<PAGE>
As filed with the Securities and Exchange Commission on January 10, 1997
Registration No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
---------------------
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
---------------------
WILMAR INDUSTRIES, INC.
(Exact name of issuer as specified in its charter)
New Jersey 22-2232386
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation organization)
303 Harper Drive
Moorestown, New Jersey 08057
(Address of principal executive offices)
AMENDED AND RESTATED 1995 STOCK OPTION PLAN
(Full title of the plans)
Fred B. Gross
Vice President, Secretary and General Counsel
Wilmar Industries, Inc.
303 Harper Drive
Moorestown, New Jersey 08057
(Name and address of agent for service)
(609) 439-1222
(Telephone number, including area code, of agent for service)
-----------------------
Copy to:
STEPHEN M. GOODMAN
Morgan, Lewis & Bockius LLP
2000 One Logan Square
Philadelphia, PA 19103-6993
(215) 963-5000
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
=================================================================================================================
Title of securities Amount to be Proposed maximum Proposed maximum Amount of
to be registered registered offering price aggregate offering registration fee(3)
per share(2) price(2)
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, 800,000(1) $26.00 $20,800,000 $6,500.00
no par value
=================================================================================================================
</TABLE>
(1) Represents shares that may be offered or sold pursuant to the Amended and
Restated 1995 Stock Option Plan.
(2) Estimated pursuant to paragraphs (c) and (h) of Rule 457 solely for the
purpose of calculating the registration fee based on the average of the
high and low prices for Wilmar Common Stock as reported on the Nasdaq
National Market on January 9, 1997.
(3) Calculated pursuant to Section 6(b) as follows: 1/32 of one percent of the
maximum aggregate offering price.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
---------------------------------------
The following documents, as filed by Wilmar Industries, Inc. (the
"Company") with the Securities and Exchange Commission, are incorporated by
reference in this Registration Statement and made a part hereof:
(a) The Annual Report of the Company for the year ended
December 29, 1995.
(b) The Company's Registration Statement on Form S-1 (No. 333-
07845), filed pursuant to the Securities Act of 1933, as amended, which
Registration Statement became effective July 31, 1996.
(c) All other reports filed pursuant to Section 13(a) or 15(d)
of the Securities Exchange Act of 1934, as amended (the "Exchange Act")
since the end of the last fiscal period covered by the Registration
Statement referred to in (b) above.
(d) The description of the Common Stock of the Company
contained in the Registration Statement referred to in (b) above,
including any amendment or report filed for the purpose of updating such
description.
All reports and other 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 that indicates that all securities
offered hereby have been sold or that deregisters all securities then remaining
unsold, shall be deemed to be incorporated by reference herein and to be part
hereof from the date of filing of such documents. Any statement contained in
any document, all or a portion of which is incorporated by reference herein,
shall be deemed to be modified or superseded for purposes of this Registration
Statement to the extent that a statement contained or incorporated by reference
herein modifies or supersedes such statement. Any statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Registration Statement.
Experts
-------
The financial statements of Wilmar Industries, Inc. as of December 29,
1995 and December 30, 1994 and for the years then ended, included in the
Registration Statement, have been included in the Registration Statement in
reliance upon the report of Deloitte & Touche LLP, independent auditors,
incorporated by reference herein, and upon the authority of said firm as experts
in accounting and auditing. The financial statements of Wilmar Industries, Inc.
for the year ended December 31, 1993, included in the Registration Statement,
have been included in the Registration Statement in reliance upon the report of
Fishbein & Company, P.C., independent auditors, incorporated by reference
herein, and upon the authority of said firm as experts in accounting and
auditing.
The financial statements of One Source Supply, Inc. as of September
30, 1995 and for the nine months then ended, included in the Registration
Statement, have been included in the Registration Statement in reliance upon the
report of Deloitte & Touche LLP, independent auditors, incorporated by reference
herein, and upon the authority of said firm as experts in accounting and
auditing. The financial statements of One Source Supply, Inc. as of December
31, 1994 and for the year then ended, included in the Registration Statement,
have been included in the Registration Statement in reliance upon the report of
Mutnick & Associates, P.A., independent auditors, incorporated by reference
herein, and upon the authority of said firm as experts in accounting and
auditing.
The financial statements of HMA Enterprises, Inc. as of February 28,
1995 and for the year then ended, included in the Registration Statement, have
been included in the Registration Statement in reliance upon the report of KPMG
Peat Marwick LLP, independent auditors, incorporated by reference herein, and
upon the authority of said firm as experts in accounting and auditing. The
financial statements of HMA Enterprises, Inc. as
II-1
<PAGE>
of February 29, 1996 and for the year then ended, included in the Registration
Statement, have been included in the Registration Statement in reliance upon the
report of Deloitte & Touche LLP, independent auditors, incorporated by reference
herein, and upon the authority of said firm as experts in accounting and
auditing.
To the extent that Fishbein & Company, P.C., Deloitte & Touche LLP,
KPMG Peat Marwick LLP or Mutnick & Associates, P.A. audits and reports on
financial statements of the Company issued at future dates, and consents to the
use of their report thereon, such financial statements also will be incorporated
by reference in the registration statement in reliance upon their report and
said authority.
ITEM 4. DESCRIPTION OF SECURITIES.
-------------------------
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
--------------------------------------
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
-----------------------------------------
Reference is made to Section 14A:3-5 of the New Jersey Business
Corporation Act, as amended, which sets forth the extent to which a corporation
may indemnify its directors, officers and employees. More specifically, such law
empowers a corporation to indemnify a corporate agent against his or her
expenses and a liabilities incurred in connection with any proceeding (other
than a derivative law suit) involving the corporate agent by reason of his or
her being or having been a corporate agent if (a) the corporate agent acted in
good faith or in a manner he or she reasonably believed to be in or not opposed
to the best interests of the corporation and (b) with respect to any criminal
proceeding, the corporate agent had no reasonable cause to believe his or her
conduct was unlawful. For purposes of such law the term "corporate agent"
includes any present or former director, officer, employee or agent of the
corporation, and a person serving as a "corporate agent" at the request of such
director, officer, trustee, employee or agent. For purposes of this section,
"proceeding" means any pending, threatened or completed civil, criminal,
administrative or arbitrative action, suit or proceeding, and any appeal therein
and any inquiry or investigation which could lead to such action, suit or
proceeding.
With respect to any derivative action, the corporation is empowered to
indemnify a corporate agent against his or her expenses (but not his or her
liabilities) incurred in connection with any proceeding involving the corporate
agent by reason of his or her being or having been a corporate agent if the
agent acted in good faith and in a manner he or she reasonably believed to be in
or not opposed to the best interests of the corporation. However, a court may,
upon application, empower a corporation to indemnify a corporate agent, to the
extent such court deems proper in view of the circumstances, against expenses
with respect to any claim, issue or matter as to which the agent was adjudged
liable to the corporation.
The Company's Bylaws permit it to purchase insurance on behalf of any
corporate agents against any liability asserted against him and incurred by him
in any such capacity, or arising out of his status as such, whether or not the
Company would have the power to indemnify him against such liability under the
foregoing provision of the Bylaws.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
-----------------------------------
Not applicable.
II-2
<PAGE>
ITEM 8. EXHIBITS.
--------
The following is a list of exhibits filed as part of this
Registration Statement.
<TABLE>
<CAPTION>
Exhibit Location or
Number Exhibit Page Number
------- ------- -----------
<S> <C> <C>
5.1 - Opinion of Morgan, Lewis & Bockius LLP E-2
23.1 - Consent of Deloitte & Touche LLP E-3
23.2 - Consent of Deloitte & Touche LLP E-4
23.3 - Consent of Deloitte & Touche LLP E-5
23.4 - Consent of Fishbein & Company, P.C. E-6
23.5 - Consent of Mutnick & Associates, P.A. E-7
23.6 - Consent of KPMG Peat Marwick LLP E-8
23.7 - Consent of Morgan, Lewis & Bockius LLP E-2
(included as part of Exhibit 5.1)
99.1 - Amended and Restated 1995 Stock Option Plan E-9
</TABLE>
ITEM 9. UNDERTAKINGS.
------------
(a) 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:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events which,
individually or together, represent a fundamental change in the
information set forth in the registration statement; and
(iii) To include any additional or changed material
information on the plan of distribution not previously disclosed in the
registration statement or any material change to such information in the
registration statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) of this
-----------------
section do not apply if the information required to be included in a post-
effective amendment by those paragraphs is contained in periodic reports filed
by the Company pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the registration
statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, 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.
II-3
<PAGE>
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered that remain unsold at the
termination of the offering.
(b) The undersigned registrant hereby undertakes that, for the purpose
of determining any liability under the Securities Act of 1933, each filing of
the Company's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of a plan's
annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934)
that is incorporated by reference in this 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.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 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 Securities and
Exchange Commission such indemnification is against public policy as expressed
in the 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 Act and will
be governed by the final adjudication of such issue.
II-4
<PAGE>
SIGNATURES AND POWER OF ATTORNEY
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 Moorestown, New Jersey, on the 6th day of January, 1997.
WILMAR INDUSTRIES, INC.
By: /s/ William S. Green
---------------------------------------
WILLIAM S. GREEN
Chairman of the Board of Directors
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints William S. Green and Fred B. Gross 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 to this Registration
Statement, and to file the same, with the Securities and Exchange Commission,
granting unto said attorneys-in-fact and agents 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 their substitute or substitutes, may lawfully do or cause to
be done by virtue hereof.
Pursuant to the requirements of the Securities Act 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
Signatures Title Date
---------- ----- ----
<S> <C> <C>
/s/ William S. Green Chairman and Chief Executive Officer January 7, 1996
- ------------------------ (principal executive officer)
William S. Green
/s/ Michael T. Toomey Chief Financial Officer and Treasurer January 7, 1996
- ------------------------ (principal financial officer and principal
Michael T. Toomey accounting officer)
/s/ Fred B. Gross Vice President - Corporate January 7, 1996
- ------------------------ Development, Secretary and General
Fred B. Gross Counsel, Director
/s/ Martin Hanaka Director January 7, 1996
- ------------------------
Martin Hanaka
/s/ Ernest Jacquet Director January 7, 1996
- ------------------------
Ernest Jacquet
/s/ Donald M. Wilson Director January 7, 1996
- ------------------------
Donald M. Wilson
</TABLE>
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit Sequentially
Number Exhibit Numbered Page
- ------ ------- -------------
<S> <C> <C>
5.1 - Opinion of Morgan, Lewis & Bockius LLP E-2
23.1 - Consent of Deloitte & Touche LLP E-3
23.2 - Consent of Deloitte & Touche LLP E-4
23.3 - Consent of Deloitte & Touche LLP E-5
23.4 - Consent of Fishbein & Company, P.C. E-6
23.5 - Consent of Mutnick & Associates, P.A. E-7
23.6 - Consent of KPMG Peat Marwick LLP E-8
23.7 - Consent of Morgan, Lewis & Bockius LLP E-2
(included as part of Exhibit 5.1)
99.1 - Amended and Restated 1995 Stock Option Plan E-9
</TABLE>
<PAGE>
EXHIBIT 5.1
Morgan, Lewis & Bockius LLP
2000 One Logan Square
Philadelphia, PA 19103-6993
(215) 963-5000 (telephone)
(215) 963-5299 (facsimile)
January 10, 1997
Wilmar Industries, Inc.
303 Harper Drive
Moorestown, NJ 08057
Re: Registration Statement on Form S-8
----------------------------------
Ladies and Gentlemen:
We have acted as counsel to Wilmar Industries, Inc., a New Jersey corporation
(the "Company"), in connection with the preparation of the subject registration
statement on Form S-8 (the "Registration Statement") filed with the Securities
and Exchange Commission (the "Commission") under the Securities Act of 1933, as
amended (the "Act"), relating to the registration by the Company of up to
800,000 shares (the "Shares") of Common Stock, no par value, of the Company (the
"Common Stock"), issuable upon the exercise of options granted under the
Company's Amended and Restated 1995 Stock Option Plan (the "Plan").
In connection with this opinion, we have examined the Registration Statement and
the Exhibits thereto, including the Plan, certain records of the Company's
corporate proceedings as reflected in its minute books and such statutes,
records and other documents as we have deemed relevant. In our examination, we
have assumed the genuineness of all signatures, the authenticity of all
documents submitted to us as originals, and the conformity with the originals of
all documents submitted to us as copies thereof. In addition, we have made such
other examinations of law and fact as we have deemed relevant in order to form a
basis for the opinion hereinafter expressed.
In our opinion the Shares will be legally issued, fully paid and non-assessable
shares of Common Stock of the Company when and to the extent issued by the
Company in the manner contemplated in the Registration Statement.
We hereby consent to the use of this opinion as Exhibit 5 to the Registration
Statement and to all references to our firm in the Registration Statement. In
giving such consent, we do not thereby admit that we are acting within the
category of persons whose consent is required under Section 7 of the Act and the
rules and regulations of the Commission thereunder.
Very truly yours,
/s/ Morgan, Lewis & Bockius LLP
E-2
<PAGE>
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Wilmar Industries, Inc. on Form S-8 of our reports dated March 5, 1996,
appearing in the Annual Report on Form 10-K of Wilmar Industries, Inc. for the
year ended December 29, 1995 and contained in Registration Statement No. 333-
07845 of Wilmar Industries, Inc. on Form S-2 under the Securities Act of 1933.
We also consent to the reference to us under the heading "Experts" in the
Prospectus, which is part of this Registration Statement.
/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Philadelphia, Pennsylvania
January 10, 1997
E-3
<PAGE>
EXHIBIT 23.2
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Wilmar Industries, Inc. on Form S-8 of our report on the financial statements of
One Source Supply, Inc. for the nine month period ended September 30, 1995,
dated November 17, 1995 and contained in Registration Statement No. 333-07845 of
Wilmar Industries, Inc. on Form S-2 under the Securities Act of 1933. We also
consent to the reference to us under the heading "Experts" in the Prospectus,
which is part of this Registration Statement.
/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Miami, Florida
January 10, 1997
E-4
<PAGE>
EXHIBIT 23.3
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Wilmar Industries, Inc. on Form S-8 of our report on the financial statements of
HMA Enterprises, Inc. for the year ended February 29, 1996, dated May 30, 1996
and contained in Registration Statement No. 333-07845 of Wilmar Industries, Inc.
on Form S-2 under the Securities Act of 1933. We also consent to the reference
to us under the heading "Experts" in the Prospectus, which is part of this
Registration Statement.
/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Houston, Texas
January 10, 1997
E-5
<PAGE>
EXHIBIT 23.4
INDEPENDENT AUDITOR'S CONSENT AND REPORT ON SCHEDULE
We hereby consent to the use in this Registration Statement of Wilmar
Industries, Inc. of our report dated October 30, 1995, accompanying the
financial statements of Wilmar Industries, Inc. contained in such Registration
Statement, and to the use of our name, and the statement with respect to us, as
appearing under the heading "Experts" in the Prospectus.
Our audit of the financial statements referred to in our aforementioned report
also included the financial statement schedule of Wilmar Industries, Inc. listed
in Item 16(b). This financial statement schedule is the responsibility of the
Company's management. Our responsibility is to express an opinion based on our
audit. In our opinion, such financial statement schedule, when considered in
relation to the basic financial statements taken as a whole, present fairly in
all material respects the information set forth therein.
/s/ Fishbein & Company, P.C.
Fishbein & Company, P.C.
Elkins Park, PA
January 10, 1997
E-6
<PAGE>
EXHIBIT 23.5
CONSENT OF INDEPENDENT AUDITORS
We consent to the inclusion in this Form S-8 being filed under the Securities
Act of 1933 by Wilmar Industries, Inc. of our report dated May 2, 1995, relating
to our examination of the financial statements of One Source Supply, Inc. as of
December 31, 1994 and for the period then ended appearing in the Prospectus. We
also consent to the reference to our firm appearing under the caption "Experts"
in the Form S-8.
/s/ Mutnick & Associates, P.A.
MUTNICK & ASSOCIATES, P.A.
Certified Public Accountants
Pembroke Pines, Florida
January 9, 1997
E-7
<PAGE>
EXHIBIT 23.6
To the Board of Directors
HMA Enterprises, Inc.:
We consent to the use of our report incorporated herein by reference and to the
reference to our firm under the heading "Experts" in the registration statement.
KPMG Peat Marwick LLP
/s/ KPMG Peat Marwick LLP
Houston, Texas
January 10, 1997
E-8
<PAGE>
EXHIBIT 99.1
WILMAR INDUSTRIES, INC.
AMENDED AND RESTATED
1995 STOCK OPTION PLAN
----------------------
The purpose of the Wilmar Industries, Inc. 1995 Stock Option Plan (the
"Plan") is to authorize the Compensation Committee (the "Committee") of the
Board of Directors to provide designated officers (including officers who are
also directors) and other key employees of Wilmar Industries, Inc. and its
subsidiaries (hereinafter collectively referred to as the "Company") with the
opportunity to receive grants of incentive stock options and nonqualified stock
options. The Company believes that the Plan will cause the participants to
contribute materially to the growth of the Company, thereby benefitting the
Company's shareholders and will align the economic interests of the participants
with those of the shareholders.
1. Administration
--------------
The Plan shall be administered and interpreted by a committee (the
"Committee") consisting of not less than one person appointed by the Board of
Directors of the Company. To the extent applicable, in accordance with Section
15, the Committee shall consist of not less than two persons appointed by the
Board of Directors of the Company, all of whom shall be "disinterested persons"
as defined under Rule 16b-3 under the Securities Exchange Act of 1934 (the
"Exchange Act") and "outside directors" as defined under Section 162(m) of the
Internal Revenue Code of 1986, as amended (the "Code") and related Treasury
regulations.
The Committee shall have the sole authority to determine (i) the key
employees to whom options shall be granted under the Plan, (ii) the type, size
and terms of the options to be granted to each such individual, (iii) the time
when the options will be granted and the duration of the exercise period and
(iv) any other matters arising under the Plan.
The Committee shall have full power and authority to administer and
interpret the Plan, to make factual determinations and to adopt or amend such
rules, regulations, agreements and instruments for implementing the Plan and for
conduct of its business as it deems necessary or advisable, in its sole
discretion. The Committee's interpretations of the Plan and all determinations
made by the Committee pursuant to the powers vested in it hereunder shall be
conclusive and binding on all persons having any interests in the Plan or in any
awards granted hereunder.
2. Grants
------
Incentives under the Plan shall consist of incentive stock options and
nonqualified stock options (hereinafter collectively referred to as "Stock
Options"). All Stock Options shall be subject to the terms and conditions set
forth herein and to those other terms and conditions consistent with this Plan
as the Committee deems appropriate and as are specified in writing by the
Committee to the employee (the "Grant Letter"). The Committee shall approve the
form and provisions of each Grant Letter to an employee. Grants under a
particular Section of the Plan need not be uniform as among the employees.
3. Shares Subject to the Plan
--------------------------
(a) Subject to the adjustment specified below, the aggregate number of
shares of common stock of the Company ("Company Stock") that have been or may be
issued or transferred under the Plan is 800,000 shares. In accordance with
Section 162(m) of the Code, during the term of the Plan, the maximum aggregate
number of shares of Company Stock that shall be subject to options under the
Plan to any single individual shall be 150,000 shares. The shares may be
authorized but unissued shares of Company Stock or reacquired shares of Company
Stock, including shares repurchased by the Company on the open market. If and
to the extent options
E-9
<PAGE>
granted under the Plan terminate, expire, or cancel without having been
exercised, the shares subject to such option shall again be available for
purposes of the Plan.
(b) If there is any change in the number or kind of shares of Company Stock
issuable under the Plan through the declaration of stock dividends, or through a
recapitalization, stock splits, or combinations or exchanges of such shares, or
merger, reorganization or consolidation of the Company, reclassification or
change in par value or by reason of any other extraordinary or unusual events
affecting the outstanding Company Stock as a class without the Company's receipt
of consideration, the maximum number of shares of Company Stock available for
Stock Options, the maximum number of shares of Company Stock for which any one
individual participating in the Plan may be granted over the term of the Plan,
the number of shares covered by outstanding Stock Options, and the price per
share or the applicable market value of such Stock Options, shall be
proportionately adjusted by the Committee to reflect any increase or decrease in
the number or kind of issued shares of Company Stock to preclude the enlargement
or dilution of rights and benefits under such Stock Options; provided, however,
that any fractional shares resulting from such adjustment shall be eliminated.
The adjustments determined by the Committee shall be final, binding and
conclusive.
4. Eligibility for Participation
-----------------------------
Officers and other key employees of the Company designated by the Committee
shall be eligible to participate in the Plan (hereinafter referred to
individually as the "Participant" and collectively as the "Participants"). The
Committee shall select the employees to receive Stock Options (the "Optionees")
from among the Participants and determine the number of shares of Company Stock
subject to a particular Stock Option in such manner as the Committee determines.
Nothing contained in this Plan shall be construed to limit the right of the
Company to grant options otherwise in connection with the acquisition, by
purchase, lease, merger, consolidation or otherwise, of the business or assets
of any corporation, firm or association, including options granted to employees
thereof who become employees of the Company, or for other proper corporate
purpose.
5. Granting of Options
-------------------
(a) Number of Shares. The Committee, in its sole discretion, shall
----------------
determine the number of shares of Company Stock that will be subject to each
option grant.
(b) Type of Option and Price. The Committee may grant options intended to
------------------------
qualify as incentive stock options ("Incentive Stock Options") within the
meaning of Section 422 of the Code or options which are not intended to so
qualify ("Nonqualified Stock Options") in accordance with the terms and
conditions set forth herein or any combination of Incentive Stock Options and
Nonqualified Stock Options.
The purchase price of Company Stock subject to a Stock Option shall be
determined by the Committee and may be equal to, greater than, or less than the
fair market value of a share of such Stock on the date such Stock Option is
granted; provided, however, that the purchase price of Company Stock subject to
an Incentive Stock Option shall be equal to the fair market value of a share of
such Stock on the date such Stock Option is granted and in no event shall the
price be less than 50% of the fair market value of Company Stock on the date of
grant. Notwithstanding the foregoing, no purchase price shall be established
hereunder if such purchase price would result in the disallowance of the
Company's expense deduction pursuant to Section 162(m) of the Code.
During such time that the Company Stock is not listed upon an established
stock exchange or traded in the over-the-counter-market, the "fair market value"
of Company Stock shall be determined by the Committee at least annually after
taking into account such factors as it shall deem appropriate. If the Company
Stock is listed upon an established stock exchange or other market source, as
determined by the Committee, "fair market value" on any date of reference shall
be the closing price of a share of Company Stock on the New York Stock Exchange
or other recognized market source, as determined by the Committee on such date,
or if there is no
E-10
<PAGE>
sale on such date, then the closing price of a share of Company Stock on the
last previous day on which a sale is reported.
(c) Exercise Period. The Committee shall determine the option exercise
---------------
period of each Stock Option. The exercise period shall not exceed ten years
from the date of grant.
(d) Vesting of Options. The vesting period for Stock Options shall
------------------
commence on the date of grant and shall end on such date as is determined by the
Committee, in its sole discretion, which shall be specified in the Grant Letter.
(e) Manner of Exercise. An Optionee may exercise a Stock Option by
------------------
delivering a notice of exercise to the Committee with accompanying payment of
the option price in accordance with (g) below. Should a Stock Option become
exercisable on and after the date on which the initial registration of the
Company Stock under Section 12(g) of the Exchange Act becomes effective, such
notice may instruct the Company to deliver shares of Company Stock due upon the
exercise of the Stock Option to any registered broker or dealer designated by
the Company ("Designated Broker") in lieu of delivery to the Optionee. Such
instructions must designate the account into which the shares are to be
deposited. The Optionee may tender this notice of exercise, which has been
properly executed by the Optionee, and the aforementioned delivery instructions
to any Designated Broker.
(f) Termination of Employment, Disability or Death.
----------------------------------------------
(1) In the event the Optionee during his lifetime ceases to be an
employee of the Company for any reason other than death, a termination for cause
by the Company or a voluntary termination of employment by the employee, any
Stock Option which is otherwise exercisable by the Optionee shall terminate
unless exercised within 30 days of the date on which he ceases to be an employee
(or within such other period of time as may be specified in the Grant Letter),
but in any event no later than the date of expiration of the option exercise
period; provided, however, that in the case of an Optionee who is disabled
within the meaning of Section 105(d)(4) of the Code, such period shall be one
year rather than 30 days (except as the Committee may otherwise provide in the
Grant Letter).
(2) In the event the Optionee ceases to be an employee of the Company
on account of a termination for cause by the Company or a voluntary termination
of employment by the employee, any Stock Option held by the Optionee shall
terminate as of the date he ceases to be an employee (except as the Committee
may otherwise provide in the Grant Letter).
(3) In the event of the death of the Optionee while he is an employee
of the Company or within not more than 30 days of the date on which he ceases to
be an employee for any reason other than a termination for cause by the Company
or a voluntary termination of employment by the employee (or within such other
period of time as may be specified in the Grant Letter), any Stock Option which
was otherwise exercisable by the Optionee at the date of death may be exercised
by his personal representative at any time prior to the expiration of one year
from the date of death, but in any event no later than the date of expiration of
the option exercise period.
(g) Satisfaction of Option Price. The Optionee shall pay the option price
----------------------------
(i) in cash, (ii) with the approval of the Committee, by delivering shares of
Company Stock owned by the Optionee including Company Stock acquired in
connection with the exercise of a particular Stock Option and having a fair
market value on the date of exercise equal to the option price or with a
combination of cash and shares, (iii) if shares of Company Stock may not be sold
immediately following the exercise of a Stock Option, with the approval of the
Committee, with the proceeds of a promissory note payable by the Optionee to the
Company, but only in accordance with the provisions of a Loan Program
established by the Company, or any successor program as in effect from time to
time, (A) in a principal amount of up to 100% of the payment due upon the
exercise of the Stock Option, or such applicable lower percentage as may be
specified by the Committee pursuant to the Loan Program, and (B) bearing
interest at a rate not less than the applicable Federal rate prescribed by
Section 1274 of the Code, or such higher rate as may be specified by the
Committee pursuant to the Loan Program or (iv) through any combination of (i),
(ii) or (iii). The
E-11
<PAGE>
Optionee shall pay the option price and the amount of withholding tax due, if
any, at the time of exercise. Shares of Company Stock shall not be issued or
transferred upon exercise of a Stock Option until the option price is fully
paid.
(h) Rule 16b-3 Restrictions. Unless an Optionee could otherwise transfer
-----------------------
Company Stock issued pursuant to a Stock Option granted hereunder without
incurring liability under Section 16(b) of the Exchange Act, at least six months
must elapse from the date of acquisition of a Stock Option to the date of
disposition of the Company Stock issued upon exercise of such option.
(i) Limits on Incentive Stock Options. Each Incentive Stock Option shall
---------------------------------
provide that if the aggregate fair market value of the Company Stock on the date
of the grant with respect to which Incentive Stock Options are exercisable for
the first time by an Optionee during any calendar year under the Plan or any
other stock option plan of the Company exceeds $100,000, then such option shall
be treated as a Nonqualified Stock Option. An Incentive Stock Option shall not
be granted to any Participant who, at the time of grant, owns stock possessing
more than 10 percent of the total combined voting power of all classes of stock
of the Company or parent of the Company, unless the option price per share is
not less than 110% of the fair market value of Company Stock on the date of
grant and the option exercise period is not more than five years from the date
of grant.
(j) Right of Repurchase Upon Death or Termination of Employment. Until
-----------------------------------------------------------
such time as the Company's outstanding shares of Common Stock are first
registered under Section 12(g) of the Exchange Act, the Company shall have the
right to repurchase shares of Company Stock issued under the Plan upon the death
or termination of employment of the Optionee for any reason in accordance with
the terms established by the Committee and set forth in the Grant Letter.
(k) Restrictions on Transfer of Stock. Until such time as the Company's
---------------------------------
outstanding shares of Company Stock are first registered under Section 12(g) of
the Exchange Act, shares of Company Stock received by an Optionee upon the
exercise of a Stock Option shall not be transferable, except for any: (1)
gratuitous transfer of the shares of Company Stock made to the Optionee's spouse
or issue, including adopted children, or to a trust for the exclusive benefit of
the Optionee or the Optionee's spouse or issue; (2) transfer of title to the
shares of Company Stock effected pursuant to an Optionee's will or the laws of
distribution; (3) any sale or transfer of the shares of Company Stock to the
Company; or (4) any sale of the shares of Company Stock pursuant to an effective
registration statement. In the event of any such transfer, other than pursuant
to (3) or (4) above, the transferee of the shares of Company Stock (the
"Permitted Transferee") shall hold the shares so acquired subject to all the
rights and restrictions (including without limitation the restriction on
transfer) conferred or imposed by the Plan and shall be deemed the Optionee for
purposes of the Plan, except that no transfer shall be permitted pursuant to
this Section unless and until the transferee agrees in writing to be bound by
the provisions of the Plan. Subsection (3) shall not be interpreted to impose
any obligation on the Company to purchase shares of Company Stock held by an
Optionee or a Permitted Transferee.
6. Transferability of Options
--------------------------
Only a Participant or his or her authorized legal representative may
exercise rights under a Stock Option. Such persons may not transfer those
rights except by will or by the laws of descent and distribution or, if
permitted under Rule 16b-3 of the Exchange Act and if permitted in any specific
case by the Committee in their sole discretion, pursuant to a qualified domestic
relations order as defined under the Code or Title I of ERISA or the regulations
thereunder. When a Participant dies, the personal representative or other
person entitled to succeed to the rights of the Participant ("Successor
Optionee") may exercise such rights. A Successor Optionee must furnish proof
satisfactory to the Company of his or her right to receive the Stock Option
under the Participant's will or under the applicable laws of descent and
distribution.
E-12
<PAGE>
7. Certain Corporate Changes
-------------------------
(a) Sale or Exchange of Assets, Dissolution or Liquidation, or Merger or
--------------------------------------------------------------------
Consolidation Where the Company Survives. If all or substantially all of the
- ----------------------------------------
assets of the Company are to be sold or exchanged, the Company is to be
dissolved or liquidated, or the Company is a party to a merger or consolidation
with another corporation in which the Company will be the surviving corporation,
then, each Optionee with any outstanding Stock Options shall have the right to
exercise in full any installments of such Stock Options not previously exercised
(whether or not the right to exercise such installments has accrued pursuant to
such Stock Options), unless the Committee, in its sole discretion, determines
not to accelerate such Stock Options upon such transaction. In the event that
options are accelerated pursuant to this Section, if a termination of such Stock
Options would not affect the accounting treatment of any such transaction, any
options not exercised shall thereafter terminate and cease to remain
outstanding. In addition, if a cashout of such Stock Options would not affect
the accounting treatment of any such transaction, the Committee may, in its sole
discretion, require that the Company purchase such Stock Options for a cash
payment equal to the excess over the purchase price of the then fair market
value of the shares of Company Stock subject to the Optionee's outstanding Stock
Options.
(b) Merger or Consolidation Where the Company Does Not Survive. If the
----------------------------------------------------------
Company is a party to a merger or consolidation in which the Company will not be
the surviving corporation, then any Optionee with any outstanding Stock Options
shall have the right to exercise in full any installments of such Stock Options
not previously exercised (whether or not the right to exercise such installments
has accrued pursuant to such Stock Options) unless the Committee, in its sole
discretion, determines not to accelerate such Stock Options upon such
transaction. In the event that options are accelerated pursuant to this
Section, if a termination of such Stock Options would not affect the accounting
treatment of any such transaction, any options not exercised shall thereafter
terminate and cease to remain outstanding. In addition, if a cashout or
substitution of such Stock Options would not affect the accounting treatment of
any such transaction, the Committee may, in its sole discretion, require (i)
that the Company purchase such Stock Options for a cash payment equal to the
excess over the purchase price of the then fair market value of the shares of
Company Stock subject to the Optionee's outstanding Stock Options or (ii) that
the surviving company replace the Stock Options with options to purchase common
stock of the surviving company having comparable value and terms as determined,
in its sole discretion, by the Committee.
8. Amendment and Termination of the Plan
-------------------------------------
(a) Amendment. The Board of Directors of the Company, by written
---------
resolution, may amend or terminate the Plan at any time; provided, however, that
any amendment that materially increases the benefits accruing to Participants
under the Plan, increases the aggregate number (or individual limit for any
single Optionee) of shares of Company Stock that may be issued or transferred
under the Plan (other than by operation of Section 3(b)), or modifies the
requirements as to eligibility for participation in the Plan, shall be subject
to approval by the shareholders of the Company, and provided, further, that the
Board of Directors shall not amend the Plan if such amendment would cause the
Plan or any Stock Option, or the exercise of any right under the Plan to fail to
comply with the requirements of Rule 16b-3 under the Exchange Act or if such
amendment would cause the Plan or the Stock Option or exercise of an Incentive
Stock Option under the Plan to fail to comply with the requirements of Section
422 of the Code including, without limitation, a reduction of the option price
set forth in Section 5(b) or an extension of the period during which an
Incentive Stock Option may be exercised as set forth in Section 5(c).
(b) Termination of Plan. The Plan shall terminate on the tenth anniversary
-------------------
of its effective date unless terminated earlier by the Board of Directors of the
Company or unless extended by the Board with the approval of the shareholders.
(c) Termination and Amendment of Outstanding Stock Options. A termination
------------------------------------------------------
or amendment of the Plan that occurs after a Stock Option is made shall not
result in the termination or amendment of the Stock Option unless the Optionee
consents or unless the Committee acts under Section 16(a). The termination of
the Plan shall not impair the power and authority of the Committee with respect
to an outstanding Stock Option. Whether or not the Plan has terminated, an
outstanding Stock Option may be terminated or amended under Section 16(a) or may
be amended by agreement of the Company and the Optionee consistent with the
Plan.
E-13
<PAGE>
9. Funding of the Plan
-------------------
This Plan shall be unfunded. The Company shall not be required to
establish any special or separate fund or to make any other segregation of
assets to assure the payment of any Stock Options under this Plan. In no event
shall interest be paid or accrued on any Stock Option, including unpaid
installments of Stock Options.
10. Rights of Participants
----------------------
Nothing in this Plan shall entitle any Participant or other person to any
claim or right to be granted a Stock Option under this Plan. Neither this Plan
nor any action taken hereunder shall be construed as giving any Participant any
rights to be retained by or in the employ of the Company or any other employment
rights.
11. Withholding of Taxes
--------------------
The Participant or other person receiving shares of Company Stock upon the
exercise of a Stock Option shall be required to pay to the Company the amount of
any federal, state or local taxes which the Company is required to withhold with
respect to the exercise of such Stock Options or the Company shall have the
right to deduct from other wages paid to the employee by the Company the amount
of any withholding due with respect to such Stock Options.
12. Agreements with Participants
----------------------------
Each Stock Option made under this Plan shall be evidenced by a Grant Letter
containing such terms and conditions as the Committee shall approve.
13. Requirements for Issuance of Shares
-----------------------------------
No Company Stock shall be issued or transferred upon the exercise of any
Stock Option hereunder unless and until all legal requirements applicable to the
issuance or transfer of such Company Stock have been complied with to the
satisfaction of the Committee. The Committee shall have the right to condition
any Stock Option made to any Participant hereunder on such Participant's
undertaking in writing to comply with such restrictions on his subsequent
disposition of such shares of Company Stock as the Committee shall deem
necessary or advisable as a result of any applicable law, regulation or official
interpretation thereof, and certificates representing such shares may be
legended to reflect any such restrictions.
14. Headings
--------
Section headings are for reference only. In the event of a conflict
between a title and the content of a Section, the content of the Section shall
control.
15. Effective Date
--------------
(a) Effective Date of the Plan. Subject to the approval of the Company's
--------------------------
shareholders, this Plan shall be effective as of March 6, 1995.
(b) Effectiveness of Section 16 Provisions. The provisions of the Plan
--------------------------------------
that refer to, or are applicable to persons subject to, Section 16 of the
Exchange Act shall be effective, if at all, upon registration of the Company
Stock under Section 12 of the Exchange Act, and shall remain effective
thereafter for so long as the Company Stock is so registered.
(c) Effectiveness of Section 162(m) Provisions. The provisions of the Plan
------------------------------------------
that refer to, or are applicable to persons subject to, Section 162(m) of the
Code shall be effective, if at all, upon registration of the Company Stock under
Section 12 of the Exchange Act, and shall remain effective thereafter for so
long as the Company Stock is so registered.
E-14
<PAGE>
16. Miscellaneous
-------------
(a) Compliance with Law. The Plan, the exercise of Stock Options and the
-------------------
obligations of the Company to issue or transfer shares of Company Stock under
Stock Options shall be subject to all applicable laws and to approvals by an
governmental or regulatory agency as may be required. With respect to persons
subject to Section 16 of the Exchange Act, it is the intent of the Company that
the Plan and all transactions under the Plan comply with all applicable
provisions of Rule 16b-3 or its successors under the Exchange Act. The
Committee may revoke any Stock Option if it is contrary to law or modify a Stock
Option to bring it into compliance with any valid and mandatory government
regulation. The Committee may also adopt rules regarding the withholding of
taxes on payments to Optionees. The Committee may, in its sole discretion,
agree to limit its authority under this Section.
(b) Ownership of Stock. An Optionee or Successor Optionee shall have no
------------------
rights as a shareholder with respect to any shares of Company Stock covered by a
Stock Option until the shares are issued or transferred to the Optionee or
Successor Optionee on the stock transfer records of the Company.
(c) Governing Law. The validity, construction, interpretation and effect
-------------
of the Plan and Grant Letters issued under the Plan shall exclusively be
governed by and determined in accordance with the law of the State of New
Jersey.
E-15
