<PAGE> 1
As filed with the Securities and Exchange Commission on January 31, 1997
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
ALPHANET SOLUTIONS, INC.
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(Exact Name of Registrant as Specified in its Charter)
New Jersey
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(State or Other Jurisdiction of Incorporation or Organization)
22-2554535
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(I.R.S. Employer Identification No.)
7 Ridgedale Avenue, Cedar Knolls, New Jersey 07927
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(Address of Principal Executive Offices)(Zip Code)
1995 Stock Plan
1995 Non-Employee Director Stock Option Plan
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(Full Title of the Plan)
Stan Gang
Chairman of the Board, President and Chief Executive Officer
AlphaNet Solutions, Inc.
7 Ridgedale Avenue, Cedar Knolls, New Jersey 07927
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(Name and Address of Agent for Service)
(201) 267-0088
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(Telephone Number, Including Area Code, of Agent for Service)
Copy to:
David J. Sorin, Esq.
Andrew P. Gilbert, Esq.
Buchanan Ingersoll
500 College Road East
Princeton, NJ 08540
(609) 987-6800
<PAGE> 2
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
====================================================================================================================================
Proposed Proposed
Maximum Maximum
Amount Offering Aggregate Amount Of
Title Of Securities To Be Price Per Offering Registration
To Be Registered Registered(1) Share Price Fee
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<S> <C> <C> <C> <C>
Common Stock, par value $.01 per share
To be issued under the 1995 Stock Plan 268,600 $15.44(2) $4,147,184(2) $1,257
Issued under the 1995 Stock Plan . . . 478,500 $ 9.23(3) $4,416,555(3) $1,338
To be issued under the 1995 Non-
Employee Director Stock Option Plan . 40,000 $15.44(2) $ 617,600(2) $ 187
Issued under 1995 Non-Employee
Director Stock Option Plan . . . . . 60,000 $11.08(4) $ 664,800(4) $ 202
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TOTAL 847,100 $9,846,139 $2,984
====================================================================================================================================
</TABLE>
(1) For the sole purpose of calculating the registration fee, the number of
shares to be registered under this Registration Statement has been divided
among four subtotals.
(2) Pursuant to Rule 457(h) and Rule 457(c), these prices are estimated
solely for the purpose of calculating the registration fee and are based upon
the average of the high and low price per share of the Registrant's Common Stock
as reported on the Nasdaq National Market on January 29, 1997.
(3) Pursuant to Rule 457(h), these prices are calculated based on the
weighted average exercise price of $9.23 per share covering 478,500 shares
subject to stock options granted under the 1995 Stock Plan.
(4) Pursuant to Rule 457(h), these prices are calculated based on the
weighted average exercise price of $11.08 per share covering 60,000 shares
subject to stock options granted under the 1995 Non-Employee Director Stock
Option Plan.
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<PAGE> 3
EXPLANATORY NOTE
This Registration Statement has been filed by AlphaNet Solutions, Inc.
(the "Company") in order to register an aggregate of 847,100 shares of Common
Stock, as follows: (i) 100,000 shares of Common Stock issuable under the 1995
Non-Employee Director Stock Option Plan (the "Director Plan"); and (ii) 747,100
shares of Common Stock issuable under the 1995 Stock Plan (the "Stock Plan,"
and collectively with the Director Plan hereinafter referred to as the
"Plans"), in each case adopted by the written consent of the then sole director
of the Company on August 25, 1995 and approved by the shareholders of the
Company on August 25, 1995.
i
<PAGE> 4
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The document(s) containing the information specified by Part I of this
Form S-8 will be sent or given to participants in the Plans listed on the cover
page of this Registration Statement as specified in Rule 428(b)(1) promulgated
by the Securities and Exchange Commission (the "Commission") under the
Securities Act. Such document(s) are not being filed with the Commission but
constitute (taken together with the documents incorporated by reference into
this Registration Statement pursuant to Item 3 of Part II hereof) a prospectus
that meets the requirements of Section 10(a) (the "Section 10(a) Prospectus")
of the Securities Act.
The Company will provide a written statement to each participant of
the Plans advising each such participant of the availability without charge,
upon written or oral request, of the documents referred to under Item 3 --
"Incorporation of Documents by Reference" which have been incorporated in the
Section 10(a) Prospectus by reference, along with any other documents required
to be delivered to employees pursuant to Rule 428(b) promulgated by the
Commission under the Securities Act. Whenever updating information is
required, the Company shall furnish promptly without charge to each Plan
participant, upon written or oral request, a copy of all documents containing
the Plan information required by Part I that then constitute part of the
Section 10(a) Prospectus, although documents previously furnished need not be
re-delivered. Requests for such copies should be directed to the Vice
President and Chief Financial Officer, AlphaNet Solutions, Inc., 7 Ridgedale
Avenue, Cedar Knolls, New Jersey 07927. Telephone requests may be directed to
(201) 267-0088.
1
<PAGE> 5
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents which have been or will be filed with the
Commission are incorporated herein by reference and in the Section 10(a)
Prospectus by reference:
(a) The Company's Registration Statement on Form S-1
(Registration No. 33-97922) in the form declared effective by the Commission on
March 20, 1996, including the Prospectus dated March 20, 1996, as filed with
the Commission pursuant to Rule 424(b) on March 21, 1996.
(b) All reports filed pursuant to Section 13(a) or 15(d) of
the Exchange Act since March 20, 1996, the date the Company's Registration
Statements on Form S-1 and Form 8-A were declared effective by the Commission.
(c) The description of the Company's Common Stock, $.01 par
value, which is contained in the Company's Registration Statement on Form 8-A
filed pursuant to Section 12(g) of the Exchange Act in the form declared
effective by the Commission on March 20, 1996, including any subsequent
amendments or reports filed for the purpose of updating such description.
All documents subsequently filed by the Company pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a
post-effective amendment which indicates that all securities offered hereby
have been sold or which deregisters all securities then remaining unsold, shall
be deemed to be incorporated by reference and to be a part hereof from the date
of the filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
A member of the firm Buchanan Ingersoll serves on the Board of
Directors of the Company, and, as a result of his election as a Director, was
granted, on May 3, 1996, options to purchase 20,000 shares of the Company's
Common Stock pursuant to the Director Plan.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 14A:3-5 of the Business Corporation Act of the State of New
Jersey permits each New Jersey business corporation to indemnify its directors,
officers, employees and agents against expenses and liability for each such
person's acts taken in his or her capacity as a director, officer, employee or
agent of the corporation if such actions were taken in good faith and in a
manner which he or she reasonably believed to be in or not opposed to the best
interests of the corporation, and with respect to any criminal proceeding, if
he or she had no reasonable
II-1
<PAGE> 6
cause to believe his or her conduct was unlawful, provided that any such
proceeding is not by or in the right of the corporation.
Section 14A:2-7(3) of the Business Corporation Act of the State of New
Jersey enables a corporation in its certificate of incorporation to limit the
liability of directors and officers of the corporation to the corporation or
its shareholders. Specifically, the certificate of incorporation may provide
that directors and officers of the corporation will not be personally liable
for money damages for breach of a duty as a director or an officer, except for
liability (i) for any breach of the director's or officer's duty of loyalty to
the corporation or its stockholder, (ii) for acts or omissions not in good
faith or which involve a knowing violation of law, (iii) as to directors only,
under Section 14A:6-12(1)(a) of the Business Corporation Act of the State of
New Jersey, which relates to unlawful declaration of dividends or other
distributions of assets to stockholders or the unlawful purchase of shares of
the corporation, or (iv) for any transaction from which the director or officer
derived an improper personal benefit. The Registrant's amended and restated
certificate of incorporation limits the liability of its directors and officers
as authorized by Section 14A:2-7(3).
Article XI of the Registrant's Amended and Restated By-laws specifies
that the Registrant shall indemnify its directors and officers to the fullest
extent permitted by the Business Corporation Act of the State of New Jersey.
The Company has agreed to indemnify such parties for their actual and
reasonable expenses if such party acted in good faith and in a manner he or she
reasonably believed to be in the best interests of the Company and such party
had no reasonable cause to believe his or her conduct was unlawful. This
provision of the By-laws is deemed to be a contract between the registrant and
each director and officer who serves in such capacity at any time while such
provision and the relevant provisions of the Business Corporation Act of the
State of New Jersey are in effect, and any repeal or modification thereof shall
not offset any rights or obligations then existing with respect to any
statement of facts then or theretofore existing or any action, suit or
proceeding theretofore or thereafter brought or threatened based in whole or in
part upon any such state of facts.
The Registrant has executed indemnification agreements with each of
its directors and executive officers pursuant to which the Company has agreed
to indemnify such parties to the fullest extent permitted by law, subject to
certain exceptions, if such party becomes subject to an action because such
party is a Director, officer, employee, agent or fiduciary of the Company.
The Registrant has obtained liability insurance for the benefit of its
directors and officers which provides coverage for losses of directors and
officers for liabilities arising out of claims against such persons acting as
directors or officers of the registrant (or any subsidiary thereof) due to any
breach of duty, neglect, error, misstatement, misleading statement, omission or
act done by such directors and officers, except as prohibited by law, or
otherwise excluded by such insurance policy.
At present, there is no pending litigation or proceeding involving a
director or officer of the registrant as to which indemnification is being
sought nor is the registrant aware of any threatened litigation that may result
in claims for indemnification by any director of officer.
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<PAGE> 7
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
<TABLE>
<CAPTION>
Exhibit
Number Description
------ -----------
<S> <C>
4.1 1995 Stock Plan.
4.2 1995 Non-Employee Director Stock Option Plan.
5 Opinion of Buchanan Ingersoll.
23.1 Consent of Price Waterhouse LLP.
23.2 Consent of Buchanan Ingersoll (contained in the opinion filed as Exhibit 5).
24 Power of Attorney (see "Power of Attorney" below).
</TABLE>
II-3
<PAGE> 8
ITEM 9. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement to include any
material information with respect to the plan of distribution not previously
disclosed in the Registration Statement or any material change to such
information in the Registration Statement;
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof; and
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or 15(d) of the Exchange
Act that is incorporated by reference in the Registration Statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the securities
being registered, the Registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act and will be governed
by the final adjudication of such issue.
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<PAGE> 9
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the Township of Hanover, State of New Jersey, on this 31st
day of January, 1997.
ALPHANET SOLUTIONS, INC.
By: /s/Stan Gang
--------------------------------------------
Stan Gang
Chairman of the Board, President and Chief
Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each individual whose signature
appears below constitutes and appoints Stan Gang and Gary S. Finkel, and each
of them, his true and lawful attorneys-in-fact and agents with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments (including
post-effective amendments) to this Registration Statement, and to file the same
with all exhibits thereto, and all documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents or any of them, or their or his substitute or substitutes, may lawfully
do or cause to be done by virtue hereof.
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<PAGE> 10
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/Stan Gang Chairman of the Board, President, Chief Executive January 31, 1997
-------------------------------- Officer and Director (principal executive
Stan Gang officer)
/s/Gary S. Finkel Vice President and January 31, 1997
-------------------------------- Chief Financial Officer (principal financial and
Gary S. Finkel accounting officer)
/s/Michael Gang Director January 31, 1997
--------------------------------
Michael Gang
/s/Michael R. Bruce Director January 31, 1997
--------------------------------
Michael R. Bruce
/s/David J. Sorin, Esq. Director January 31, 1997
--------------------------------
David J. Sorin, Esq.
/s/Susan Wolford Director January 31, 1997
--------------------------------
Susan Wolford
</TABLE>
II-6
<PAGE> 11
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit Description Page
Number ----------- Number
------ ------
<S> <C> <C>
4.1 1995 Stock Plan.
4.2 1995 Non-Employee Director Stock Plan.
5 Opinion of Buchanan Ingersoll.
23.1 Consent of Price Waterhouse LLP.
23.2 Consent of Buchanan Ingersoll (contained in the opinion filed
as Exhibit 5).
24 Power of Attorney (included on signature page).
</TABLE>
<PAGE> 1
EXHIBIT 4.1
ALPHANET SOLUTIONS, INC.
1995 STOCK PLAN
1. Purposes of the Plan. The purposes of this Stock Plan are to
attract and retain the best available personnel for positions of substantial
responsibility, to provide additional incentive to Employees and Consultants of
the Company and its Subsidiaries and to promote the success of the Company's
business. Options granted under the Plan may be incentive stock options (as
defined under Section 422 of the Code) or non-statutory stock options, as
determined by the Administrator at the time of grant of an option and subject
to the applicable provisions of Section 422 of the Code, as amended, and the
regulations promulgated thereunder. Stock purchase rights may also be granted
under the Plan.
2. Certain Definitions. As used herein, the following
definitions shall apply:
(a) "Administrator" means the Board or any of its
Committees appointed pursuant to Section 4 of the Plan.
(b) "Board" means the Board of Directors of the Company.
(c) "Code" means the Internal Revenue Code of 1986, as
amended.
(d) "Committee" means the Committee appointed by the
Board of Directors in accordance with paragraph (a) of Section 4 of the Plan.
(e) "Common Stock" means the Common Stock of the
Company.
(f) "Company" means AlphaNet Solutions, Inc., a New
Jersey corporation.
(g) "Consultant" means any person, including an advisor,
who is engaged by the Company or any Parent or subsidiary to render services
and is compensated for such services, and any director of the Company whether
compensated for such services or not, provided that if and in the event the
Company registers any class of any equity security pursuant to the Exchange
Act, the term Consultant shall thereafter not include directors who are not
compensated for their services or are paid only a director's fee by the
Company.
(h) "Continuous Status as an Employee" means the absence
of any interruption or termination of the employment relationship by the
Company or any Subsidiary. Continuous Status as an Employee shall not be
considered interrupted in the case of: (i) sick leave; (ii) military leave;
(iii) any other leave of absence approved by the Board, provided that such
leave is for a period of not more than ninety (90) days, unless reemployment
upon the expiration of such leave is guaranteed by contract or statute, or
unless provided otherwise pursuant to Company policy
<PAGE> 2
adopted from time to time; or (iv) transfers between locations of the Company
or between the Company, its Subsidiaries or its successor.
(i) "Employee" means any person, including officers and
directors, employed by the Company or any Parent or Subsidiary of the Company.
The payment of a director's fee by the Company shall not be sufficient to
constitute "employment" by the Company.
(j) "Exchange Act" means the Securities Exchange Act of
1934, as amended.
(k) "Fair Market Value" means, as of any date, the value
of Common Stock determined as follows:
(i) If the Common Stock is listed on any
established stock exchange or a national market system including without
limitation the National Market System of the National Association of Securities
Dealers, Inc. Automated Quotation ("Nasdaq") System, its Fair Market Value
shall be the closing sales price for such stock (or the closing bid, if no
sales were reported) as quoted on such system or exchange for the last market
trading day prior to the time of determination as reported in the Wall Street
Journal or such other source as the Administrator deems reliable or;
(ii) If the Common Stock is quoted on Nasdaq
(but not on the National Market System thereof) or regularly quoted by a
recognized securities dealer but selling prices are not reported, its Fair
Market Value shall be the mean between the high and low asked prices for the
Common Stock or;
(iii) In the absence of an established market
for the Common Stock, the Fair Market Value thereof shall be determined in good
faith by the Administrator.
(l) "Incentive Stock Option" means an Option intended to
qualify as an incentive stock option within the meaning of Section 422 of the
Code.
(m) "Nonstatutory Stock Option" means an Option not
intended to qualify as an Incentive Stock Option.
(n) "Option" means a stock option granted pursuant to
the Plan.
(o) "Optioned Stock" means the Common Stock subject to
an Option.
(p) "Optionee" means an Employee or Consultant who
receives an Option.
(q) "Parent" means a "parent corporation", whether now
or hereafter existing, as defined in Section 424(e) of the Code.
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<PAGE> 3
(r) "Plan" means this 1995 Stock Plan.
(s) "Restricted Stock" means shares of Common Stock
acquired pursuant to a grant of stock purchase rights under Section 11 below.
(t) "Share" means a share of the Common Stock, as
adjusted in accordance with Section 13 of the Plan.
(u) "Subsidiary" means a "subsidiary corporation",
whether now or hereafter existing, as defined in Section 424(f) of the Code.
3. Stock Subject to the Plan. Subject to the provisions of
Section 13 of the Plan, the maximum aggregate number of shares which may be
optioned and sold under the Plan is 750,000 shares of Common Stock. The shares
may be authorized, but unissued, or reacquired Common Stock.
If an option should expire or become unexercisable for any
reason without having been exercised in full, the unpurchased Shares which were
subject thereto shall, unless the Plan shall have been terminated, become
available for future grant under the Plan.
4. Administration of the Plan.
(a) Procedure.
(i) Administration With Respect to Directors
and officers. With respect to grants of Options or stock purchase rights to
Employees who are also officers or directors of the Company, the Plan shall be
administered by (A) the Board if the Board may administer the Plan in
compliance with Rule 16b-3 promulgated under the Exchange Act or any successor
thereto ("Rule 16b-3") with respect to a plan intended to qualify thereunder as
a discretionary plan, or (B) a Committee designated by the Board to administer
the Plan, which Committee shall be constituted in such a manner as to permit
the Plan to comply with Rule 16b-3 with respect to a plan intended to qualify
thereunder as a discretionary plan. Once appointed, such Committee shall
continue to serve in its designated capacity until otherwise directed by the
Board. From time to time the Board may increase the size of the Committee and
appoint additional members thereof, remove members (with or without cause) and
appoint new members in substitution therefor, fill vacancies, however caused,
and remove all members of the Committee and thereafter directly administer the
Plan, all to the extent permitted by Rule 16b-3 with respect to a plan intended
to qualify thereunder as a discretionary plan.
(ii) Multiple Administrative Bodies. If
permitted by Rule 16b-3, the Plan may be administered by different bodies with
respect to directors, non-director officers and Employees who are neither
directors nor officers.
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<PAGE> 4
(iii) Administration With Respect to
Consultants and Other Employees. With respect to grants of Options or stock
purchase rights to Employees or Consultants who are neither directors nor
officers of the Company, the Plan shall be administered by (A) the Board or (B)
a Committee designated by the Board, which Committee shall be constituted in
such a manner as to satisfy the legal requirements relating to the
administration of incentive stock option plans, if any, of New Jersey corporate
law and applicable securities laws and of the Code (the "Applicable Laws").
Once appointed, such Committee shall continue to serve in its designated
capacity until otherwise directed by the Board. From time to time the Board
may increase the size of the Committee and appoint additional members thereof,
remove members (with or without cause) and appoint new members in substitution
therefor, fill vacancies, however caused, and remove all members of the
Committee and thereafter directly administer the Plan, all to the extent
permitted by the Applicable Laws.
(b) Powers of the Administrator. Subject to the
provisions of the Plan and in the case of a Committee, the specific duties
delegated by the Board to such Committee, the Administrator shall have the
authority, in its discretion:
(i) to determine the Fair Market Value of
the Common Stock, in accordance with Section 2(k) of the Plan;
(ii) to select the officers, Consultants and
Employees to whom Options and stock purchase rights may from time to time be
granted hereunder;
(iii) to determine whether and to what extent
Options and stock purchase rights or any combination thereof, are granted
hereunder;
(iv) to determine the number of shares of
Common Stock to be covered by each such award granted hereunder;
(v) to approve forms of agreement for use
under the Plan;
(vi) to determine the terms and conditions,
not inconsistent with the terms of the Plan, of any award granted hereunder
(including, but not limited to, the share price and any restriction or
limitation or waiver of forfeiture restrictions regarding any Option or other
award and/or the shares of Common Stock relating thereto, based in each case on
such factors as the Administrator shall determine, in its sole discretion);
(vii) to determine whether and under what
circumstances an Option may be settled in cash under subsection 9(f) instead of
Common Stock;
(viii) to determine whether, to what extent and
under what circumstances Common Stock and other amounts payable with respect to
an award under this Plan shall be deferred either automatically or at the
election of the participant (including providing for
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<PAGE> 5
and determining the amount, if any, of any deemed earnings on any deferred
amount during any deferral period);
(ix) to reduce the exercise price of any
Option to the then current Fair Market Value if the Fair Market Value of the
Common Stock covered by such Option shall have declined since the date the
Option was granted; and
(x) to determine the terms and restrictions
applicable to stock purchase rights and the Restricted Stock purchased by
exercising such stock purchase rights.
(c) Effect of Committee's Decision. All decisions,
determinations and interpretations of the Administrator shall be final and
binding on all Optionees and any other holders of any Options.
5. Eligibility.
(a) Nonstatutory Stock Options may be granted to
Employees and Consultants. Incentive Stock Options may be granted only to
Employees. An Employee or Consultant who has been granted an Option may, if he
is otherwise eligible, be granted an additional Option or Options.
(b) Each Option shall be designated in the written
option agreement as either an Incentive Stock Option or a Nonstatutory Stock
Option. However, notwithstanding such designations, to the extent that the
aggregate Fair Market Value of the Shares with respect to which Options
designated as Incentive Stock Options are exercisable for the first time by any
optionee during any calendar year (under all plans of the Company or any Parent
or Subsidiary) exceeds $100,000, such excess Options shall be treated as
Nonstatutory Stock Options.
(c) For purposes of Section 5(b), Incentive Stock
Options shall be taken into account in the order in which they were granted,
and the Fair Market Value of the Shares shall be determined as of the time the
Option with respect to such Shares is granted.
(d) The Plan shall not confer upon any Optionee any
right with respect to continuation of employment or consulting relationship
with the Company, nor shall it interfere in any way with his right or the
Company's right to terminate his employment or consulting relationship at any
time, with or without cause.
6. Term of Plan. The Plan shall become effective upon the
earlier to occur of its adoption by the Board of Directors or its approval by
the shareholders of the Company as described in Section 19 of the Plan. It
shall continue in effect for a term of ten (10) years unless sooner terminated
under Section 15 of the Plan.
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<PAGE> 6
7. Term of Option. The term of each Option shall be the term
stated in the Option Agreement; provided, however, that in the case of an
Incentive Stock Option, the term shall be no more than ten (10) years from the
date of grant thereof or such shorter term as may be provided in the Option
Agreement. However, in the case of an Option granted to an Optionee who, at the
time the Option is granted, owns stock representing more than ten percent (10%)
of the voting power of all classes of stock of the Company or any Parent or
Subsidiary, the term of the Option shall be five (5) years from the date of
grant thereof or such shorter term as may be provided in the Option Agreement.
8. Option Exercise Price and Consideration.
(a) The per share exercise price for the Shares to be
issued pursuant to exercise of an Option shall be such price as is determined
by the Board, but shall be subject to the following:
(i) In the case of an Incentive Stock Option
(A) granted to an Employee who, at the
time of the grant of such Incentive Stock Option, owns stock representing more
than ten percent (10%) of the voting power of all classes of stock of the
Company or any Parent or Subsidiary, the per Share exercise price shall be no
less than 110% of the Fair Market Value per Share on the date of grant.
(B) granted to any Employee, the per
Share exercise price shall be no less than 100% of the Fair Market Value per
Share on the date of grant.
(ii) In the case of a Nonstatutory Stock
Option
(A) granted to a person who, at the
time of the grant of such Option, owns stock representing more than ten percent
(10%) of the voting power of all classes of stock of the Company or any Parent
or Subsidiary, the per Share exercise price shall be no less than 110% of the
Fair Market Value per Share on the date of the grant.
(B) granted to any person, the per
Share exercise price shall be no less than 85% of the Fair Market Value per
Share on the date of grant.
(b) The consideration to be paid for the Shares to be
issued upon exercise of an Option, including the method of payment, shall be
determined by the Administrator (and, in the case of an Incentive Stock Option,
shall be determined at the time of grant) and may consist entirely of (1) cash,
(2) check, (3) promissory note, (4) other Shares which (x) in the case of
Shares acquired upon exercise of an Option either have been owned by the
Optionee for more than six months on the date of surrender or were not
acquired, directly or indirectly, from the Company, and (y) have a Fair Market
Value on the date of surrender equal to the aggregate exercise price of the
Shares as to which said Option shall be exercised, (5) authorization from the
Company to retain from the total number of Shares as to which the Option is
exercised that number of Shares having a Fair Market
-6-
<PAGE> 7
Value on the date of exercise equal to the exercise price for the total number
of Shares as to which the option is exercised, (6) delivery of a properly
executed exercise notice together with irrevocable instructions to a broker to
promptly deliver to the Company the amount of sale or loan proceeds required to
pay the exercise price, (7) by delivering an irrevocable subscription agreement
for the Shares which irrevocably obligates the option holder to take and pay
for the Shares not more than twelve months after the date of delivery of the
subscription agreement, (8) any combination of the foregoing methods of
payment, or (9) such other consideration and method of payment for the issuance
of Shares to the extent permitted under Applicable Laws. In making its
determination as to the type of consideration to accept, the Administrator
shall consider if acceptance of such consideration may be reasonably expected
to benefit the Company.
9. Exercise of Option.
(a) Procedure for Exercise; Rights as a Shareholder.
Any Option granted hereunder shall be exercisable at such times and under such
conditions as determined by the Administrator, including performance criteria
with respect to the Company and/or the Optionee, and as shall be permissible
under the terms of the Plan.
An Option may not be exercised for a fraction of a
Share.
An Option shall be deemed to be exercised when
written notice of such exercise has been given to the Company in accordance
with the terms of the Option by the person entitled to exercise the Option and
full payment for the Shares with respect to which the Option is exercised has
been received by the Company. Full payment may, as authorized by the
Administrator, consist of any consideration and method of payment allowable
under Section 8(b) of the Plan. Until the issuance (as evidenced by the
appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company) of the stock certificate evidencing such Shares, no right
to vote or receive dividends or any other rights as a shareholder shall exist
with respect to the Optioned Stock, notwithstanding the exercise of the Option.
The Company shall issue (or cause to be issued) such stock certificate promptly
upon exercise of the Option. No adjustment will be made for a dividend or
other right for which the record date is prior to the date the stock
certificate is issued, except as provided in Section 11 of the Plan.
Exercise of an Option in any manner shall result in
a decrease in the number of Shares which thereafter may be available, both for
purposes of the Plan and for sale under the Option, by the number of Shares as
to which the Option is exercised.
(b) Termination of Employment. In the event of
termination of an Optionee's consulting relationship or Continuous Status as an
Employee with the Company (as the case may be), such Optionee may, but only
within ninety (90) days (or such other period of time as is determined by the
Board, with such determination in the case of an Incentive Stock Option being
made at the time of grant of the Option and not exceeding ninety (90) days)
after the date of such termination (but in no event later than the expiration
date of the term of such Option as set forth in
-7-
<PAGE> 8
the Option Agreement), exercise his Option to the extent that Optionee was
entitled to exercise it at the date of such termination. To the extent that
Optionee was not entitled to exercise the Option at the date of such
termination, or if Optionee does not exercise such Option to the extent so
entitled within the time specified herein, the Option shall terminate.
(c) Disability of Optionee. Notwithstanding the
provisions of Section 9(b) above, in the event of termination of an Optionee's
consulting relationship or Continuous Status as an Employee as a result of his
total and permanent disability (as defined in Section 22(e)(3) of the Code),
Optionee may, but only within twelve (12) months from the date of such
termination (but in no event later than the expiration date of the term of such
Option as set forth in the Option Agreement), exercise the Option to the extent
otherwise entitled to exercise it at the date of such termination. To the
extent that Optionee was not entitled to exercise the Option at the date of
termination, or if Optionee does not exercise such Option to the extent so
entitled within the time specified herein, the Option shall terminate.
(d) Death of Optionee. In the event of the death of an
Optionee, the Option may be exercised, at any time within twelve (12) months
following the date of death (but in no event later than the expiration date of
the term of such Option as set forth in the Option Agreement), by the
Optionee's estate or by a person who acquired the right to exercise the Option
by bequest or inheritance, but only to the extent the Optionee was entitled to
exercise the Option at the date of death. To the extent that Optionee was not
entitled to exercise the Option at the date of termination, or if Optionee does
not exercise such Option to the extent so entitled within the time specified
herein, the Option shall terminate.
(e) Rule 16b-3. Options granted to persons subject to
Section 16(b) of the Exchange Act must comply with Rule 16b-3 and shall contain
such additional conditions or restrictions as may be required thereunder to
qualify for the maximum exemption from Section 16 of the Exchange Act with
respect to Plan transactions.
(f) Buyout Provisions. The Administrator may at any
time offer to buy out for a payment in cash or Shares, an Option previously
granted, based on such terms and conditions as the Administrator shall
establish and communicate to the Optionee at the time that such offer is made.
10. Non-Transferability of Options. The Option may not be sold,
pledged, assigned, hypothecated, transferred, or disposed of in any manner
other than by will or by the laws of descent or distribution and may be
exercised, during the lifetime of the Optionee, only by the Optionee. The
terms of the Option shall be binding upon the executors, administrators, heirs,
successors and assigns of the Optionee.
-8-
<PAGE> 9
11. Stock Purchase Rights.
(a) Rights to Purchase. Stock purchase rights may be
issued either alone, in addition to, or in tandem with other awards granted
under the Plan and/or cash awards made outside of the Plan. After the
Administrator determines that it will offer stock purchase rights under the
Plan, it shall advise the offeree in writing of the terms, conditions and
restrictions related to the offer, including the number of Shares that such
person shall be entitled to purchase, the price to be paid (which price shall
not be less than 50% of the Fair Market Value of the Shares as of the date of
the offer), and the time within which such person must accept such offer, which
shall in no event exceed thirty (30) days from the date upon which the
Administrator made the determination to grant the stock purchase right. The
offer shall be accepted by execution of a Restricted Stock purchase agreement
in the form determined by the Administrator.
(b) Repurchase Option. Unless the Administrator
determines otherwise, the Restricted Stock purchase agreement shall grant the
Company a repurchase option exercisable upon the voluntary or involuntary
termination of the purchaser's employment with the Company for any reason
(including death or Disability). The purchase price for Shares repurchased
pursuant to the Restricted Stock purchase agreement shall be the original price
paid by the purchaser and may be paid by cancellation of any indebtedness of
the purchaser to the Company. The repurchase option shall lapse at such rate
as the Committee may determine.
(c) Other Provisions. The Restricted Stock purchase
agreement shall contain such other terms, provisions and conditions not
inconsistent with the Plan as may be determined by the Administrator in its
sole discretion. In addition, the provisions of Restricted Stock purchase
agreements need not be the same with respect to each purchaser.
(d) Rights as a Shareholder. Once the stock purchase
right is exercised, the purchaser shall have the rights equivalent to those of
a shareholder, and shall be a shareholder when his or her purchase is entered
upon the records of the duly authorized transfer agent of the Company. No
adjustment will be made for a dividend or other right for which the record date
is prior to the date the stock purchase right is exercised, except as provided
in Section 13 of the Plan.
12. Stock Withholding to Satisfy Withholding Tax Obligations. At
the discretion of the Administrator, Optionees may satisfy withholding
obligations as provided in this paragraph. When an Optionee incurs tax
liability in connection with an Option or stock purchase right, which tax
liability is subject to tax withholding under applicable tax laws, and the
Optionee is obligated to pay the Company an amount required to be withheld
under applicable tax laws, the Optionee may satisfy the withholding tax
obligation by electing to have the Company withhold from the Shares to be
issued upon exercise of the Option, or the Shares to be issued in connection
with the stock purchase right, if any, that number of Shares having a Fair
Market Value equal to the amount required to be withheld. The Fair Market
Value of the Shares to be withheld shall be determined on the date that the
amount of tax to be withheld is to be determined (the "Tax Date").
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<PAGE> 10
All elections by an Optionee to have Shares withheld for this purpose
shall be made in writing in a form acceptable to the Administrator and shall be
subject to the following restrictions:
(a) the election must be made on or prior to the
applicable Tax Date;
(b) once made, the election shall be irrevocable as to
the particular Shares of the Option or Right as to which the election is made;
(c) all elections shall be subject to the consent or
disapproval of the Administrator;
(d) if the Optionee is subject to Rule 16b-3, the
election must comply with the applicable provisions of Rule 16b-3 and shall be
subject to such additional conditions or restrictions as may be required
thereunder to qualify for the maximum exemption from Section 16 of the Exchange
Act with respect to Plan transactions.
In the event the election to have Shares withheld is made by an
Optionee and the Tax Date is deferred under Section 83 of the Code because no
election is filed under Section 83(b) of the Code, the Optionee shall receive
the full number of Shares with respect to which the Option or stock purchase
right is exercised but such Optionee shall be unconditionally obligated to
tender back to the Company the proper number of Shares on the Tax Date.
13. Adjustments Upon Changes in Capitalization or Merger. Subject
to any required action by the shareholders of the Company, the number of shares
of Common Stock covered by each outstanding Option, and the number of shares of
Common Stock which have been authorized for issuance under the Plan but as to
which no Options have yet been granted or which have been returned to the Plan
upon cancellation or expiration of an Option, as well as the price per share of
Common Stock covered by each such outstanding Option, shall be proportionately
adjusted for any increase or decrease in the number of issued shares of Common
Stock resulting from a stock split, reverse stock split, stock dividend,
combination or reclassification of the Common Stock, or any other increase or
decrease in the number of issued shares of Common Stock effected without
receipt of consideration by the Company; provided, however, that conversion of
any convertible securities of the Company shall not be deemed to have been
"effected without receipt of consideration." Such adjustment shall be made by
the Board, whose determination in that respect shall be final, binding and
conclusive. Except as expressly provided herein, no issuance by the Company of
shares of stock of any class, or securities convertible into shares of stock of
any class, shall affect, and no adjustment by reason thereof shall be made with
respect to, the number or price of shares of Common Stock subject to an Option.
In the event of the proposed dissolution or liquidation of the
Company, the Board shall notify the Optionee at least fifteen (15) days prior
to such proposed action. To the extent it has not been previously exercised,
the Option will terminate immediately prior to the consummation of such
proposed action. In the event of a merger or consolidation of the Company with
or into
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<PAGE> 11
another corporation or the sale of all or substantially all of the Company's
assets (hereinafter, a "merger"), the Option shall be assumed or an equivalent
option shall be substituted by such successor corporation or a parent or
subsidiary of such successor corporation. In the event that such successor
corporation does not agree to assume the Option or to substitute an equivalent
option, the Board shall, in lieu of such assumption or substitution, provide
for the Optionee to have the right to exercise the Option as to all of the
Optioned Stock, including Shares as to which the Option would not otherwise be
exercisable. If the Board makes an Option fully exercisable in lieu of
assumption or substitution in the event of a merger, the Board shall notify the
Optionee that the Option shall be fully exercisable for a period of fifteen
(15) days from the date of such notice, and the Option will terminate upon the
expiration of such period. For the purposes of this paragraph, the Option
shall be considered assumed if, following the merger, the Option or right
confers the right to purchase, for each Share of stock subject to the Option
immediately prior to the merger, the consideration (whether stock, cash, or
other securities or property) received in the merger by holders of Common Stock
for each Share held on the effective date of the transaction (and if holders
were offered a choice of consideration, the type of consideration chosen by the
holders of a majority of the outstanding Shares); provided, however, that if
such consideration received in the merger was not solely common stock of the
successor corporation or its Parent, the Board may, with the consent of the
successor corporation and the participant, provide for the consideration to be
received upon the exercise of the Option, for each Share of stock subject to
the Option, to be solely common stock of the successor corporation or its
Parent equal in Fair Market Value to the per share consideration received by
holders of Common Stock in the merger or sale of assets.
14. Time of Granting Options. The date of grant of an Option
shall, for all purposes, be the date on which the Administrator makes the
determination granting such Option, or such other date as is determined by the
Board. Notice of the determination shall be given to each Employee or
Consultant to whom an Option is so granted within a reasonable time after the
date of such grant.
15. Amendment and Termination of the Plan.
(a) Amendment and Termination. The Board may at any
time amend, alter, suspend or discontinue the Plan, but no amendment,
alteration, suspension or discontinuation shall be made which would impair the
rights of any Optionee under any grant theretofore made, without his or her
consent. In addition, to the extent necessary and desirable to comply with
Rule 16b-3 under the Exchange Act or with Section 422 of the Code (or any other
applicable law or regulation, including the requirements of the NASD or an
established stock exchange), the Company shall obtain shareholder approval of
any Plan amendment in such a manner and to such a degree as required.
(b) Effect of Amendment or Termination. Any such
amendment or termination of the Plan shall not affect Options already granted
and such Options shall remain in full force and effect as if this Plan had not
been amended or terminated, unless mutually agreed otherwise between the
Optionee and the Board, which agreement must be in writing and signed by the
Optionee and the Company.
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<PAGE> 12
16. Conditions Upon Issuance of Shares. Shares shall not be
issued pursuant to the exercise of an Option unless the exercise of such Option
and the issuance and delivery of such Shares pursuant thereto shall comply with
all relevant provisions of law, including, without limitation, the Securities
Act of 1933, as amended, the Exchange Act, the rules and regulations
promulgated thereunder, and the requirements of any stock exchange upon which
the Shares may then be listed, and shall be further subject to the approval of
counsel for the Company with respect to such compliance.
As a condition to the exercise of an Option, the Company may require
the person exercising such Option to represent and warrant at the time of any
such exercise that the Shares are being purchased only for investment and
without any present intention to sell or distribute such Shares if, in the
opinion of counsel for the Company, such a representation is required by any of
the aforementioned relevant provisions of law.
17. Reservation of Shares. The Company, during the term of this
Plan, will at all times reserve and keep available such number of Shares as
shall be sufficient to satisfy the requirements of the Plan.
The inability of the Company to obtain authority from any
regulatory body having jurisdiction, which authority is deemed by the Company's
counsel to be necessary to the lawful issuance and sale of any Shares
hereunder, shall relieve the Company of any liability in respect of the failure
to issue or sell such Shares as to which such requisite authority shall not
have been obtained.
18. Agreements. Options and stock purchase rights shall be
evidenced by written agreements in such form as the Board shall approve from
time to time.
19. Shareholder Approval. Continuance of the Plan shall be
subject to approval by the shareholders of the Company within twelve (12)
months before or after the date the Plan is adopted. Such shareholder approval
shall be obtained in the degree and manner required under applicable state and
federal law.
20. Information to Optionees. The Company shall provide to each
Optionee, during the period for which such Optionee has one or more Options
outstanding, copies of all annual reports and other information which are
provided to all shareholders of the Company. The Company shall not be required
to provide such information if the issuance of Options under the Plan is
limited to key employees whose duties in connection with the Company assure
their access to equivalent information.
-12-
<PAGE> 1
EXHIBIT 4.2
AlphaNet Solutions, Inc.
1995 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
1. Purpose. This Non-Qualified Stock Option Plan, to be known as
the 1995 Non-Employee Director Stock Option Plan (the "Plan"), is intended to
promote the interests of AlphaNet Solutions, Inc. (the "Company") by providing
an inducement to obtain and retain the services of qualified persons who are
not employees or officers of the Company to serve as members of its Board of
Directors (the "Board"), each such person hereinafter referred to as a
"Non-Employee Director."
2. Available Shares. The total number of shares of Common Stock,
par value $.01 per share, of the Company (the "Common Stock") for which options
may be granted under the Plan shall not exceed 100,000 shares, subject to
adjustment in accordance with Section 10 of the Plan. Shares subject to the
Plan are authorized but unissued shares, or shares that were once issued and
subsequently reacquired by the Company. If any options granted under the Plan
are surrendered before exercise or lapse without exercise, in whole or in part,
the shares reserved therefor shall continue to be available under the Plan.
3. Administration. The Plan shall be administered by the Board
or by a committee appointed by the Board (the "Committee"). In the event the
Board fails to appoint or refrains from appointing a Committee, the Board shall
have all power and authority to administer the Plan. In such event, the word
"Committee" wherever used herein shall be deemed to mean the Board. The
Committee shall, subject to the provisions of the Plan, have the power to
construe the Plan, to determine all questions hereunder, and to adopt and amend
such rules and regulations for the administration of the Plan, as it may deem
desirable. No member of the Board or the Committee shall be liable for any
action or determination made in good faith with respect to the Plan or any
option granted under it.
4. Automatic Grant of Options. Subject to the availability of
shares under the Plan:
(a) each Non-Employee Director who is a member of the
Board on the effective date of the Company's initial public offering (the
"IPO") shall be automatically granted on the effective date of the IPO, without
further action by the Board, an option to purchase 20,000 shares of the Common
Stock; and
(b) each Non-Employee Director who first becomes a member
of the Board after the IPO shall be automatically granted, on the date such
person becomes a member of the Board, an option to purchase 20,000 shares of
the Common Stock.
The term "Grant Date" as used hereinafter shall mean, in the case of a
grant under Section 4(a), the effective date of the IPO, or, in the case of a
grant under Section 4(b), the date the optionee becomes a member of the Board.
<PAGE> 2
The options to be granted under this Section 4 shall be the only
options ever to be granted at any such time to such member under the Plan.
5. Option Price. The purchase price of the stock covered by an
option granted pursuant to the Plan shall be 100% of the fair market value of
such shares on the Grant Date. The option price will be subject to adjustment
in accordance with the provisions of Section 10 of the Plan. For purposes of
the Plan, "fair market value" shall be determined as of the last business day
for which the prices or quotes discussed in this sentence are available prior
to the date such option is granted and shall mean (i) the average (on that
date) of the high and low prices of the Common Stock on the principal national
securities exchange on which the Common Stock is traded, if the Common Stock is
then traded on a national securities exchange; or (ii) the last reported sale
price (on that date) of the Common Stock on the Nasdaq National Market, if the
Common Stock is not then traded on a national securities exchange; or (iii) the
closing bid price (or average of bid prices) last quoted (on that date) by an
established quotation service for over-the-counter securities, if the Common
Stock is not reported on the Nasdaq National Market. The "fair market value" of
the stock issuable upon exercise of an option granted pursuant to Section 4(a)
hereof shall be deemed to be equal to the initial public offering price per
share.
6. Period of Option. Unless sooner terminated in accordance with
the provisions of Section 8 of the Plan, an option granted hereunder shall
expire on the date which is ten (10) years after the Grant Date.
7. (a) Vesting of Shares and Non-Transferability of Options.
Options granted under the Plan shall not be exercisable until they become
vested. Options granted under the Plan shall vest in the optionee and thus
become exercisable in accordance with the following schedule, provided that the
optionee has continuously served as a member of the Board through such vesting
date, and subject also to Subsection (b) of this Section 7:
<TABLE>
<CAPTION>
Percentage of Option Shares for which
Option Will be Exercisable Date of Vesting
--------------------------------------------- ---------------
<S> <C>
20% One year from Grant Date
40% Two years from Grant Date
60% Three years from Grant Date
80% Four years from Grant Date
100% Five years from Grant Date
</TABLE>
The number of shares as to which options may be exercised shall be
cumulative, so that once the option shall become exercisable as to any shares
it shall continue to be exercisable as to said shares, until expiration or
termination of the option as provided in the Plan.
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<PAGE> 3
(b) Notwithstanding Subsection (a) of this Section 7, if
an optionee attends less than 80% of the Board meetings (whether regular or
special) held in any fiscal year (a "Default Year"), then either (i) the
optionee shall forfeit his exercise rights with respect to the option
installment which vested on the preceding annual vesting date, in proportion to
the percentage of Board meetings actually attended by such optionee during the
Default Year; or (ii) in the event that the optionee does not own a sufficient
number of exercisable options to satisfy the forfeiture obligation described
above, the optionee shall forfeit his right to receive the next succeeding
annual installment of the option, in proportion to the percentage of Board
meetings which the optionee actually attended in the Default Year. By way of
illustration, if an optionee attends only 50% of the actual meetings of the
Board of Directors (whether regular or special) held in any fiscal year, then
the optionee shall forfeit the right to exercise 50% of the option installment
which became exercisable on the preceding annual vesting date. If, however,
the optionee had already exercised 75% of the preceding option installment, and
did not own any additional unexercised options available to satisfy the
forfeiture obligation, the optionee would forfeit the remaining 25% of the
prior installment, and would also forfeit the right to receive or exercise 25%
of the next succeeding annual option installment. Attendance at Board meetings
may be in person or via teleconference, or any manner consistent with the
Amended and Restated Bylaws of the Company.
(c) Non-transferability. Any option granted pursuant to
the Plan shall not be assignable or transferable other than by will or the laws
of descent and distribution or pursuant to a domestic relations order and shall
be exercisable during the optionee's lifetime only by him or her.
8. Termination of Option Rights.
(a) In the event that an optionee ceases to be a member
of the Board by reason of his or her death or permanent disability, any option
granted to such optionee shall be immediately and automatically accelerated and
become fully vested and all unexercised options shall be exercisable by the
optionee (or by the optionee's personal representative, heir or legatee, in the
event of death) at any time prior to the scheduled expiration date of the
option.
(b) In the event any optionee: (i) ceases to be a member
of the Board of Directors at the request of the Company; (ii) is removed
without cause; or (iii) otherwise does not stand for nomination or re-election
as a Director of the Company at the request of the Company, then any
unexercised options, to the extent not vested at the date of the applicable
event, shall immediately terminate and become void, and to the extent any such
options are vested at such date, they shall continue to be exercisable for a
period of one year from the date of the applicable event; provided, however,
that no portion of any option, vested or unvested, may be exercised if the
optionee is removed from the Board of Directors for any one of the following
reasons: (i) disloyalty, gross negligence, dishonesty or breach of fiduciary
duty to the Company; (ii) the commission of an act of embezzlement, fraud or
deliberate disregard of the rules or policies of the Company which results in
loss, damage or injury to the Company, whether directly or indirectly; (iii)
the unauthorized disclosure of any trade secret or confidential information of
the Company; (iv) the commission of an act which constitutes unfair competition
with the Company
-3-
<PAGE> 4
or which induces any customer of the Company to breach a contract with the
Company; or (v) engages in any conduct or activity on behalf of any
organization or entity which is a competitor of the Company (unless such
conduct or activity is approved by a majority of the members of the Board of
Directors).
9. Exercise of Option. Subject to the terms and conditions of
the Plan and the option agreements, an option granted hereunder shall, to the
extent then exercisable, be exercisable in whole or in part by giving written
notice to the Company by mail or in person addressed to AlphaNet Solutions,
Inc., 7 Ridgedale Avenue, Cedar Knolls, New Jersey 07927, Attention:
President, or at its then principal executive offices, stating the number of
shares with respect to which the option is being exercised, accompanied by
payment in full for such shares. Payment may be (a) in United States dollars
in cash or by check, (b) in whole or in part in shares of Common Stock of the
Company already owned by the person or persons exercising the option or shares
subject to the option being exercised (subject to such restrictions and
guidelines as the Board may adopt from time to time) valued at fair market
value determined in accordance with the provisions of Section 5, or (c)
consistent with applicable law, through the delivery of an assignment to the
Company of a sufficient amount of the proceeds from the sale of the Common
Stock acquired upon exercise of the option and an authorization to the broker
or selling agent to pay that amount to the Company, which sale shall be at the
participant's direction at the time of exercise. There shall be no such
exercise at any one time as to fewer than one hundred (100) shares or all of
the remaining shares then purchasable by the person or persons exercising the
option, if fewer than one hundred (100) shares. The Company's transfer agent
shall, on behalf of the Company, prepare a certificate or certificates
representing such shares acquired pursuant to exercise of the option, shall
register the optionee as the owner of such shares on the books of the Company
and shall cause the fully executed certificate(s) representing such shares to
be delivered to the optionee as soon as practicable after payment of the option
price in full. The holder of an option shall not have any rights of a
stockholder with respect to the shares covered by the option, except to the
extent that one or more certificates for such shares shall be delivered to him
or her upon the due exercise of the option.
10. Adjustments Upon Changes in Capitalization and Other Events.
Upon the occurrence of any of the following events, an optionee's rights with
respect to options granted to him or her hereunder shall be adjusted as
hereinafter provided:
(a) Stock Dividends and Stock Splits. If the shares of
Common Stock shall be subdivided or combined into a greater or smaller number
of shares or if the Company shall issue any shares of Common Stock as a stock
dividend on its outstanding Common Stock, the number of shares of Common Stock
deliverable upon the exercise of options shall be appropriately increased or
decreased proportionately, and appropriate adjustments shall be made in the
purchase price per share to reflect such subdivision, combination or stock
dividend.
(b) Recapitalization Adjustments. If the Company is to
be consolidated with or acquired by another entity in a merger, sale of all or
substantially all of the Company's assets or otherwise, each option granted
under the Plan which is outstanding but unvested as of the effective date of
such event shall become exercisable in full twenty (20) days prior to the
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<PAGE> 5
effective date of such event. In the event of a reorganization,
recapitalization, merger, consolidation, or any other change in the corporate
structure or shares of the Company, to the extent permitted by Rule 16b-3 under
the Securities Exchange Act of 1934, as amended, adjustments shall be made in
the number and kind of shares authorized by the Plan and in the number of and
kind of shares covered by, and the option price of, outstanding options under
the Plan, in each case, as necessary to maintain the proportionate interest of
the optionee and preserve, without exceeding, the value of such option.
Notwithstanding the foregoing, no such adjustments shall be made which would,
within the meaning of any applicable provisions of the Internal Revenue Code of
1986, as amended, constitute a modification, extension or renewal of any option
or a grant of additional benefits to the holder of an option.
(c) Issuance of Securities. Except as expressly provided
herein, no issuance by the Company of shares of stock of any class, or
securities convertible into shares of stock of any class, shall affect, and no
adjustment by reason thereof shall be made with respect to, the number or price
of shares subject to options. No adjustments shall be made for dividends paid
in cash or in property other than securities of the Company.
(d) Adjustments. Upon the happening of any of the
foregoing events, the class and aggregate number of shares set forth in Section
2 of the Plan that are subject to options which previously have been or
subsequently may be granted under the Plan shall also be appropriately adjusted
to reflect such events. The Board shall determine the specific adjustments to
be made under this Section 10 and its determination shall be conclusive.
11. Restrictions on Issuances of Shares. Notwithstanding the
provisions of Sections 4 and 9 of the Plan, the Company shall have no
obligation to deliver any certificate or certificates upon exercise of an
option until one of the following conditions shall be satisfied:
(a) The issuance of shares with respect to which the
option has been exercised is at the time of the issue of such shares registered
under applicable Federal and state securities laws as now in force or hereafter
amended; or
(b) Counsel for the Company shall have given an opinion
that the issuance of such shares is exempt from registration under Federal and
state securities laws as now in force or hereafter amended; and that the
Company has complied with all applicable laws and regulations with respect
thereto, including without limitation, all regulations required by any stock
exchange upon which the Company's outstanding Common Stock is then listed.
12. Legend on Certificates. The certificate representing shares
issued pursuant to the exercise of an option granted hereunder shall carry such
appropriate legend, and such written instructions shall be given to the
Company's transfer agent, as may be deemed necessary or advisable by counsel to
the Company in order to comply with the requirements of the Securities Act of
1933, as amended, or any state securities laws.
13. Representation of Optionee. If requested by the Company, the
optionee shall deliver to the Company written representations and warranties
upon exercise of the option that are necessary to show compliance with Federal
and state securities laws, including
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representations and warranties to the effect that a purchase of shares under
the option is made for investment and not with a view to their distribution (as
that term is used in the Securities Act of 1933, as amended).
14. Option Agreement. Each option granted under the provisions of
the Plan shall be evidenced by an option agreement, which agreement shall be
duly executed and delivered on behalf of the Company and by the optionee to
whom such option is granted. The option agreement shall contain such terms,
provisions and conditions not inconsistent with the Plan as may be determined
by the officer executing it.
15. Termination and Amendment of Plan. The Plan shall terminate
on the earlier to occur of August 31, 2005 or at such time as all shares
reserved for issuance hereunder (including any amendments hereto) shall have
been issued. The Board may at any time terminate the Plan or make such
modification or amendment thereof as it deems advisable; provided, however,
that the Board may not, without approval by the affirmative vote of the holders
of a majority of the shares of Common Stock present in person or by proxy and
voting on such matter at a meeting, (a) increase the maximum number of shares
for which options may be granted under the Plan (except by adjustment pursuant
to Section 10), (b) materially modify the requirements as to eligibility to
participate in the Plan, (c) materially increase benefits accruing to option
holders under the Plan, or (d) amend the Plan in any manner which would cause
Rule 16b-3 under the Securities Exchange Act of 1934, as amended, to become
inapplicable to the Plan; and provided further that the provisions of the Plan
specified in Rule 16b-3(c)(2)(ii)(A) (or any successor or amended provision
thereto) under the Securities Act of 1934, as amended (including without
limitation, provisions as to eligibility, amount, price and timing of awards)
may not be amended more than once every six months, other than to comport with
changes in the Internal Revenue Code, the Employee Retirement Income Security
Act, or the rules thereunder. Termination or any modification or amendment of
the Plan shall not, without consent of a participant, affect his or her rights
under an option previously granted to him or her.
16. Withholding of Income Taxes. Upon the exercise of an option,
the Company, in accordance with Section 3402(a) of the Internal Revenue Code,
as amended, may require the optionee to pay withholding taxes in respect of
amounts considered to be compensation includible in the optionee's gross
income.
17. Compliance with Regulations. It is the Company's intent that
the Plan comply in all respects with Rule 16b-3 under the Securities Exchange
Act of 1934, as amended, and any applicable Securities and Exchange commission
interpretations thereof. If any provision of the Plan is deemed not to be in
compliance with Rule 16b-3, such provision of the Plan shall be null and void.
18. Governing Law. The validity and construction of the Plan and
the instruments evidencing options shall be governed by the laws of the State
of New Jersey, without giving effect to the principles of conflicts of law
thereof.
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19. Acceleration and Vesting of Option for Business Combinations.
Upon any merger, consolidation, sale of all (or substantially all) of the
assets of the Company, or a business combination involving the sale or transfer
of all (or substantially all) of the capital stock or assets of the Company in
which the Company is not the surviving entity, or, if it is the surviving
entity, does not survive as an operating going concern in substantially the
same line of business, then the options granted under the Plan shall,
immediately prior to the consummation of any of the foregoing events, become
fully vested and immediately exercisable by the optionee.
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EXHIBIT 5
BUCHANAN INGERSOLL
Attorneys
500 College Road East
Princeton, New Jersey 08540
January 31, 1997
AlphaNet Solutions, Inc.
7 Ridgedale Avenue
Cedar Knolls, New Jersey 07927
Gentlemen:
We have acted as counsel to AlphaNet Solutions, Inc., a New Jersey
corporation (the "Company"), in connection with the filing by the Company of a
registration statement on Form S-8 (the "Registration Statement"), under the
Securities Act of 1933, as amended, relating to the registration of an
aggregate of 847,100 shares (the "Shares") of the Company's common stock, $.01
par value, of which: (i) 100,000 are to be offered by the Company to its
non-employee directors under the Company's 1995 Non-Employee Director Stock
Option Plan (the "Director Plan"); and (ii) 747,100 are to be offered by the
Company to its employees and consultants under the Company's 1995 Stock Plan
(the "Stock Plan"). The Director Plan and the Stock Plan are referred to
collectively herein as the "Plans."
In connection with the Registration Statement, we have examined such
corporate records and documents, other documents, and such questions of law as
we have deemed necessary or appropriate for purposes of this opinion. On the
basis of such examination, it is our opinion that:
1. The issuance of the Shares has been duly and validly
authorized; and
2. The Shares underlying the Plans, when issued, delivered and
sold in accordance with the terms of the respective Plans and
the stock options, or other instruments authorized by such
plans, granted or to be granted thereunder, will be validly
issued, fully paid and non-assessable.
We hereby consent to the filing of this opinion as Exhibit 5 to the
Registration Statement and to the reference to this firm under the heading
"Interests of Named Experts and Counsel" in the Registration Statement.
Very truly yours,
/s/BUCHANAN INGERSOLL
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EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 and related Prospectus of our report dated February 20,
1996 appearing on page F-2 of AlphaNet Solutions, Inc.'s Registration Statement
on Form S-1 as declared effective by the Securities and Exchange Commission on
March 20, 1996.
PRICE WATERHOUSE LLP
Morristown, New Jersey
January 31, 1997
