date on which the
vote was taken. Failure to make written demand within the prescribed 10 day
period will result in the loss of dissenter's rights, and the shareholder will
be bound by the terms of the Reincorporation Proposal. Once a written demand for
payment has been made, such demand may not be withdrawn unless the Company
consents to the withdrawal. Within 20 days after demanding payment for his
shares, each holder must submit his certificates to the Company for notation
thereon that such demand has been made. Failure to do so, at the option of the
Company, will terminate his rights as a dissenting shareholder unless a court of
competent jurisdiction, for good and sufficient cause shown, otherwise directs.
If the reincorporation is effected, the Company must, within 10 days after
the reincorporation is effected, send to the dissenting shareholders, if any, a
written offer to pay for such shares at a specified price deemed by the Company
to be the fair value thereof. The written notice and offer will be accompanied
by a balance sheet of the Company, the shares of which the shareholder holds, as
of the latest available date and not more than 12 months prior to making of the
offer, and a profit and loss statement of the Company for the 12-month period
ended on the date of the balance sheet.
If, within 30 days after the reincorporation is effected, a dissenting
shareholder and the Company agree that the shareholder's shares are Dissenting
Shares and agree upon the fair value of such shares, the Company will, upon
surrender of the certificates representing the Dissenting Shares to the Company
at 1010 Tenth Street, Suite 100, Golden, Colorado 80401, Attention: Secretary,
make payment in the agreed amount within 90 days after the reincorporation.
12
If, within 30 days of the reincorporation is effected, the Company denies
that the shares surrendered by a dissenting shareholder are Dissenting Shares or
if the Company and the dissenting shareholder fail to agree upon the fair value
of such shares, then the Company, within 30 days after receipt of written demand
from any dissenting shareholder (given within 60 days after the date
reincorporation was effected) will, or at its election at any time within the
period of 60 days may, file a petition in any court of competent jurisdiction in
Bernalillo County praying that the fair value of the shares be determined. If
the Company fails to institute the proceeding to determine the fair value of the
Dissenting Shares, any dissenting shareholder may do so in the name of the
Company. All dissenting shareholders, wherever residing, will be made parties to
the proceeding. All shareholders who are parties to the proceeding will be
entitled to judgment against the Company for the amount of the fair value of
their shares. The court may, if it so elects, appoint one or more persons as
appraisers to receive evidence and recommend a decision on the question of fair
value. The appraisers will have such power and authority as specified in the
order of their appointment or on an amendment thereof. Upon payment of the
judgment, the dissenting shareholder ceases to have any interest in the shares.
The court will enter a judgment against the Company in an amount equal to the
fair value determined per share multiplied by the number of Dissenting Shares,
with interest at the legal rate of interest accruing from the date of the vote
upon the reincorporation to the date of payment. Absent an appeal of the
judgment by either party, the Company will pay the judgment upon surrender of
the certificates representing the Dissenting Shares.
The costs and expenses of any such proceeding will be determined by the
court and will be assessed against the Company, but all or any part of the costs
and expenses may be apportioned and assessed as the court deems equitable
against any or all of the dissenting shareholder who are parties to the
proceeding to whom the Company made an offer to pay for the shares if the court
finds that the action of the shareholders in failing to accept the offer was
arbitrary or vexatious or not in good faith. Such expenses include reasonable
compensation for and reasonable expenses of the appraisers, but exclude the fees
and expenses of counsel for and experts employed by any party; but if the fair
value of the shares as determined materially exceeds the amount which the
Company offered to pay therefore, or if no offer was made, the court in its
discretion may award to any shareholder who is a party to the proceeding such
sum as the court determines to be reasonable compensation to any expert employed
by the shareholder in the proceeding, together with reasonable fees of legal
counsel.
A shareholder's right to demand payment will terminate if (i) the
reincorporation is abandoned, rescinded, or the shareholders revoke the
authority to effect the reincorporation, (ii) the shares are transferred prior
to submission for endorsement as Dissenting Shares, (iii) the shareholder does
not comply with all of the procedures described above, or (iv) with the consent
of the Company, the shareholder withdraws his demand for payment.
Cash paid for Common Stock disposed of in an appraisal proceeding may
result in a taxable transaction for federal income tax purposes. Shareholders
who exercise appraisal rights should consult with their own tax advisors with
respect to federal, state, local and foreign tax consequences, if any, of such
exercise.
Significant Changes Caused by Reincorporation
In general, the Company's corporate affairs are governed at present by the
corporate law of New Mexico, the Company's state of incorporation, and by the
Company's Articles of Incorporation, as amended (the "New Mexico Articles"), and
the Company's Bylaws (the "New Mexico Bylaws"), which have been adopted pursuant
to New Mexico law. The New Mexico Articles and New Mexico Bylaws are available
for inspection during business hours at the principal executive offices of the
Company. In addition, copies may be obtained by writing to the Company at
American Millennium Corporation, Inc., 1010 Tenth Street, Suite 100, Golden,
Colorado 80401, Attention: Corporate Secretary.
If the reincorporation proposal is adopted, the Company will merge into,
and its business will be continued by, the Delaware Company. Following the
merger, issues of corporate governance and control would be controlled by
Delaware, rather than New Mexico law. The New Mexico Articles and New Mexico
Bylaws, will, in effect, be replaced by the Certificate of Incorporation of the
Delaware Company (the "Delaware Certificate") and the Bylaws of the Delaware
Company (the "Delaware Bylaws"), copies of which are attached as Exhibits B and
C to this Proxy Statement. Accordingly, the differences among these documents
and between Delaware and New Mexico law are relevant to your decision whether to
approve the reincorporation proposal.
13
Comparison of Shareholders' Rights
The following discussion summarizes the more important differences in the
corporation laws of Delaware and New Mexico, but does not purport to be an
exhaustive discussion of all of the differences. Such differences can be
determined in full by reference to the New Mexico Business Corporation Act and
the Delaware General Corporation Law. In addition, the New Mexico Business
Corporation Act and the Delaware General Corporation Law may be modified by
provisions in the articles or certificate of incorporation or bylaws of the
corporation.
A number of differences between New Mexico and Delaware law and among the
various charter documents are summarized in the chart below. Shareholders are
requested to read this chart in conjunction with the discussion following the
chart and the Merger Agreement, the Delaware Certificate and the Delaware Bylaws
attached to this Proxy Statement. For each item summarized in the chart, there
is a reference to a page of this Proxy Statement on which a more detailed
discussion appears.
-------------- -------------------------------- -------------------------------
ISSUE DELAWARE NEW MEXICO
-------------- -------------------------------- -------------------------------
-------------- -------------------------------- -------------------------------
Limitation of The Delaware Certificate limits The New Mexico Articles and
Directors liability of directors to the Bylaws do not provide for
(See page 16) Delaware Company for breach of limitation of liability of
fiduciary duty as a director, directors to the Company.
except for (a) breach of the
duty of loyalty to the
corporation or its stockholders;
(b) acts or omissions not in
good faith or involving
intentional misconduct or knowing
violations of law; (c) the
payment of unlawful dividends
or unlawful stock repurchases
or redemptions; or
(d) transactions in which the
officer received an improper
personal benefit.
-------------- -------------------------------- -------------------------------
-------------- -------------------------------- -------------------------------
Indemnifica-
tion of Delaware law permits indemnifi- New Mexico law provides that
Directors and cation of directors and officers the corporation shall have the
Officers (see for third party actions if the power to indemnify and advance
page 16). director or officer acted in reasonable expenses to an
good faith and in a manner officer who is not a director
reasonably believed to be in or to such further extent,
not opposed to the best consistent with law,
interests of the corporation, as provided for in the articles
and, with respect to criminal of incorporation, bylaws, board
actions, if the director or action or contract.
officer had no reasonable cause
to believe the director's or
officer's conduct was unlawful.
-------------- -------------------------------- -------------------------------
-------------- -------------------------------- -------------------------------
Cumulative Cumulative voting not available New Mexico permits if provided
Voting for to Delaware Company stockholders for in the articles of
Directors because not provided in the incorporation. The New Mexico
(See page 18). Delaware Certificate. Articles provide for
cumulative voting.
-------------- -------------------------------- -------------------------------
-------------- -------------------------------- -------------------------------
Number of Number of directors determined Number of directors determined
Directors by bylaws or certificate of by articles of incorporation or
(see page 18). incorporation. The Delaware the bylaws. The New Mexico
Bylaws and the Delaware Articles provide that the
Certificate provide that the number of directors increased
Board may fix the number of or decreased by an amendment to
directors from time to time by the New Mexico Bylaws; provided
resolution. that there shall always be at
least three directors.
-------------- -------------------------------- -------------------------------
-------------- -------------------------------- -------------------------------
14
-------------- -------------------------------- -------------------------------
ISSUE DELAWARE NEW MEXICO
-------------- -------------------------------- -------------------------------
-------------- -------------------------------- -------------------------------
Classified The Delaware Certificate of The New Mexico Articles and
Board Incorporation presently desig- Bylaws provide for only one
(see page 18). nates three classes of directors. class of directors.
-------------- -------------------------------- -------------------------------
-------------- -------------------------------- -------------------------------
Removal of Removal of directors from the Removal of directors or the
Directors by classified board only for cause, entire board of directors with
Shareholders by affirmative vote of a or without cause, by
(see page 19). majority of the outstanding affirmative vote of a majority
voting stock, unless otherwise of the outstanding voting
provided for in the certificate stock. Because the New Mexico
of incorporation. The Delaware Articles provide for cumulative
Certificate does not provide voting, if less than the entire
otherwise. board is to be removed, a
director cannot be removed if
the votes against such removal
would be sufficient to elect
him or her at an election of
the entire board.
-------------- -------------------------------- -------------------------------
-------------- -------------------------------- -------------------------------
Who May Call The Delaware Certificate and the The New Mexico Bylaws provide
Special Delaware Bylaws provide that that only the Board, or the
Shareholder only the Chairman of the Board, President, or holder(s) of 10%
Meeting (see the President or the Board by a or more of the outstanding
page 19). resolution approved by a majority shares entitled to vote at the
of the total number of directors, meeting may call a special
which the corporation would have meeting.
if there were no vacancies may
call a special meeting.
-------------- -------------------------------- -------------------------------
-------------- -------------------------------- -------------------------------
Action by Action by written consent is The New Mexico Bylaws permit
Written permitted by Delaware Law unless actions by written consent so
Consent of otherwise provided by the long as all stockholders
Shareholders certificate of incorporation. entitled to vote consent in
(see page 20). The Delaware Certificate writing.
prohibits ations by written
consent.
-------------- -------------------------------- -------------------------------
-------------- -------------------------------- -------------------------------
Advance Notice Under the Delaware Bylaws, The New Mexico Articles and
Requirement a shareholder must notify the Bylaws do not contain any
for Shareholder Company of a proposal or advance notice requirements.
Proposals nomination not less than 45 days
and Director nor more than 75 days prior to
Nominations the anniversary of the date on
(see page 20). which the corporation first
mailed its proxy materials for
the preceding year's annual
meeting.
-------------- -------------------------------- -------------------------------
-------------- -------------------------------- -------------------------------
15
-------------- -------------------------------- -------------------------------
Anti-Takeover See "Anti-Takeover" discussion. See "Anti-Takeover" discussion.
Provisions
(see page 20).
-------------- -------------------------------- -------------------------------
-------------- -------------------------------- -------------------------------
Amendment of The Delaware Certificate grants The New Mexico Articles grant
Bylaws (see the Board of Directors the power the Board of Directors the
page 22). to adopt, amend or repeal bylaws power to adopt, amend or repeal
by approval of a majority of the bylaws and grants shareholders
total number of directors which owning 25% of the capital stock
the corporation would have if the power to call a special
there were no vacancies, except meeting of shareholders to
that a two-thirds supermajority adopt, amend or repeal bylaws.
vote is required to amend or
repeal certain anti-takeover
provisions of the Delaware
Bylaws. The stockholders also
have the power to adopt, amend
or repeal bylaws by the
affirmative vote of at least
66 2/3% of the outstanding
voting stock.
-------------- -------------------------------- -------------------------------
-------------- -------------------------------- -------------------------------
Inspection of Permitted for any purpose Permitted for any shareholder
Corporate reasonably related to such of at least six months or the
Books and stockholder's interest as a holder of a beneficial
Records stockholder. interest of 5% or more.
(see page 23).
-------------- -------------------------------- -------------------------------
-------------- -------------------------------- -------------------------------
Dissenters' or Generally available for mergers Generally available to
Appraisal if stockholders receive cash in dissenting shareholders.
Rights exchange for the shares and in
(see page 23). certain other circumstances.
-------------- -------------------------------- -------------------------------
-------------- -------------------------------- -------------------------------
Dividends May be declared and paid from May be declared and paid so
(see page 23). surplus or, in certain long as, after giving effect
circumstances, out of net to the distribution, the
profits. Company can pay its debts when
they become due and the total
assets are greater than the sum
of its total liabilities and
the maximum amount that would
then be payable in any
liquidation, in respect of all
outstanding shares having
preferential rights in
liquidation.
-------------- -------------------------------- -------------------------------
INDEMNIFICATION AND LIMITATION OF LIABILITY
The New Mexico Articles and Bylaws do not provide for limitation of
liability of directors to the Company.
New Mexico law provides that a corporation may indemnify a director or
officer of the corporation, or a person who was serving at the corporation's
request as a director, officer, partner, trustee, employee or agent of another
foreign or domestic corporation or nonprofit corporation, cooperative,
partnership, joint venture, trust, other incorporated or unincorporated
enterprise or employee benefit plan or trust, provided that the person (a) acted
in good faith, (b) reasonably believed, in the case of conduct in his official
capacity with the corporation, that the conduct was in the best interest of the
corporation and, in all other cases, that his conduct was at least not opposed
to the corporation's best interests, and (c) in the case of criminal
proceedings, had no reasonable cause to believe the conduct was unlawful. No
indemnification of an officer or director may be made in connection with a
proceeding in which the person was adjudged liable on the basis that a financial
benefit was improperly received by such a person. New Mexico law also permits
indemnification of expenses in a suit by, or in the right of, the corporation if
the person acted in good faith and in a manner he or she reasonably believed to
be in or not opposed to the best interests of the corporation, subject to court
approval if the person is adjudged liable of negligence or misconduct.
16
Under New Mexico law, unless limited by Articles of Incorporation, to the
extent that an officer or director has been successful in the defense of the
proceeding, he or she must be indemnified by the corporation for expenses
reasonably incurred. Expenses may be paid in advance of the final disposition of
a suit upon (i) receipt of the claimant's written affirmation of good faith
belief that he or she has met the statutory standard of conduct, (ii) the
claimant agrees to repay such amount if he or she is not entitled to mandatory
indemnification, and (iii) a determination is made that the facts than known to
those making the determination would not preclude indemnification.
Under New Mexico law, a corporation has the power to indemnify and to
advance reasonable expenses to an officer, employee or agent who is not a
director to the extent provided for in the articles of incorporation, bylaws,
general or specific action of its board of directors, or contract so long as
consistent with New Mexico law. The New Mexico Articles provide that an officer,
employee or agent may be indemnified so long as he or she acted in good faith
and in a manner he or she reasonably believed to be in or not opposed to the
best interests of the corporation, and, with respect to a criminal action, had
no reasonable case to believe his or her conduct was unlawful. The New Mexico
Bylaws provide that the corporation shall indemnify any officer unless the
officer was adjudged liable for negligence or misconduct in the performance of
duty to the corporation.
Unless ordered by a court that the person is entitled to mandatory
indemnification, or that such person is entitled to indemnification whether or
not he has met the statutory standard of conduct or has been adjudged liable (in
which case court ordered indemnification is limited to reasonable expenses),
indemnification may be made under New Mexico law only upon determination that
the person has met the statutory standard of conduct. This determination is made
by (i) by the board of directors by a majority vote of a quorum consisting of
directors not at the time parties to the proceeding, (ii) if such quorum cannot
be obtained, by a majority vote of a committee of the board duly designated to
act in the matter by a majority vote of the full board, in which designation
directors who are parties may participate, and consisting solely of two or more
directors not at the time parties to the proceeding, (iii) special legal
counsel, selected by the board of directors or a committee thereof, by a
majority vote of a quorum consisting of directors not at the time parties to the
proceeding, or if the requisite quorum cannot be obtained, by a majority vote of
the full board, or (iv) by the shareholders.
Delaware law permits a corporation to include a provision in its
certificate of incorporation, which is included in the Delaware Certificate,
which eliminates or limits the personal liability of a director to the
corporation or its shareholders for monetary damages for breach of fiduciary
duty, except for liability for (a) breaches of the director's duty of loyalty to
the corporation or its stockholder; (b) acts or omissions not in good faith or
involving intentional misconduct or knowing violations of law; (c) the payment
of unlawful dividends or unlawful stock repurchases or redemptions; or (d)
transactions in which the director received an improper personal benefit.
Under Delaware law, a corporation has the power to indemnify its directors,
officers, employees and agents against judgments, settlements, and expenses in
any litigation or other proceeding, except a proceeding by, or in the right of,
the corporation, if the person acted in good faith and in a manner he or she
reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to a criminal proceeding, had no reasonable cause
to believe his or her conduct was unlawful. The indemnification provisions of
Delaware law require indemnification of a present or former director or officer
to the extent that he has been successful on the merits or otherwise in defense
of any action or claim. Delaware law also permits indemnification of expenses in
a suit by, or in the right of, the corporation if the person acted in good faith
and in a manner he or she reasonably believed to be in or not opposed to the
best interests of the corporation, subject to court approval if the person is
adjudged liable. The Delaware Certificate and the Delaware Bylaws generally
require the Delaware Company to indemnify and advance litigation expenses to its
directors and officers to the extent permitted by Delaware law.
17
Unless otherwise ordered by a court, indemnification may be made under New
Mexico law only upon determination that the person has met the statutory
standard of conduct. This determination is made, with respect to a person who is
a director or officer at the time of such determination, by (i) by the board of
directors by a majority vote of the directors who are not parties to the action,
suit or proceeding, even though less than a quorum, (ii) by a committee of such
directors designated by a majority vote of such directors, even though less than
a quorum, (iii) if there are no such directors, or if such directors so direct,
by independent legal counsel in a written opinion, or (iv) by the stockholders.
CUMULATIVE VOTING FOR DIRECTORS
Cumulative voting permits the holder of each share of stock entitled to
vote in the election of directors to cast that number of votes which equal the
number of directors to be elected. The holder may allocate all votes represented
by a share to a single candidate or may allocate those votes among as many
candidates as he chooses. Thus, a shareholder with a significant minority
percentage of the outstanding shares may be able to elect one or more directors
if voting is cumulative.
Under New Mexico law cumulative voting in the election of directors is
optional. The New Mexico Articles provide for cumulative voting.
Cumulative voting is not available under Delaware law unless so provided in
the corporation's certificate of incorporation. The Delaware Certificate does
not provide for cumulative voting.
OTHER MATTERS RELATING TO DIRECTORS
NUMBER OF DIRECTORS. New Mexico law allows the number of persons
constituting the Board of Directors of a corporation to be fixed by the bylaws
or the articles of incorporation, or permits the bylaws to provide that the
number of directors may vary within a specified range, the exact number to be
determined by the Board of Directors. The New Mexico Articles provide that the
number of directors may be increased or decreased by an amendment to the New
Mexico Bylaws; provided that there shall always be at least three directors.
Delaware law allows the number of persons constituting the board of
directors of a corporation to be fixed by the certificate of incorporation or
the bylaws, or fixed in the manner provided in the bylaws. The Delaware
Certificate and Bylaws provide that the number of directors shall be determined
from time to time exclusively by resolution of the Board of Directors.
ELECTIONS; CLASSIFIED BOARD OF DIRECTORS. New Mexico law permits, but does
not require, the adoption of a classified Board of Directors with staggered
terms. The New Mexico Articles do not provide for a classified board of
directors.
Delaware law permits, but does not require, the adoption of a classified
board of directors with staggered terms. A maximum of three classes of directors
is permitted by Delaware law, with members of one class to be elected each year
for a maximum term of three years. Classification of the Board of Directors
might make it more difficult for a person acquiring shares to take immediate
control of the Board of Directors. The Delaware Certificate and the Delaware
Bylaws provide for a classified Board of Directors with three classes of
directors. See "Anti-Takeover Measures" for more information on the potential
effects of the proposed classified board structure.
Under the Delaware Certificate, the Board of Directors would be divided
into three classes, designated Class I, Class II and Class III. All directors in
Class I would hold office until the first annual meeting of stockholders
following the implementation of this proposal; all directors in Class II would
hold office until the second annual meeting of stockholders and all directors in
Class III would hold office until the third annual meeting of the stockholders,
and, in each case, until their successors are duly elected and qualified or
until their earlier resignation, removal from office or death. As a result, only
one class of directors will be elected at each annual meeting of stockholders,
with the remaining classes continuing their respective terms until the
successors are duly elected and qualified or until earlier resignation, removal
from office or death. Any vacancy on the Board of Directors shall be filled by
the Board and any director elected to fill such vacancy shall hold office for
the remainder of the full term of the class of directors in which the vacancy
occurred.
18
If all of the nominees set forth in Proposal One are elected to the Board
of Directors, the initial classification of the Board of Directors for the
Delaware Company would be as follows:
Class I: Garrett L. Thomas
Class II: Andrew F. Cauthen and Steve Watwood
Class III: Ronald J. Corsentino and Bruce R. Bacon
REMOVAL OF DIRECTORS. Under New Mexico law, because the Company does not
have a classified board of directors, a director or the entire board may be
removed with or without cause by the affirmative vote of a majority of the
outstanding shares entitled to vote. Because the New Mexico Articles provide for
cumulative voting, if less than the entire board is to be removed, a director
cannot be removed if the votes against such removal would be sufficient to elect
him or her at an election of the entire board.
Under Delaware law, because the Delaware Corporation would have a
classified board of directors, unless the certificate of incorporation provides
otherwise, directors may be removed only for cause. The Delaware Certificate
does not provide that directors may be removed without cause.
BLANK CHECK PREFERRED
The Company's capital stock currently consists of 60,000,000 authorized
shares of Common Stock, of which 44,781,977 shares were issued and outstanding
as of October 1, 2002, and 10,000,000 authorized shares of Preferred Stock, none
of which were issued and outstanding as of October 1, 2002.
Under the Delaware Certificate, as under the New Mexico Articles, the Board
of Directors has the authority to determine or alter the rights, preferences,
privileges, powers and restrictions to be granted to or imposed upon any wholly
unissued series of Preferred Stock and to fix the number of shares constituting
any such series and to determine the designation thereof. See "Anti-Takeover
Measures."
The Board may authorize the issuance of Preferred Stock in connection with
various corporate transactions, including corporate partnering arrangements. The
Board may also authorize the issuance of Preferred Stock for the purpose of
adopting a stockholder rights plan. If the reincorporation is approved, it is
not the present intention of the Board of Directors to seek stockholder approval
prior to any issuance of preferred stock, except as required by law or
regulation.
WHO MAY CALL A SPECIAL SHAREHOLDER MEETING
Under New Mexico law a special meeting of shareholders may be called by the
Board of Directors, or the holders of not less than one-tenth of all the shares
entitled to vote at the meeting, or such other persons authorized to do so by
the articles of incorporation or bylaws. The New Mexico Bylaws also authorize
the President to call a special meeting of the shareholders.
Under Delaware law, a special meeting of stockholders may be called by the
Board of Directors or by any other person(s) authorized to do so in the
certificate of incorporation or the bylaws. The Delaware Certificate and the
Delaware Bylaws provide that such a meeting may be called by the Chairman of the
Board, the President, or the Board of Directors by a resolution approved by a
majority of the total number of directors which the corporation would have if
there were no vacancies.
19
ACTIONS BY WRITTEN CONSENT OF SHAREHOLDERS
Under New Mexico and Delaware law, shareholders may execute an action by
written consent in lieu of a shareholder meeting. New Mexico law provides that
action by written consent is permitted so long as all of the shares outstanding
and entitled to vote on the matter provide consent in writing.
Delaware law permits a corporation to eliminate such actions by written
consent in its charter. The Delaware Certificate prohibits actions by written
consent of stockholders.
ADVANCE NOTICE REQUIREMENT FOR SHAREHOLDER PROPOSALS AND DIRECTOR NOMINATIONS
There is no specific statutory requirement under either New Mexico or
Delaware law with regard to advance notice of director nominations and
shareholder proposals. Absent a bylaw restriction, director nominations and
shareholder proposals may be made without advance notice at the annual meeting.
However, federal securities laws generally provide that shareholder proposals
that the proponent wishes to include in the Company's proxy materials must be
received not less than 120 days in advance of the date of the proxy statement
released in connection with the previous year's annual meeting.
The New Mexico Bylaws do not provide any restrictions on director
nominations or shareholder proposals. The Delaware Bylaws provide that in order
for director nominations or shareholder proposals to be properly brought before
an annual meeting, the shareholder must have delivered timely notice to the
Secretary of the corporation. Under the Delaware Bylaws, to be timely, notice
must have been delivered not less than 45 days nor more than 75 days prior to
the first anniversary of the date on which the corporation first mailed its
proxy materials for the preceding year's annual meeting. If no annual meeting
was held in the previous year or the date of the annual meeting has been
advanced more than 30 days prior to or delayed by more than 60 days after such
anniversary date, notice must be provided not earlier than the 150th day prior
to such annual meeting and not later than the close of business on the later of
the 90th day prior to such annual meeting or the 10th day following the day on
which public announcement of the date of such meeting is first made.
These notice requirements help ensure that shareholders are aware of all
proposals to be voted on at the meeting and have the opportunity to consider
each proposal in advance of the meeting.
ANTI-TAKEOVER MEASURES
Delaware law has been widely viewed to permit a corporation greater
flexibility in governing its internal affairs and its relationships with
stockholders and other parties than do the laws of many other states, including
New Mexico. In particular, Delaware law permits a corporation to adopt a number
of measures designed to reduce a corporation's vulnerability to hostile takeover
attempts. As discussed herein, certain provisions of the Delaware Certificate
could be considered to be anti-takeover measures. Although the Board of
Directors does not have knowledge that any attempt to gain control of the
Company is being contemplated, differences between New Mexico and Delaware law,
effective without additional action by the Delaware Company, could have a
bearing on unapproved takeover attempts.
CLASSIFIED BOARD. Approval of the reincorporation will extend the time
required to elect a new majority to the Board of Directors. The New Mexico
Articles do not provide for a classified board of directors. Consequently, each
of the directors are elected at every meeting of shareholders. The Delaware
Certificate, unless directors are removed for cause, will require at least two
annual meetings of stockholders for a majority of stockholders to make a change
in control of the Board of Directors, since only a minority of the directors
will be elected at each meeting. A significant effect of a classified Board of
Directors may be to deter hostile takeover attempts because an acquirer would
experience delay in replacing a majority of the directors.
20
The existence of a classified Board may deter so-called "creeping
acquisitions" in which a person or group seeks to acquire: (i) a controlling
position without paying a control premium to the selling shareholders; (ii) a
position sufficient to exert control over the Company through a proxy contest or
otherwise; or (iii) a block of stock with a view toward attempting to promote a
sale or liquidation or a repurchase by the Company of the block at a premium, or
an exchange of the block for assets of the Company. Faced with a classified
Board of Directors, such a person or group would have to assess carefully its
ability to control or influence the Company. If free of the necessity to act in
response to an immediately threatened change in control, the Board of Directors
can act in a more careful and deliberative manner to make and implement
appropriate business judgments in response to a creeping acquisition.
The Board believes that instituting a classified board having staggered
three-year terms will help to assure the continuity and stability of the
Company's long-term policies in the future and permit it to more effectively
represent the interests of all stockholders, since approximately two-thirds of
the directors at any given time will have prior experience as directors of the
Company. A classified board will also make it more difficult to change the
overall composition of the Board of Directors. The Board, however, believes that
the benefits of maintaining continuity on the Board, outweighs this effect.
BUSINESS COMBINATIONS. New Mexico law has not adopted any statutes which
limit business combinations or restrict or limit the acquisition of a
controlling interest in a company.
Section 203 of the Delaware General Corporation Law provides that, subject
to certain exceptions specified therein, a corporation shall not engage in any
"business combination" (as defined) with an "interested stockholder" (as defined
below) for a three-year period following the time that such stockholder becomes
an interested stockholder unless (i) prior to such time, the board of directors
of the corporation approved either the business combination or the transaction
which resulted in the stockholder becoming an interested stockholder; (ii) upon
consummation of the transaction which resulted in the stockholder becoming an
interested stockholder, the interested stockholder owned at least 85% of the
voting stock of the corporation outstanding at the time the transaction
commenced (excluding certain shares); or (iii) on or subsequent to such time,
the business combination is approved by the board of directors of the
corporation and by the affirmative vote of at least 66 2/3% of the outstanding
voting stock which is not owned by the interested stockholder. Delaware law does
not impose any additional restrictions on business combination with interested
stockholders following the end of such three-year period.
Except as specified in the Delaware law, an interested stockholder is
defined to include (i) any person that is the "owner" (as defined) of 15% or
more of the outstanding voting stock of the corporation; or (ii) any person that
is an affiliate or associate of the corporation and was the owner of 15% or more
of the outstanding voting stock of the corporation at any time within three
years immediately prior to the relevant date. Under the Delaware law, the
foregoing provisions do not apply to a corporation if its original certificate
of incorporation contains a provision expressly electing not to be governed by
such provisions. The Delaware Certificate excludes the Delaware Company from the
restrictions imposed under Section 203 of the Delaware General Corporation Law.
ISSUANCE OF ADDITIONAL SHARES. In addition to the various anti-takeover
measures that would be available to the Delaware Company after the
reincorporation due to the application of Delaware law, the Delaware Company
would retain the rights currently available to the Company under New Mexico law
to issue shares of its authorized but unissued capital stock. Following the
effectiveness of the proposed reincorporation, shares of authorized and unissued
Common Stock and Preferred Stock of the Delaware Company could (within the
limits imposed by applicable law) be issued in one or more transactions, or
Preferred Stock could be issued with terms, provisions and rights which would
make more difficult and, therefore, less likely, a takeover of the Delaware
Company. Any such issuance of additional stock could have the effect of diluting
the earnings per share and book value per share of existing shares of Common
Stock, and such additional shares could be used to dilute the stock ownership of
persons seeking to obtain control of the Delaware Company.
21
It should be noted that the voting rights to be accorded to any unissued
series of Preferred Stock of the Delaware Company ("Delaware Preferred Stock")
remain to be fixed by the Board of Directors of the Delaware Company (the
"Delaware Board"). Accordingly, if the Delaware Board so authorizes, the holders
of Delaware Preferred Stock may be entitled to vote separately as a class in
connection with approval of certain extraordinary corporate transactions in
circumstances where Delaware law does not ordinarily require such a class vote,
or might be given a disproportionately large number of votes. Such Delaware
Preferred Stock could also be convertible into a large number of shares of
Common Stock of the Delaware Company under certain circumstances or have other
terms which might make acquisition of a controlling interest in the Delaware
Company more difficult or more costly, including the right to elect additional
directors to the Delaware Board. Potentially, the Delaware Preferred Stock could
be used to create voting impediments or to frustrate persons seeking to effect a
merger or otherwise to gain control of the Delaware Company. Also, the Delaware
Preferred Stock could be privately placed with purchasers who might side with
the management of the Delaware Company in opposing a hostile tender offer or
other attempt to obtain control.
The Board may also authorize the issuance of Delaware Preferred Stock in
connection with various corporate transactions, including corporate partnering
arrangements. The Board may also authorize the issuance of Delaware Preferred
Stock for the purpose of adopting a shareholder rights plan. However, future
issuances of Delaware Preferred Stock as an anti-takeover device might preclude
stockholders from taking advantage of a situation which might otherwise be
favorable to their interests. In addition (subject to the considerations
referred to above as to applicable law), the Delaware Board could authorize
issuance of shares of Common Stock of the Delaware Company ("Delaware Common
Stock") or Delaware Preferred Stock to a holder who might thereby obtain
sufficient voting power to ensure that any proposal to alter, amend or repeal
provisions of the Delaware Certificate unfavorable to a suitor would not receive
the necessary vote required for the proposed amendments.
If the reincorporation is approved it is not the present intention of the
Board of Directors to seek shareholder approval prior to any issuance of the
Delaware Preferred Stock or Delaware Common Stock, except as required by law or
regulation. Frequently, opportunities arise that require prompt action, and it
is the belief of the Board of Directors that the delay necessary for shareholder
approval of a specific issuance would be a detriment to the Delaware Company and
its shareholders. The Board of Directors does not intend to issue any Preferred
Stock except on terms that the Board of Directors deems to be in the best
interests of the Delaware Company and its then existing stockholders.
There can be no assurance that the Board of Directors would not adopt any
further anti-takeover measures available under Delaware law (some of which may
not require stockholder approval). Moreover, the availability of such measures
under Delaware law, whether or not implemented, may have the effect of
discouraging a future takeover attempt which a majority of the Delaware
Company's stockholders may deem to be in their best interests or in which
shareholders may receive a premium for their shares over then current market
prices. As a result, stockholders who might desire to participate in such
transactions may not have the opportunity to do so. Shareholders should
recognize that, if adopted, the effect of such measures, along with the
possibility of discouraging takeover attempts, may be to limit in certain
respects the rights of stockholders of the Delaware Company compared with the
rights of shareholders of the Company.
AMENDMENT OF BYLAWS
New Mexico law provides the power to adopt bylaws is vested in the Board of
Directors unless reserved to the shareholders by the Articles of Incorporation.
The New Mexico Bylaws vest the power to alter, amend or repeal the Bylaws or
adopt new Bylaws in the Board of Directors, subject to the right of any
shareholders owning 25% of the capital stock of the Company, issued and
outstanding, to call a special meeting of shareholders, for the purpose of
making, adopting, altering, amending or repealing such Bylaws, and all Bylaws
adopted by the shareholders shall supersede the Bylaws made and adopted by the
Board of Directors in conflict therewith.
Upon the effectiveness of the proposed reincorporation, the Delaware Board
will be able to make, alter, amend and repeal the Bylaws by a majority vote,
except that a two-thirds supermajority vote will be required to amend or repeal
certain anti-takeover provisions of the Delaware Bylaws. The Delaware
Certificate and Delaware Bylaws require the affirmative vote of 66 2/3% of the
outstanding common stock entitled to vote at an election of the Board of
Directors for the stockholders to make, alter, amend or repeal the Bylaws.
22
INSPECTION OF CORPORATE BOOKS AND RECORDS
New Mexico law provides that any shareholder of at least six months or the
holder of a beneficial interest of 5% or more of the outstanding stock has a
right to inspect the Company records, including shareholder lists upon written
request setting forth the purpose thereof. New Mexico law also provides that any
shareholder has a right to inspect the Company's shareholder list in
anticipation of a noticed shareholder meeting.
Delaware law permits any stockholder of record to inspect the stockholder
list for any purpose reasonably related to that person's interest as a
stockholder and, under certain circumstances, to inspect the books and records
of the corporation.
DISSENTERS' OR APPRAISAL RIGHTS
New Mexico law grants to shareholders the right to dissent in the case of
(i) consummation of a plan of merger if the shareholder is entitled to vote on
the merger, (ii) consummation of a plan of share exchange to which the
corporation is a party as the corporation whose shares will be acquired, if the
shareholder is entitled to vote on the plan, (iii) a sale or exchange by a
corporation of all or substantially all of its property and assets not made in
the usual and regular course of its business, including a sale in dissolution,
but not including a sale pursuant to an order of a court having jurisdiction in
the premises or a sale for cash on terms requiring that all or substantially all
of the net proceeds of a sale be distributed to the shareholders in accordance
with their respective interest within one year after the date of sale, (iv) an
amendment of the articles of incorporation that materially adversely affects
rights in respect of a dissenter's shares, and (v) any corporate action taken
pursuant to a shareholder vote to the extent the articles of incorporation,
bylaws or a resolution of the board of directors provides for dissenter's
rights. Under New Mexico law, following the date of the transaction, the
corporation is required to make a written offer to each dissenting shareholder
to pay for the dissenting shareholder's shares at a price the corporation
estimates to be the fair value of the shares.
Delaware law grants appraisal rights only in the case of a merger or
consolidation and not in the case of a sale or exchange of assets, regardless of
the number of shares of stock being issued. Such appraisal rights are not
available: (a) with respect to the sale, lease or exchange of all or
substantially all of the assets of a corporation; (b) with respect to a merger
or consolidation by a corporation the shares of which are either (i) listed on a
national securities exchange or designated as a national market system security
on an interdealer quotation system by the National Association of Securities
Dealers, Inc. or (ii) held of record by more than 2,000 holders if such
stockholders receive only shares of the surviving corporation or shares of any
other corporation that are either listed on a national securities exchange or
designated as a national market system security on an interdealer quotation
system by the National Association of Securities Dealers, Inc. or held of record
by more than 2,000 holders, plus cash in lieu of fractional shares of such
corporations; or (c) to stockholders of a corporation surviving a merger if no
vote of the stockholders of the surviving corporation is required to approve the
merger under Delaware law.
Delaware law does not provide stockholders with voting or appraisal rights
when a corporation acquires another business through the issuance of its stock
in exchange for assets or stock or in a merger with a subsidiary.
Because the Company's shareholders will all be entitled to vote on this
plan of merger, dissenters' rights will be available under New Mexico law to the
Company's shareholders in connection with the reincorporation in Delaware. See
"Dissenters' Rights" on page 11.
23
DIVIDENDS
Under New Mexico law, the directors of every corporation are permitted,
subject to the articles of incorporation, to make distributions to shareholders
unless, after giving effect to such a distribution, the corporation would not be
able to pay its debts as they become due in the usual course of business, or the
corporation's total assets would be less than the sum of its total liabilities
plus the amount that would be needed to satisfy the dissolution rights of
shareholders whose preferential rights are superior to those receiving the
distribution.
Delaware law allows the payment of dividends out of surplus (including
paid-in and earned surplus) or, in certain circumstances, out of net profits for
the current and immediately preceding fiscal years. The Company has never paid
cash dividends and has no present plans to do so. Shares may be redeemed or
repurchased out of surplus, or, in limited circumstances, out of capital.
FEDERAL INCOME TAX CONSEQUENCES OF THE REINCORPORATION
The reincorporation provided for in the Merger Agreement is intended to be
a tax free reorganization under the Internal Revenue Code of 1986, as amended.
Assuming the reincorporation qualifies as a reorganization, no gain or loss will
be recognized to the holders of capital stock of the Company as a result of
consummation of the reincorporation, and no gain or loss will be recognized by
the Company or the Delaware Company. Each former holder of capital stock of the
Company will have the same basis in the capital stock of the Delaware Company
received by such holder pursuant to the reincorporation as such holder has in
the capital stock of the Company held by such holder at the time of consummation
of the reincorporation. Each shareholder's holding period with respect to the
Delaware Company's capital stock will include the period during which such
holder held the corresponding Company capital stock, provided the latter was
held by such holder as a capital asset at the time of consummation of the
reincorporation. The Company has not obtained a ruling from the Internal Revenue
Service or an opinion of legal or tax counsel with respect to the consequences
of the reincorporation. Shareholders are urged to consult their own tax advisors
as to the federal, state, local and foreign tax consequences, if any, of the
reincorporation.
Required Vote
The ratification of the change in the incorporation from New Mexico to
Delaware requires the affirmative vote of the holders of a majority of the
outstanding shares of Common Stock of the Company. Abstentions and broker
non-votes will have the effect of a vote against the reincorporation at the
Annual Meeting.
THE BOARD OF DIRECTORS RECOMMENDS
THE SHAREHOLDERS VOTE FOR PROPOSAL TWO
24
PROPOSAL THREE
INCREASE OF AUTHORIZED SHARES OF COMMON STOCK
The Company's Board of Directors has approved an amendment to the New
Mexico Articles to increase the number of authorized shares of Common Stock to
100,000,000 from 60,000,000. The Board of Directors recommends that the
shareholders approve this amendment. If Proposal Two is approved by the
shareholders, approval of this Proposal Three will result in the Delaware
Company having 100,000,000 authorized shares of Common Stock. If Proposal Two is
approved, but this Proposal Three is not approved, the Delaware Company will
have 60,000,000 authorized shares of Common Stock.
As of October 1, 2002, 44,781,977 shares of Company Common Stock were
issued and outstanding. An additional 19,485,516 shares were covered by
outstanding options and warrants. If this Proposal Three is approved, the
Company will have 35,732,507 shares of authorized, unissued and unreserved
shares of Common Stock.
The number of authorized shares of Common Stock currently available is not
sufficient to meet the Company's potential obligations to issue shares of Common
Stock upon exercise of outstanding options and warrants. In addition, the Board
of Directors believes that the authorized shares of Common Stock remaining
available for future issuances is not sufficient to enable the Company to
respond to potential business opportunities and to pursue important objectives
that may be anticipated. Accordingly, the Board of Directors believes that it is
in the Company's best interests to increase the number of authorized shares of
Common Stock as described above. The Board of Directors also believes that the
availability of such shares will provide the Company with the flexibility to
issue Common Stock for proper corporate purposes that may be identified by the
Board of Directors from time to time, such as financings, acquisitions,
strategic business relationships or stock dividends (including stock splits in
the form of stock dividends). Further, the Board of Directors believes the
availability of additional shares of Common Stock will enable the Company to
attract and retain talented employees through the grant of stock options and
other stock-based incentives. The issuance of additional shares of Common Stock
may have a dilutive effect on earnings per share and, for a person who does not
purchase additional shares to maintain his or her pro rata interest, on a
stockholder's percentage voting power.
The Board of Directors does not intend to issue any common stock except on
terms which the Board deems to be in the best interests and in the best
interests of the Company's then-existing shareholders. Unless the Company is
required by law or stock market or exchange requirements, the Board of Directors
does not intend to seek the approval of the shareholders prior to any issuance
of the authorized common stock.
The Board of Directors does not recommend this proposed amendment with the
intent to use the ability to issue additional Common Stock to discourage tender
offers or takeover attempts. However, the availability of authorized Common
Stock for issuance could render more difficult or discourage a merger, tender
offer, proxy contest or other attempt to obtain control of the Company. The
proposed amendment is not in response to any effort on the part of any party to
accumulate material amounts of Common Stock or to acquire control of us by means
of merger, tender offer, proxy contest or otherwise, or to change management of
the Company.
The text of the first paragraph of Article IV of the New Mexico Articles,
as it is proposed to be amended pursuant to this proposal, is as follows:
"The corporation shall have the authority to issue 100,000,000 shares of
Common Stock, par value $0.001 per share. Fractional shares may be issued.
The corporation is authorized to issue 10,000,000 shares of Preferred
Stock. The Board of Directors is authorized to issue such Preferred Stock
in five (5) series, and to establish the number of shares to be included in
each series and the preferences, limitations, conversion rights and other
relative rights of each series."
25
Vote Required
The affirmative vote of the holders of a majority of the outstanding shares
of common stock of the Company is required to approve this Proposal Three.
Abstentions and broker non-votes will have the effect of a vote against Proposal
Three at the Annual Meeting.
THE BOARD OF DIRECTORS RECOMMENDS
THE SHAREHOLDERS VOTE FOR PROPOSAL THREE.
26
PROPOSAL FOUR
THE SELECTION OF INDEPENDENT PUBLIC ACCOUNTANTS
The Company has engaged Dohan and Company as its principal independent
public accountants to perform the audit of the Company's financial statements
for fiscal year 2003, and to perform other accounting services. Dohan and
Company audited the Company's financial statements for its fiscal year ended
July 31, 2002. Representatives of Dohan and Company are not expected to be
present at the Annual Meeting. In the event representatives do attend the Annual
Meeting, each of them will have an opportunity to make a statement should any of
them desire to do so, and they would be expected to be available to respond to
appropriate questions.
Audit Fees
The aggregate fees billed to the Company for professional services rendered
by Dohan and Company for its audit of the Company's annual financial statements
for the fiscal year ended July 31, 2002, and its reviews of the financial
statements included in the Company's Quarterly Reports on Form 10-QSB for that
fiscal year were _______________.
Financial Information Systems Design and Implementation Fees
Dohan and Company did not render any professional services related to
financial information systems design and implementation for the fiscal year
ended July 31, 2002.
All Other Fees
The aggregate fees billed to the Company for all other services rendered by
Dohan and Company for the most recent fiscal year were $5,992. These fees
related to preparation and review of the Company's tax returns and assistance
with the filing of registration statements with the Securities and Exchange
Commission.
Auditor Independence
The Board of Directors has determined that the fees received by Dohan and
Company for the non-audit related professional services listed above are
compatible with maintaining Dohan and Company's independence.
The ratification of the selection of Dohan and Company requires the
affirmative vote of the holders of a majority of shares of Common Stock present
or represented and entitled to vote at the Annual Meeting. Abstentions and
broker non-votes will be counted as present for purposes of determining whether
a quorum is present at the Annual Meeting. Abstentions will have the effect of a
vote against Proposal Four, and broker non-votes will have no effect on the vote
on Proposal Four.
THE BOARD OF DIRECTORS RECOMMENDS
THE SHAREHOLDERS VOTE FOR PROPOSAL FOUR
27
SHAREHOLDER PROPOSALS
Proposals of shareholders of the Company which are intended to be presented
at the Company's 2004 Annual Meeting of Shareholders and included in the
Company's proxy soliciting material must be received by the Secretary of the
Company, in accordance with rules of the Securities and Exchange Commission, no
later than _____________, 2003.
In the event that the Shareholders approve Proposal Two, proposals of
shareholders of the Company which are intended to be presented at the Company's
2004 Annual Meeting of Shareholders, but are not intended to be included in the
Company's proxy soliciting material, must be received by the Secretary of the
Company no earlier than ______, 2003 and no later than ______, 2003.
2002 ANNUAL REPORT
The Company's 2002 Annual Report, including audited financial statements
for the fiscal years ending July 31, 2002, 2001, and 2000, are being forwarded
to each person who is a shareholder of record as of October 30, 2002, together
with this proxy statement.
A copy of the Company's 2002 Annual Report on Form 10-KSB is available
without charge to those shareholders who would like more detailed information
concerning the Company. If you desire a copy of that document, please send a
written request to Investor Relations, American Millennium Corporation, Inc.,
1010 Tenth Street, Suite 100, Golden, Colorado 80401.
THE BOARD OF DIRECTORS
Golden, Colorado
_____________, 2002
YOU ARE CORDIALLY INVITED TO ATTEND THE ANNUAL MEETING IN PERSON. WHETHER
OR NOT YOU PLAN TO ATTEND THE MEETING, YOU ARE REQUESTED TO SIGN AND RETURN THE
ACCOMPANYING PROXY IN THE ENCLOSED POSTAGE PAID ENVELOPE.
28
A-1
Exhibit A
AGREEMENT AND PLAN OF MERGER
OF
AMERICAN MILLENNIUM CORPORATION, INC.
(A NEW MEXICO CORPORATION)
AND
AMERICAN MILLENNIUM CORPORATION, INC.
(A DELAWARE CORPORATION)
THIS AGREEMENT AND PLAN OF MERGER, dated as of ___________ ___, 2002 (this
"Agreement") is entered into between American Millennium Corporation, Inc., a
New Mexico corporation ("AMCi New Mexico"), and American Millennium Corporation,
Inc., a Delaware corporation ("AMCi Delaware"). AMCi New Mexico and AMCi
Delaware are sometimes referred to herein as the "Constituent Corporations."
R E C I T A L S:
A. AMCi New Mexico is a corporation duly organized, validly existing and in
good standing under the laws of the State of New Mexico and, on the date of this
Agreement, has authority to issue 70,000,000 shares, consisting of 60,000,000
shares Common Stock, par value $0.001 per share, and 10,000,000 shares of
Preferred Stock. As of [ ], 2002, [ ] shares of Common Stock and [ ] shares of
Preferred Stock were issued and outstanding.
B. AMCi Delaware is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware and, on the date of this
Agreement, has authority to issue [110,000,000] shares, consisting of
[100,000,000] shares Common Stock, $0.001 par value, and 10,000,000 shares of
Preferred Stock, $0.001 par value. As of the date hereof, and before giving
effect to the transactions contemplated hereby, no shares of capital stock were
issued and outstanding.
C. The Board of Directors of AMCi New Mexico has determined that, for the
purpose of effecting the reincorporation of AMCi New Mexico in the State of
Delaware, it is advisable and in the best interests of AMCi New Mexico that AMCi
New Mexico merge with and into AMCi Delaware upon the terms and conditions of
this Agreement.
D. The respective Boards of Directors of AMCi Delaware and AMCi New Mexico
have approved this Agreement and have directed that this Agreement be submitted
to a vote of their respective stockholders and executed by the undersigned
officers.
NOW, THEREFORE, in consideration of the mutual agreements and covenants set
forth herein, AMCi Delaware and AMCi New Mexico hereby agree, subject to the
terms and conditions hereinafter set forth, as follows:
I. MERGER
1.1 MERGER. In accordance with the provisions of this Agreement, the
Delaware General Corporation Law and the Business Corporation Act of the State
of New Mexico, AMCi New Mexico shall be merged with and into AMCi Delaware (the
"Merger"), the separate existence of AMCi New Mexico shall cease and AMCi
Delaware shall be the surviving corporation upon the Effective Date of the
Merger (as defined below) and which is sometimes hereinafter referred to as the
"Surviving Corporation." The name of the Surviving Corporation shall be American
Millennium Corporation, Inc.
29
1.2 FILING AND EFFECTIVENESS. The Merger shall not become effective until
the following actions shall be completed:
(a) This Agreement and the Merger shall have been adopted and approved
by the stockholders of AMCi New Mexico and the sole stockholder of AMCi
Delaware in accordance with the requirements of the Delaware General
Corporation Law and the Business Corporation Act of the State of New
Mexico; (b) All of the conditions precedent to the consummation of the
Merger specified in this Agreement shall have been satisfied or duly waived
by the party entitled to satisfaction thereof;
(c) An executed Certificate of Merger or an executed counterpart of
this Agreement meeting the requirements of the Delaware General Corporation
Law shall have been filed with the Secretary of State of the State of
Delaware; and
(d) An executed Articles of Merger shall have been filed with the
Public Regulatory Commission of the State of New Mexico.
The date and time when the Merger shall become effective as aforesaid, is
herein called the "Effective Date of the Merger."
1.3 EFFECT OF THE MERGER. Upon the Effective Date of the Merger, the
separate existence of AMCi New Mexico shall cease and AMCi Delaware, as the
Surviving Corporation (i) shall continue to possess all of its assets, rights,
powers and property as constituted immediately prior to the Effective Date of
the Merger, (ii) shall be subject to all actions previously taken by its and
AMCi New Mexico's Board of Directors, (iii) shall succeed, without other
transfer, to all of the assets, rights, powers and property of AMCi New Mexico
in the manner more fully set forth in Section 259 of the General Corporation Law
of the State of Delaware, (iv) shall continue to be subject to all of the debts,
liabilities and obligations of AMCi Delaware as constituted immediately prior to
the Effective Date of the Merger, and (v) shall succeed, without other transfer,
to all of the debts, liabilities and obligations of AMCi New Mexico in the same
manner as if AMCi Delaware had itself incurred them, all as more fully provided
under the applicable provisions of the General Corporation Law of the State of
Delaware and the Business Corporation Act of the State of New Mexico.
II. CHARTER DOCUMENTS, DIRECTORS AND OFFICERS
2.1 CERTIFICATE OF INCORPORATION. The Certificate of Incorporation of AMCi
Delaware as in effect immediately prior to the Effective Date of the Merger
shall continue in full force and effect as the Certificate of Incorporation of
the Surviving Corporation until duly amended in accordance with the provisions
thereof and applicable law.
2.2 BYLAWS. The Bylaws of AMCi Delaware as in effect immediately prior to
the Effective Date of the Merger shall continue in full force and effect as the
Bylaws of the Surviving Corporation until duly amended in accordance with the
provisions thereof and applicable law.
2.3 DIRECTORS AND OFFICERS. The directors and officers of AMCi New Mexico
immediately prior to the Effective Date of the Merger shall be the directors and
officers of the Surviving Corporation until their successors shall have been
duly elected and qualified or until as otherwise provided by law, the
Certificate of Incorporation of the Surviving Corporation or the Bylaws of the
Surviving Corporation.
III. MANNER OF CONVERSION OF STOCK
3.1 AMCi NEW MEXICO COMMON STOCK AND PREFERRED STOCK. Upon the Effective
Date of the Merger, each share of AMCi New Mexico Common Stock, par value $0.001
per share, and each share of Preferred Stock issued and outstanding immediately
prior thereto shall by virtue of the Merger and without any action by the
Constituent Corporations, the holder of such share or any other person, be
converted into and exchanged for one (1) fully paid and nonassessable share of
Common Stock, par value $0.001 per share, of the Surviving Corporation or one
(1) fully paid and nonassessable share of Preferred Stock, par value $0.001 per
share, of the Surviving Corporation, respectively. Each share of Surviving
Corporation Common Stock or Preferred Stock shall be subject to the same
restrictions on sale or other transfer, if any, as the share of AMCi New Mexico
Common Stock or Preferred Stock which was converted into and exchanged for such
share of Surviving Corporation Common Stock or Preferred Stock.
30
3.2 AMCi NEW MEXICO OPTIONS, WARRANTS AND RIGHTS.
(a) Upon the Effective Date of the Merger, the Surviving Corporation
shall assume and continue the stock option plans and all other employee
benefit plans of AMCi New Mexico. Each outstanding and unexercised option,
warrant or right for AMCi New Mexico Common Stock shall become an option,
warrant or right for the Surviving Corporation's Common Stock on the basis
of one (1) share of the Surviving Corporation's Common Stock for each share
of AMCi New Mexico Common Stock issuable pursuant to any such option,
warrant or right, on the same terms and conditions and at an exercise price
per share equal to the exercise price per share applicable to any such AMCi
New Mexico option, warrant or right at the Effective Date of the Merger.
There are no options, warrants, or rights for the Preferred Stock of AMCi
New Mexico.
(b) A number of shares of the Surviving Corporation's Common Stock
shall be reserved for issuance upon the exercise of options, warrants and
rights equal to the number of shares of AMCi New Mexico Common Stock so
reserved immediately prior to the Effective Date of the Merger.
3.3 STOCK CERTIFICATES. At and after the Effective Date, all of the
outstanding certificates which immediately prior to the Effective Time
represented shares of AMCi New Mexico Common Stock or Preferred Stock shall be
deemed for all purposes to evidence ownership of, and to represent, shares of
the Surviving Corporation Common Stock or Preferred Stock into which the shares
of AMCi New Mexico Common Stock or Preferred Stock formerly represented by such
certificates have been converted as provided in this Agreement. The registered
owner on the books and records of the Surviving Corporation or its transfer
agent of any outstanding stock certificate shall, until such certificate shall
have been surrendered for transfer or otherwise accounted for to the Surviving
Corporation or its transfer agents, have and be entitled to exercise any voting
and other rights with respect to, and to receive any dividends and other
distributions upon, the shares of the Surviving Corporation Common Stock or
Preferred Stock evidenced by such outstanding certificate as provided above.
IV. GENERAL
4.1 FURTHER ASSURANCES. AMCi New Mexico agrees that if, at any time after
the Effective Date of the Merger, the Surviving Corporation shall consider or be
advised that any further deeds, assignments or assurances are necessary or
desirable to vest, perfect or confirm in the Surviving Corporation title to any
property or rights of AMCi New Mexico, the Surviving Corporation and its
officers and directors may execute and deliver all such deeds, assignments and
assurances and do all other things necessary or desirable to vest, perfect or
confirm title to such property or rights in the Surviving Corporation and
otherwise to carry out the purposes of this Agreement, in the name of AMCi New
Mexico or otherwise.
4.2 ABANDONMENT. At any time before the Effective Date of the Merger, this
Agreement may be terminated and the Merger may be abandoned for any reason
whatsoever by the Board of Directors of either AMCi New Mexico or of AMCi
Delaware, or of both, notwithstanding the approval of this Agreement by the
shareholders of AMCi New Mexico or by the sole stockholder of AMCi Delaware, or
both.
4.3 AMENDMENT. The Boards of Directors of the Constituent Corporations may
amend this Agreement at any time prior to the filing of this Agreement (or
certificate in lieu thereof) with the Secretary of State of the State of
Delaware, provided that an amendment made subsequent to the adoption of this
Agreement by the stockholder or shareholders of either Constituent Corporation
shall not: (1) alter or change the amount or kind of shares, securities, cash,
property and/or rights to be received in exchange for or on conversion of all or
any of the shares of any class or series thereof of such Constituent
Corporation, (2) alter or change any term of the Certificate of Incorporation of
the Surviving Corporation to be effected by the Merger or (3) alter or change
any of the terms and conditions of this Agreement if such alteration or change
would adversely affect the holders of any class or series of capital stock of
any Constituent Corporation.
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4.4 GOVERNING LAW. This Agreement shall in all respects be construed,
interpreted and enforced in accordance with and governed by the laws of the
State of Delaware.
4.8 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, this Agreement having first been approved by the
resolutions of the Boards of Directors of American Millennium Corporation, Inc.,
a New Mexico corporation, and American Millennium Corporation, Inc., a Delaware
corporation, is hereby executed on behalf of each of such two corporations and
attested by their respective officers thereunto duly authorized.
American Millennium Corporation, Inc.
a New Mexico corporation
By: __________________________________
President and Chief Executive Officer
ATTEST:
_______________________________
Secretary
American Millennium Corporation, Inc.
a Delaware corporation
By: ____________________________________
President and Chief Executive Officer
ATTEST:
_______________________________
Secretary
SIGNATURE PAGE TO AGREEMENT AND PLAN OF MERGER
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B-1
Exhibit B
CERTIFICATE OF INCORPORATION
OF
AMERICAN MILLENNIUM CORPORATION, INC.
FIRST. The name of the corporation is American Millennium Corporation, Inc.
SECOND. The address of the registered office of the corporation in the State of
Delaware is 2711 Centerville Road, Ste. 400, Wilmington, Delaware 19808, County
of New Castle. The name of its registered agent at such address is Corporation
Service Company.
THIRD. The nature of the business or purposes to be conducted or promoted is to
engage in any lawful act or activity for which corporations may be organized
under the General Corporation Law of the State of Delaware.
FOURTH.
A. Capitalization.
The total number of shares of all classes of capital stock which the
corporation shall have authority to issue is [110,000,000] shares, comprised of
[100,000,000] shares of Common Stock with a par value of $0.001 per share (the
"Common Stock") and 10,000,000 shares of Preferred Stock with a par value of
$0.001 per share (the "Preferred Stock").
A description of the respective classes of stock and a statement of the
designations, preferences, voting powers (or no voting powers), relative,
participating, optional or other special rights and privileges and the
qualifications, limitations and restrictions of the Preferred Stock and Common
Stock are as follows:
B. Voting Rights.
Except as otherwise required by law or this Certificate of Incorporation,
each holder of Common Stock shall have one vote in respect of each share of
stock held by such holder of record on the books of the corporation for the
election of directors and on all matters submitted to a vote of stockholders of
the corporation; provided, however, that, except as otherwise required by law,
holders of Common Stock shall not be entitled to vote on any amendment to this
Certificate of Incorporation (including any certificate of designations relating
to any series of Preferred Stock) that relates solely to the terms of one or
more outstanding series of Preferred Stock if the holders of such affected
series are entitled, either separately or together as a class with the holders
of one or more other such series, to vote thereon pursuant to this Certificate
of Incorporation (including any certificate of designations relating to any
series of Preferred Stock).
C. Preferred Stock.
The Preferred Stock may be issued in one or more series at such time or
times and for such consideration or considerations as the board of directors may
determine. Each series shall be so designated as to distinguish the shares
thereof from the shares of all other series.
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The board of directors is expressly authorized, subject to the limitations
prescribed by law and the provisions of this Certificate of Incorporation, to
provide for the issuance of all or any shares of the Preferred Stock, in one or
more series, each with such designations, preferences, voting powers (or no
voting powers), relative, participating, optional or other special rights and
privileges and such qualifications, limitations or restrictions thereof as shall
be stated in the resolution or resolutions adopted by the board of directors to
create such series, and a certificate of designations setting forth a copy of
said resolution or resolutions shall be filed in accordance with the General
Corporation Law of the State of Delaware. The authority of the board of
directors with respect to each such series shall include without limitation of
the foregoing the right to specify the number of shares of each such series and
to authorize an increase or decrease in such number of shares and the right to
provide that the shares of each such series may be: (i) subject to redemption at
such time or times and at such price or prices; (ii) entitled to receive
dividends (which may be cumulative or non-cumulative) at such rates, on such
conditions, and at such times, and payable in preference to, or in such relation
to, the dividends payable on any other class or classes or any other series;
(iii) entitled to such rights upon the dissolution of, or upon any distribution
of the assets of, the corporation; (iv) convertible into, or exchangeable for,
shares of any other class or classes of stock, or of any other series of the
same or any other class or classes of stock of the corporation at such price or
prices or at such rates of exchange and with such adjustments, if any;
(v) entitled to the benefit of such limitations, if any, on the issuance of
additional shares of such series or shares of any other series of Preferred
Stock; or (vi) entitled to such other preferences, powers, qualifications,
rights and privileges, all as the board of directors may deem advisable and as
are not inconsistent with law and the provisions of this Certificate of
Incorporation. The number of authorized shares of Preferred Stock may be
increased or decreased (but not below the number of shares thereof then
outstanding) by the affirmative vote of the holders of a majority of the Common
Stock, without a vote of the holders of the Preferred Stock, or of any series
thereof, unless a vote of such holder is required pursuant to the terms of any
Preferred Stock designation.
FIFTH. In furtherance and not in limitation of the powers conferred by the laws
of the State of Delaware:
A. Subject to the rights of the holders of any series of Preferred Stock to
elect additional directors under specified circumstances, the number of
directors which shall constitute the board of directors of the corporation shall
be determined by resolution of a majority of directors then in office. The board
of directors shall be divided into three classes. Each director shall serve for
a term ending on the third annual meeting of stockholders following the annual
meeting of stockholders at which such director was elected; provided, however,
that the directors first elected to Class I shall serve for a term ending at the
2003-2004 annual meeting of stockholders, the directors first elected to Class
II shall serve for a term ending at the 2004-2005 annual meeting of
stockholders, and directors first elected to Class III shall serve for a term
ending at the 2005-2006 annual meeting of stockholders. At each annual election,
the directors chosen to succeed those whose terms then expire shall be of the
same class as the directors they succeed. In the event of any change in the
authorized number of directors, each director then continuing to serve as such
shall nevertheless continue as a director of the class of which he or she is a
member until the expiration of his or her current term, or his or her prior
death, resignation or removal. The directors shall be elected at each annual
meeting of the stockholders, but if any annual meeting is not held, or the
directors are not elected thereat, the directors may be elected at any special
meeting of the stockholders held for that purpose. All directors shall hold
office until the expiration of the term for which elected, and until their
respective successors are elected, except in the case of death, resignation, or
removal of any director.
B. Except as required by law or provided for by resolution of the board of
directors, newly created directorships resulting from any increase in the number
of directors and any vacancies on the board of directors resulting from death,
resignation, disqualification, removal or other cause shall be filled solely by
the affirmative vote of a majority of the remaining directors then in office,
even though less than a quorum of the board of directors, by a sole remaining
director and not by the stockholders. Any director elected in accordance with
the preceding sentence shall hold office for the remainder of the full term of
the class of directors in which the new directorship was created or the vacancy
occurred and until such director's successor has been elected and qualified. No
decrease in the number of directors constituting the board of directors may
shorten the term of any incumbent director.
34
C. The board of directors of the corporation is expressly empowered to
adopt, amend or repeal the Bylaws of the corporation. Any adoption, amendment or
repeal of the Bylaws of the corporation by the board of shall require the
approval of a majority of the total number of directors which the corporation
would have if there were no vacancies; provided, however, that the affirmative
vote of not less than two-thirds of the total number of directors which the
corporation would have if there were no vacancies shall be required to repeal,
alter or amend any Bylaw provision relating to (i) the calling of a special
meeting of the stockholders or a special meeting of the board of directors, (ii)
stockholder nominations or proposals, (iii) the number, classification or
election of directors or (iv) supermajority approval or quorum requirements of
the board, or any committee thereof, or to adopt any Bylaw provision
inconsistent therewith. Notwithstanding the foregoing, the affirmative vote of
not less than two-thirds of the total number of directors which the corporation
would have if there were no vacancies shall be required to alter, amend or adopt
any Bylaw provision inconsistent with or repeal Article IX of the Bylaws
relating to amendments thereof. The stockholders shall also have the power to
adopt, amend or repeal the Bylaws of the corporation; provided, however, that,
notwithstanding any other provision of this Certificate of Incorporation or any
provision of law which might otherwise permit a lesser vote or no vote, but in
addition to any affirmative vote of the holders of any particular class or
series of the capital stock of the corporation required by law, this Certificate
of Incorporation or any preferred stock, the affirmative vote of the holders of
at least sixty-six and two-thirds percent (66 2/3%) of the voting power of all
of the then-outstanding shares of the capital stock of the corporation entitled
to vote generally in the election of directors, voting together as a single
class, shall be required to adopt, amend or repeal any provision of the Bylaws
of the corporation.
D. Elections of directors need not be by written ballot unless the Bylaws
of the corporation shall so provide.
E. The books of the corporation may be kept at such place within or without
the State of Delaware as the Bylaws of the corporation may provide or as may be
designated from time to time by the board of directors of the corporation.
SIXTH. Whenever a compromise or arrangement is proposed between this
corporation and its creditors or any class of them and/or between this
corporation and its stockholders or any class of them, any court of equitable
jurisdiction within the State of Delaware may, on the application in a summary
way of this corporation or of any creditor or stockholder thereof or on the
application of any receiver or receivers appointed for this corporation under
the provisions of Section 291 of Title 8 of the Delaware Code or on the
application of trustees in dissolution or of any receiver or receivers appointed
for this corporation under the provisions of Section 279 of Title 8 of the
Delaware Code, order a meeting of the creditors or classes of creditors, and/or
of the stockholders or classes of stockholders of this corporation, as the case
may be, to be summoned in such manner as the said court directs. If a majority
in number representing three-fourths in value of the creditors or class of
creditors, and/or of the stockholders or class of stockholders of this
corporation, as the case may be, agree to any compromise or arrangement and to
any reorganization of this corporation as a consequence of such compromise or
arrangement, the said compromise or arrangement and the said reorganization
shall, if sanctioned by the court to which the said application has been made,
be binding on all the creditors or class of creditors, and/or on all the
stockholders or class of stockholders, of this corporation, as the case may be,
and also on this corporation.
SEVENTH. A director of the corporation shall not be personally liable to
the corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, except for liability (i) for any breach of the director's
duty of loyalty to the corporation or its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a knowing
violation of law, (iii) under Section 174 of the Delaware General Corporation
Law, or (iv) for any transaction from which the director derived any improper
personal benefit. If the Delaware General Corporation Law is amended hereafter
to authorize corporate action further eliminating or limiting the personal
liability of directors, then the liability of a director of the corporation
shall be eliminated or limited to the fullest extent permitted by the Delaware
General Corporation Law, as so amended.
Any repeal or modification of the foregoing paragraph by the stockholders
of the corporation shall not adversely affect any right or protection of a
director of the corporation existing at the time of repeal or modification.
35
EIGHTH.
A. Right to Indemnification.
Each person who was or is made a party or is threatened to be made a party
to or is otherwise involved in any action, suit or proceeding, whether civil,
criminal, administrative or investigative (hereinafter a "proceeding"), by
reason of the fact that he or she is or was a director or an officer of the
corporation or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation or of a partnership,
joint venture, trust or other enterprise, including service with respect to an
employee benefit plan (hereinafter an "indemnitee"), whether the basis of such
proceeding is alleged action in an official capacity as a director, officer,
employee or agent or in any other capacity while serving as a director, officer,
employee or agent, shall be indemnified and held harmless by the corporation to
the fullest extent authorized by the Delaware General Corporation Law, as the
same exists or may hereafter be amended (but, in the case of any such amendment,
only to the extent that such amendment permits the corporation to provide
broader indemnification rights than such law permitted the corporation to
provide prior to such amendment), against all expense, liability and loss
(including attorneys' fees, judgments, fines, ERISA excise taxes or penalties
and amounts paid in settlement) reasonably incurred or suffered by such
indemnitee in connection therewith; provided, however, that, except as provided
in Section C of this Article EIGHTH with respect to proceedings to enforce
rights to indemnification, the corporation shall indemnify any such indemnitee
in connection with a proceeding (or part thereof) initiated by such indemnitee
only if such proceeding (or part thereof) was authorized by the board of
directors of the corporation.
B. Right to Advancement of Expenses.
In addition to the right to indemnification conferred in Section A of this
Article EIGHTH, an indemnitee shall also have the right to be paid by the
corporation the expenses (including attorney's fees) incurred in defending any
such proceeding in advance of its final disposition (hereinafter an "advancement
of expenses"); provided, however, that, if the Delaware General Corporation Law
requires, an advancement of expenses incurred by an indemnitee in his or her
capacity as a director or officer (and not in any other capacity in which
service was or is rendered by such indemnitee, including, without limitation,
service to an employee benefit plan) shall be made only upon delivery to the
corporation of an undertaking (hereinafter an "undertaking"), by or on behalf of
such indemnitee, to repay all amounts so advanced if it shall ultimately be
determined by final judicial decision from which there is no further right to
appeal (hereinafter a "final adjudication") that such indemnitee is not entitled
to be indemnified for such expenses under this Section B or otherwise. The
rights to indemnification and to the advancement of expenses conferred in
Sections A and B of this Article EIGHTH shall be contract rights and such rights
shall continue as to an indemnitee who has ceased to be a director, officer,
employee or agent and shall inure to the benefit of the indemnitee's heirs,
executors and administrators.
C. Right of Indemnitee to Bring Suit.
If a claim under Section A or B of this Article EIGHTH is not paid in full
by the corporation within 60 days after a written claim has been received by the
corporation, except in the case of a claim for an advancement of expenses, in
which case the applicable period shall be 20 days, the indemnitee may at any
time thereafter bring suit against the corporation to recover the unpaid amount
of the claim. If successful in whole or in part in any such suit, or in a suit
brought by the corporation to recover an advancement of expenses pursuant to the
terms of an undertaking, the indemnitee shall be entitled to be paid also the
expense of prosecuting or defending such suit. In (i) any suit brought by the
indemnitee to enforce a right to indemnification hereunder (but not in a suit
brought by the indemnitee to enforce a right to an advancement of expenses) it
shall be a defense that, and (ii) in any suit brought by the corporation to
recover an advancement of expenses pursuant to the terms of an undertaking, the
corporation shall be entitled to recover such expenses upon a final adjudication
that, the indemnitee has not met any applicable standard for indemnification set
forth in the Delaware General Corporation Law. Neither the failure of the
corporation (including its directors who are not parties to such action, a
committee of such directors, independent legal counsel, or its stockholders) to
have made a determination prior to the commencement of such suit that
indemnification of the indemnitee is proper in the circumstances because the
indemnitee has met the applicable standard of conduct set forth in the Delaware
General Corporation Law, nor an actual determination by the corporation
(including its directors who are not parties to such action, a committee of such
directors, independent legal counsel, or its stockholders) that the indemnitee
has not met such applicable standard of conduct, shall create a presumption that
the indemnitee has not met the applicable standard of conduct or, in the case of
such a suit brought by the indemnitee, be a defense to such suit. In any suit
brought by the indemnitee to enforce a right to indemnification or to an
advancement of expenses hereunder, or brought by the corporation to recover an
advancement of expenses pursuant to the terms of an undertaking, the burden of
proving that the indemnitee is not entitled to be indemnified, or to such
advancement of expenses, under this Article EIGHTH or otherwise shall be on the
corporation.
36
D. Non Exclusivity of Rights.
The rights to indemnification and to the advancement of expenses conferred
in this Article EIGHTH shall not be exclusive of any other right which any
person may have or hereafter acquire under any statute, the corporation's
Certificate of Incorporation, bylaws, agreement, vote of stockholders or
directors or otherwise.
E. Insurance.
The corporation may maintain insurance, at its expense, to protect itself
and any director, officer, employee or agent of the corporation or another
corporation, partnership, joint venture, trust or other enterprise against any
expense, liability or loss, whether or not the corporation would have the power
to indemnify such person against such expense, liability or loss under the
Delaware General Corporation Law. F. Indemnification of Employees and Agents of
the Corporation.
The corporation may, to the extent authorized from time to time by the
board of directors, grant rights to indemnification and to the advancement of
expenses to any employee or agent of the corporation to the fullest extent of
the provisions of this Article EIGHTH with respect to the indemnification and
advancement of expenses of directors and officers of the corporation.
G. Nature of Rights.
The rights conferred upon indemnitees in this Article EIGHTH shall be
contract rights and such rights shall continue as to an indemnitee who has
ceased to be a director, officer or trustee and shall inure to the benefit of
the indemnitee's heirs, executors and administrators. Any amendment, alteration
or repeal of this Article EIGHTH that adversely affects any right of an
indemnitee or its successors shall be prospective only and shall not limit or
eliminate any such right with respect to any proceeding involving any occurrence
or alleged occurrence of any action or omission to act that took place prior to
such amendment or repeal.
NINTH. The Corporation shall not be governed by Section 203 of the Delaware
General Corporation Law.
TENTH. The corporation reserves the right to amend or repeal any provision
contained in this Certificate of Incorporation, in the manner now or hereafter
prescribed by statute, and all rights conferred upon a stockholder herein are
granted subject to this reservation.
37
ELEVENTH. No action required or permitted to be taken at any annual or
special meeting of the stockholders may be taken without a meeting and the power
of stockholders to consent in writing, without a meeting, to the taking of any
action is specifically denied. Special meetings of the stockholders of this
corporation may be called only by the Chairman of the Board or the President or
by the board of directors pursuant to a resolution approved by a majority of the
total number of directors which the corporation would have if there were no
vacancies.
TWELFTH. The name and address of the incorporator are as follows:
David A. Charapp
4350 La Jolla Village Drive
7th Floor
San Diego, California 92122
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C-1
Exhibit C
AMERICAN MILLENNIUM CORPORATION, INC.
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BYLAWS
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STOCKHOLDERS
Section 1. Annual Meeting.
(1) An annual meeting of the stockholders, for the election of directors to
succeed those whose terms expire and for the transaction of such other business
as may properly come before the meeting, shall be held at such place, if any, on
such date, and at such time as the Board of Directors shall fix each year.
(2) Nominations of persons for election to the Board of Directors of the
Corporation and the proposal of business to be considered by the stockholders
may be made at an annual meeting of stockholders (a) pursuant to the
Corporation's notice of meeting, (b) by or at the direction of the Board of
Directors or (c) by any stockholder of the Corporation who was a stockholder of
record at the time of giving of the notice provided for in this bylaw, who is
entitled to vote at the meeting and who complied with the notice procedures set
forth in this bylaw.
(3) For nominations or other business to be properly brought before an annual
meeting by a stockholder pursuant to clause (c) of paragraph (2) of this Section
1, (a) the stockholder must have given timely notice thereof in writing to the
Secretary of the Corporation, (b) such business must be a proper matter for
stockholder action under the Delaware General Corporation Law, (c) if the
stockholder, or the beneficial owner on whose behalf any such proposal or
nomination is made, has provided the Corporation with a Solicitation Notice, as
that term is defined in subclause (z)(iii) of this paragraph (3), such
stockholder or beneficial owner must, in the case of a proposal, have delivered
a proxy statement and form of proxy to holders of at least the percentage of the
Corporation's voting shares required under applicable law to carry any such
proposal, or, in the case of a nomination or nominations, have delivered a proxy
statement and form of proxy to holders of a percentage of the Corporation's
voting shares reasonably believed by such stockholder or beneficial holder to be
sufficient to elect the nominee or nominees proposed to be nominated by such
stockholder, and must, in either case, have included in such materials the
Solicitation Notice and (d) if no Solicitation Notice relating thereto has been
timely provided pursuant to this section, the stockholder or beneficial owner
proposing such business or nomination must not have solicited a number of
proxies sufficient to have required the delivery of such a Solicitation Notice
under this section. To be timely, a stockholder's notice shall be delivered to
the Secretary at the principal executive offices of the Corporation not less
than 45 nor more than 75 days prior to the first anniversary of the date on
which the Corporation first mailed its proxy materials for the preceding year's
annual meeting; provided, however, that in the event that the date of the annual
meeting is advanced by more than 30 days or delayed by more than 60 days from
such anniversary date, or if no meeting was held in the prior year, notice by
the stockholder to be timely must be so delivered not earlier than the 150th day
prior to such annual meeting and not later than the close of business on the
later of (i) the 90th day prior to such annual meeting or (ii) the 10th day
following the day on which public announcement of the date of such meeting is
first made. Such stockholder's notice shall set forth (x) as to each person whom
the stockholder proposes to nominate for election or reelection as a director
all information relating to such person as would be required to be disclosed in
solicitations of proxies for election of directors, or is otherwise required, in
each case pursuant to Regulation 14A under the Securities Exchange Act of 1934,
as amended (the "Exchange Act") (including such person's written consent to
being named in the proxy statement as a nominee and to serving as a director if
elected); (y) as to any other business that the stockholder proposes to bring
before the meeting, a brief description of the business desired to be brought
before the meeting, the reasons for conducting such business at the meeting and
any material interest in such business of such stockholder and the beneficial
owner, if any, on whose behalf the proposal is made; and (z) as to the
stockholder giving the notice and the beneficial owner, if any, on whose behalf
the nomination or proposal is made (i) the name and address of such stockholder,
as they appear on the Corporation's books, and of such beneficial owner and (ii)
the class and number of shares of the Corporation which are owned beneficially
and of record by such stockholder and such beneficial owner, and (iii) whether
either such stockholder or beneficial owner intends to deliver a proxy statement
and form of proxy to holders of, in the case of a proposal, at least the
percentage of the Corporation's voting shares required under applicable law to
carry the proposal or, in the case of a nomination or nominations, a sufficient
number of holders of the Corporation's voting shares to elect such nominee or
nominees (an affirmative statement of such intent, a "Solicitation Notice").
39
(4) Notwithstanding anything in the second sentence of paragraph (3) of this
Section 1 to the contrary, in the event that the number of directors to be
elected to the Board of Directors of the Corporation is increased and there is
no public announcement naming all of the nominees for director or specifying the
size of the increased Board of Directors made by the Corporation at least 55
days prior to the first anniversary of the date on which the Corporation first
mailed its proxy materials for the preceding year's annual meeting, a
stockholder's notice required by this bylaw shall also be considered timely, but
only with respect to nominees for any new positions created by such increase, if
it shall be delivered to the Secretary at the principal executive offices of the
Corporation not later than the close of business on the 10th day following the
day on which such public announcement is first made by the Corporation.
(5) Only such persons who are nominated in accordance with the procedures set
forth in this Section 1 shall be eligible to serve as directors and only such
business shall be conducted at an annual meeting of stockholders as shall have
been brought before the meeting in accordance with the procedures set forth in
this Section 1. The chairman of the meeting shall have the power and duty to
determine whether a nomination or any business proposed to be brought before the
meeting was made in accordance with the procedures set forth in these Bylaws
and, if any proposed nomination or business is not in compliance with these
Bylaws, to declare that such defective proposed business or nomination shall be
disregarded.
(6) For purposes of these Bylaws, "public announcement" shall mean disclosure in
a press release reported by the Dow Jones News Service, Associated Press or a
comparable national news service or in a document publicly filed by the
Corporation with the Securities and Exchange Commission pursuant to Section 13,
14 or 15(d) of the Exchange Act.
(7) Notwithstanding the foregoing provisions of this Section 1, a stockholder
shall also comply with all applicable requirements of the Exchange Act and the
rules and regulations thereunder with respect to the matters set forth in this
Section 1. Nothing in this Section 1 shall be deemed to affect any rights of
stockholders to request inclusion of proposals in the Corporation's proxy
statement pursuant to Rule 14a-8 under the Exchange Act.
Section 2. Special Meetings; Notice.
(1) Special meetings of the stockholders, other than those required by statute,
may be called at any time by the Chairman of the Board or the President or by
the Board of Directors pursuant to a resolution approved by a majority of the
total number of directors which the Corporation would have if there were no
vacancies. Notice of every special meeting, stating the time, place, if any, and
purpose, shall be given by mailing, postage prepaid, at least 10 but not more
than 60 days before each such meeting, a copy of such notice addressed to each
stockholder of the Corporation at his post office address as recorded on the
books of the Corporation. The Board of Directors may postpone or reschedule any
previously scheduled special meeting.
(2) Only such business shall be conducted at a special meeting of stockholders
as shall have been brought before the meeting pursuant to the Corporation's
notice of meeting. Nominations of persons for election to the Board of Directors
may be made at a special meeting of stockholders at which directors are to be
elected pursuant to the Corporation's notice of meeting (a) by or at the
direction of the Board of Directors or (b) by any stockholder of record of the
Corporation who is a stockholder of record at the time of giving of notice
provided for in this paragraph, who shall be entitled to vote at the meeting and
who complies with the notice procedures set forth in Section 1 of this Article
I. Nominations by stockholders of persons for election to the Board of Directors
may be made at such a special meeting of stockholders if the stockholder's
notice required by the third paragraph of Section 1 of this Article I shall be
delivered to the Secretary at the principal executive offices of the Corporation
not later than the close of business on the later of the 90th day prior to such
special meeting or the 10th day following the day on which public announcement
is first made of the date of the special meeting and of the nominees proposed by
the Board of Directors to be elected at such meeting.
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(3) Notwithstanding the foregoing provisions of this Section 2, a stockholder
shall also comply with all applicable requirements of the Exchange Act and the
rules and regulations thereunder with respect to matters set forth in this
Section 2. Nothing in this Section 2 shall be deemed to affect any rights of
stockholders to request inclusion of proposals in the Corporation's proxy
statement pursuant to Rule 14a-8 under the Exchange Act.
Section 3. Notice of Meetings.
Written notice of the place, if any, date, and time of all meetings of the
stockholders, and the means of remote communications, if any, by which
stockholders and proxyholders may be deemed to be present in person and vote at
such meeting, shall be given, not less than 10 nor more than 60 days before the
date on which the meeting is to be held, to each stockholder entitled to vote at
such meeting, except as otherwise provided herein or required by law (meaning,
here and hereinafter, as required from time to time by the Delaware General
Corporation Law or the Certificate of Incorporation of the Corporation).
When a meeting is adjourned to another place, if any, date or time, written
notice need not be given of the adjourned meeting if the place, if any, date and
time thereof, and the means of remote communications, if any, by which
stockholders and proxyholders may be deemed to be present in person and vote at
such meeting, are announced at the meeting at which the adjournment is taken;
provided, however, that if the date of any adjourned meeting is more than 30
days after the date for which the meeting was originally noticed, or if a new
record date is fixed for the adjourned meeting, written notice of the place, if
any, date, and time of the adjourned meeting, and the means of remote
communications, if any, by which stockholders and proxyholders may be deemed to
be present in person and vote at such meeting, shall be given in conformity
herewith. At any adjourned meeting, any business may be transacted which might
have been transacted at the original meeting.
Section 4. Quorum.
At any meeting of the stockholders, the holders of a majority of all of the
shares of the stock entitled to vote at the meeting, present in person or by
proxy, shall constitute a quorum for all purposes, unless or except to the
extent that the presence of a larger number may be required by law. Where a
separate vote by a class or classes is required, a majority of the shares of
such class or classes present in person or represented by proxy shall constitute
a quorum entitled to take action with respect to that vote on that matter.
If a quorum shall fail to attend any meeting, the chairman of the meeting
may adjourn the meeting to another place, if any, date, or time.
Section 5. Organization.
Such person as the Board of Directors may have designated or, in the
absence of such a person, the Chairman of the Board or, in his or her absence,
the President or, in his or her absence, such person as may be chosen by the
holders of a majority of the shares entitled to vote who are present, in person
or by proxy, shall call to order any meeting of the stockholders and act as
chairman of the meeting. In the absence of the Secretary of the Corporation, the
secretary of the meeting shall be such person as the chairman appoints.
Section 6. Conduct of Business.
The chairman of any meeting of stockholders shall determine the order of
business and the procedure at the meeting, including such regulation of the
manner of voting and the conduct of discussion as seem to him or her in order.
The chairman shall have the power to adjourn the meeting to another place, if
any, date and time. The date and time of the opening and closing of the polls
for each matter upon which the stockholders will vote at the meeting shall be
announced at the meeting.
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Section 7. Proxies and Voting.
At any meeting of the stockholders, every stockholder entitled to vote may
vote in person or by proxy authorized by an instrument in writing or by a
transmission permitted by law filed in accordance with the procedure established
for the meeting. Any copy, facsimile telecommunication or other reliable
reproduction of the writing or transmission created pursuant to this paragraph
may be substituted or used in lieu of the original writing or transmission for
any and all purposes for which the original writing or transmission could be
used, provided that such copy, facsimile telecommunication or other reproduction
shall be a complete reproduction of the entire original writing or transmission.
The Corporation may, and to the extent required by law, shall, in advance
of any meeting of stockholders, appoint one or more inspectors to act at the
meeting and make a written report thereof. The Corporation may designate one or
more persons as alternate inspectors to replace any inspector who fails to act.
If no inspector or alternate is able to act at a meeting of stockholders, the
person presiding at the meeting may, and to the extent required by law, shall,
appoint one or more inspectors to act at the meeting. Each inspector, before
entering upon the discharge of his duties, shall take and sign an oath
faithfully to execute the duties of inspector with strict impartiality and
according to the best of his ability. Every vote taken by ballots shall be
counted by a duly appointed inspector or inspectors.
All elections shall be determined by a plurality of the votes cast, and
except as otherwise required by law, rule or regulation, all other matters shall
be determined by a majority of the votes cast affirmatively or negatively.
Section 8. Stock List.
A complete list of stockholders entitled to vote at any meeting of
stockholders, arranged in alphabetical order for each class of stock and showing
the address of each such stockholder and the number of shares registered in his
or her name, shall be open to the examination of any such stockholder, for any
purpose germane to the meeting, during ordinary business hours for a period of
at least 10 days prior to the meeting in the manner provided by law.
The stock list shall also be open to the examination of any stockholder
during the whole time of the meeting as provided by law. This list shall
presumptively determine the identity of the stockholders entitled to vote at the
meeting and the number of shares held by each of them.
ARTICLE II.
BOARD OF DIRECTORS
Section 1. Number, Election and Term of Directors.
Subject to the rights of the holders of any series of Preferred Stock to
elect additional directors under specified circumstances, the number of
directors which shall constitute the Board of Directors of the Corporation shall
be determined by resolution of a majority of directors then in office. The Board
of Directors shall be divided into three classes. Each director shall serve for
a term ending on the third annual meeting of stockholders following the annual
meeting of stockholders at which such director was elected; provided, however,
that the directors first elected to Class I shall serve for a term ending at the
2003-2004 annual meeting of stockholders, the directors first elected to Class
II shall serve for a term ending at the 2004-2005 annual meeting of
stockholders, and directors first elected to Class III shall serve for a term
ending at the 2005-2006 annual meeting of stockholders. At each annual election,
the directors chosen to succeed those whose terms then expire shall be of the
same class as the directors they succeed. In the event of any change in the
authorized number of directors, each director then continuing to serve as such
shall nevertheless continue as a director of the class of which he or she is a
member until the expiration of his or her current term, or his or her prior
death, resignation or removal. The directors shall be elected at each annual
meeting of the stockholders, but if any annual meeting is not held, or the
directors are not elected thereat, the directors may be elected at any special
meeting of the stockholders held for that purpose. All directors shall hold
office until the expiration of the term for which elected, and until their
respective successors are elected, except in the case of death, resignation, or
removal of any director.
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Section 2. Newly Created Directorships and Vacancies.
Except as required by law or provided for by resolution of the Board of
Directors, newly created directorships resulting from any increase in the number
of directors and any vacancies on the Board of Directors resulting from death,
resignation, disqualification, removal or other cause shall be filled solely by
the affirmative vote of a majority of the remaining directors then in office,
even though less than a quorum, or by a sole remaining director (and not by the
stockholders). Any director elected in accordance with the preceding sentence
shall hold office for the remainder of the full term of the class of directors
in which the new directorship was created or the vacancy occurred and until such
director's successor has been elected and qualified. No decrease in the number
of directors constituting the Board of Directors may shorten the term of any
incumbent director.
Section 3. Regular Meetings.
Regular meetings of the Board of Directors shall be held at such place or
places, if any, on such date or dates, and at such time or times as shall have
been established by the Board of Directors and publicized among all directors. A
notice of each regular meeting shall not be required.
Section 4. Special Meetings.
Special meetings of the Board of Directors may be called by the Chairman of
the Board, President or by the Board of Directors pursuant to a resolution
approved by a majority of the total number of directors which the Corporation
would have if there were no vacancies, and shall be held at such place, if any,
on such date, and at such time as they or he or she shall fix. Notice of the
place, if any, date, and time of each such special meeting shall be given each
director by whom it is not waived by mailing written notice not less than five
days before the meeting or by telephone or by telegraphing or telexing or by
facsimile or electronic transmission of the same not less than 24 hours before
the meeting. Unless otherwise indicated in the notice thereof, any and all
business may be transacted at a special meeting.
Section 5. Quorum.
At any meeting of the Board of Directors, a majority of the total number of
the whole Board shall constitute a quorum for all purposes. If a quorum shall
fail to attend any meeting, a majority of those present may adjourn the meeting
to another place, if any, date, or time, without further notice or waiver
thereof.
Section 6. Participation in Meetings By Conference Telephone.
Members of the Board of Directors, or of any committee thereof, may
participate in a meeting of such Board or committee by means of conference
telephone or similar communications equipment by means of which all persons
participating in the meeting can hear each other and such participation shall
constitute presence in person at such meeting.
Section 7. Conduct of Business.
At any meeting of the Board of Directors, business shall be transacted in
such order and manner as the Board may from time to time determine, and all
matters shall be determined by the affirmative vote of a majority of the
directors present, except as otherwise provided herein or required by law.
Action may be taken by the Board of Directors without a meeting if all members
thereof consent thereto in writing or by electronic transmission, and the
writing or writings or electronic transmissions are filed with the minutes of
proceedings of the Board of Directors. Such filing shall be in paper form if the
minutes are maintained in paper form and shall be in electronic form if the
minutes are maintained in electronic form.
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Section 8. Powers.
The Board of Directors may, except as otherwise required by law, exercise
all such powers and do all such acts and things as may be exercised or done by
the Corporation, including, without limiting the generality of the foregoing,
the unqualified power:
(1) To declare dividends from time to time in accordance with law;
(2) To purchase or otherwise acquire any property, rights or privileges on
such terms as it shall determine;
(3) To authorize the creation, making and issuance, in such form as it may
determine, of written obligations of every kind, negotiable or
non-negotiable, secured or unsecured, and to do all things necessary in
connection therewith;
(4) To remove any officer of the Corporation with or without cause, and
from time to time to devolve the powers and duties of any officer upon any
other person for the time being;
(5) To confer upon any officer of the Corporation the power to appoint,
remove and suspend subordinate officers, employees and agents;
(6) To adopt from time to time such stock option, stock purchase, bonus or
other compensation plans for directors, officers, employees and agents of
the Corporation and its subsidiaries as it may determine;
(7) To adopt from time to time such insurance, retirement, and other
benefit plans for directors, officers, employees and agents of the
Corporation and its subsidiaries as it may determine; and,
(8) To adopt from time to time regulations, not inconsistent with these
Bylaws, for the management of the Corporation's business and affairs.
Section 9. Compensation of Directors.
Unless otherwise restricted by the certificate of incorporation, the Board
of Directors shall have the authority to fix the compensation of the directors.
The directors may be paid their expenses, if any, of attendance at each meeting
of the Board of Directors and may be paid a fixed sum for attendance at the
meeting of the Board of Directors or paid a stated salary or paid other
compensation as director. No such payment shall preclude any director from
serving the Corporation in any other capacity and receiving compensation
therefor. Members of special or standing committees may be allowed like
compensation for attending committee meetings.
ARTICLE III. COMMITTEES
Section 1. Committees of the Board of Directors.
The Board of Directors may from time to time designate committees of the
Board, with such lawfully delegable powers and duties as it thereby confers, to
serve at the pleasure of the Board and shall, for those committees and any
others provided for herein, elect a director or directors to serve as the member
or members, designating, if it desires, other directors as alternate members who
may replace any absent or disqualified member at any meeting of the committee.
In the absence or disqualification of any member of any committee and any
alternate member in his or her place, the member or members of the committee
present at the meeting and not disqualified from voting, whether or not he or
she or they constitute a quorum, may by unanimous vote appoint another member of
the Board of Directors to act at the meeting in the place of the absent or
disqualified member.
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Section 2. Conduct of Business.
Each committee may determine the procedural rules for meeting and
conducting its business and shall act in accordance therewith, except as
otherwise provided herein or required by law. Adequate provision shall be made
for notice to members of all meetings; a majority of the members shall
constitute a quorum unless the committee shall consist of one (1) or two (2)
members, in which event one (1) member shall constitute a quorum; and all
matters shall be determined by a majority vote of the members present. Action
may be taken by any committee without a meeting if all members thereof consent
thereto in writing or by electronic transmission, and the writing or writings or
electronic transmission or transmissions are filed with the minutes of the
proceedings of such committee. Such filing shall be in paper form if the minutes
are maintained in paper form and shall be in electronic form if the minutes are
maintained in electronic form.
ARTICLE IV
OFFICERS
Section 1. Generally.
The officers of the corporation shall consist of a President, one or more
Vice Presidents, a Secretary and a Chief Financial Officer. The Corporation may
also have, at the discretion of the Board of Directors, a Chairman of the Board
and such other officers as may from time to time be appointed by the Board of
Directors. Officers shall be elected by the Board of Directors, which shall
consider that subject at its first meeting after every annual meeting of
stockholders. Each officer shall hold office until his or her successor is
elected and qualified or until his or her earlier resignation or removal. Any
number of offices may be held by the same person. The salaries of officers
elected by the Board of Directors shall be fixed from time to time by the Board
of Directors or by such officers as may be designated by resolution of the
Board.
Section 2. President.
The President shall be the Chief Executive Officer of the Corporation.
Subject to the provisions of these Bylaws and to the direction of the Board of
Directors, he or she shall have the responsibility for the general management
and control of the business and affairs of the Corporation and shall perform all
duties and have all powers which are commonly incident to the office of chief
executive or which are delegated to him or her by the Board of Directors. He or
she shall have power to sign all stock certificates, contracts and other
instruments of the Corporation which are authorized and shall have general
supervision and direction of all of the other officers, employees and agents of
the Corporation.
Section 3. Vice President.
Each Vice President shall have such powers and duties as may be delegated
to him or her by the Board of Directors. One Vice President shall be designated
by the Board to perform the duties and exercise the powers of the President in
the event of the President's absence or disability.
Section 4. Chief Financial Officer.
The Chief Financial Officer shall have the responsibility for maintaining
the financial records of the Corporation. He or she shall make such
disbursements of the funds of the Corporation as are authorized and shall render
from time to time an account of all such transactions and of the financial
condition of the Corporation. The Chief Financial Officer shall also perform
such other duties as the Board of Directors may from time to time prescribe.
Section 5. Secretary.
The Secretary shall issue all authorized notices for, and shall keep
minutes of, all meetings of the stockholders and the Board of Directors. He or
she shall have charge of the corporate books and shall perform such other duties
as the Board of Directors may from time to time prescribe.
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Section 6. Delegation of Authority.
The Board of Directors may from time to time delegate the powers or duties
of any officer to any other officers or agents, notwithstanding any provision
hereof.
Section 7. Removal.
Any officer of the Corporation may be removed at any time, with or without
cause, by the Board of Directors.
Action with Respect to Securities of Other Corporations.
Unless otherwise directed by the Board of Directors, the President or any
officer of the Corporation authorized by the President shall have power to vote
and otherwise act on behalf of the Corporation, in person or by proxy, at any
meeting of stockholders of or with respect to any action of stockholders of any
other Corporation in which this Corporation may hold securities and otherwise to
exercise any and all rights and powers which this Corporation may possess by
reason of its ownership of securities in such other Corporation.
ARTICLE V.
STOCK
Section 1. Certificates of Stock.
Each stockholder shall be entitled to a certificate signed by, or in the
name of the Corporation by, the President or a Vice President, and by the
Secretary or an Assistant Secretary, or the Treasurer or an Assistant Treasurer,
if any, certifying the number of shares owned by him or her. Any or all of the
signatures on the certificate may be by facsimile.
Section 2. Transfers of Stock.
Transfers of stock shall be made only upon the transfer books of the
Corporation kept at an office of the Corporation or by transfer agents
designated to transfer shares of the stock of the Corporation. Except where a
certificate is issued in accordance with Section 4 of Article V of these Bylaws,
an outstanding certificate for the number of shares involved shall be
surrendered for cancellation before a new certificate is issued therefor.
Section 3. Record Date.
In order that the Corporation may determine the stockholders entitled to
notice of or to vote at any meeting of stockholders, or to receive payment of
any dividend or other distribution or allotment of any rights or to exercise any
rights in respect of any change, conversion or exchange of stock or for the
purpose of any other lawful action, the Board of Directors may, except as
otherwise required by law, fix a record date, which record date shall not
precede the date on which the resolution fixing the record date is adopted and
which record date shall not be more than 60 nor less than 10 days before the
date of any meeting of stockholders, nor more than 60 days prior to the time for
such other action as hereinbefore described; provided, however, that if no
record date is fixed by the Board of Directors, the record date for determining
stockholders entitled to notice of or to vote at a meeting of stockholders shall
be at the close of business on the day next preceding the day on which notice is
given or, if notice is waived, at the close of business on the day next
preceding the day on which the meeting is held, and, for determining
stockholders entitled to receive payment of any dividend or other distribution
or allotment of rights or to exercise any rights of change, conversion or
exchange of stock or for any other purpose, the record date shall be at the
close of business on the day on which the Board of Directors adopts a resolution
relating thereto.
A determination of stockholders of record entitled to notice of or to vote
at a meeting of stockholders shall apply to any adjournment of the meeting;
provided, however, that the Board of Directors may fix a new record date for the
adjourned meeting.
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Section 4. Lost, Stolen or Destroyed Certificates.
In the event of the loss, theft or destruction of any certificate of stock,
another may be issued in its place pursuant to such regulations as the Board of
Directors may establish concerning proof of such loss, theft or destruction and
concerning the giving of a satisfactory bond or bonds of indemnity.
Section 5. Regulations.
The issue, transfer, conversion and registration of certificates of stock
shall be governed by such other regulations as the Board of Directors may
establish.
ARTICLE VI.
NOTICES
Section 1. Notices.
If mailed, notice to stockholders shall be deemed given when deposited in
the mail, postage prepaid, directed to the stockholder at such stockholder's
address as it appears on the records of the Corporation. Without limiting the
manner by which notice otherwise may be given effectively to stockholders, any
notice to stockholders may be given by electronic transmission in the manner
provided in Section 232 of the Delaware General Corporation Law.
Section 2. Waivers.
A written waiver of any notice, signed by a stockholder or director, or
waiver by electronic transmission by such person, whether given before or after
the time of the event for which notice is to be given, shall be deemed
equivalent to the notice required to be given to such person. Neither the
business nor the purpose of any meeting need be specified in such a waiver.
Attendance at any meeting shall constitute waiver of notice except attendance
for the sole purpose of objecting to the timeliness of notice.
ARTICLE VII.
MISCELLANEOUS
Section 1. Facsimile Signatures.
In addition to the provisions for use of facsimile signatures elsewhere
specifically authorized in these Bylaws, facsimile signatures of any officer or
officers of the Corporation may be used whenever and as authorized by the Board
of Directors or a committee thereof.
Section 2. Corporate Seal.
The Board of Directors may provide a suitable seal containing the name of
the Corporation, which seal shall be in the charge of the Secretary. If and when
so directed by the Board of Directors or a committee thereof, duplicates of the
seal may be kept and used by the Treasurer or by an Assistant Secretary or
Assistant Treasurer.
Section 3. Reliance upon Books, Reports and Records.
Each director, each member of any committee designated by the Board of
Directors, and each officer of the Corporation shall, in the performance of his
or her duties, be fully protected in relying in good faith upon the books of
account or other records of the Corporation and upon such information, opinions,
reports or statements presented to the Corporation by any of its officers or
employees, or committees of the Board of Directors so designated, or by any
other person as to matters which such director or committee member reasonably
believes are within such other person's professional or expert competence and
who has been selected with reasonable care by or on behalf of the Corporation.
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Section 4. Fiscal Year.
The fiscal year of the Corporation shall be as fixed by the Board of
Directors.
Section 5. Time Periods.
In applying any provision of these Bylaws which requires that an act be
done or not be done a specified number of days prior to an event or that an act
be done during a period of a specified number of days prior to an event,
calendar days shall be used, the day of the doing of the act shall be excluded,
and the day of the event shall be included.
ARTICLE VIII.
INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 1. Right to Indemnification.
Each person who was or is made a party or is threatened to be made a party
to or is otherwise involved in any action, suit or proceeding, whether civil,
criminal, administrative or investigative (hereinafter a "proceeding"), by
reason of the fact that he or she is or was a director or an officer of the
Corporation or is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation or of a partnership,
joint venture, trust or other enterprise, including service with respect to an
employee benefit plan (hereinafter an "indemnitee"), whether the basis of such
proceeding is alleged action in an official capacity as a director, officer,
employee or agent or in any other capacity while serving as a director, officer,
employee or agent, shall be indemnified and held harmless by the Corporation to
the fullest extent authorized by the Delaware General Corporation Law, as the
same exists or may hereafter be amended (but, in the case of any such amendment,
only to the extent that such amendment permits the Corporation to provide
broader indemnification rights than such law permitted the Corporation to
provide prior to such amendment), against all expense, liability and loss
(including attorneys' fees, judgments, fines, ERISA excise taxes or penalties
and amounts paid in settlement) reasonably incurred or suffered by such
indemnitee in connection therewith; provided, however, that, except as provided
in Section 3 of this ARTICLE VIII with respect to proceedings to enforce rights
to indemnification, the Corporation shall indemnify any such indemnitee in
connection with a proceeding (or part thereof) initiated by such indemnitee only
if such proceeding (or part thereof) was authorized by the Board of Directors of
the Corporation.
Section 2. Right to Advancement of Expenses.
In addition to the right to indemnification conferred in Section 1 of this
ARTICLE VIII, an indemnitee shall also have the right to be paid by the
Corporation the expenses (including attorney's fees) incurred in defending any
such proceeding in advance of its final disposition (hereinafter an "advancement
of expenses"); provided, however, that, if the Delaware General Corporation Law
requires, an advancement of expenses incurred by an indemnitee in his or her
capacity as a director or officer (and not in any other capacity in which
service was or is rendered by such indemnitee, including, without limitation,
service to an employee benefit plan) shall be made only upon delivery to the
Corporation of an undertaking (hereinafter an "undertaking"), by or on behalf of
such indemnitee, to repay all amounts so advanced if it shall ultimately be
determined by final judicial decision from which there is no further right to
appeal (hereinafter a "final adjudication") that such indemnitee is not entitled
to be indemnified for such expenses under this Section 2 or otherwise. The
rights to indemnification and to the advancement of expenses conferred in
Sections 1 and 2 of this ARTICLE VIII shall be contract rights and such rights
shall continue as to an indemnitee who has ceased to be a director, officer,
employee or agent and shall inure to the benefit of the indemnitee's heirs,
executors and administrators.
Section 3. Right of Indemnitee to Bring Suit.
If a claim under Section 1 or 2 of this ARTICLE VIII is not paid in full by
the Corporation within 60 days after a written claim has been received by the
Corporation, except in the case of a claim for an advancement of expenses, in
which case the applicable period shall be 20 days, the indemnitee may at any
time thereafter bring suit against the Corporation to recover the unpaid amount
of the claim. If successful in whole or in part in any such suit, or in a suit
brought by the Corporation to recover an advancement of expenses pursuant to the
terms of an undertaking, the indemnitee shall be entitled to be paid also the
expense of prosecuting or defending such suit. In (i) any suit brought by the
indemnitee to enforce a right to indemnification hereunder (but not in a suit
brought by the indemnitee to enforce a right to an advancement of expenses) it
shall be a defense that, and (ii) in any suit brought by the Corporation to
recover an advancement of expenses pursuant to the terms of an undertaking, the
Corporation shall be entitled to recover such expenses upon a final adjudication
that, the indemnitee has not met any applicable standard for indemnification set
forth in the Delaware General Corporation Law. Neither the failure of the
Corporation (including its directors who are not parties to such action, a
committee of such directors, independent legal counsel, or its stockholders) to
have made a determination prior to the commencement of such suit that
indemnification of the indemnitee is proper in the circumstances because the
indemnitee has met the applicable standard of conduct set forth in the Delaware
General Corporation Law, nor an actual determination by the Corporation
(including its directors who are not parties to such action, a committee of such
directors, independent legal counsel, or its stockholders) that the indemnitee
has not met such applicable standard of conduct, shall create a presumption that
the indemnitee has not met the applicable standard of conduct or, in the case of
such a suit brought by the indemnitee, be a defense to such suit. In any suit
brought by the indemnitee to enforce a right to indemnification or to an
advancement of expenses hereunder, or brought by the Corporation to recover an
advancement of expenses pursuant to the terms of an undertaking, the burden of
proving that the indemnitee is not entitled to be indemnified, or to such
advancement of expenses, under this ARTICLE VIII or otherwise shall be on the
Corporation.
Section 4. Non Exclusivity of Rights.
The rights to indemnification and to the advancement of expenses conferred
in this ARTICLE VIII shall not be exclusive of any other right which any person
may have or hereafter acquire under any statute, the Corporation's Certificate
of Incorporation, Bylaws, agreement, vote of stockholders or directors or
otherwise.
Section 5. Insurance.
The Corporation may maintain insurance, at its expense, to protect itself
and any director, officer, employee or agent of the Corporation or another
corporation, partnership, joint venture, trust or other enterprise against any
expense, liability or loss, whether or not the Corporation would have the power
to indemnify such person against such expense, liability or loss under the
Delaware General Corporation Law.
Section 6. Indemnification of Employees and Agents of the Corporation.
The Corporation may, to the extent authorized from time to time by the
Board of Directors, grant rights to indemnification and to the advancement of
expenses to any employee or agent of the Corporation to the fullest extent of
the provisions of this Article VIII with respect to the indemnification and
advancement of expenses of directors and officers of the Corporation.
Section 7. Nature of Rights.
The rights conferred upon indemnitees in this Article VIII shall be
contract rights and such rights shall continue as to an indemnitee who has
ceased to be a director, officer or trustee and shall inure to the benefit of
the indemnitee's heirs, executors and administrators. Any amendment, alteration
or repeal of this Article VIII that adversely affects any right of an indemnitee
or its successors shall be prospective only and shall not limit or eliminate any
such right with respect to any proceeding involving any occurrence or alleged
occurrence of any action or omission to act that took place prior to such
amendment or repeal.
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ARTICLE IX.
AMENDMENTS
In furtherance and not in limitation of the powers conferred by law, the
Board of Directors is expressly authorized to adopt, alter, amend and repeal
these Bylaws subject to the power of the holders of capital stock of the
Corporation to alter, amend or repeal the Bylaws. Any adoption, amendment or
repeal of these Bylaws by the Board of Directors shall require the approval of a
majority of the total number of directors which the Corporation would have if
there were no vacancies; provided, however, that the affirmative vote of not
less than two-thirds of the total number of directors which the Corporation
would have if there were no vacancies shall be required to repeal, alter or
amend any Bylaw provision relating to (i) the calling of a special meeting of
the stockholders or a special meeting of the Board of Directors, (ii)
stockholder nominations or proposals, (iii) the number, classification or
election of directors or (iv) supermajority approval or quorum requirements of
the Board, or any committee thereof, or to adopt any Bylaw provision
inconsistent therewith. Notwithstanding the foregoing, the affirmative vote of
not less than two-thirds of the total number of directors which the Corporation
would have if there were no vacancies shall be required to alter, amend or adopt
any Bylaw provision inconsistent with or repeal this Article IX. With respect to
the powers of holders of capital stock to make, alter, amend and repeal Bylaws
of the Corporation, notwithstanding any other provision of these Bylaws or any
provision of law which might otherwise permit a lesser vote or no vote, but in
addition to any affirmative vote of the holders of any particular class or
series of the capital stock of the Corporation required by law, these Bylaws or
any preferred stock, the affirmative vote of the holders of at least sixty-six
and two-thirds percent (66 2/3%) of the voting power of all of the
then-outstanding shares entitled to vote generally in the election of directors,
voting together as a single class, shall be required to make, alter, amend or
repeal any provision of these Bylaws.
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Exhibit D
Dissenters' Rights
NEW MEXICO STATUTES, SECTION 53-15-4. RIGHTS OF DISSENTING SHAREHOLDERS
A. Any shareholder electing to exercise his right of dissent shall file
with the corporation, prior to or at the meeting of shareholders at which the
proposed corporate action is submitted to a vote, a written objection to the
proposed corporate action. If the proposed corporate action is approved by the
required vote and the shareholder has not voted in favor thereof, the
shareholder may, within ten days after the date on which the vote was taken or
if a corporation is to be merged without a vote of its shareholders into another
corporation any of its shareholders may, within twenty-five days after the plan
of the merger has been mailed to the shareholders, make written demand on the
corporation, or, in the case of a merger or consolidation, on the surviving or
new corporation, domestic or foreign, for payment of the fair value of the
shareholder's shares, and, if the proposed corporate action is effected, the
corporation shall pay to the shareholder, upon the determination of the fair
value, by agreement or judgment as provided herein, and, in the case of shares
represented by certificates, the surrender of such certificates the fair value
thereof as of the day prior to the date on which the vote was taken approving
the proposed corporate action, excluding any appreciation or depreciation in
anticipation of the corporate action. Any shareholder failing to make demand
within the prescribed ten-day or twenty-five-day period shall be bound by the
terms of the proposed corporate action. Any shareholder making such demand shall
thereafter be entitled only to payment as in this section provided and shall not
be entitled to vote or to exercise any other rights of a shareholder.
B. No such demand may be withdrawn unless the corporation consents thereto.
If, however, the demand is withdrawn upon consent, or if the proposed corporate
action is abandoned or rescinded or the shareholders revoke the authority to
effect the action, or if, in the case of a merger, on the date of the filing of
the articles of merger the surviving corporation is the owner of all the
outstanding shares of the other corporation, domestic and foreign, that are
parties to the merger, or if no demand or petition for the determination of fair
value by a court has been made or filed within the time provided in this
section, or if a court of competent jurisdiction determines that the shareholder
is not entitled to the relief provided by this section, then the right of the
shareholder to be paid the fair value of his shares ceases and his status as a
shareholder shall be restored, without prejudice, to any corporate proceedings
which may have been taken during the interim.
C. Within ten days after such corporate action is effected, the
corporation, or, in the case of a merger or consolidation, the surviving or new
corporation, domestic or foreign, shall give written notice thereof to each
dissenting shareholder who has made demand as provided in this section and shall
make a written offer to each such shareholder to pay for such shares at a
specified price deemed by the corporation to be the fair value thereof. The
notice and offer shall be accompanied by a balance sheet of the corporation, the
shares of which the dissenting shareholder holds, as of the latest available
date and not more than twelve months prior to the making of the offer, and a
profit and loss statement of the corporation for the twelve-months' period ended
on the date of the balance sheet.
D. If within thirty days after the date on which the corporate action was
effected the fair value of the shares is agreed upon between any dissenting
shareholder and the corporation, payment therefor shall be made within ninety
days after the date on which the corporate action was effected, and, in the case
of shares represented by certificates, upon surrender of the certificates. Upon
payment of the agreed value, the dissenting shareholder shall cease to have any
interest in the shares.
50
E. If, within the period of thirty days, a dissenting shareholder and the
corporation do not so agree, then the corporation, within thirty days after
receipt of written demand from any dissenting shareholder, given within sixty
days after the date on which corporate action was effected, shall, or at its
election at any time within the period of sixty days may, file a petition in any
court of competent jurisdiction in the county in this state where the registered
office of the corporation is located praying that the fair value of the shares
be found and determined. If, in the case of a merger or consolidation, the
surviving or new corporation is a foreign corporation without a registered
office in this state, the petition shall be filed in the county where the
registered office of the domestic corporation was last located. If the
corporation fails to institute the proceeding as provided in this section, any
dissenting shareholder may do so in the name of the corporation. All dissenting
shareholders, wherever residing, shall be made parties to the proceeding as an
action against their shares quasi in rem. A copy of the petition shall be served
on each dissenting shareholder who is a resident of this state and shall be
served by registered or certified mail on each dissenting shareholder who is a
nonresident. Service on nonresidents shall also be made by publication as
provided by law. The jurisdiction of the court shall be plenary and exclusive.
All shareholders who are parties to the proceeding shall be entitled to judgment
against the corporation for the amount of the fair value of their shares. The
court may, if it so elects, appoint one or more persons as appraisers to receive
evidence and recommend a decision on the question of fair value. The appraisers
shall have such power and authority as specified in the order of their
appointment or on an amendment thereof. The judgment shall be payable to the
holders of uncertificated shares immediately, but to the holders of shares
represented by certificates only upon and concurrently with the surrender to the
corporation of certificates. Upon payment of the judgment, the dissenting
shareholder ceases to have any interest in the shares.
F. The judgment shall include an allowance for interest at such rate as the
court may find to be fair and equitable, in all the circumstances, from the date
on which the vote was taken on the proposed corporate action to the date of
payment.
G. The costs and expenses of any such proceeding shall be determined by the
court and shall be assessed against the corporation, but all or any part of the
costs and expenses may be apportioned and assessed as the court deems equitable
against any or all of the dissenting shareholders who are parties to the
proceeding to whom the corporation made an offer to pay for the shares if the
court finds that the action of the shareholders in failing to accept the offer
was arbitrary or vexatious or not in good faith. Such expenses include
reasonable compensation for and reasonable expenses of the appraisers, but
exclude the fees and expenses of counsel for and experts employed by any party;
but if the fair value of the shares as determined materially exceeds the amount
which the corporation offered to pay therefor, or if no offer was made, the
court in its discretion may award to any shareholder who is a party to the
proceeding such sum as the court determines to be reasonable compensation to any
expert employed by the shareholder in the proceeding, together with reasonable
fees of legal counsel.
H. Upon receiving a demand for payment from any dissenting shareholder, the
corporation shall make an appropriate notation thereof in its shareholder
records. Within twenty days after demanding payment for his shares, each holder
of shares represented by certificates demanding payment shall submit the
certificates to the corporation for notation thereon that such demand has been
made. His failure to do so shall, at the option of the corporation, terminate
his rights under this section unless a court of competent jurisdiction, for good
and sufficient cause shown, otherwise directs. If uncertificated shares for
which payment has been demanded or shares represented by a certificate on which
notation has been so made is [are] transferred, any new certificate issued
therefor shall bear similar notation, together with the name of the original
dissenting holder of the shares, and a transferee of the shares acquires by such
transfer no rights in the corporation other than those which the original
dissenting shareholder had after making demand for payment of the fair value
thereof.
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I. Shares acquired by a corporation pursuant to payment of the agreed value
therefor or to payment of the judgment entered therefor, as in this section
provided, may be held and disposed of by the corporation as in the case of other
treasury shares, except that, in the case of a merger or consolidation, they may
be held and disposed of as the plan of merger or consolidation may otherwise
provide.
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PRELIMINARY
PROXY
AMERICAN MILLENNIUM CORPORATION, INC.
This Proxy is Solicited by the Board of Directors for the
Annual Meeting of Shareholders to be Held December 10, 2002
The undersigned hereby appoints Garrett L. Thomas and Ronald J. Corsentino,
and each of them, with individual powers of substitution and revocation, to vote
all common shares of American Millennium Corporation, Inc. which the undersigned
would be entitled to vote, if personally present at the annual general meeting
of shareholders to be held at 1010 Tenth Street, Suite 100, Golden, Colorado
80401, on December 10, 2002, and any adjournment thereof, upon matters indicated
below as described in the Notice of Annual Meeting of Shareholders and
accompanying Proxy Statement and, in their discretion, upon such other business
as may properly be presented at the meeting.
This Proxy will be voted in accordance with the instructions as indicated
below. If no instructions are given, this Proxy will be voted "FOR" approval of
the five nominees to the Company's Board of Directors, "FOR" ratification of the
reincorporation from New Mexico to Delaware, "FOR" the increase in the number of
authorized shares of the Company's Common Stock from 60,000,000 to 100,000,000,
and "FOR" the ratification of Dohan and Company as the independent auditors for
fiscal year 2003.
Please sign where indicated and return this Proxy promptly in the enclosed
envelope.
1. Election of five (5) Directors: Garrett L. Thomas, Bruce Bacon,
Andrew F. Cauthen, Steve Watwood and Ronald J. Corsentino.
FOR ALL ________ AGAINST ALL_________ ABSTAIN ________
For all nominees except vote WITHHELD from the following nominees:
______________________________________________________________________
2. Approval of the reincorporation from New Mexico to Delaware.
FOR ________ AGAINST _________ ABSTAIN ________
3. Approval of increase in the number of authorized shares of Common Stock from
60,000,000 to 100,000,000.
FOR ________ AGAINST _________ ABSTAIN ________
4. Ratification of Dohan and Company as the independent auditors for fiscal
year 2003.
FOR ________ AGAINST _________ ABSTAIN ________
The proxy holders in their discretion may cumulate votes for the election
of directors. This proxy may be revoked at any time prior to the time it is
voted by any means described in the accompanying proxy statement.
Please sign exactly as name appears on address label. Executors,
administrators, guardians, trustees, attorneys, and officers or representatives
should give full title. For joint owners, each owner should sign.
_______________________ __________________ _______________
Signature Print Name & Title Date