<PAGE>
As filed with the Securities and Exchange Commission on July 31, 1997.
Registration No. 33-
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------------
AMERICAN WAGERING, INC.
- -------------------------------------------------------------------------------
(Exact name of issuer as specified in its charter)
Nevada 88-0344658
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(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
675 Grier Drive, Las Vegas, Nevada 89119
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(Address of principal executive offices)
American Wagering, Inc. 1995 Stock Option Plan
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(Full title of the plan)
Robert D. Ciunci
Chief Financial Officer
American Wagering, Inc.
675 Grier Drive
Las Vegas, Nevada 89119
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(Name and address of agent for service)
(702) 735-0101
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(Telephone number, including area code, of agent for service)
Copies to:
Alan H. Lieblich, Esquire
Schnader, Harrison, Segal & Lewis
Suite 3600
1600 Market Street
Philadelphia, Pennsylvania 19103
Telephone: (215) 751-2048
<PAGE>
- -------------------------------------------------------------------------------
CALCULATION OF REGISTRATION FEE
===============================================================================
<TABLE>
<CAPTION>
Proposed Maximum Proposed Maximum
Title of Securities Amount to be Offering Price per Aggregate Offering Amount of
to be Registered Registered Share Price Registration Fee
------------------ ------------ ------- ------- ----------------
<S> <C> <C> <C> <C>
Common Stock, 200,000 Shares $10.313(*) $2,062,600(*) $625.03(*)
par value $.01
per share
</TABLE>
- -------------------------------------------------------------------------------
(*) Estimated solely for the purpose of calculating the registration fee in
accordance with Rule 457(h), based upon the average of the high and low
prices of a share of Common Stock on July 30, 1997, which was $10.313
per share.
The approximate date of proposed sale to the public will be from time
to time upon exercise of options granted pursuant to the Plan.
-2-
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Certain Documents by Reference.
The following documents filed with the Securities and Exchange
Commission are hereby incorporated by reference herein and made a part hereof:
(a) The annual report of the Company on Form 10-KSB for the
year ended January 31, 1997; and
(b) The Description of Securities contained in Item 1 of the
Form 8-A dated May 9, 1996, filed with the Commission on May 9, 1996.
In addition, any and all documents filed by the Company
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of
1934 after the date hereof and prior to the termination of the offering of the
securities offered hereby shall be deemed to be incorporated by reference herein
and to be a part hereof from the date of filing such documents.
Item 4. Description of Securities.
As the securities to be offered pursuant to this registration
statement are registered under Section 12 of the Securities Exchange Act of
1934, this item is inapplicable.
Item 5. Interests of Named Experts and Counsel.
The due issuance of the shares offered hereby has been passed
upon by Gordon & Silver, Ltd.
Item 6. Indemnification of Directors and Officers.
The Company's By-Laws and Amended and Restated Articles of
Incorporation provide for the indemnification of any director or officer who is
or is threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative (including an action by or in the right of the Company, subject to
the condition set forth below) by reason of the fact that he or she is or was a
director or officer of the Company, or is or was serving at the request of the
Company as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against liabilities,
losses and expenses (including attorneys' fees), judgments, fines and amounts
paid or to be paid in settlement reasonably incurred by him or her in connection
with such action, suit or proceeding, provided that he or she acted in good
faith and in a manner he or she reasonably believed to be in or not opposed to
the best interest of the Company, and with respect to any criminal action or
<PAGE>
proceeding, had no reasonable cause to believe was unlawful. No indemnification
shall be made in respect of any claim, issue or matter raised by or in the right
of the Company as to which the director or officer shall have been adjudged to
be liable for negligence or misconduct in the performance of his or her duty to
the Company, unless and only to the extent that the court in which such action
or suit was brought shall determine upon application that despite the
adjudication of liability but in view of all the circumstances of the case, such
person is fairly and reasonably entitled to indemnity for such expenses as the
court shall deem proper. A determination may be made by either the stockholders
or Board of Directors to approve or disallow any indemnification under the
foregoing provisions. In addition, with the approval of the stockholders, the
Company has entered into an Indemnification Agreement with each of its
directors. These agreements require the Company to indemnify any director, to
the fullest extent permitted by law, who is or is threatened to be made a party
to any threatened, pending or completed action, suit or proceeding, or any
inquiry or investigation (including discovery), whether conducted by the Company
or any other party, that such director in good faith believes might lead to the
institution of any action, suit or proceeding, whether civil, criminal,
administrative, investigative or other by reason of (or arising in part out of)
any event or occurrence related to the fact that such director is or was a
director, officer, employee, agent or fiduciary of the Company, or is or was
serving at the request of the Company as a director, officer, employee, trustee,
agent or fiduciary of another corporation, partnership, joint venture, employee
benefit plan, trust or other enterprise, or by reason of any thing done or not
done by such director in any capacity. Indemnification under the foregoing
arrangements may be available for liabilities arising in connection with offers
under the Plan.
The Company has included in its Amended and Restated Articles
of Incorporation a provision which limits personal liability for breach of the
fiduciary duty of its directors, to the extent provided by Section 78.037 of the
Nevada corporation law. Such provision eliminates the personal liability of
directors for damages occasioned by breach of fiduciary duty, except for
liability based on the director's duty of loyalty to the Company, liability for
acts or omissions involving intentional misconduct, fraud or a knowing violation
of law, liability based on payments of improper dividends, and liability for
acts occurring prior to the date such provision was added.
Item 7. Exemption From Registration Claimed.
As no restricted securities are to be reoffered or resold
pursuant to this registration statement, this item is inapplicable.
Item 8. Exhibits
The exhibits required by Item 601 of Regulation S-K and this
item are included following the Exhibit Index at Page E-1, all of which are
incorporated herein by reference.
Item 9. Undertakings.
(a) The undersigned registrant hereby undertakes:
II-2
<PAGE>
(1) To file, during any period in which it offers or sells
securities, a post-effective amendment to this registration statement to:
(i) Include any additional or changed material
information on the plan of distribution;
(2) For determining liability under the Securities Act of
1933, to treat each post-effective amendment as a new registration statement of
the securities being offered, and the offering of the securities at that time to
be the initial bona fide offering.
(3) To file a post-effective amendment to remove from
registration any of the securities that remain unsold at the end of the
offering.
The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of 1933, each
filing of the registrant'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 the employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) 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 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-3
<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 Las Vegas, State of Nevada on July 30, 1997.
AMERICAN WAGERING, INC.
By: /s/ Victor Salerno
------------------------------
Victor Salerno, President and
Chief Executive Officer
In accordance with 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/ Victor Salerno President; Chief Executive Officer; Director July 30, 1997
- --------------------------
Victor Salerno
/s/ Robert R. Barengo Director July 30, 1997
- --------------------------
Robert R. Barengo
/s/ Michael Roxborough Director July 30, 1997
- --------------------------
Michael Roxborough
/s/ Michael S. Merillat Director July 30, 1997
- --------------------------
Michael S. Merillat
/s/ Robert D. Ciunci Chief Financial Officer (Principal Financial and July 30, 1997
- -------------------------- Accounting Officer); Director
Robert D. Ciunci
</TABLE>
II-4
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Number Description Method of Filing
- ------ ----------- ----------------
<S> <C> <C>
4.1 Form of Common Stock Certificate Incorporated by Reference to Exhibit
4.1 to Registration Statement on
Form SB-2, File No. 33-80431
5 Opinion of Gordon & Silver, Ltd. Filed herewith.
23.1 Consent of Arthur Andersen LLP Filed herewith.
23.2 Consent of Gordon & Silver, Ltd. Included in Exhibit 5 above.
99.1 1995 Stock Option Plan, as amended. Filed herewith.
</TABLE>
E-1
<PAGE>
EXHIBIT 5
July 30, 1997
Board of Directors
American Wagering, Inc.
675 Grier Drive
Las Vegas, Nevada 89119
Re: Registration Statement on Form S-8
Gentlemen:
We have acted as Nevada counsel for American Wagering, Inc., a Nevada
corporation (the "Company"), in connection with the proposed issuance of up to
an additional 200,000 shares of Common Stock of the Company (the "Shares"). The
Shares are the subject of a public offering under the American Wagering, Inc.
1995 Stock Option Plan (the "Plan"), pursuant to a Registration Statement on
Form S-8 filed by the Company with the Securities and Exchange Commission (the
"Registration Statement") under the Securities Act of 1933, as amended.
For the purpose of rendering our opinion as set forth herein, we have
examined and relied upon the Company's bylaws and minutes, which are contained
in the minute book of the corporate proceedings of the board of directors and
shareholders of the Company; the Company's amended and restated articles of
incorporation, as certified by the Nevada Secretary of State on July 22, 1997;
and a certificate of good standing of the Company, dated July 22, 1997, issued
by the Nevada Secretary of State.
We have assumed the authenticity of all documents submitted to us as
originals; the genuineness of all signatures; the legal capacity of natural
persons; the accuracy and completeness of all corporate records made available
to us by the Company; the veracity of the records, certificates, documents and
other instruments furnished to us by the Company and public officials, although,
with your permission we have not necessarily independently verified the
statements made therein nor have we investigated the basis for the
representations contained therein; and the conformity to the originals of all
documents submitted to us as copies.
Based upon and subject to the assumptions, qualifications and
limitations set forth herein, we are of the opinion that the Shares have been
duly authorized and, when issued and delivered by the Company against payment
therefor pursuant to the Plan and due exercise of the options thereunder, will
be validly issued, fully paid and non-assessable.
<PAGE>
Board of Directors
American Wagering, Inc.
July 30, 1997
Page 2
We are licensed to practice law in the State of Nevada and the opinion
set forth herein is expressly limited to the laws of the State of Nevada. No
opinion is given or implied regarding federal law or the laws of any
jurisdiction other than the State of Nevada.
We hereby consent to the inclusion of this opinion in Exhibit 5 to the
Registration Statement and the reference to Gordon & Silver, Ltd. in Part II of
the Registration Statement under the caption "Interests of Named Experts and
Counsel."
Very truly yours,
/s/ GORDON & SILVER, LTD.
<PAGE>
EXHIBIT 23.1
July 28, 1997
To American Wagering, Inc.:
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement on Form S-8 of our report dated April
4, 1997 included in American Wagering, Inc.'s Annual Report on Form 10-KSB for
the year ended January 31, 1997 and to all references to our Firm included in
this registration statement.
Very truly yours,
ARTHUR ANDERSEN LLP
<PAGE>
Exhibit 99.1
AMERICAN WAGERING, INC.
1995 STOCK OPTION PLAN
1. Definitions.
As used in this Plan, the following definitions apply to the terms
indicated below:
A. "Board" means the Board of Directors of the Company.
B. "Committee" means the Stock Option Committee appointed by the Board
from time to time to administer the Plan. The Committee shall consist of at
least two persons, who shall be directors of the Company and who shall not be
or have been granted or awarded, while serving on the Committee or within one
year prior thereto, stock, stock options, or stock appreciation rights pursuant
to any plan of the Company or any of its affiliates except a plan that provides
for formula grants or awards.
C. "Company" means American Wagering, Inc., a Nevada corporation.
D. "Fair Market Value" of a Share on a given day means, if the Shares
are traded in a public market, the mean between the highest and lowest quoted
selling prices of a Share as reported on the principal securities exchange on
which the Shares are then listed or admitted to trading, or if not so reported,
the mean between the highest and lowest quoted trading prices of a Share if
traded on a national market system, or the mean between the highest asked price
and the lowest bid price as the case may be, as reported on the National
Association of Securities Dealers Automated Quotation System. If the Shares
shall not be so traded, the Fair Market Value shall be determined by the
Committee taking into account all relevant facts and circumstances.
E. "Grantee" means a person who is either an Optionee or an
Optionee-Stockholder.
F. "Incentive Stock Option" means an option, whether granted under this
Plan or otherwise, that qualifies as an incentive stock option within the
meaning of Section 422 of the Internal Revenue Code.
G. "Option" means a right to purchase Shares under the terms and
conditions of this Plan as evidenced by an option certificate or agreement for
Shares in such form, not inconsistent with this Plan, as the Committee may
adopt for general use or for specific cases from time to time.
H. "Optionee" means a person other than an Optionee-Stockholder to whom
an option is granted under this Plan.
I. "Optionee-Stockholder" means a person to whom an option is granted
under this Plan and who at the time such option is granted owns, actually or
constructively, stock of the Company or of a Parent or Subsidiary possessing
more than ten percent (10%) of the total combined voting power of all classes
of stock of the Company or of such Parent or Subsidiary.
J. "Nonqualified Option" means an Option that is not an Incentive Stock
Option.
K. "Parent" means any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company if, at the time of
granting an Option, each of the corporations in the unbroken chain (other than
the Company) owns stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in the chain.
L. "Plan" means this American Wagering, Inc. 1995 Stock Option Plan,
including any amendments to the Plan.
M. "Share" means a share of the Company's common stock, par value $.01
per share, either now or hereafter owned by the Company as treasury stock or
authorized but unissued.
1
<PAGE>
N. "Subsidiary" means any corporation (other than the Company) in an
unbroken chain of corporations beginning with the Company if, at the time of
granting an Option, each of the corporations in the unbroken chain (other than
the last corporation in the chain) owns stock possessing fifty percent (50%) or
more of the total combined voting power of all classes of stock in one of the
other corporations in the chain.
O. Options shall be deemed "granted" under this Plan on the date on
which the Committee, by appropriate action, approves the grant of an Option
hereunder or on such subsequent date as the Committee may designate.
P. As used herein, the masculine includes the feminine, the plural
includes the singular, and the singular includes the plural.
2. Purpose.
The purposes of the Plan are as follows:
A. To secure for the Company and its stockholders the benefits arising
from share ownership by those officers and key employees, consultants and
advisors of the Company and its Subsidiaries who will be responsible for the
Company's future growth and continued success. The Plan is intended to provide
an incentive to officers and key employees, consultants and advisors by
providing them with an opportunity to acquire an equity interest or increase an
existing equity interest in the Company, thereby increasing their personal
stake in its continued success and progress.
B. To enable the Company and its Subsidiaries to obtain and retain the
services of key employees, consultants and advisors by providing such key
employees, consultants and advisors with an opportunity to acquire Shares under
the terms and conditions and in the manner contemplated by this Plan.
3. Plan Adoption and Term.
A. This Plan shall become effective upon its adoption by the Board, and
Options may be issued upon such adoption and from time to time thereafter;
provided, however, that the Plan shall be submitted to the Company's
stockholders for their approval at the next annual meeting of Stockholders, or
prior thereto at a special meeting of stockholders expressly called for such
purpose; and provided further, that the approval of the Company's stockholders
shall be obtained within 12 months of the date of adoption of the Plan. If the
Plan is not approved by the affirmative vote of the holders of a majority of
all shares present in person or by proxy, at a duly called stockholders'
meeting at which a quorum representing a majority of all voting stock is
present in person or by proxy and voting on this Plan or by the unanimous
written consent of all Stockholders of the Company, then this Plan and all
Options then outstanding under it shall forthwith automatically terminate and
be of no force and effect.
B. Subject to the provisions hereinafter contained relating to amendment
or discontinuance, this Plan shall continue to be in effect for ten (10) years
from the date of adoption of this Plan by the Board. No Options may be granted
hereunder except within such period of ten (10) years.
4. Administration of Plan.
A. This Plan shall be administered by the Committee. Except as otherwise
expressly provided in this Plan, the Committee shall have authority to
interpret the provisions of the Plan, to construe the terms of any Option, to
prescribe, amend and rescind rules and regulations relating to the Plan, to
determine the terms and provisions of Options granted hereunder, and to make
all other determinations in the judgment of the Committee necessary or
desirable for the administration of the Plan. Without limiting the foregoing,
the Committee shall, to the extent and in the manner contemplated herein,
exercise the discretion granted to it to determine to whom Incentive Stock
Options and Non-qualified Options shall be granted, how many Shares shall be
subject to each such Option, whether a Grantee shall be required to surrender
for cancellation an outstanding Option as a condition to the grant of a new
Option, and the prices at which Shares shall be sold to Grantees. The Committee
may correct any defect or supply any omission or reconcile any inconsistency in
the Plan or in any Option in the manner and to the extent it shall deem
expedient to carry the Plan into effect and shall be the sole and final judge
of such expediency.
2
<PAGE>
B. No member of the Committee shall be liable for any action taken or
omitted or any determination made by him in good faith relating to the Plan,
and the Company shall indemnify and hold harmless each member of the Committee
and each other director or employee of the Company to whom any duty or power
relating to the administration or interpretation of the Plan has been delegated
against any cost or expense (including counsel fees) or liability (including
any sum paid in settlement of a claim with the approval of the Committee)
arising out of any act or omission in connection with the Plan, unless arising
out of such person's own fault or bad faith.
C. Any power granted to the Committee either in this Plan or by the
Board may at any time be exercised by the Board and any determination by the
Committee shall be subject to review and reversal or modification by the Board
on its own motion.
5. Eligibility. Officers and key employees, consultants and advisors of
the Company and its Subsidiaries shall be eligible for selection by the
Committee to be granted Options. An employee, consultant or advisor who has
been granted an Option may, if he or she is otherwise eligible, be granted an
additional Option or Options if the Committee shall so determine.
6. Options.
A. Subject to adjustment as provided in Paragraph 13 hereof, Options may
be granted pursuant to the Plan for the purchase of not more than an aggregate
of 555,000 Shares; provided, however, that if prior to the termination of the
Plan, an Option shall expire or terminate for any reason without having been
exercised in full, the unpurchased Shares subject thereto shall again be
available for the purposes of the Plan.
B. The aggregate fair market value (determined as of the time Options
are granted) of the stock with respect to which Incentive Stock Options may be
or become exercisable for the first time by a Grantee during any calendar year
(whether granted under this Plan or any other plan of the Company or any Parent
or Subsidiary corporation) shall not exceed $100,000. To the extent an
Incentive Stock Option may be or become exercisable in violation of this
limitation, it shall be deemed to be a Nonqualified Option.
7. Option Price. The purchase price per Share deliverable upon the
exercise of an Option shall be determined by the Committee, but shall not be
less than 100% of the Fair Market Value of such Share on the date the Option is
granted (110% of the Fair Market Value of such Share on the date an Incentive
Stock Option is granted to an Optionee-Stockholder).
8. Duration of Options. Each Option and all rights thereunder shall expire
and the Option shall no longer be exercisable on a date not later than ten (10)
years (five (5) years in the case of an Incentive Stock Option granted to an
Optionee-Stockholder) from the date on which the Option was granted, or such
lesser period of time as the Committee designates at the time of the grant of
an Option. Options may expire and cease to be exercisable on such earlier date
as the Committee may determine at the time of grant. Options shall be subject
to termination before their expiration date as provided herein.
9. Conditions Relating to Exercise of Options.
A. The Shares subject to any Option may be purchased at any time during
the term of the Option, unless, at the time an Option is granted, the Committee
shall have fixed a specific period or periods in which exercise must take
place. To the extent an Option is not exercised when it becomes initially
exercisable, or is exercised only in part, the Option or remaining part thereof
shall not expire but shall be carried forward and shall be exercisable until
the expiration or termination of the Option. Partial exercise as to whole
Shares is permitted from time to time, provided that no partial exercise of an
Option shall be for a number of Shares having a purchase price of less than
$100.
B. No Option shall be transferable by the Grantee thereof other than by
will or by the laws of descent and distribution, and Options shall be
exercisable during the lifetime of a Grantee only by such Grantee or, to the
extent that such exercise would not prevent an Option from qualifying as an
Incentive Stock Option under the Internal Revenue Code, by his or her guardian
or legal representative.
C. Certificates for Shares purchased upon exercise of Options shall be
issued either in the name of the Grantee or in the name of the Grantee and
another person jointly with the right of survivorship. Such certificates shall
be delivered as soon as practical following the date the Option is exercised.
3
<PAGE>
D. An Option shall be exercised by the delivery to the Company at its
principal office, to the attention of its Secretary, of written notice of the
number of Shares with respect to which the Option is being exercised, and of
the name or names in which the certificate for the Shares is to be issued, and
by paying the purchase price for the Shares. The purchase price shall be paid
in cash or by certified check or bank cashier's check or by delivering to the
Company:
(1) Shares (in proper form for transfer and accompanied by all requisite
stock transfer tax stamps or cash in lieu thereof) owned by the Grantee
having a Fair Market Value equal to the purchase price; or
(2) a notarized statement attesting to ownership of the number of Shares
which are intended to be used at Fair Market Value to pay the purchase
price, with the certificate number(s) thereof, and requesting that only the
incremental number of Shares as to which the Option is being exercised be
issued by the Company.
E. Notwithstanding any other provision in this Plan, no Option may be
exercised unless and until (i) this Plan has been approved by the stockholders
of the Company, and (ii) the Shares to be issued upon the exercise thereof have
been registered under the Securities Act of 1933 and applicable state
securities laws, or are, in the opinion of counsel to the Company, exempt from
such registration. The Company shall not be under any obligation to register
under applicable Federal or state securities laws any Shares to be issued upon
the exercise of an Option granted hereunder, or to comply with an appropriate
exemption from registration under such laws in order to permit the exercise of
an Option or the issuance and sale of Shares subject to such Option. If the
Company chooses to comply with such an exemption from registration, the
certificates for Shares issued under the Plan, may, at the direction of the
Committee, bear an appropriate restrictive legend restricting the transfer or
pledge of the Shares represented thereby, and the Committee may also give
appropriate stop-transfer instructions to the transfer agent of the Company.
F. Any person exercising an Option or transferring or receiving Shares
shall comply with all regulations and requirements of any governmental
authority having jurisdiction over the issuance, transfer or sale of securities
of the Company or over the extension of credit for the purposes of purchasing
or carrying any margin securities, or the requirements of any stock exchange or
national market or automated quotation system on which the Shares may be
listed, and as a condition to receiving any Shares, shall execute all such
instruments as the Committee in its sole discretion may deem necessary or
advisable.
G. Each Option shall be subject to the requirement that if the Committee
shall determine that the listing, registration or qualification of the Shares
subject to such Option upon any securities exchange, national market or
automated quotation system or under any state or Federal law, or the consent or
approval of any governmental or regulatory body, is necessary or desirable as a
condition of, or in connection with, the granting of such Option or the
issuance or purchase of Shares thereunder, such Option may not be exercised in
whole or in part unless such listing, registration, qualification, consent or
approval shall have been effective or obtained free of any conditions not
acceptable to the Committee.
10. Effect of Termination of Employment or Death.
A. In the event of termination of a Grantee's employment by reason of
such Grantee's death, disability or retirement with the consent of the Board or
in accordance with an applicable retirement plan, or pursuant to a written
employment agreement between the Company and Grantee originally executed prior
to August 2, 1995 (i) the Grantee s employment with the Company is terminated
by the Company at any time in violation of such agreement or (ii) Grantee
unilaterally terminates such agreement by the terms of such agreement within
six months after a Constructive Termination (as defined in such agreement) or a
Change of Control (as defined in such agreement) any outstanding Option held by
such Grantee shall, notwithstanding the extent to which such Option was
exercisable prior to termination of employment, immediately become exercisable
as to the total number of Shares purchasable thereunder. Any such Option shall
remain so exercisable at any time prior to its expiration date or, if earlier,
the first anniversary of termination of the Grantee's employment.
B. In the event of termination of a Grantee's employment for any reason
other than as set forth in Paragraph 10A hereof, all rights of any kind under
any outstanding Option held by such Grantee shall
4
<PAGE>
immediately lapse and terminate, except that the Committee may, in its
discretion, elect to permit exercise for a period ending on the earlier of the
expiration date of the Option and a date thirty days after the termination of
employment as to the total number of Shares purchasable under the Option as of
the date of the termination.
C. Whether an authorized leave of absence or absence in military or
government service shall constitute termination of employment shall be
determined by the Committee. Transfer of employment between the Company and a
Subsidiary corporation or between one Subsidiary corporation and another shall
not constitute termination of employment.
11. No Special Employment Rights. Nothing contained in the Plan or in any
Option shall confer upon any Grantee any right with respect to the continuation
of his or her employment by the Company or a Subsidiary or interfere in any way
with the right of the Company or a Subsidiary, subject to the terms of any
separate employment agreement to the contrary, at any time to terminate such
employment or to increase or decrease the compensation of the Grantee from the
rate in existence at the time of the grant of an Option.
12. Rights as a Stockholder. The Grantee of an Option shall have no rights
as a stockholder with respect to any Shares covered by an Option until the date
of issuance of a certificate to him for such Shares. Except as otherwise
expressly provided in the Plan, no adjustment shall be made for dividends or
other rights for which the record date occurs prior to the date of issuance of
such certificate.
13. Anti-dilution Provision.
A. In case the Company shall (i) declare a dividend or dividends on its
Shares payable in shares of its capital stock, (ii) subdivide its outstanding
Shares, (iii) combine its outstanding Shares into a smaller number of Shares,
or (iv) issue any shares of capital stock by reclassification of its Shares
(including any such reclassification in connection with a consolidation or
merger in which the Company is the continuing corporation), the number of
Shares authorized under the Plan will be adjusted proportionately. Similarly,
in any such event, there will be a proportionate adjustment in the number of
Shares subject to unexercised Options (but without adjustment to the aggregate
option price).
B. In the event of any kind of transaction which may constitute a change
in control of the Company, the Committee, with the approval of the majority of
the members of the Board who are not then holding Options (or for Grantees who
are neither Optionee-Stockholders nor directors of the Company, with the
approval of a majority of the members of the Board), may modify any and all
outstanding Options so as to accelerate, as a consequence of or in connection
with such transaction, a Grantee's right to exercise any such Option.
Notwithstanding the foregoing, if the operation of this Paragraph 13B would
cause an Option to become exercisable in such a way as to violate Paragraph 6B
hereof, the exercisability of such Option shall be delayed as necessary to
avoid such a violation.
14. Withholding Taxes. Whenever an Option is to be exercised under the
Plan, the Company shall have the right to require the Grantee, as a condition
of exercise of the Option, to remit to the Company an amount sufficient to
satisfy the Company's (or a Subsidiary's) Federal, state and local withholding
tax obligation, if any, that will, in the sole opinion of the Committee, result
from the exercise. In addition, the Company shall have the right, at the sole
discretion of the Committee, to satisfy any such withholding tax obligation by
retention of Shares issuable upon such exercise having a Fair Market Value on
the date of exercise equal to the amount to be withheld.
15. Amendment of the Plan. The Board may at any time and from time to time
terminate or modify or amend the Plan in any respect, except that, without
stockholder approval, the Board may not (a) increase the number of Shares which
may be issued under the Plan, or (b) modify the requirements as to eligibility
for participation under the Plan. The termination or modification or amendment
of the Plan shall not, without the consent of a Grantee, affect his rights
under an Option previously granted to him or her. With the consent of the
Grantee, the Board may amend outstanding Options in a manner not inconsistent
with the Plan.
16. Miscellaneous.
A. It is expressly understood that this Plan grants powers to the
Committee but does not require their exercise; nor shall any person, by reason
of the adoption of this Plan, be deemed to be entitled to the grant of any
Option; nor shall any rights begin to accrue under the Plan except as Options
may be granted hereunder.
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B. All expenses of the Plan, including the cost of maintaining records,
shall be borne by Company.
17. Governing Law. This Plan and all rights hereunder shall be governed by
and interpreted in accordance with the laws of the State of Nevada.
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