<PAGE>
Registration No. 333-______
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
WIRELESS XCESSORIES GROUP, INC.
-------------------------------
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware 13-3835420
- ----------------------------------- -------------------
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
1840 COUNTY LINE ROAD
HUNTINGDON VALLEY, PENNSYLVANIA 19006
- -------------------------------------------- ---------------
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
WIRELESS XCESSORIES GROUP, INC.
1995 STOCK OPTION PLAN
----------------------
(FULL TITLE OF THE PLAN)
STEPHEN RADE
PRESIDENT AND CHIEF EXECUTIVE OFFICER
1840 COUNTY LINE ROAD
HUNTINGDON VALLEY, PENNSYLVANIA 19006
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(NAME AND ADDRESS OF AGENT FOR SERVICE)
(800) 233-0013
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(TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE)
WITH A COPY TO:
JUSTIN P. KLEIN, ESQUIRE
BALLARD SPAHR ANDREWS & INGERSOLL, LLP
1735 MARKET STREET
PHILADELPHIA, PENNSYLVANIA 19103-7599
(215) 665-8500
CALCULATION OF REGISTRATION FEE
-------------------------------
- --------------------------------------------------------------------------------
PROPOSED PROPOSED
TITLE OF MAXIMUM MAXIMUM
SECURITIES AMOUNT OFFERING AGGREGATE AMOUNT OF
TO BE TO BE PRICE PER OFFERING REGISTRATION
REGISTERED REGISTERED(1) SHARE(2) PRICE(2) FEE
- --------------------------------------------------------------------------------
COMMON STOCK, PAR
VALUE $.001 PER SHARE 600,000 $ (2) $1,514,054 $400
- --------------------------------------------------------------------------------
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(1) In addition, pursuant to Rule 416(c) under the Securities Act of 1933,
this registration statement shall be deemed to cover an indeterminate
number of additional shares of Common Stock issuable in the event the
number of outstanding shares of the Company is increased by split-up,
reclassification, stock dividend or the like.
(2) In accordance with Rules 457(c) and (h)(1), the price shown is based
upon: (1) 355,517 shares offered pursuant to outstanding options
exercisable at the following prices: (i) 40,000 shares at $5.00 per
share; (ii) 33,865 shares at $4.50 per share; (iii) 11,000 shares at
$4.25 per share; (iv) 25,000 shares at $2.80 per share; (v) 50,652
shares at $1.38 per share; (vi) 30,000 shares at $1.875 per share; and
(vii) 165,000 shares at $1.375 per share; and (2) 244,483 shares
reserved for issuance upon exercise of options to be granted in the
future, the proposed offering price of which has been determined based
upon the average of the high and low price of the Company's Common
Stock on April 12, 2000, $2.83, as reported on the Nasdaq National
Market for securities of the same class as those to be offered.
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PART I - INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The documents containing the information specified in Part I of Form
S-8 will be given or sent to all employees who participate in the 1995 Stock
Option Plan as specified by Rule 428 under the Securities Act of 1933.
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 (the "Commission") pursuant to the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), by Wireless Xcessories Group, Inc. (the
"Company") (File No. 000-27996) are incorporated herein by reference:
(a) Annual Report on Form 10-K for the fiscal year ended December
31, 1999.
(b) Current Report on Form 8-K filed on February 11, 2000.
(c) Item 1 of the Registration Statement of the Company on Form
8-A dated March 18, 1996.
All documents filed by the Company pursuant to Sections 13(a), 13(c),
14 or 15(d) of the Exchange Act, after the date of this Registration Statement
and prior to the termination of the offering, shall be deemed to be incorporated
by reference herein and to be part hereof from the date of filing such
documents. Any statement contained herein or in a document incorporated by
reference or deemed to be incorporated by reference herein shall be deemed to be
modified or superseded for purposes of this Registration Statement to the extent
that such statement is modified or superseded by any other subsequently filed
document which is incorporated or is deemed to be incorporated by reference
herein. Any such statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this Registration
Statement.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF OFFICERS AND DIRECTORS.
As set forth below, the Company has adopted the provisions of Section
102(b)(7) of the Delaware General Corporation Law (the "DGCL") which eliminate
or limit the personal liability of a director to the Company or its stockholders
for monetary damages for breach of fiduciary duty under certain circumstances.
Furthermore, under Section 145 of the DGCL, the Company shall indemnify each
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of its directors and officers against expenses (including reasonable costs,
disbursements, and counsel fees) in connection with any proceeding involving
such person by reason of having been an officer or director of the Company. In
addition, the Company has obtained Directors' and Officers' Liability Insurance
in the aggregate amount of $3,000,000 which insures its officers and directors
against certain liabilities such persons may incur in their capacities as
officers or directors of the Company.
Article VIII of the Company's By-Laws provides as follows:
Section 8.1 Indemnification. The Company shall indemnify each director,
officer, employee and agent of the Company who is a natural person, such
person's heirs, executors and administrators (whether or not natural persons)
and all other natural persons whom the Company is authorized to indemnify under
the provisions of the General Corporation Law of the State of Delaware
(including but not limited to a person who is or was serving at the request of
the Company as a director, officer, partner, trustee, employee or agent (or in a
like capacity) of another corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise), to the fullest extent permitted by
law, (i) against all expenses (including but not limited to attorneys' and other
experts' fees and disbursements), judgments, fines and amounts paid in
settlement actually and reasonably incurred by such person in connection with
any actual or threatened action, suit or other proceeding, whether civil,
criminal, administrative, investigative or an arbitration, or in connection with
any appeal therein, or otherwise, and (ii) against all expenses (including but
not limited to attorneys' and other experts' fees and disbursements) actually
and reasonably incurred by such person in connection with the defense or
settlement of any action, suit or other proceeding, by or in the right of the
Company, or in connection with any appeal therein, or otherwise; and no
provision of these By-Laws is intended to be construed as limiting, prohibiting,
denying or abrogating any of the general or specific powers or rights conferred
under the General Corporation Law of the State of Delaware upon the Company to
furnish, or upon any court to award, such indemnification, or such other
indemnification as may otherwise be authorized pursuant to the General
Corporation Law of the State of Delaware or any other law now or hereafter in
effect, including but not limited to indemnification of any employees or agents
of the Company or of another corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise. The term "proceeding" shall be
understood to include any inquiry or investigation that could lead to a
proceeding. The indemnification provided for herein shall not be deemed
exclusive of any other rights to which a person seeking indemnification may be
entitled and shall continue as to a person who has ceased to be a director,
officer, employee or agent and shall inure to the benefit of such person's
heirs, executors and administrators.
Section 8.2 Determinations. If and to the extent such indemnification
shall require a determination whether or not the relevant person met the
applicable standard of conduct set forth in the General Corporation Law of the
State of Delaware, such determination shall be made expeditiously at the cost of
the Company after a request for the same from the person seeking
indemnification. If indemnification is to be given or an advance of expenses is
to be made upon a determination by independent legal counsel, such counsel may
be the regular counsel to the Company. In rendering such opinion, such counsel
shall be entitled to rely upon statements of fact furnished to them by persons
reasonably believed by them to be credible, and such counsel shall have no
liability or responsibility for the accuracy of the facts so relied upon, nor
shall such counsel have any liability for the exercise of their own judgment as
to matters of fact or law forming a part of the process of providing such
opinion. The fees and disbursements of counsel engaged to render such opinion
shall be paid by the Company whether or not such counsel ultimately are able to
render the opinion that is the subject of their engagement.
<PAGE>
Section 8.3 Business Combinations. Unless the Board of Directors shall
determine otherwise with reference to a particular merger or consolidation or
other business combination, for purposes of this Article VIII references to "the
Company" shall include, in addition to the resulting corporation, any
constituent corporation (including any constituent of a constituent) absorbed in
an merger or consolidation or other business combination which, if its separate
existence had continued, would have had power and authority to indemnify its
directors, officers, employees or agents, so that any person who is or was a
director, officer, employee or agent of such constituent corporation, or is or
was serving at the request of such constituent corporation as a director,
officer, partner, trustee, employee, agent (or in a like capacity) of another
corporation, partnership, joint venture, trust, employee benefit pln or other
enterprise, shall stand in the same position under the provisions of this
Article VIII with respect to the resulting or surviving corporation as such
person would have with respect to such constituent corporation if its separate
existence had continued.
Section 8.4 Advances of Expenses. If a person who may be entitled to
indemnification hereunder shall request that such person's expenses actually and
reasonably incurred in connection with any action, suit, proceeding, arbitration
or investigation or appeal therein be paid by the Company in advance of the
final disposition thereof, such request shall not be unreasonably refused, and a
response to such request shall not be unreasonably delayed, by the Company.
Section 8.5 Employee Benefit Plans. References herein to "fines" shall
include any excise taxes assessed on a person with respect to an employee
benefit plan; and references to "serving at the request of the Company" shall
include any service as a corporate agent which imposes duties on, or involves
services by, the corporate agent with respect to an employee benefit plan, its
participants, or beneficiaries. A person who acted in good faith and in a manner
such person reasonably believed to be in the interest of the participants and
beneficiaries of an employee benefit plan shall be deemed to have acted in a
manner not opposed to the best interests of the Company.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
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ITEM 8. EXHIBITS.
4 Specimen copy of Common Stock Certificate (Incorporated by
reference to Exhibit 4(a) to the Company's Registration
Statement on Form S-1, as amended (File No. 33- 80939)).
5 Opinion of Ballard Spahr Andrews & Ingersoll, LLP as to the
legality of the securities to be offered.
23.1 Consent of Deloitte & Touche LLP.
23.2 Consent of Arthur Andersen LLP.
23.3 Consent of Ballard Spahr Andrews & Ingersoll, LLP (included as
part of Exhibit 5).
24 Power of Attorney (included on signature page).
99 Wireless Xcessories Group, Inc. 1995 Stock Option Plan.
ITEM 9. UNDERTAKINGS
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(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 arising
after the effective date of the 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 the registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do
not apply if the registration statement is on Form S-3 or Form S-8, and the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the registrant pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
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(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.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
The Company hereby undertakes that, for purposes 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 an
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.
<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 Huntingdon Valley, Commonwealth of Pennsylvania, on
April 13, 2000.
WIRELESS XCESSORIES GROUP, INC.
By: /s/ Stephen Rade
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Stephen Rade
President and Chief Executive Officer
Each person whose signature appears below in so signing also makes,
constitutes and appoints Stephen Rade and Ronald Badke, and each of them, his
true and lawful attorney-in-fact, with full power of substitution, for him in
any and all capacities, to execute and cause to be filed with the Securities and
Exchange Commission any and all amendments and post-effective amendments to this
Registration Statement, with exhibits thereto and other documents in connection
therewith, and hereby ratifies and confirms all that said attorney-in-fact or
his substitute or substitutes may do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Christopher F. McConnell Chairman of the Board April 13, 2000
- ----------------------------------------
Christopher F. McConnell
/s/ Stephen Rade President, Chief Executive Officer
- ---------------------------------------------- and Director (Principal Executive April 13, 2000
Stephen Rade Officer)
/s/ Ronald E. Badke Chief Financial Officer and April 13, 2000
- ---------------------------------------------- Secretary (Principal Financial
Ronald E. Badke Officer and Principal Accounting
Officer)
/s/ Allan Kalish Director April 13, 2000
- ----------------------------------------------
Allan Kalish
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
/s/ Barbara M. Henagan Director April 13, 2000
- -------------------------------------------
Barbara M. Henagan
/s/ Bradley T. MacDonald Director April 13, 2000
- ------------------------------------------
Bradley T. MacDonald
/s/ Robert W. Tauber Director April 13, 2000
- -----------------------------------------
Robert W. Tauber
/s/ Christopher C. Cole Director April 13, 2000
- -----------------------------------------
Christopher C. Cole
</TABLE>
<PAGE>
EXHIBIT INDEX
Number Exhibit
- ------ -------
4 Specimen copy of Common Stock Certificate (Incorporated by
reference to Exhibit 4(a) to the Company's Registration
Statement on Form S-1, as amended (File No. 33- 80939)).
5 Opinion of Ballard Spahr Andrews & Ingersoll, LLP as to the
legality of the securities to be offered.
23.1 Consent of Deloitte & Touche LLP.
23.2 Consent of Arthur Andersen LLP.
23.3 Consent of Ballard Spahr Andrews & Ingersoll, LLP (included as
part of Exhibit 5).
24 Power of Attorney (included in signature page).
99 Wireless Xcessories Group, Inc. 1995 Stock Option Plan.
<PAGE>
Exhibit 5
[LETTERHEAD OF BALLARD SPAHR ANDREWS & INGERSOLL, LLP]
April 13, 2000
Wireless Xcessories Group, Inc.
1840 County Line Road
Huntingdon Valley, PA 19006
Re: Common Stock to be Issued Pursuant to
Wireless Xcessories Group, Inc. 1995 Stock Option Plan
Gentlemen:
We have acted as counsel to Wireless Xcessories Group, Inc., a Delaware
corporation (the "Company"), in connection with the registration under the
Securities Act of 1933, as amended, of 600,000 shares of the Company's common
stock, par value $0.001 per share (the "Shares"), issuable upon the exercise of
options outstanding under the Wireless Xcessories Group, Inc. 1995 Stock Option
Plan (the "Plan").
In rendering our opinion, we have reviewed the Plan and such
certificates, documents, corporate records and other instruments and matters of
law as in our judgment are necessary or appropriate to enable us to render the
opinion expressed below. In giving this opinion, we are assuming the
authenticity of all instruments presented to us as originals, the conformity
with the originals of all instruments presented to us as copies and the
genuineness of all signatures.
Based on the foregoing, we are of the opinion that the Shares, when
issued upon the exercise of options granted under the Plan in accordance with
the terms and conditions thereof, will be legally issued, fully paid and
non-assessable.
This opinion is limited to the matters expressly stated herein. No
implied opinion may be inferred to extend this opinion beyond the matters
expressly stated herein. We do not undertake to advise you or anyone else of any
changes in the opinions expressed herein resulting from changes in law, changes
in facts or any other matters that hereafter might occur or be brought to our
attention.
We consent to the filing of this opinion as Exhibit 5 to the
Registration Statement on Form S-8 being filed with respect to the offering of
the Shares.
Very truly yours,
/s/ Ballard Spahr Andrews & Ingersoll, LLP
<PAGE>
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Wireless Xcessories Group, Inc. (formerly, Batteries Batteries, Inc.) on
Form S-8 of our reports dated March 30, 1999, appearing in the Annual Report
on Form 10-K of Wireless Xcessories, Inc. for the year ended December 31, 1999.
/s/ DELOITTE & TOUCHE LLP
San Diego, California
April 11, 2000
<PAGE>
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Board of Directors and Stockholders Wireless Xcessories Group, Inc.:
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our report dated March 30, 2000
included in Wireless Xcessories Group, Inc.'s Form 10-K for the year ended
December 31, 1999 and to all references to our firm included in this
registration statement.
/s/ Arthur Andersen LLP
Philadelphia, Pennsylvania
April 12, 2000
<PAGE>
WIRELESS XCESSORIES GROUP, INC.
1995 STOCK OPTION PLAN
1. PURPOSE OF PLAN. The Wireless Xcessories Group, Inc. Stock Option
Plan (the "Plan") is intended as an incentive to attract and retain persons of
training, experience and ability as directors, employees and non-employee
consultants and advisors of Wireless Xcessories Group, Inc. (the "Company") and
its subsidiaries to encourage the sense of proprietorship of such persons, and
to stimulate the active interest of such persons in the development and
financial success of the Company and its subsidiaries. Stock options ("Options")
granted under the Plan may, at the discretion of the granting authority, but
need not contain such terms as will qualify the Options as incentive stock
options ("ISOs") within the meaning of Section 422 of the Internal Revenue Code
of 1986, as amended (the "Code"), or any successor provision thereto.
2. ADMINISTRATION OF PLAN. The Board of Directors (the "Board") or a
Stock Option Committee (the "Committee") appointed and maintained by the Board
shall have the power to administer the Plan. The Committee shall consist of at
least two members who shall serve at the pleasure of the Board. The Board or the
Committee shall have full power and authority (i) to designate participants;
(ii) to designate Options or any portion thereof as ISOs; (iii) to determine the
terms and provisions of respective Option Agreements (which need not be
identical) including, but not limited to, provisions concerning the time or
times when and the extent to which the Options may be exercised and the nature
and duration of restrictions as to transferability or restrictions constituting
substantial risk of forfeiture; (iv) to accelerate the right of an optionee to
exercise in whole or in part any previously granted Option; and (v) to interpret
the provisions and supervise the administration of the Plan.
<PAGE>
The Board or the Committee shall also have the authority to
grant Options in its discretion to the holder of an outstanding Option, in
addition to or in exchange for the surrender and cancellation of the outstanding
Option, which additional or new Option may have a purchase price lower than
provided in the outstanding Option and containing such other terms and
conditions as the Board or the Committee may prescribe in accordance with the
provisions of the Plan.
All decisions and selections made by the Board or the
Committee pursuant to the provisions of the Plan shall be made by a majority of
its members except that no member of the Board or Committee shall vote on or be
counted for quorum purposes, with respect to any proposed action of the Board or
Committee relating to any Option to be granted to that member. Any decision
reduced to writing and signed by a majority of the members who are authorized to
make such decision shall be fully effective as if it had been made by a majority
at a meeting duly held.
Each member of the Board or Committee shall be indemnified and
held harmless by the Company against any cost or expense (including counsel
fees) reasonably incurred by him or liability including any sum paid in
settlement of a claim with the approval of the Company arising out of any act or
omission to act in connection with the Plan unless arising out of such member's
own fraud or bad faith, to the extent permitted by applicable law. Such
indemnification shall be in addition to any rights of indemnification the member
may have as director or otherwise under the by-laws of the Company, any
agreement, vote of stockholders or disinterested directors, or otherwise.
3. DESIGNATION OF PARTICIPANTS. The persons eligible for participation
in the Plan as recipients of Options shall include only directors of the Company
and employees and
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non-employee consultants and advisors of the Company or any of its subsidiaries;
provided that only employees of the Company or of any subsidiary of the Company
shall be eligible to be recipients of ISOs; and provided further that eligible
consultants and advisors shall be only those who render bona fide services to
the Company or any subsidiary, which services may not be in connection with the
offer or sale of securities in a capital raising transaction.
4. STOCK RESERVED FOR PLAN. Subject to adjustment as provided in
paragraph 6 hereof, a total of 600,000 shares of the Common Stock, $.001 par
value, of the Company ("Stock") shall be subject to the Plan. The shares subject
to the Plan shall consist of unissued shares and such number of shares shall be
and hereby is reserved for sale for such purpose. Any of such shares which may
remain unsold and which are not subject to outstanding Options at the
termination of the Plan shall cease to be reserved for the purpose of the Plan,
but until termination of the Plan, the Company shall at all times reserve a
sufficient number of shares to meet the requirements of the Plan. Should any
Option for any reason expire or be cancelled prior to its exercise or
termination in full, the shares therefor subject to such Option may again be
subjected to an Option under the Plan.
5. OPTION PRICE. (a) The purchase price of each share subject to an ISO
shall not be less than 100% (or 110%, if at the time of grant the optionee owns,
directly or indirectly, more than 10% of the combined voting power of all
classes of stock of the Company or of any subsidiary of the Company) of the Fair
Market Value of such share (as defined in paragraph (b)) on the date the ISO is
granted. The purchase price of each share subject to an Option or any portion
thereof which is not designated by the Board or the Committee as an ISO shall
not be less than the greater of 75% of the Fair Market Value of such share on
the date the Option is granted or the par value of the Company's Stock.
3
<PAGE>
(b) The determination of the Fair Market Value of a share shall be made
by the Board of Directors using such method as it determines to be reasonable in
the circumstances unless the shares of Common Stock are listed or admitted for
trading on a national securities exchange or on the National Association of
Securities Dealers Associated Quotation System ("NASDAQ"), or if not so listed
or admitted, selling prices are quoted by the National Quotation Bureau, Inc. If
listed or admitted, the Fair Market Value of the share shall be the closing sale
price on:
A. The date of grant on:
(i) the national securities exchange, if listed
or admitted on such exchange; or
(ii) if not so listed or admitted, on NASDAQ, if
listed or admitted on NASDAQ; or
B. If no sales have been effected on such date, the average of
the closing sale price on the most recent three trading days preceding
the date of grant on the national securities exchange on which it is
listed or admitted or on NASDAQ if not listed or admitted on an
exchange or, if no such sales were effected on any of such markets
during such three trading days, the Fair Market Value shall be the mean
between the high bid and low asked prices on the exchange or NASDAQ on
the date of grant, as the case may be.
C. If the shares are traded in the over-the-counter market and
not listed or admitted on NASDAQ, the Fair Market Value of a share
shall be the mean between the high bid and low asked prices as quoted
for the date of grant by the National Quotation Bureau in its "pink
sheets" or equivalent record or publication or, if no bid prices are
4
<PAGE>
quoted on such date, the next preceding date to the date of grant for
which a bid price is quoted.
(c) The option price shall be payable upon the exercise of the Option
in cash, by check, or, at the option of the Board or the Committee, shares of
the Company's stock value at their Fair Market Value or other form satisfactory
to the Board or the Committee.
(d) The proceeds of the sale of the Stock subject to an Option are to
be added to the general funds of the Company and used for its corporate
purposes.
6. ADJUSTMENTS (a) If the company is reorganized or merged or
consolidated with another corporation while unexercised Options remain
outstanding under the Plan, there shall be substituted for the shares subject to
the unexercised portions of such outstanding Options an appropriate number of
shares of each class of stock or other securities of the reorganized, or merged
or consolidated corporation based on the number of shares which were distributed
to the stockholders of the Company in respect of their shares, provided,
however, that the unexercised Options outstanding under the Plan immediately
prior to such reorganization, merger or consolidation may be exercised in full
by the optionees as of the effective date of any such reorganization, merger or
consolidation of the Company, without regard to the installment exercise
provisions of the Option, by the optionees giving notice in writing to the
Company of their intention to so exercise.
(b) If the Company is liquidated or dissolved while unexercised Options
remain outstanding under the Plan, then all such outstanding Options may be
exercised in full by the optionees as of the effective date of any such
liquidation or dissolution of the Company without
5
<PAGE>
regard to the installment exercise provisions of the Option by the optionees
giving notice in writing to the Company of their intention to so exercise.
(c) If the outstanding shares of stock shall at any time be changed or
exchanged by declaration of a stock dividend, stock split, combination or
exchange of shares, recapitalization, extraordinary dividend payable in stock of
a corporation other than the Company, or otherwise in cash, or any like event by
or of the Company, and as often as the same shall occur, then the number, class
and kind of shares subject to this Plan and subject to any outstanding Options
theretofore granted, and the option prices, shall be appropriately and equitably
adjusted so as to maintain the proportionate number of shares without changing
the aggregate option price, provided, however, that no adjustment shall be made
by reason of the distribution of subscription rights on outstanding stock.
7. TERM AND EXERCISE OF OPTIONS. (a) The Option Agreement evidencing
the option shall set forth the terms of the Option including the period during
which it must be exercised, except that no Option may be exercisable after the
expiration of 10 years from the date of grant or, if granted to a person who
owns more than 10% of the voting stock of the Company at the time of grant,
after the expiration of five years from the date of grant.
(b) Options granted under the Plan shall not be transferable by
optionees other than by will or the laws of descent and distribution, and during
an optionee's lifetime shall be exercisable only by that optionee.
(c) Options granted to the Company's employees or directors may not be
exercised after the termination of the term of employment of the employee or, if
the optionee is a non-employee director, after service as a director, unless (i)
prior to the date of termination of
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employment or service, the Board or the Committee shall authorize, in the
relevant Option Agreement or otherwise, an extension of the term of all or part
of the Option beyond the date of such termination for a period not to exceed the
period during which the Option by its terms would otherwise have been
exercisable, (ii) termination of employment is without cause of the optionee, in
which event any Option still in force and unexpired may be exercised within a
period of 90 days from the date of such termination, but only with respect to
the number of shares purchasable at the time of such termination, or (iii)
termination is the result of death or disability, in which event any Option
still in force and unexpired may be exercised in whole or in part without regard
to the installment exercise provisions of the Option, within a period designated
in the Option Agreement, but not less than 60 days from the date of termination.
An Option held by a non-employee consultant or advisor which is still in force
and unexpired on the date of such person's death may be exercised by such
person's legal representative in whole or in part without regard to the
installment exercise provisions of the Option, within a period designated in the
Option Agreement, but not less than 60 days from the date of death.
(d) The holders of Options shall not be or have any of the rights or
privileges of stockholders of the Company in respect of any shares purchasable
upon the exercise of any part of an Option unless and until, following exercise,
certificates representing such shares shall have been issued by the Company to
such holders.
(e) Any form of Option Agreement authorized by the Plan may contain
such other provisions as the Board or the Committee may, from time to time, deem
advisable. Without limiting the foregoing, the Board or the Committee may, with
the consent of the optionee, from time to time cancel all or any portion of any
Option then subject to exercise, and the Company's obligation in respect of such
Option may be discharged by (i) payment to the optionee of an
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amount in cash equal to the excess, if any, of the Fair Market Value of the
shares at the date of such cancellation subject to the portion of the Option so
cancelled over the aggregate price of such shares, (ii) the issuance or transfer
to the optionee of shares of Stock with a Fair Market Value at the date of such
transfer equal to any such excess or (iii) a combination of cash and shares with
a combined value equal to any such excess, all as determined by the Board or the
Committee in its sole discretion.
(f) Options shall be exercised by the optionee by giving written notice
to the Company which exercise shall be effective upon receipt of such notice by
the Secretary of the Company at its principal office. The notice shall specify
the number of shares with respect to which the Option is being exercised.
8. MAXIMUM ISO AWARD. The aggregate Fair Market Value of Stock
(determined as of the date of the grant of options) with respect to which ISOs
are exercisable for the first time by any optionee during any calendar year
shall not exceed the limitation provided under Section 422 of the Code or any
successor provision thereto.
9. PURCHASE FOR INVESTMENT. Unless shares of Stock covered by the plan
have been registered under the Securities Act of 1933, as amended (the "Act"),
or the Company has determined that such registration is unnecessary, each person
exercising an Option under the Plan may be required by the Company to give a
representation in writing that such person is acquiring such shares for his or
her own account for investment and not with a view to, or for sale in connection
with, the distribution of any part thereof. The Company reserves the right to
appropriately legend certificates evidencing the share issuable upon exercise
that the shares may not be sold or transferred until they are registered under
the Act or transferred in a transaction
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exempt from registration thereunder and to place stop transfer orders on their
records as to such shares.
10. TERMINATION OF PLAN. The Plan shall be effective as of June 6,
1995 and shall terminate on a date 10 years thereafter.
11. AMENDMENTS OR TERMINATION. The Board may amend, alter, or
discontinue the Plan except that no amendment or alteration shall be made which
would impair the rights of the holder of any Option therefore granted without
his consent, and except that no amendment or alteration shall be made which,
without the approval of the stockholders of the Company, would:
(a) Increase the total number of shares reserved for the purposes of
the Plan, except as is provided in Section 6, or decrease the minimum option
price provided in Section 5, or change the class of persons eligible to
participate in the Plan as provided in Section 3; or
(b) Extend the option period provided for Section 7.
12. GOVERNMENT REGULATIONS. The Plan and the granting and exercise of
Options hereunder, and the obligation of the Company to sell and deliver shares
or cash under such Options shall be subject to all applicable laws, rules, and
regulations, including the registration of the shares under to the Securities
Act of 1933, and to such approvals by any governmental agencies or national
securities exchanges as may be required.
13. GOVERNING LAW. This Plan shall be deemed made in the State of New
York and shall be governed by and construed and enforced in accordance with the
laws of such State applicable to contracts made and to be performed in such
State, without giving effect to the principles of conflict of laws.
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