As filed with the Securities and Exchange Commission on April 3, 1997
Registration No. 33
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
PERFORMANCE TECHNOLOGIES, INCORPORATED
(Exact name of Registrant as specified in its charter)
Delaware 16-1158413
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
315 Science Parkway
Rochester, New York 14620
(716) 256-0200
(Address, including zip code, and telephone number, including area code,
of Registrant's principal executive offices)
Performance Technologies, Incorporated
Amended and Restated Stock Option Plan
(Full title of Plan)
Charles E. Maginness
Chairman and Chief Executive Officer
Performance Technologies, Incorporated
315 Science Parkway
Rochester, New York 14620
(716) 256-0200
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Calculation of Registration Fee
-------------------------------
Title of Proposed Maximum Proposed Maximum Amount of
Securities to Amount to be Offering Price Aggregate Offering Registration
be Registered Registered per Share(1) Price(1) Fee
- -------------- ------------ ---------------- ------------------ ------------
Common Stock, 373,865 $11.19 $4,183,549.35 $1,267.74
par value $.01
per share
(1) Estimated solely for the purpose of calculating the amount of the
registration fee in accordance with Rule 457(c) of the Securities Act of
1933 and based upon the high and low prices of the Registrant's Common
Stock, par value $.01 per share, as reported on the Nasdaq National Market
System on March 27, 1997.
In addition, pursuant to rule 416(c) under the Securities Act of 1933, as
amended, this Registration Statement also covers an indeterminate amount of
interests to be offered or sold pursuant to the stock option plan described
herein.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Certain Documents by Reference
The following documents of the Registrant previously filed with the
Securities and Exchange Commission are incorporated herein by reference:
(a) the Registrant's Annual Report on Form 10-K for the fiscal year
ended December 31, 1996;
(b) the description of the Registrant's Common Stock, $.01 par value,
contained in Item 1 of the Registrant's Registration Statement on Form 8-A
(Registration No. 0-27460), filed with the Securities and Exchange
Commission on December 28, 1995.
All documents filed by the Registrant pursuant to Sections 13(a), 13(c), 14
and 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), after the date of this Registration Statement (and prior to the filing of
a post-effective amendment which indicates that all securities offered have been
sold or which deregisters all securities then remaining unsold) shall be deemed
to be incorporated by reference in this Registration Statement and to be a part
hereof from the date of filing of such documents.
Item 4. Description of Securities
Not Applicable.
Item 5. Interests of Named Experts and Counsel
Not Applicable.
Item 6. Indemnification of Directors and Officers
The Company's Restated Certificate of Incorporation and By-laws as amended
(the "By-laws") provide for limitation of the liability of Directors to the
Registrant and its stockholders and for indemnification of directors, officers,
employees and agents of the Company, respectively, to the maximum extent
permitted by the Delaware General
Corporation Law.
The Registrant's Restated Certificate of Incorporation provides that
Directors are not liable to the Registrant or its stockholders for monetary
damages for breaches of fiduciary duty as a Director, except for liability (i)
for any breach of the Director's duty of loyalty to the Registrant or its
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) for dividend
payments or stock repurchases in violation of the Delaware General Corporation
Law, or (iv) for any transaction from which the Director derived any improper
personal benefit.
(1)
<PAGE>
The By-laws of the Registrant include provisions by which the Registrant
will indemnify its officers and Directors and other persons against expenses,
judgments, fines and amounts paid in settlement with respect to threatened,
pending or completed suits or proceedings against such persons by reason of
serving or having served the Registrant as officers, Directors or in other
capacities, except in relation to matters with respect to which such persons
shall be determined not to have acted in good faith, lawfully or in the best
interests of the Registrant. With respect to matters to which the Registrant's
officers, Directors, employees, agents or other representatives are determined
to be liable for misconduct or negligence in the performance of their duties,
the By-laws provide for indemnification only to the extent that the Registrant
determines that such person acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of the Registrant.
The general effect of these provisions will be to eliminate the rights of
the Registrant and its stockholders (through stockholders' derivative suits on
behalf of the Registrant) to recover monetary damages in the event of a breach
of fiduciary duty as a director (including breach of duty in the case of
negligent or grossly negligent behavior) except in the situations as described
above. These provisions will not affect the availability of injunctive relief
against directors of the Registrant (although such relief may not always be
available as a practical matter) nor will it limit directors' liability for
violations of the federal securities laws.
Item 7. Exemption from Registration Claimed
Not Applicable.
Item 8. Exhibits
Exhibit 4 - Instruments defining the rights of security holders, including
indentures
4.1 Restated Certificate of Incorporation of the Registrant (Exhibit 3.1)1
4.2 Amended By-laws of the Registrant (Exhibit 3.2)1
4.3 Form of Common Stock Certificate of the Registrant (Exhibit 4.1)1
Exhibit 5 - Opinion re: Legality
5.1 Opinion of Harter, Secrest & Emery*
Exhibit 15 - Letter re: Unaudited interim financial information
Not applicable
(2)
<PAGE>
Exhibit 23 - Consents of Experts and Counsel
23.1 Consent of Price Waterhouse LLP*
23.2 Consent of Rotenberg & Company, LLP*
23.3 Consent of Harter, Secrest & Emery2
Exhibit 24 - Power of Attorney
Not applicable
Exhibit 99 - Additional Exhibits
99.1 Performance Technologies, Incorporated Amended and Restated Stock
Option Plan*
____________________________
* Exhibit filed with this Registration Statement.
1 Exhibit previously filed as part of and is incorporated herein by reference
to the Registrant's Registration Statement on Form S-1 (Registration No.
33-99684). The exhibit number contained in parenthesis refers to the
exhibit number in such Registration Statement.
2 Filed as Exhibit 5.1 to this Registration Statement.
Item 9. Undertakings
(a) The undersigned Registrant hereby undertakes (subject to the proviso
contained in Item 512(a) of Regulation S-K):
(1) to file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, as amended (the "Securities Act");
(ii)to reflect in the prospectus any facts or events arising after the
effective date of this Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in this
Registration Statement;
(iii)to include any material information with respect to the plan of
distribution not previously disclosed in this Registration Statement or any
material change to such information in this Registration Statement;
(3)
<PAGE>
(2) that, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof;
(3) to remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The 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 Section 15(d) of the
Exchange Act that is incorporated by reference in this Registration Statement
shall be deemed to be a new registration statement relating to the securities
offered herein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers, controlling persons of the
Registrant pursuant to the provisions described under Item 6 above, or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange 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 of whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudications of such issue.
(4)
<PAGE>
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 City of Rochester, State of New York, on this 28th day of
March, 1997.
PERFORMANCE TECHNOLOGIES, INCORPORATED
By: /s/ Charles E. Maginness
------------------------
Charles E. Maginness
Chairman of the Board and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the date indicated.
Signature Title Date
/s/ Charles E. Maginness Chairman of the Board, Chief March 28, 1997
Executive Officer and Director
(Principal Executive Officer)
- ------------------------
Charles E. Maginness
/s/ Dorrance W. Lamb Vice President - Finance March 28, 1997
- ------------------------ (Principal Financial Officer and
Dorrance W. Lamb Principal Accounting Officer)
/s/ John M. Slusser Director March 28, 1997
- ------------------------
John M. Slusser
/s/ Donald L. Turrell Director March 28, 1997
- ------------------------
Donald L. Turrell
/s/ Bernard Kozel Director March 28, 1997
- ------------------------
Bernard Kozel
/s/ John E. Mooney Director March 28, 1997
- ------------------------
John E. Mooney
/s/ Paul L. Smith Director March 28, 1997
- ------------------------
Paul L. Smith
(5)
<PAGE>
Exhibit 5
Opinion of Harter, Secrest & Emery
<PAGE>
[Letterhead of Harter, Secrest & Emery]
April 1, 1997
Performance Technologies, Incorporated
315 Science Parkway
Rochester, New York 14620
Re: Performance Technologies, Incorporated
Registration Statement on Form S-8
Gentlemen:
You have requested our opinion in connection with your Registration
Statement on Form S-8, filed under the Securities Act of 1933, as amended (the
"Registration Statement"), with the Securities and Exchange Commission in
respect of the proposed issuance by Performance Technologies, Incorporated (the
"Company") of up to 373,865 shares of Common Stock, par value $.01 per share, of
the Company pursuant to the Company's Amended and Restated Stock Option Plan.
We have examined the following corporate records and proceedings of the
Company in connection with the preparation of this opinion: its Certificate of
Incorporation as amended and restated to date; its By-laws as currently in force
and effect; its minute books, containing minutes and records of other
proceedings of its stockholders and its Board of Directors from the date of
incorporation to the date hereof; the Registration Statement and the related
exhibits thereto; applicable provisions of laws of the State of Delaware; and
such other documents and matters as we have deemed necessary.
In rendering this opinion, we have made such examination of laws as we have
deemed relevant for the purposes hereof. As to various questions of fact
material to this opinion, we have relied upon representations and/or
certificates of officers of the Company, certificates and documents issued by
public officials and authorities, and information received from searchers of
public records.
Based upon and in reliance on the foregoing, we are of the opinion that:
1. The Company is validly existing under the laws of the State of Delaware
as of March 31, 1997.
2. The Company has the authority to issue an aggregate of 373,865 shares of
Common Stock upon the effectiveness of the Registration Statement.
3. The shares of Common Stock to be sold by the Company upon the
effectiveness of the Registration Statement will, when sold and paid for as
described in the Registration Statement, be validly authorized, legally issued
and outstanding, and fully paid and non- assessable.
We hereby consent to being named in the Registration Statement as attorneys
who will, for the Company, pass upon the validity of the issuance of shares of
Common Stock offered thereby, and we hereby consent to the filing of this
opinion as an Exhibit to the Registration Statement.
Very truly yours,
/s/ Harter, Secrest & Emery
<PAGE>
Exhibit 23.1
Consent of Price Waterhouse LLP
<PAGE>
Consent of Independent Accountants
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated February 14, 1997 appearing on page 17
of Performance Technologies, Incorporated's Annual Report on Form 10-K for the
year ended December 31, 1996.
/s/ Price Waterhouse LLP
Rochester, New York
April 1, 1997
<PAGE>
Exhibit 23.2
Consent of Rotenberg & Company, LLP
<PAGE>
[Letterhead of Rotenberg & Company, LLP]
Independent Auditor's Consent
The Board of Directors
Performance Technologies, Incorporated
We consent to the incorporation by reference in the Registration Statement
on Form S-8 of Performance Technologies, Incorporated of our report dated March
3, 1995, relating to the consolidated statements of income, stockholders' equity
and cash flows of Performance Technologies, Incorporated and Subsidiaries for
the year ended December 31, 1994, which report is incorporated by reference in
the December 31, 1996 Annual Report on Form 10-K of Performance Technologies,
Incorporated.
/s/ Rotenberg & Company, LLP
Rochester, New York
April 1, 1997
<PAGE>
Exhibit 99.1
Performance Technologies, Incorporated
Amended and Restated Stock Option Plan
Whereas, Performance Technologies, Incorporated (the "Company") adopted the
Performance Technologies, Incorporated Stock Option Plan (the "Plan") on May 1,
1986, amended and restated the Plan effective January 1, 1987 and amended the
Plan on May 3, 1990, amended and restated the Plan on April 18, 1994 and amended
the Plan again on November 14, 1995; and
Whereas, the Company desires to amend the Plan to (i) provide for
non-discretionary formula grants of options to outside directors, (ii) make
certain non-substantive changes to the Plan, and (iii) restate the Plan in its
entirety in one document.
Now, Therefore, the Plan is hereby amended and restated in its entirety,
effective April 22, 1996, as follows:
1. Purpose. The Performance Technologies, Incorporated Stock Option Plan
(the "Plan") is designed to attract the best available personnel for positions
of substantial responsibility and to furnish additional incentive to key
employees and directors of the Company, upon whose efforts the successful
conduct of the business of the Company largely depends, by encouraging such
individuals to acquire a proprietary interest in the Company or to increase the
same. This purpose will be effected through the granting of options to purchase
shares of Common Stock, $.01 par value per share, of the Company (the "Shares")
which will be identified by the Compensation Committee of the Board of Directors
of the Company (the "Committee") either as incentive stock options within the
meaning of Section 422 of the Internal Revenue Code of 1986, as amended to date
(the "Code") or as non-statutory stock options.
2. Eligibility. The persons eligible to receive options under this Plan
shall be non- employee directors as more fully described in Section 17 hereof
("Outside Participating Directors") and such key employees of the Company as the
Committee shall select from time to time (the "Participants"). Participants
under the Plan shall be eligible to receive stock options provided that no
member of the Committee shall have received options under this Plan (other than
options granted pursuant to Sections 17 through 21 of this Plan) during the one
year prior to serving on the Committee or during the time served on the
Committee. Outside Participating Directors of the Company shall be eligible to
receive non-statutory stock options pursuant to Sections 17 through 21 of this
Plan. All references in this Plan to employees or directors of the Company shall
include employees or directors of any parent or subsidiary of the Company, as
those terms are defined in Section 424 of the Code.
3. Stock Subject to Options. Subject to the provisions of Section 9 hereof,
options may be granted under the Plan to purchase, in the aggregate, not more
than 700,000 Shares. The Shares may, in the discretion of the Board of Directors
of the Company, consist either in whole or in part of authorized but unissued
Shares or Shares held in the treasury of the Company, and the Shares may, in the
discretion of the Committee, become subject to incentive stock options or
non-statutory stock options. Any Shares subject to an option which for any
reason expires or is terminated unexercised as to such Shares shall continue to
be available for options under the Plan.
<PAGE>
4. Annual Limitation. The aggregate fair market value (determined as of the
time the option is granted) of the Shares with respect to which incentive stock
options are exercisable for the first time by a Participant during any calendar
year (under all incentive stock option plans of the Company, any parent and any
subsidiaries) shall not exceed $100,000.
5. Terms and Conditions of Options. Each option granted by the Committee or
granted pursuant to Sections 17 through 21 of this Plan shall be evidenced by a
stock option agreement in such form or forms as the Committee may from time to
time prescribe (which agreements need not be identical) containing provisions
consistent with the Plan, including a provision prohibiting disposition of any
option granted under this Plan or the Shares issued on exercise of such option
within six months of the date of grant and, in the discretion of the Committee,
any other waiting period following the grant of the option during which all or
any part may not be exercised. The right of the Company to terminate the
employment of the Participant at any time, with or without cause, shall in no
way be restricted by the existence of this Plan, any option granted hereunder,
or any stock option agreement relating thereto. Options shall in all cases
further be subject to the following terms and conditions:
(a) Type of Option and Price. Each option shall state the number of Shares
subject to the option, whether the option is intended to be an incentive stock
option or a non- statutory stock option and the option price. The option price
of any incentive stock option shall equal or exceed the fair market value of the
Shares with respect to which the incentive stock option is granted at the time
of the granting of the option. However, if an incentive stock option is granted
to any person who would, after the grant of such option, be deemed to own stock
possessing more than 10% of the total combined voting power of all classes of
stock of the Company or any parent or subsidiary (a "Ten Percent Stockholder"),
the option price shall not be less than 110% of the fair market value of the
Shares with respect to which the option is granted at the time of the granting
of the option to the Ten Percent Stockholder.
(b) Term. The term of each option granted to a Participant shall be
determined by the Committee, but in no event shall an option be exercisable
either in whole or in part after the expiration of ten years from the date on
which it is granted. Notwithstanding the foregoing, an incentive stock option
granted to a Ten Percent Stockholder shall not be exercisable either in whole or
in part after the expiration of five years from the date on which it is granted.
The Committee and a Participant or Outside Participating Director may at any
time by mutual agreement terminate any option granted to such Participant or
Outside Participating Director under the Plan.
(c) Exercise. Each option, or any installment thereof, shall be exercised,
whether in whole or in part, by giving written notice to the Company at its
principal office, specifying the number of Shares purchased and the purchase
price being paid, and accompanied by the payment of the purchase price. A
Participant or Outside Participating Director may pay for the Shares subject to
the option with cash, a certified check or a bank cashier's check payable to the
<PAGE>
order of the Company. Alternatively, at the Company's sole option he may be
permitted to pay for the Shares, in whole or in part, by the delivery of Shares
already owned by him, which will be accepted in exchange at their fair market
value on the date of exercise. Certificates representing the Shares purchased by
the Participant or Outside Participating Director shall be issued as soon as
reasonably practicable after the Participant or Outside Participating Director
has complied with the provisions hereof. Pursuant to applicable federal and
state laws, the Company may be required to collect withholding taxes upon the
exercise of a non-statutory option. The Company may require, as a condition to
the exercise of a non-statutory stock option, that the Participant or Outside
Participating Director exercising that option concurrently pay to the Company
the entire amount or a portion of any taxes which the Company is required to
withhold by reason of such exercise, in such amount as the Committee or the
Company in its discretion may determine.
(d) Disposition of Shares. If the option is an incentive stock option, the
Participant cannot transfer Shares acquired upon the exercise of that option
within two years from the date of the grant of the option or within one year
from the date the option is exercised.
6. Non-Assignment. During the lifetime of the Participant or Outside
Participating Director, options granted hereunder shall be exercisable only by
him and shall not be assignable or transferable by him, whether voluntarily or
by operation of law or otherwise, and no other person shall acquire any rights
therein.
7. Death of Participant or Outside Participating Director. In the event
that a Participant or Outside Participating Director shall die while he is an
employee or director of the Company (or within 30 days after the termination of
such directorship or employment) and prior to the complete exercise of options
granted to him under the Plan, any such remaining options may be exercised in
whole or in part within one year after the date of the Participant's or outside
Participating Director's death and then only: (i) by the Participant's or
Outside Participating Director's estate or by or on behalf of such person or
persons to whom the Participant's or Outside Participating Director's rights
pass under his Will or the laws of descent and distribution, (ii) to the extent
that the Participant or Outside Participating Director was entitled to exercise
the option at the date of his death, and subject to all of the conditions on
exercise imposed hereby, and (iii) prior to the expiration of the term of the
option.
8. Termination of Employment of a Participant.
(a) Any stock option shall be exercisable, during the lifetime of the
Participant, only while he is an employee of the Company and has been an
employee continuously since the grant of the option, or within 30 days after the
date on which he ceases to be such an employee.
<PAGE>
(b) Any option shall be exercisable under this Section 8 only to the extent
that the Participant would have been entitled to exercise the option at the time
of the termination of the employment relationship; and further, no option shall
be exercisable after the expiration of the term thereof. In the case of a
Participant who is permanently and totally disabled (within the meaning of
Section 105(d)(4) of the Code), the 30-day period described in this Section 8
shall be one year.
(c) For purposes of this Section 8, an employment relationship will be
treated as continuing during the period when a Participant is on military duty,
sick leave or other bona fide leave of absence if the period of such leave does
not exceed 90 days, or, if longer, so long as a statute or contract guarantees
the Participant's right to re-employment with the Company. When the period of
leave exceeds 90 days and the individual's right to re- employment is not
guaranteed either by statute or by contract, the employment relationship will be
deemed to have terminated on the 91st day of such leave.
9. Anti-Dilution Provisions. The aggregate number and kind of Shares
available for options under the Plan, the number and kind of Shares subject to
any outstanding option, and the option price of each outstanding option, shall
be proportionately adjusted by the Committee for any increase, decrease or
change in the total outstanding Shares of the Company resulting from a stock
dividend, recapitalization, merger, consolidation, split-up, combination,
exchange of Shares or similar transaction (but not by reason of the issuance,
sale or purchase of Shares by the Company in consideration for money, services
or property).
10. Rights as a Stockholder. The Participant or Outside Participating
Director shall have no rights as a stockholder with respect to the Shares
purchased by him pursuant to the exercise of an option until the date of the
issuance to him of a certificate of stock representing such Shares. No
adjustment shall be made for dividends or for distributions of any other kind
with respect to Shares for which the record date is prior to the date of the
issuance to the Participant or Outside Participating Director of a certificate
for the Shares.
11. Investment Purpose. Until such time as the Plan is registered with the
Securities and Exchange Commission pursuant to applicable provisions of the
Securities Act of 1933, as amended (the "Act"), each written notice by which a
Participant or Outside Participating Director exercises an option shall contain
representations on behalf of the Participant or Outside Participating Director
that he acknowledges that the Company is selling or distributing Shares to him
under a claim of exemption from registration under the Act, as a transaction not
involving any public offering; that he is acquiring such Shares with a view to
investment and not with a view to distribution or resale; and that he agrees not
to make any sale or other distribution or disposition of such Shares unless (i)
a registration statement with respect to such Shares shall be effective under
the Act, and the Company shall have received proof satisfactory to it that there
has been compliance with applicable state law, or (ii) the Company shall have
received an opinion of counsel satisfactory to it that no violation of the Act
or applicable state law will be involved in such transfer. The Company shall
include on each certificate for Shares issued under the Plan a legend to the
foregoing effect and such other legends restricting the transfer thereof as it
may deem appropriate to comply with any requirement established by law or by the
rules of any stock exchange.
<PAGE>
12. Stockholders Agreement. In the event that at the time of any exercise
of an option the Company is a party to any stockholders' agreement or stock
repurchase agreement which by its terms requires any person to become a party
thereto as a precondition to the issuance of any Shares to him, then any Shares
issued hereunder shall be delivered only upon the execution and delivery by the
Participant or Outside Participating Director of such agreement.
13. Adoption, Approval, and Term of Plan. The Plan was adopted and took
effect on May 1, 1986. The Plan shall terminate on December 31, 2001 provided
that all incentive stock options with respect to the 17,070 Shares remaining
under the Plan as of April 16, 1994 must be granted on or before April 30, 1996.
No termination of the Plan, whether under the provisions of this Section 13 or
otherwise, shall terminate or otherwise affect options held by Participants or
Outside Participating Directors on the effective date of the termination of the
Plan.
14. Amendment and Termination of Plan. The Board of Directors of the
Company, without further approval of the stockholders of the Company, may at any
time suspend or terminate the Plan or may amend it from time to time in any
manner; provided, however, that no amendment shall be effective without prior
approval of the stockholders of the Company, which would (i) except as provided
in Section 9 hereof, increase the maximum number of Shares which may be issued
with respect to options under the Plan, (ii) change the eligibility requirements
for individuals entitled to receive options under the Plan, (iii) extend the
period for granting incentive stock options, or (iv) materially increase
benefits accruing to Participants or Outside Participating Directors hereunder.
15. Effect of Acquisition, Reorganization or Liquidation. Notwithstanding
any provision to the contrary in this Plan or in any agreement evidencing
options granted hereunder, all options with exercise periods then currently
outstanding shall become immediately exercisable in full and remain exercisable
until their expiration in accordance with their respective terms upon the
occurrence of either of the following events:
(i) the first purchase of the Shares pursuant to a tender or exchange offer
which is intended to effect the acquisition of more than 50% of the voting power
of the Company (other than a tender or exchange offer made by the Company); or
(ii)approval by the Company's stockholders of (A) a merger or consolidation
of the Company with or into another corporation (other than a merger or
consolidation in which the Company is the surviving corporation and which does
not result in any reclassification or reorganization of the Shares), (B) a sale
or disposition of all or substantially all of the Company's assets, or (C) a
plan of complete liquidation or dissolution of the Company.
<PAGE>
16. Administration. The Plan shall be administered by the Committee as it
may be constituted from time to time. The Committee shall consist of at least
two members of the Board selected by the Board, all of whom shall be
Disinterested Persons. A Disinterested Person for purposes of the Plan is one
who is not, during the one year prior to service on the Committee, or during
such period of service, granted or awarded equity securities pursuant to the
Plan or any other plan of the Company that would entitle him to acquire stock or
stock options of the Company, except for options issued pursuant to Sections 17
through 21 of this Plan. Decisions of the Committee concerning the
interpretation and construction of any provisions of the Plan or of any option
granted pursuant to the Plan shall be final. The Company shall effect the grant
of options under the Plan in accordance with the decisions of the Committee,
which may, from time to time, adopt rules and regulations for carrying out the
Plan. For purposes of the Plan, an option shall be deemed to be granted when the
written agreement for the same is signed on behalf of the Company by its duly
authorized officer or representative. Subject to the express provisions of the
Plan, the Committee shall have the authority, in its discretion and without
limitation, to determine the individuals to receive options, whether an option
is intended to be an incentive stock option or a non- statutory stock option,
the times when such individuals shall receive such options, the number of Shares
to be subject to each option, the term of each option, the date when each option
shall become exercisable, whether an option shall be exercisable in whole or in
part in installments, the number of Shares to be subject to each installment,
the date each installment shall become exercisable, the terms of each
installment and the option price of each option, to accelerate the date of
exercise of any option or installment thereof, and to make all other
determinations necessary or advisable for administering the Plan.
17. Outside Participating Directors. As of each Grant Date as defined in
Section 18, each member of the Board of Directors (including any member who is
not standing for reelection to the Board of Directors) who (a) is not an
employee of the Company or any of its subsidiaries, and (b) served as a member
of the Board of Directors since the last Annual Meeting of Stockholders is
deemed an Outside Participating Director and is eligible to receive options in
accordance with Section 18 below.
18. Grants of Options to Outside Participating Directors.
(a) Grant Dates. On the date of each Annual Meeting of Stockholders, each
Outside Participating Director shall automatically be granted a non-statutory
option to purchase 1,000 Shares (the "Grant Date").
(b) Election to Decline Option. Any Outside Participating Director may, by
written notice received by the Company prior to the Grant Date of such Option,
elect to decline an Option, in which case such Option shall not be granted to
him; provided, however, that at no time shall the Company pay or provide to such
Outside Participating Director anything of value in lieu of the declined Option.
In addition, any Outside Participating Director may, by written notice received
by the Company prior to the Grant Date of such Option, revoke a previous
election to decline an Option.
<PAGE>
19. Exercise Price of Options Granted to Outside Participating Directors.
The price at which each option granted pursuant to Section 18 shall be
exercisable shall be the fair market value per share (the "Market Value") of the
Shares on the Grant Date of such option. For purposes of this Plan, the Market
Value of the Shares shall be the closing price of the Shares in the
over-the-counter market as reported by the National Association of Securities
Dealers, Inc. Automated Quotation System ("Nasdaq"), if the closing price of the
Shares is then reported by Nasdaq. If the closing price of the Shares is not
then reported by Nasdaq, the Market Value of the Shares on any date shall be
deemed to be the mean between the representative closing bid and asked prices of
the Shares in the over-the-counter market as reported by Nasdaq. If the Shares
are reported on a national securities exchange, Market Value of the Shares shall
mean the Market Value on the principal national securities exchange on which the
Shares are then listed or admitted to trading (if the Shares are then listed or
admitted to trading on any national securities exchange), and the closing price
shall be the last reported sale price regular way or, in case no such sale takes
place on such date, the average of the closing bid and asked prices regular way,
as reported by such exchange. If the Shares are not then so listed on a national
securities exchange, the Market Value of the Shares on any date shall be the
closing price (the last reported sale price regular way). If the Shares are not
then reported by Nasdaq or are not reported on a national securities exchange,
the Market Value of the Shares on any date shall be as furnished by any member
of the National Association of Securities Dealers, Inc. selected from time to
time by the Company for that purpose. If no member of the National Association
of Securities Dealers, Inc. furnishes quotes with respect to the Shares, Market
Value shall be determined by such other reasonable method as is adopted by
resolution of the Board of Directors.
20. Vesting and Expiration of Outside Participating Director Stock Options.
Each option granted to an Outside Participating Director shall immediately vest
on the Grant Date and shall become exercisable within six months of the Grant
Date in accordance with Section 5(c) of this Plan. Each option shall expire on
the fifth anniversary of the Grant Date, and to the extent any option remains
unexercised on such fifth anniversary, it shall be forfeited.
21. Cessation of Service of an Outside Participating Director.
(a) Cessation of Service. An Outside Participating Director's cessation of
service as a member of the Board of Directors for any reason shall not have any
effect on options that (i) have been granted prior to the date of cessation of
service or (ii) the Grant Date of which coincides with the Outside Participating
Director's last day in office as a result of not standing for reelection to the
Company's Board of Directors. Notwithstanding the foregoing, upon the death of
an Outside Participating Director or former Outside Participating Director, all
options held by the decedent must be exercised by his legal representative
within one year after the date of death (but in no event after the expiration of
the option) or they shall be forfeited.
(b) Loss of Eligibility. If an Outside Participating Director becomes an
employee of the Company or otherwise no longer satisfies the requirements for
eligibility set forth in Section 17 hereof, then all options already granted to
him hereunder shall continue in full force and effect, in accordance with their
original terms, for so long as he remains a member of the Board of Directors,
but he shall be entitled to no further formula grants of Options pursuant to
Section 17 through Section 21 hereof.
<PAGE>
22. Reservation of Shares. The Company shall be under no obligation to
reserve Shares to fill options. The grant of options to individuals hereunder
shall not be construed to constitute the establishment of a trust of such Shares
and non particular Shares shall be identified as optioned and reserved for
individuals hereunder. The Company shall be deemed to have complied with the
terms of the Plan if, at the time of issuance and delivery pursuant to the
exercise of an option, it has a sufficient number of Shares authorized and
unissued or in its treasury which may then be appropriated and issued for
purposes of the Plan, irrespective of the date when such Shares were authorized.
All Participants' rights hereunder are limited to the right to receive Shares of
the Company as provided in this Plan.
23. Application of Proceeds. The proceeds of the sale of Shares by the
Company under the Plan will constitute general funds of the Company and may be
used by the Company for any purpose.
24. Gender. As used in this Plan, masculine pronouns shall be deemed to
include the feminine, and vice versa.
In Witness Whereof, the Company has caused this Amended and Restated Stock
Option Plan to be executed this 5th day of June, 1996.
Performance Technologies, Incorporated
By: /s/ Charles E. Maginness
------------------------
Charles E. Maginness
Chief Executive Officer