As filed with the Securities and Exchange Commission on August 6, 1996.
Registration No. 333-________
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
SPURLOCK INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
Virginia 84-1019856
(State or other jurisdiction (I.R.S. employer
of incorporation or organization) identification number)
5090 General Mahone Highway
P.O. Box 8 23890
Waverly, Virginia (Zip code)
(Address of principal executive offices)
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SPURLOCK INDUSTRIES, INC.
1995 STOCK INCENTIVE PLAN
(Full title of the plan)
H. Norman Spurlock, Jr.
Vice President and Secretary
5090 General Mahone Highway
P.O. Box 8
Waverly, Virginia 23890
(804) 834-3113
(Name, address and telephone
number of agent for service)
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<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
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<S> <C> <C> <C> <C>
Proposed
Title of securities Amount to be Proposed maximum maximum aggregate Amount of
to be registered registered(1) offering price per share(2) offering price registration fee
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Common Stock, no par value....... 500,000 $.8435 $421,750 $146
==================================================================================================================================
</TABLE>
(1) The amount of Common Stock registered hereunder shall be deemed to include
any additional shares issuable as a result of any stock split, stock dividend or
other change in the capitalization of the Registrant. (2) Pursuant to Rule
457(h), the offering price is based on the average of the bid ($.50) and asked
($1.187) prices as reported on the OTC Bulletin Board for August 1, 1996.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
The following documents previously filed by the Registrant with the
Securities and Exchange Commission are incorporated herein by reference and made
a part hereof:
(1) the Registrant's Quarterly Report on Form 10-Q for the quarter
ended March 31, 1996, filed pursuant to Section 13(a) or 15(d)
of the Securities Exchange Act of 1934, as amended (the
"Exchange Act").
All documents subsequently filed by the Registrant pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a
post-effective amendment which indicates that all securities offered have been
sold or which deregisters all securities then remaining unsold, shall be deemed
to be incorporated by reference herein and to be a part hereof from the date of
filing of such documents. Any statement contained in a document incorporated 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 a
statement contained herein or in any other subsequently filed document which
also is or is deemed to be incorporated by reference herein modified or
supersedes such earlier statement. 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
The description of the Common Stock to be registered hereunder is set
forth as follows:
Authorized and Outstanding Capital Stock
The Registrant's authorized capital stock consists of 50,000,000 shares
of Common Stock and 5,000,000 shares of preferred stock, no par value per share
(the "Preferred Stock"). On July 15, 1996, there were 6,725,066 shares of the
Common Stock and no shares of the Preferred Stock issued and outstanding. All of
the outstanding shares of the Common Stock are validly issued, fully paid and
non-assessable.
Common Stock. The holders of the Common Stock are entitled to one vote
for each share on all matters voted on by shareholders, including elections of
directors, and, except as otherwise required by law or provided in any
resolution adopted by the Board of Directors with respect to any series of the
Preferred Stock, the holders of such shares exclusively possess all voting
power. The Amended and Restated Articles of Incorporation of the Registrant (the
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"Articles") do not provide for cumulative voting in the election of directors.
Subject to any preferential rights of any outstanding series of the Preferred
Stock created by the Board of Directors from time to time, the holders of the
Common Stock are entitled to such dividends as may be declared from time to time
by the Board of Directors from funds available therefor, and upon liquidation
are entitled to receive pro rata all assets of the Registrant available for
distribution to such holders.
Preferred Stock. Under the Articles, the Board of Directors, without
shareholder approval, is authorized to issue shares of the Preferred Stock in
one or more series and to designate, with respect to each such series of the
Preferred Stock, the number of shares in each such series, the dividend rates,
preferences and date of payment, whether or not dividends shall be cumulative
and, if cumulative, the date or dates from which the same shall be cumulative,
voluntary and involuntary liquidation preferences, the availability of
redemption and the prices at which it may occur, the rights, if any, and the
terms and conditions upon which shares can be converted into or exchanged for
shares of any other class or series, and the voting rights, if any. Any issued
Preferred Stock may be senior to the Common Stock as to dividends and as to
distribution in the event of liquidation, dissolution or winding up of the
Registrant. The ability of the Board of Directors to issue the Preferred Stock,
while providing flexibility in connection with possible acquisitions and other
corporate purposes, could, among other things, adversely affect the voting power
of holders of the Common Stock.
The Registrant believes that the Preferred Stock will provide the
Registrant with flexibility in structuring possible future financings and
acquisitions, and in meeting other corporate needs which might arise. Having
such authorized shares available for issuance will allow the Registrant to issue
shares of the Preferred Stock without the expense and delay of a special
shareholders' meeting. The authorized shares of the Preferred Stock, as well as
shares of the Common Stock, will be available for issuance without further
action by shareholders, unless such action is required by applicable law or the
rules of any stock exchange or stock market on which the Registrant's securities
may be listed. Although the Board of Directors has no intention at the present
time of doing so, it could issue a series of the Preferred Stock that, subject
to certain limitations imposed by the securities laws, could impede the
completion of a merger, tender offer, takeover attempt or other transaction that
some, or a majority, of the shareholders might believe to be in their best
interests or in which shareholders might receive a premium for their stock over
the then current market price of such stock. This impediment might be
accomplished by, among other things, selling a substantial number of shares of
the Preferred Stock to persons who have an arrangement with the Registrant
concerning the voting of such shares, or by distributing shares of the Preferred
Stock, or rights to receive such shares, to the shareholders. In this respect,
certain corporations have issued as a dividend to their common stockholders
shares of preferred stock or rights to acquire shares of preferred stock having
terms designed to encourage negotiated rather than unilateral takeover proposals
and to protect against the adverse consequences of certain abusive takeover
tactics such as open market accumulation programs and partial and front-end
loaded takeovers and freezeouts. The shares of authorized Preferred Stock would
be available for such purposes, and the Board of Directors from time to time may
consider issuing shares of the Preferred Stock for such purposes. The
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ability to issue shares of the Preferred Stock also would allow the Board of
Directors to issue shares only to shareholders supportive of management's
position. This ability could provide management with the means to block a
business combination considered desirable by some shareholders. In addition, the
Board of Directors could authorize the issuance of a series of the Preferred
Stock that votes as a class, either separately or with the holders of the Common
Stock, on any merger, sale or exchange of assets by the Registrant or any other
extraordinary corporate transaction. The Board of Directors will make any
determination to issue such shares based on its judgment as to the best
interests of the Registrant and its shareholders at the time of issuance.
Preemptive Rights. No holder of any share of the Common Stock or the
Preferred Stock, now or hereafter authorized, shall have any preemptive right to
subscribe to any securities of the Registrant of any kind or class.
Liability and Indemnification of Directors and Officers
As permitted by the Virginia Stock Corporation Act (the "Virginia
Act"), the Articles contain provisions which indemnify directors and officers of
the Registrant to the full extent permitted by Virginia law and seek to
eliminate the personal liability of directors and officers for monetary damages
to the Registrant or its shareholders for breach of their fiduciary duties,
except to the extent that such indemnification or elimination of liability is
prohibited by the Virginia Act. These provisions do not limit or eliminate the
rights of the Registrant or any shareholder to seek an injunction or any other
non-monetary relief in the event of a breach of a director's or officer's
fiduciary duty. In addition, these provisions apply only to claims against a
director or officer arising out of his role as a director or officer and do not
relieve a director or officer from liability if he engaged in willful misconduct
or a knowing violation of the criminal law or any federal or state securities
law.
In addition, the Articles provide for the indemnification of both
directors and officers for expenses incurred by them in connection with the
defense or settlement of claims asserted against them in their capacities as
directors and officers. In certain cases, this right of indemnification extends
to judgments or penalties assessed against them. The Registrant may limit its
exposure to liability for indemnification of directors and officers by
purchasing directors and officers liability insurance coverage.
The purpose of these provisions is to assist the Registrant in
retaining qualified individuals to serve as directors by limiting their exposure
to personal liability for serving as such. On December 21, 1995, Air Resources
Corporation ("Air Resources"), the predecessor to the Registrant pursuant to an
Agreement and Plan of Merger, dated as of February 15, 1996, between Air
Resources and the Registrant (the "Merger Agreement"), and effective July 15,
1996 (the "Effective Date"), entered into an Indemnification Agreement with
Phillip S. Sumpter upon his appointment to the Board of Directors. The
Indemnification Agreement provides for the indemnification of Mr. Sumpter
against claims, losses, liabilities, damages, costs and expenses that he may
suffer as a result of his service as a director of Air Resources, to the full
extent that such indemnification is permitted and not prohibited by applicable
federal or state
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law, including securities law, or the Certificate of Incorporation of Air
Resources. The Registrant has succeeded to and assumed all the rights and
obligations of Air Resources under the Indemnification Agreement.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933, as amended (the "Securities Act"), may be permitted to officers and
directors pursuant to the foregoing provisions or otherwise, the Registrant
understands that it is the opinion of the Securities and Exchange Commission
that such indemnification is against public policy as expressed in the
Securities Act and therefore unenforceable. In the event that a claim for
indemnification with respect to the capital stock of the Registrant is asserted
by an officer or a director (except for the payment of expenses incurred in the
successful defense of any claim), the Registrant, unless the question has
already been settled by controlling precedent, will submit to a court of
appropriate jurisdiction the question of whether or not such indemnification by
it is against public policy as expressed in the Securities Act and will be
governed by the final adjudication of such issue.
Anti-Takeover Effects of Certain Provisions of the Articles and Bylaws
The Articles contain several provisions that will make more difficult
the acquisition of control of the Registrant by various means, such as a tender
offer or open market purchases not approved by the Board of Directors or a proxy
contest. The Bylaws of the Registrant (the "Bylaws") also contain provisions
that could have an anti-takeover effect.
The purposes of these provisions are to discourage certain types of
non-negotiated transactions and to encourage persons seeking to acquire control
of the Registrant to consult first with the Board of Directors to negotiate the
terms of any proposed business combination or offer. The provisions are designed
to reduce the vulnerability of the Registrant to an unsolicited proposal for a
takeover that does not contemplate the acquisition of all outstanding shares or
is otherwise unfair to shareholders of the Registrant, or an unsolicited
proposal for the restructuring or sale of all or part of the Registrant.
These provisions will help ensure that the Board of Directors, if
confronted by a proposal from a third party, will have sufficient time to review
the proposal and any alternatives thereto and to act in what it believes to be
the best interests of the shareholders.
These provisions may make difficult and may discourage a merger, tender
offer or proxy fight even if such a transaction could prove favorable to the
interests of the shareholders and may delay or frustrate the assumption of
control by a holder of a large block of the Registrant's capital stock and the
removal of incumbent management, even if such removal might be beneficial to
shareholders. Furthermore, these provisions may deter or could be utilized to
frustrate a future takeover attempt which is not approved by the incumbent Board
of Directors, but which the holders of a majority of the shares may deem to be
in their best interests or in respect of which shareholders may receive a
substantial premium for their stock over prevailing market prices of such stock.
By discouraging takeover attempts, these provisions might have
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the incidental effect of inhibiting certain changes in management (some or all
of the members of which might be replaced in the course of a change of control)
and also the temporary fluctuations in the market price of stock which often
result from actual or rumored takeover attempts.
Set forth in the following sections are descriptions of such provisions
of the Articles and Bylaws. Capitalized terms used and not defined herein are
defined in the Articles or Bylaws, as the case may be.
Classified Board of Directors
The Articles provide that, commencing with the first shareholders'
meeting at which directors are elected, the Board of Directors shall be divided
into three classes, as nearly equal in number as is reasonably possible, with
one class of directors serving until the 1997 annual meeting, one class serving
until the 1998 annual meeting, and one class serving until the 1999 annual
meeting of the Registrant's shareholders. Beginning with the 1997 annual meeting
of shareholders, one class of directors will be elected each year for a
three-year term.
The Registrant believes that a classified board of directors will help
to assure the continuity and stability of the Board of Directors and the
Registrant's business strategies and policies as determined by the Board of
Directors because generally a majority of the directors at any given time will
have had prior experience as directors of the Registrant. The classification of
directors also will have the effect of making it more difficult for shareholders
to change the composition of the Board of Directors in a relatively short period
of time. At least two annual meetings of shareholders, instead of one, will
generally be required to effect a change in a majority of the Board of
Directors. Such a delay may help ensure that the Board of Directors, if
confronted by a shareholder conducting a proxy contest or an extraordinary
corporate transaction, will have sufficient time to review the proposal and any
alternatives to the proposal and to act in what it believes is the best
interests of the shareholders.
Number of Directors; Vacancies and Removal
The Articles provide that the Board of Directors will consist of not
less than three nor more than eleven directors, and the exact number of
directors will be determined from time to time by resolution adopted by a
majority of the total number of directors which the Registrant would have if
there were no vacancies (the "Whole Board") or by the affirmative vote of at
least eighty percent (80%) of the votes entitled to be cast by the Voting Stock.
In addition, the Articles provide that, subject to any rights of the holders of
the Preferred Stock, only a majority of the Board of Directors then in office
shall have the authority to fill any newly created directorships resulting from
any increase in the authorized number of directors or any vacancies on the Board
of Directors resulting from death, resignation, retirement, disqualification,
removal from office or other cause. Accordingly, the Board of Directors could
prevent any shareholder from obtaining majority representation on the Board of
Directors by enlarging the Board of Directors and filling the new directorships
with its own nominees.
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Moreover, the Articles provide, subject to any rights of the holders of
any class or series of the Preferred Stock, that directors may be removed only
for cause and only by the affirmative vote of holders of at least eighty percent
(80%) of the votes entitled to be cast by the Voting Stock. The term "Voting
Stock" is defined in the Articles to mean the outstanding shares of all classes
and series of capital stock of the Registrant entitled to vote on a matter and
voting together as a single voting group. This provision, when coupled with the
provision of the Articles authorizing only the Board of Directors to fill vacant
directorships, will preclude shareholders from removing incumbent directors
without cause and filling the vacancies created by such removal with their own
nominees.
Limitations on Shareholder Action by Written Consent; Special Meetings
The Virginia Act permits shareholder action by written consent in lieu
of a meeting only when consents are obtained from all of the shareholders who
would be entitled to vote on the matter at a shareholders meeting. In the
absence of unanimous written consent, shareholder action may be taken only at an
annual or special meeting of shareholders. The Articles provide that, subject to
the rights of holders of any class or series of the Preferred Stock, special
meetings of shareholders may be called only by the Chairman of the Board or by
the Board of Directors pursuant to a resolution adopted by a majority of the
Whole Board and may not be called by the shareholders. The business permitted to
be conducted at any special meeting of shareholders is limited to the business
brought before the meeting by or at the direction of the Board of Directors.
The provisions of the Virginia Act restricting shareholder action by
written consent may have the effect of delaying consideration of a shareholder
proposal until the next annual meeting unless a special meeting is called by the
Chairman of the Board or a majority of the Whole Board. Moreover, a shareholder
could not force shareholder consideration of a proposal over the opposition of
the Board of Directors by calling a special meeting of shareholders prior to the
time that the Board of Directors believed such consideration to be appropriate.
Advance Notice Provision for Shareholder Proposals and Shareholder Nominations
of Directors
The Bylaws establish an advance notice procedure with regard to the
nomination, other than by or at the direction of the Board of Directors, of
candidates for election as directors (the "Nomination Procedure") and with
regard to matters to be brought before an annual meeting of shareholders at the
request of a shareholder (the "Business Procedure").
The Nomination Procedure provides that only persons who are nominated
by, or at the direction of, the Board of Directors, or by a shareholder who has
given timely prior written notice to the Secretary of the Registrant prior to
the meeting at which directors are to be elected, will be eligible for election
as directors. The Business Procedure provides that at an annual meeting, and
subject to any other applicable requirements, only such business may be
conducted as has been brought before the meeting by, or at the direction of, the
Board of Directors or by
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a shareholder who has given timely prior written notice to the Secretary of the
Registrant of such shareholder's intention to bring such business (which
business must otherwise be a proper matter for shareholder action) before the
meeting. In the case of the annual meeting, notice to be timely must be received
by the Registrant not later than the close of business on the 60th day nor
earlier than the close of business on the 90th day prior to the first
anniversary of the preceding year's annual meeting. In the case of a special
meeting or of an annual meeting that is more than 30 days before or more than 60
days after the anniversary date of the preceding year's annual meeting, notice
to be timely must be received by the Registrant not earlier than the close of
business on the 90th day prior to such meeting and not later than the close of
business on the later of the 60th day prior to such meeting or the 10th day
following the date on which public announcement is first made of the date of the
meeting by the Registrant.
Under the Nomination Procedure, notice to the Registrant from a
shareholder who proposes to nominate a person at a meeting for election as a
director must contain certain information about that person, including name,
age, principal occupation, the class and number of shares of the Registrant's
capital stock beneficially owned, such person's consent to be nominated and such
other information as would be required to be included in a proxy statement
soliciting proxies for the election of the proposed nominee in an election
contest, and certain information about the shareholder proposing to nominate
that person. Under the Business Procedure, notice relating to the conduct of
business other than the nomination of directors at an annual meeting must
contain certain information about such business and about the shareholder who
proposes to bring the business before the meeting, including a brief description
of the business the shareholder proposes to bring before the meeting, the
reasons for conducting such business at the meeting and any material interest of
such shareholder in the business so proposed. In addition, a shareholder giving
notice pursuant to these provisions of the Bylaws must provide the name and
address of such shareholder and of any beneficial owner on whose behalf the
nomination or proposal is made and the class and number of shares of the
Registrant's capital stock which are owned beneficially and of record by such
shareholder and such beneficial owner. If the Chairman of the Board or other
officer presiding at a meeting determines that a person was not nominated in
accordance with the Nomination Procedure, such person will not be eligible for
election as a director, or if he determines that other business was not properly
brought before such meeting in accordance with the Business Procedure, such
business will not be conducted at such meeting. Nothing in the Nomination
Procedure or the Business Procedure will preclude discussion by any shareholder
of any nomination or business properly made or brought before the meeting in
accordance with the above-mentioned procedures.
By requiring advance notice of nominations by shareholders, the
Nomination Procedure affords the Board of Directors a meaningful opportunity to
consider the qualifications of the proposed nominees and, to the extent deemed
necessary or desirable by the Board of Directors, to inform shareholders about
such qualifications. By requiring advance notice of proposed business, the
Business Procedure provides a more orderly procedure for conducting annual
meetings of shareholders and, to the extent deemed necessary or desirable by the
Board of Directors, provides the Board of Directors with a meaningful
opportunity to inform shareholders, prior to such meetings, of any business
proposed by a shareholder to be conducted at such
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meetings, together with any recommendations as to the Board of Directors'
position or belief as to action to be taken with respect to such business. The
Bylaws may have the effect of precluding a nomination for the election of
directors or precluding the conduct of business at a particular meeting if the
proper procedures are not followed, and may discourage or deter a third party
from conducting a solicitation of proxies to elect its own slate of directors or
otherwise attempting to obtain control of the Registrant, even if the conduct of
such solicitation or such attempt might be believed by a shareholder to be
beneficial to the Registrant and its shareholders.
Transactions with Certain Interested Shareholders
Provisions of the Articles. Article VII of the Articles ("Article VII")
provides that the affirmative vote of the holders of at least eighty percent
(80%) of the votes entitled to be cast by the Voting Stock shall be required for
the approval of transactions with certain interested shareholders. Such
supermajority approval would be required for (i) a merger or consolidation
involving any person or entity who directly or indirectly owns or controls ten
percent (10%) or more of the votes entitled to be cast by the Voting Stock (an
"Interested Shareholder") at the record date for determining shareholders
entitled to vote on such merger or consolidation or (ii) a sale, lease or
exchange of substantially all of the Registrant's assets and property to or with
an Interested Shareholder, or a sale, lease or exchange of substantially all of
the assets and property of an Interested Shareholder to or with the Registrant.
In addition, Article VII provides that the same 80% vote shall be required for
the approval of certain transactions, including a reclassification of
securities, recapitalization, share exchange or other transaction designed to
decrease the number of holders of the Common Stock remaining after any person or
entity has become an Interested Shareholder. Notwithstanding the foregoing, the
supermajority approval requirement will not apply to any transaction that is
approved by the Board of Directors prior to the time that the Interested
Shareholder becomes an Interested Shareholder.
For purposes of Article VII, a person or entity shall not be deemed to
be an Interested Shareholder if (i) on the Effective Date of the Merger
Agreement, such person or entity was the beneficial owner of shares representing
10% or more of the votes entitled to be cast by the Voting Stock or (ii) such
person or entity became the beneficial owner of such shares as a result of
acquiring shares from a person or entity specified in (i) above by gift,
testamentary bequest or the laws of descent and distribution and who has
continued thereafter to be the beneficial owner of shares representing 10% or
more of the votes entitled to be cast by the Voting Stock. The effect of this
provision is to permit shareholders who will beneficially own more than 10% of
the Common Stock on the Effective Date of the Merger Agreement to effect
transactions with the Registrant without compliance with the supermajority
voting requirement of Article VII.
Provisions of the Virginia Act. The Virginia Act contains provisions
governing "Affiliated Transactions" designed to deter certain coercive two-tier
takeovers of Virginia corporations. Affiliated Transactions include certain
mergers and share exchanges, material dispositions of corporate assets not in
the ordinary course of business, any dissolution of the corporation proposed by
or on behalf of an Interested Shareholder (as defined below), or
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reclassifications, including reverse stock splits, recapitalizations or mergers
of the corporation with its subsidiaries which have the effect of increasing the
percentage of voting shares beneficially owned by an Interested Shareholder by
more than 5%. For purposes of the Virginia Act, an Interested Shareholder is
defined as any beneficial owner of more than 10% of any class of the voting
securities of a Virginia corporation.
Subject to certain exceptions discussed below, the provisions governing
Affiliated Transactions require that, for three years following the date upon
which any shareholder becomes an Interested Shareholder, a Virginia corporation
cannot engage in an Affiliated Transaction with such Interested Shareholder
unless approved by the affirmative vote of the holders of two-thirds of the
outstanding shares of the corporation entitled to vote, other than the shares
beneficially owned by the Interested Shareholder, and by a majority (but not
less than two) of the "Disinterested Directors." A Disinterested Director means,
with respect to a particular Interested Shareholder, a member of a corporation's
board of directors who (i) was a member before the later of January 1, 1988 and
the date on which an Interested Shareholder became an Interested Shareholder and
(ii) was recommended for election by, or was elected to fill a vacancy and
received the affirmative vote of, a majority of the Disinterested Directors then
on the corporation's board of directors. At the expiration of the three-year
period, these provisions require approval of Affiliated Transactions by the
affirmative vote of the holders of two-thirds of the outstanding shares of the
corporation entitled to vote, other than those beneficially owned by the
Interested Shareholder.
The principal exceptions to the special voting requirement apply to
Affiliated Transactions occurring after the three-year period has expired and
require either that the transaction be approved by a majority of the
Disinterested Directors or that the transaction satisfy certain fair price
requirements of the statute. In general, the fair price requirements provide
that the shareholders must receive the highest per share price for their shares
as was paid by the Interested Shareholder for his shares or the fair market
value of their shares, whichever is higher. The fair price requirements also
require that, during the three years preceding the announcement of the proposed
Affiliated Transaction, all required dividends have been paid and no special
financial accommodations have been accorded the Interested Shareholder, unless
approved by a majority of the Disinterested Directors.
None of the foregoing limitations and special voting requirements
applies to an Affiliated Transaction with an Interested Shareholder whose
acquisition of shares making such a person an Interested Shareholder was
approved by a majority of the Disinterested Directors.
The provisions of the Virginia Act governing Affiliated Transactions
are inapplicable to transactions with the Registrant until the Registrant has
more than 300 shareholders of record. In addition, the Affiliated Transactions
provisions provide that, by affirmative vote of a majority of the voting shares
other than shares owned by any Interested Shareholder, a corporation may adopt,
by meeting certain voting requirements, an amendment to its articles of
incorporation or bylaws providing that the Affiliated Transactions provisions
shall not apply to the corporation. The Registrant has not adopted such an
amendment.
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Control Share Acquisitions
The Virginia Act contains provisions regulating certain "control share
acquisitions," which are transactions causing the voting strength of any person
acquiring beneficial ownership of shares of a public corporation in Virginia to
meet or exceed certain threshold percentages (20%, 331/3% or 50%) of the total
votes entitled to be cast for the election of directors. Shares acquired in a
control share acquisition have no voting rights unless granted by a majority
vote of all outstanding shares other than those held by the acquiring person or
any officer or employee director of the corporation. The acquiring person may
require that a special meeting of the shareholders be held to consider the grant
of voting rights to the shares acquired in the control share acquisition. If the
acquiring person's shares are not accorded voting rights (or if no request for a
special meeting is made by an acquiror), the corporation may, if authorized by
its charter and bylaws prior to the control share acquisition, purchase the
acquiring person's shares at their cost to the acquiring person. Article VIII of
the Articles authorizes the repurchase of any acquiring person's shares that are
not accorded voting rights under the control share provisions of the Virginia
Act. If voting rights are approved and the acquiring person controls fifty
percent (50%) or more of the voting power, all shareholders other than the
acquiring person have dissenters' rights which enable them to receive the "fair
value" of their shares. "Fair value" is not less than the highest price paid in
the control share acquisition. The Virginia Act permits corporations to opt-out
of its provisions by adopting a bylaw or charter provision prior to a control
share acquisition stating that the control share provisions of the Virginia Act
shall not apply. The Articles and Bylaws do not contain a provision opting-out
of the control share provisions of the Virginia Act. The provisions of the
Virginia Act relating to "control share acquisitions" are inapplicable to a
corporation until it has more than 300 shareholders.
Other Applicable Shareholder Voting Requirements
In general, under current provisions of the Virginia Act, most mergers,
share exchanges, sales of substantially all of the assets and reclassifications
of securities or plans for the dissolution of a corporation must be approved by
the board of directors and by the vote of the holders of more than two-thirds of
the outstanding shares entitled to vote thereon, unless the corporation's
articles of incorporation provide for a higher or lower (but not less than a
majority) vote. The Articles provide that such transactions require the approval
of only a majority of the votes entitled to be cast by the Voting Stock, unless
Article VII of the Articles or Article 14 of the Virginia Act (Affiliated
Transactions) impose a higher requirement. Under the Articles, the holder of
each outstanding share of the Common Stock is entitled to one vote per share on
all such matters.
Amendment of Certain Provisions of the Articles and Bylaws
The Articles require the affirmative vote of the holders of at least
eighty percent (80%) of the votes entitled to be cast by the Voting Stock to
amend certain provisions of the Articles (including the provisions discussed
above under "Classified Board of Directors;" "Number of Directors; Vacancies and
Removal;" "Limitations on Shareholder Action by Written Consent;
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Special Meetings;" and "Transactions with Certain Interested Shareholders"). The
Articles and Bylaws also require an 80% vote of the shareholders to amend the
Bylaws. The Bylaws may also be amended by the Board of Directors. These
provisions will make it more difficult for shareholders to make changes in the
Articles and Bylaws, including changes designed to facilitate the exercise of
control over the Registrant. In addition, the requirement for approval by at
least an 80% shareholder vote will enable the holders of a minority of the
Registrant's capital stock to prevent holders of a less-than-80% majority from
amending such provisions of the Articles and Bylaws.
Item 5. Interests of Named Experts and Counsel
Williams, Mullen, Christian & Dobbins, counsel to the Registrant, has
rendered its opinion that the shares of Common Stock which constitute original
issuance securities will, when issued pursuant to the terms and conditions of
the Plan, be validly issued, fully paid and nonassessable. Attorneys employed by
the firm beneficially owned an aggregate of 40,000 shares of the Registrant's
Common Stock as of July 30, 1996.
Item 6. Indemnification of Directors and Officers
Article 10 of Chapter 9 of Title 13.1 of the Code of Virginia (the
"Code") permits a Virginia corporation to indemnify any director or officer for
reasonable expenses incurred in any legal proceeding in advance of final
disposition of the proceeding, if the director or officer furnishes the
corporation a written statement of his good faith belief that he has met the
standard of conduct prescribed by the Code, and a determination is made by the
board of directors that such standard has been met. In a proceeding by or in the
right of the corporation, no indemnification shall be made in respect of any
matter as to which an officer or director is adjudged to be liable to the
corporation, unless the court in which the proceeding took place determines
that, despite such liability, such person is reasonably entitled to
indemnification in view of all of the relevant circumstances. In any other
proceeding, no indemnification shall be made if the director or officer is
adjudged liable to the corporation on the basis that personal benefit was
improperly received by him. Corporations are given the power to make any other
or further indemnity, including advance of expenses, to any director or officer
that may be authorized by the articles of incorporation or any bylaw made by the
shareholders, or any resolution adopted, before or after the event, by the
shareholders, except an indemnity against willful misconduct or a knowing
violation of the criminal law. Unless limited by its articles of incorporation,
indemnification of a director or officer is mandatory when he entirely prevails
in the defense of any proceeding to which he is a party because he is or was a
director or officer.
The Amended and Restated Articles of Incorporation of the Registrant
contain provisions indemnifying the directors and officers of the Registrant to
the full extent permitted by Virginia law. In addition, the Amended and Restated
Articles of Incorporation of the Registrant eliminate
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<PAGE>
the personal liability of the Registrant's directors and officers to the
Registrant or its shareholders for monetary damages to the full extent permitted
by Virginia law.
Item 7. Exemption from Registration Claimed
Not applicable.
Item 8. Exhibits
The following exhibits are filed on behalf of the Registrant as part of
this Registration Statement:
4.1 Amended and Restated Articles of Incorporation of Spurlock Industries,
Inc., attached as Exhibit 4.1 to the Registrant's Registration
Statement on Form 8-A, as amended, filed with the Commission on August
2, 1996, incorporated herein by reference.
4.2 Bylaws of Spurlock Industries, Inc., attached as Exhibit 4.2 to the
Registrant's Registration Statement on Form 8-A, as amended, filed with
the Commission on August 2, 1996, incorporated herein by reference.
4.3 Spurlock Industries, Inc. 1995 Stock Incentive Plan.
5.1 Opinion of Williams, Mullen, Christian & Dobbins.
23.1 Consent of Williams, Mullen, Christian & Dobbins (included in Exhibit
5.1).
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
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<PAGE>
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 and 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 20 percent change in
the maximum aggregate offering price set
forth in the "Calculation of Registration
Fee" table in the effective Registration
Statement; and
(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 paragraph (1)(i) and (1)(ii) shall not
apply if the Registration Statement is on Form S-3, Form S-8
or Form F-3, and the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed with or furnished to the Commission by
the Registrant pursuant to Section 13 or Section 15(d) of the
Exchange Act 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.
(3) To remove from registration by means of a
post-effective amendment any of the securities being
registered which remain unsold at the termination of
the offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or 15(d) of the Exchange
Act (and, where applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Exchange Act) that is incorporated by
reference in the Registration Statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the
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<PAGE>
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.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
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 County of Sussex, Commonwealth of Virginia, on July 26,
1996.
SPURLOCK INDUSTRIES, INC.
By: /s/ Harold N. Spurlock
Harold N. Spurlock
President, Chairman of the Board and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed below by the following persons in
the capacities and on the dates indicated:
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Harold N. Spurlock President, Chairman of the Board, July 26, 1996
- ---------------------------------------------
Harold N. Spurlock Chief Executive Officer and
Director
/s/ Irvine R. Spurlock Executive Vice President and July 26, 1996
- ---------------------------------------------
Irvine R. Spurlock Director
/s/ H. Norman Spurlock, Jr. Vice President, Secretary and July 26, 1996
- ---------------------------------------------
H. Norman Spurlock, Jr. Director
(Chief Financial Officer)
/s/ Warren E. Beam, Jr. Treasurer and Controller July 26, 1996
- ---------------------------------------------
Warren E. Beam, Jr. (Chief Accounting Officer)
<PAGE>
/s/ Phillip S. Sumpter Director July 26, 1996
- ---------------------------------------------
Phillip S. Sumpter
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT INDEX
Number Exhibit
<S> <C>
4.1 Amended and Restated Articles of Incorporation of Spurlock Industries,
Inc., attached as Exhibit 4.1 to the Registrant's Registration Statement on
Form 8-A, as amended, filed with the Commission on August 2, 1996,
incorporated herein by reference.
4.2 Bylaws of Spurlock Industries, Inc., attached as Exhibit 4.2 to the
Registrant's Registration Statement on Form 8-A, as amended, filed with the
Commission on August 2, 1996, incorporated herein by reference.
4.3 Spurlock Industries, Inc. 1995 Stock Incentive Plan.
5.1 Opinion of Williams, Mullen, Christian & Dobbins.
23.1 Consent of Williams, Mullen, Christian & Dobbins (included in Exhibit
5.1).
</TABLE>
Exhibit 4.3
SPURLOCK INDUSTRIES, INC.
1995 STOCK INCENTIVE PLAN
ARTICLE I
PURPOSE
The purpose of this Spurlock Industries, Inc. 1995 Stock Incentive Plan
(the "Plan") is to provide to certain personnel who are key employees, officers
or directors of Spurlock Industries, Inc., a Virginia corporation (the
"Corporation"), or its subsidiaries, whether directly or indirectly owned
(collectively with the Corporation, the "Company"), further incentive (i) to
remain in the service of the Company, (ii) to maintain and enhance the long-term
performance and profitability of the Company, and (iii) to associate further
their personal interests with the interests of the Company. The Plan is intended
to permit the issuance of options qualifying as either Incentive Stock Options
or Non-Qualified Stock Options, as designated by the Committee at the time of
Grant. No Option that is intended to be an Incentive Stock Option, however,
shall be invalid for failure to qualify as an Incentive Stock Option under
Section 422 of the Code but shall be treated as a Non-Qualified Stock Option.
ARTICLE II
DEFINITIONS
As used herein the following capitalized words shall have the following
meanings:
2.01 "Agreement" means a written agreement (including any amendment or
supplement thereto) between the Company and a Participant specifying the terms
and conditions of a Grant issued to such Participant.
2.02 "Board" means the Board of Directors of the Corporation.
2.03 "Code" means the Internal Revenue Code of 1986, as amended.
2.04 "Committee" means the committee of the Board appointed to
administer the Plan or, if no committee is appointed, the Board.
2.05 "Common Stock" means the shares of common stock, no par value, of
the Corporation and any other shares into which such common stock shall
thereafter be exchanged by reason of a
<PAGE>
recapitalization, merger, consolidation, split-up, combination, exchange of
shares or the like.
2.06 "Company" means the Corporation and its subsidiaries, whether
directly or indirectly owned, and where the context requires, any of them.
2.07 "Corporation" means Spurlock Industries, Inc., a Virginia
corporation.
2.08 "Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, and any successor thereto.
2.09 "Fair Market Value" means, on any given date, the mean between the
highest and lowest reported sales prices of the Common Stock on the immediately
preceding business day, or, if no sales are reported for such day, (i) the then
current bid price reported by any of the market makers in the stock, or (ii) the
fair market value of the Common Stock, as determined by the Committee in good
faith.
2.10 "Grant" means the grant of an Option, whether or not it is
presently exercisable.
2.11 "Incentive Stock Option" means an Option that is intended to
qualify as an "incentive stock option" under Section 422 of the Code.
2.12 "Non-Qualified Stock Option" means an Option other than an
Incentive Stock Option.
2.13 "Option" means a stock option that entitles the holder to purchase
from the Company a stated number of shares of Common Stock at the price set
forth in an Agreement, which may be an Incentive Stock Option or a Non-Qualified
Stock Option.
2.14 "Option Price" means the price per share for certain shares of
Common Stock purchased upon the exercise of an Option as provided in Article VI.
2.15 "Participant" means an officer, director or key employee of the
Company who satisfies the requirements of Article IV and is selected by the
Committee to receive a Grant.
2.16 "Plan" means this Spurlock Industries, Inc. 1995 Stock Incentive
Plan.
-2-
<PAGE>
ARTICLE III
ADMINISTRATION
3.01 Committee. Subject to Section 3.05, the Plan shall be administered
by a committee of the Board that shall consist of at least two outside directors
and have the power of the Board to authorize Grants and make discretionary
decisions under the Plan. The members of the Committee shall be appointed by,
and may be changed from time to time in the discretion of, the Board.
3.02 Authority of Committee. The Committee shall have the authority (i)
to exercise all powers granted to it under the Plan, (ii) to construe, interpret
and implement the Plan and any Agreement executed pursuant to Section 4.02,
(iii) to prescribe, amend and rescind rules and regulations relating to the
Plan, (iv) to make all determinations necessary or advisable in administering
the Plan, and (v) to correct any defect, supply any omission, and reconcile any
inconsistency in the Plan.
3.03 Conclusive Authority. The determination of the Committee on all
matters relating to the Plan or any Agreement shall be conclusive.
3.04 No Committee Member Liability. No member of the Committee shall be
liable to the Corporation, the Company, any Participant or any other person for
any action or determination made in good faith with respect to the Plan or any
award thereunder.
3.05 Default Administration. Notwithstanding anything to the contrary
contained herein: (i) until the Board shall appoint the members of the
Committee, the Plan shall be administered by the Board; and (ii) the Board may,
in its sole discretion, at any time and from time to time, resolve to administer
the Plan. In either of the foregoing events, the term "Committee" as used herein
shall be deemed to mean the Board.
ARTICLE IV
ELIGIBILITY
4.01 General. Any officer, director or employee of the Company who, in
the judgment of the Committee, has contributed significantly or may be expected
to contribute significantly to the profits or growth of the Company may receive
one or more Grants.
4.02 Grants. The Committee will designate the individuals to whom
Grants are to be issued and will specify the number of shares of Common Stock
subject to each such Grant. The Committee shall have the authority to grant to
any Participant Incentive
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<PAGE>
Stock Options, Non-Qualified Stock Options or both types of Options; provided,
however, that Incentive Stock Options may be granted only to employees of the
Company. Each Grant issued under this Plan shall be evidenced by an Agreement
which shall be subject to the applicable provisions of this Plan and to such
other provisions as the Committee may determine. No Participant may be granted
Options that are Incentive Stock Options which are first exercisable in any
calendar year for stock having an aggregate Fair Market Value (determined as of
the date an Option is granted) exceeding $100,000.
4.03 Designation of Option as an Incentive Stock Option or
Non-Qualified Stock Option. The Committee will designate, at the time an Option
is granted, whether the Option is to be treated as an Incentive Stock Option or
a Non-Qualified Stock Option. In the absence, however, of any such designation,
such Option shall be treated as an Incentive Stock Option.
4.04 Qualification of Incentive Stock Option under Section 422 of the
Code. Anything in the Plan to the contrary notwithstanding, no term of the Plan
relating to Incentive Stock Options shall be interpreted, amended or altered nor
shall any discretion or authority granted under the Plan be exercised so as to
disqualify the Plan under Section 422 of the Code or, without the consent of the
Participant affected, to disqualify any Incentive Stock Option under such
Section 422. In the event any Option granted as an Incentive Stock Option is for
any reason disqualified as an Incentive Stock Option, such Option shall be
treated as a duly granted Non-Qualified Stock Option.
ARTICLE V
MAXIMUM NUMBER OF SHARES TO BE AWARDED
Upon the exercise of any Option, the Company shall deliver to the
Participant authorized but previously unissued shares of Common Stock or
previously issued shares of Common Stock reacquired by the Company. The maximum
aggregate number of shares of Common Stock that may be issued pursuant to this
Plan is Five Hundred Thousand (500,000). The maximum number of shares of Common
Stock that may be issued pursuant to the exercise of Options under the Plan is
subject to adjustment as provided in Article IX. If an Option is terminated, in
whole or in part, for any reason other than its exercise, the number of shares
of Common Stock allocated to the Option or portion thereof may be reallocated to
other Options that may be granted under this Plan.
-4-
<PAGE>
ARTICLE VI
OPTION PRICE
The price per share for Common Stock purchased upon the exercise of an
Option shall be fixed by the Committee on the date of grant; provided, however,
that in the case of an Option that is an Incentive Stock Option, the price per
share shall not be less than the Fair Market Value on such date, and in the case
the Incentive Stock Option is granted to a Participant who at the time of Grant
owns, whether directly or pursuant to relevant attribution rules, more than 10%
of the total combined voting power of all classes of stock of the Corporation,
or any of its subsidiaries, the price per share shall not be less than 110% of
the Fair Market Value on such Date.
ARTICLE VII
EXERCISE OF OPTIONS
7.01 Option Period. The period in which an Option may be exercised
shall be determined by the Committee on the date of the Grant; provided, however
that an Incentive Stock Option shall not be exercisable prior to the date the
Plan is submitted to the Corporation's shareholders for approval in accordance
with Section 11.04, nor shall it be exercisable after the expiration of 10 years
from the date the Incentive Stock Option was granted, or, in the event the
Incentive Stock Option is granted to a Participant who at the time of Grant
owns, whether directly or pursuant to relevant attribution rules, more than 10%
of the total combined voting power of all classes of stock of the Corporation,
or any of its subsidiaries, after the expiration of 5 years from such Grant
date. In the event of termination of employment of a Participant holding an
Incentive Stock Option for any reason other than death or disability, the term
of the Incentive Stock Option shall expire on a date not later than three months
after the termination. In the event of termination due to death or disability of
a Participant holding an Incentive Stock Option, the Option shall expire on the
earlier of (i) 12 months from the date of termination or (ii) the expiration
date set forth in the Option.
7.02 Nontransferability. Any Option granted under this Plan shall be
nontransferable except by will or by the laws of descent and distribution. In
the event of any such transfer, the Option must be transferred to the same
Participant's trust or estate. During the lifetime of the Participant to whom an
Incentive Stock Option is granted, the Option may be exercised only by the
Participant. No right or interest of a Participant in any Option shall be liable
for, or subject to, any lien, obligation or liability of such Participant.
-5-
<PAGE>
7.03 Employee Status. For purposes of determining the applicability
of Section 422 of the Code (relating to Incentive Stock Options), or in the
event that the terms of any Grant provide that it may be exercised only during
employment or within a specified period of time after the termination of
employment, the Committee may decide to what extent leaves of absence for
governmental or military service, illness, temporary disability, or other
reasons shall not be deemed interruptions of continuous employment.
ARTICLE VIII
METHOD OF EXERCISE
8.01 Exercise. Subject to the provisions of Articles VII and X, an
Option may be exercised in whole at any time or in part from time to time at
such times and in compliance with such requirements as the Committee shall
determine. An Option granted under this Plan may be exercised with respect to
any number of whole shares less than the full number for which the Option could
be exercised. Such partial exercise of an option shall not affect the right to
exercise the Option from time to time in accordance with this Plan with respect
to remaining shares exercisable under the Option.
8.02 Payment. Unless otherwise provided by the Agreement, payment of
the Option Price shall be made in cash. If the Agreement provides, payment of
all or part of the Option Price may be made by surrendering shares of Common
Stock to the Company, provided the shares surrendered have a Fair Market Value
(determined as of the day preceding the date of exercise) that is not less than
such price or part thereof. In addition, the Committee may establish such
payment or other terms as it may deem to be appropriate and consistent with
these purposes.
8.03 Shareholder Rights. No participant shall have any rights as a
shareholder with respect to shares subject to his Option until the date he
exercises such Option.
ARTICLE IX
ADJUSTMENT UPON CHANGE IN COMMON STOCK
Should the Company effect one or more (a) stock dividends, stock
split-ups, subdivisions or consolidations of shares or other similar changes in
capitalization; (b) spin-offs, spin- outs, split-ups, split-offs, or other such
distribution of assets to shareholders; or (c) direct or indirect assumptions
and/or conversions of outstanding Options due to an acquisition of the Company,
then the maximum number of shares as to which Grants may be issued under this
Plan shall be proportionately adjusted and their terms shall be adjusted as the
Committee shall determine to
-6-
<PAGE>
be equitably required. Any determination made under this Article IX by the
Committee shall be final and conclusive.
The issuance by the Company of shares of stock of any class, or
securities convertible into shares of stock of any class, for cash or property
or for labor or services, either upon direct sale or upon the exercise of rights
or warrants to subscribe therefor, or upon conversion of shares or obligations
of the Company convertible into such shares or other securities, shall not
affect, and no adjustment by reason thereof shall be made with respect to any
Grant.
ARTICLE X
COMPLIANCE WITH LAW AND APPROVAL OF REGULATORY BODIES
No Option shall be exercisable, no certificates for shares of Common
Stock shall be delivered, and no payment shall be made under this Plan except in
compliance with all applicable federal and state laws and regulations
(including, without limitation, withholding tax requirements). The Company may
rely on an opinion of its counsel as to such compliance. Any share certificate
issued to evidence Common Stock for which an Option is exercised may bear such
legends and statements as the Committee may deem advisable to assure compliance
with federal and state laws and regulations. No Grant shall be exercisable, no
certificate for shares shall be delivered, and no payment shall be made under
this Plan until the Company has obtained such consent or approval as the
Committee may deem advisable from regulatory bodies having jurisdiction over
such matters.
ARTICLE XI
GENERAL PROVISIONS
11.01 Effect on Employment. Neither the adoption of this Plan, its
operation, nor any documents describing or referring to this Plan (or any part
thereof) shall confer upon any employee any right to continue in the employ of
the Company or in any way affect any right or power of the Company to terminate
the employment of any employee at any time with or without assigning a reason
therefor.
11.02 Unfunded Plan. The Plan, insofar as it provides for a Grant is
not required to be funded, and the Company shall not be required to segregate
any assets that may at any time be represented by a Grant.
11.03 Rules of Construction. Headings are given to the articles and
sections of this Plan for ease of reference. The reference to any statute,
regulation, or other provision of law
-7-
<PAGE>
shall be construed to refer to any amendment to or successor of such provision
of law.
11.04 Shareholder Approval. The Plan shall be submitted to the
shareholders of the Corporation for approval within twelve months after the date
of its adoption by the Board. In the event the shareholders of the Corporation
do not approve the Plan, (i) any Incentive Stock Option then outstanding shall
be automatically converted to a Non-Qualified Stock Option, (ii) the Committee
shall so inform the Participants holding such Options, and (iii) no other
Incentive Stock Options shall thereafter be granted without prior approval of
the Plan by the shareholders of the Corporation within such twelve month period.
11.05 Withholding. In the event that the Participant disposes of any
Common Stock acquired by the exercise of an Incentive Stock Option within the
two-year period following grant, or within the one-year period following
exercise, of the Incentive Stock Option, the Company shall have the right to
require the Participant to remit to the Company an amount sufficient to satisfy
all federal, state and local withholding tax requirements as a condition to the
registration of the transfer of such Common Stock on its books. Whenever under
the Plan payments are to be made by the Company in cash or by check, such
payments shall be net of any amount sufficient to satisfy all federal, state and
local withholding tax requirements.
11.06 Amendment and Termination. The Board retains the right to amend
or terminate the Plan at anytime; provided that, no amendment or termination
shall affect any Grant awarded prior to such amendment or termination. The Plan
shall automatically terminate as of the earlier of (i) ten years from the date
this Plan is adopted or (ii) when all shares have been awarded and all awards
under the Plan have been exercised in accordance with the terms and provisions
of the Plan.
-8-
Exhibits 5.1 and 23.1
[Williams, Mullen, Christian & Dobbins letterhead]
August 6, 1996
Board of Directors
Spurlock Industries, Inc.
5090 General Mahone Highway
P.O. Box 8
Waverly, Virginia 23890
Ladies and Gentlemen:
This letter is delivered to you in connection with the actions taken
and proposed to be taken by Spurlock Industries, Inc., a Virginia corporation
(the "Company"), with respect to the offer and sale from time to time pursuant
to the 1995 Stock Incentive Plan (the "Plan"), of up to 500,000 shares of the
Company's Common Stock, without par value (the "Shares"). As counsel to the
Company, we have reviewed the registration statement on Form S-8 (the
"Registration Statement") to be filed by the Company with the Securities and
Exchange Commission to effect the registration of the Shares under the
Securities Act of 1933, as amended (the "Act").
In this regard, we have examined the Amended and Restated Articles of
Incorporation and Bylaws of the Company, records of proceedings of the Board of
Directors of the Company, the Plan and such other records and documents as we
have deemed necessary or advisable in connection with the opinions set forth
herein. In addition, we have relied as to certain matters on information
obtained from public officials, officers of the Company and other sources
believed by us to be reliable.
Based upon our examination and inquiries, we are of the opinion that
the Shares which constitute original issuance securities will, when issued
pursuant to the terms and conditions of the Plan, be validly issued, fully paid
and nonassessable. The foregoing opinion is limited to the laws of the
Commonwealth of Virginia and we express no opinion as to the effect of the laws
of any other jurisdiction.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to us as counsel to the Company in
the Registration Statement. In giving such consent, we do not thereby admit that
we are persons whose consent is required under Section 7 of the Act.
Very truly yours,
/s/ Williams, Mullen, Christian & Dobbins
