<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 29, 1999
REGISTRATION NO. 333- ______
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
--------------
H.T.E., INC.
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(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
FLORIDA 59-2133858
- ------------------------------- ----------------------
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification Number)
</TABLE>
1000 BUSINESS CENTER DRIVE
LAKE MARY, FLORIDA 32746
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(Address of Principal Executive Offices)
H.T.E., INC. 1997 EMPLOYEE INCENTIVE COMPENSATION PLAN
----------------------------------------
(Full title of the Plans)
-----------------------
DENNIS J. HARWARD
CHAIRMAN OF THE BOARD, PRESIDENT AND CHIEF EXECUTIVE OFFICER
H.T.E., INC.
1000 BUSINESS CENTER DRIVE
LAKE MARY, FLORIDA 32746
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(Name and address of agent for service)
(407) 304-3235
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(Telephone number, including area code, of agent for service)
Copy to:
Sandra C. Gordon, Esq.
Greenberg Traurig, P.A.
111 North Orange Avenue, 20th Floor
Orlando, Florida 32801
(407) 420-1000
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed maximum Proposed
Title of securities Amount to be offering price maximum aggregate Amount of
to be registered registered(1) per share (2) offering price (1) registration fee
<S> <C> <C> <C> <C>
Common stock, 1,000,000
$.01 par value shares $ 3.82 $ 3,820,000 $ 1,061.96
</TABLE>
(1) In addition, pursuant to Rule 416(c) under the Securities Act of 1933, this
Registration Statement also covers an indeterminate number of additional
shares as may be issued pursuant to the anti-dilution provisions of the
1997 Employee Incentive Compensation Plan.
(2) Estimated solely for the purpose of calculating the registration fee which
was computed in accordance with Rule 457(h) on the basis of the average of
the high and low sale price of the Common Stock as of the close of business
on June 28, 1999.
<PAGE> 2
This Registration Statement on Form S-8 is being filed to register,
pursuant to the Securities Act of 1933, as amended, 1,000,000 additional shares
of the Common Stock of H.T.E., Inc., a Florida corporation (the "Company"),
issuable pursuant to the Company's 1997 Employee Incentive Compensation Plan, as
amended (formerly known as the 1997 Executive Incentive Compensation Plan). The
contents of the Registration Statement on Form S-8, File No. 333-34109,
previously filed by the Company with the Securities and Exchange Commission, are
incorporated by reference in this Registration Statement and made a part hereof.
On June 14, 1999, the Company's Board of Directors, by resolution,
changed the name of the 1997 Executive Incentive Compensation Plan to the 1997
Employee Incentive Compensation Plan.
The Company hereby incorporates by reference into this Registration
Statement the following documents or portions thereof as indicated:
(a) the Company's annual report on Form 10-K for the fiscal year
ended December 31, 1998;
(b) the Company's quarterly report on Form 10-Q for the fiscal
quarter ended March 31, 1999;
(c) the Company's current report on Form 8-K dated January 14,
1999; and
(d) the Company's Proxy Statement dated April 7, 1999 relating to
the Annual Meeting of Stockholders held on May 12, 1999.
In addition, all documents subsequently filed by the Company pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of
a post-effective amendment which indicates that all securities offered hereby
have been sold or which deregisters all securities then remaining unsold, shall
be deemed to be incorporated herein by reference and to be a part hereof from
the date of filing of such documents.
<PAGE> 3
PART II - INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 8. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
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<S> <C>
4.1 1997 Employee Incentive Compensation Plan, as amended
5.1 Opinion of Greenberg, Traurig, P.A.
23.1 Consent of Greenberg, P.A. (contained in its opinion
filed as Exhibit 5.1 hereto).
23.2 Consent of Arthur Andersen LLP
23.3 Consent of PricewaterhouseCoopers, LLP
24.1 Power of Attorney is included in the Signatures
section of this Registration Statement.
</TABLE>
<PAGE> 4
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 Lake Mary, State of Florida on June 28, 1999.
H.T.E.
By: /s/ Dennis J. Harward
--------------------------------
Dennis J. Harward
Chairman of the Board,
President and Chief Executive
Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Dennis J. Harward and Susan D.
Falotico, and each of them, his true and lawful attorney-in-fact, each acting
alone, with full powers of substitution and resubstitution, for him and in his
name, place and stead, in any and all capacities, to sign any or all amendments,
including any post-effective amendments, to this Registration Statement and to
sign any additional Registration Statements pursuant to Rule 462(b) of the
Securities Act of 1933, and to file the same, with exhibits thereto, and other
documents to be filed in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite, necessary or advisable to be done, as fully to all intents and
purposes as he might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact and agents, or any of them, or their or his
substitute or substitutes, may lawfully 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 below by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ Dennis J. Harward Chairman of the Board, President, Chief June 28, 1999
- --------------------------------------- Executive Officer and Director
Dennis J. Harward (principal executive officer)
/s/ Jack L. Harward Executive Vice President and Director June 28, 1999
- ---------------------------------------
Jack L. Harward
/s/ Susan D. Falotico Vice President, Chief Financial Officer June 28, 1999
- --------------------------------------- (principal financial officer)
Susan D. Falotico
Director June __, 1999
- ---------------------------------------
Bernard B. Markey
Director June __, 1999
- ---------------------------------------
Edward A. Moses
/s/ O.F. Ramos Director June 28, 1999
- ---------------------------------------
O.F. Ramos
</TABLE>
<PAGE> 1
EXHIBIT 4.1
H.T.E., INC.
1997 EMPLOYEE INCENTIVE COMPENSATION PLAN
as amended May 12, 1999
<PAGE> 2
H.T.E., INC.
1997 EMPLOYEE INCENTIVE COMPENSATION PLAN
<TABLE>
<CAPTION>
PAGE
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<S> <C>
1. Purpose........................................................................................................1
2. Definitions....................................................................................................1
3. Administration.................................................................................................3
(a) Authority of the Committee.................................................................................3
(b) Manner of Exercise of Committee Authority..................................................................4
(c) Limitation of Liability....................................................................................4
4. Stock Subject to Plan..........................................................................................4
(a) Limitation on Overall Number of Shares Subject to Awards...................................................4
(b) Application of Limitations.................................................................................4
5. Eligibility; Per-Person Award Limitations......................................................................4
6. Specific Terms of Awards.......................................................................................5
(a) General....................................................................................................5
(b) Options....................................................................................................5
(c) Stock Appreciation Rights..................................................................................6
(d) Restricted Stock...........................................................................................6
(e) Deferred Stock.............................................................................................7
(f) Bonus Stock and Awards in Lieu of Obligations..............................................................8
(g) Dividend Equivalents.......................................................................................8
(h) Other Stock-Based Awards...................................................................................8
7. Certain Provisions Applicable to Awards........................................................................8
(a) Stand-Alone, Additional, Tandem, and Substitute Awards.....................................................8
(b) Term of Awards.............................................................................................8
(c) Form and Timing of Payment Under Awards; Deferrals.........................................................9
(d) Exemptions from Section 16(b) Liability....................................................................9
8. Performance and Annual Incentive Awards........................................................................9
(a) Performance Conditions.....................................................................................9
(b) Performance Awards Granted to Designated Covered Employees.................................................9
(c) Annual Incentive Awards Granted to Designated Covered Employees...........................................10
(d) Written Determinations....................................................................................11
(e) Status of Section 8(b) and Section 8(c) Awards Under Code Section 162(m)..................................11
9. Change in Control.............................................................................................12
(a) Effect of "Change in Control\.............................................................................12
(b) Definition of "Change in Control\.........................................................................12
(c) Definition of "Change in Control Price\...................................................................13
10. General Provisions...........................................................................................13
(a) Compliance With Legal and Other Requirements..............................................................13
(b) Limits on Transferability; Beneficiaries..................................................................14
(c) Adjustments...............................................................................................14
(d) Taxes.....................................................................................................15
(e) Changes to the Plan and Awards............................................................................15
(f) Limitation on Rights Conferred Under Plan.................................................................15
(g) Unfunded Status of Awards; Creation of Trusts.............................................................15
(h) Nonexclusivity of the Plan................................................................................16
(i) Payments in the Event of Forfeitures; Fractional Shares...................................................16
(j) Governing Law.............................................................................................16
(k) Plan Effective Date and Stockholder Approval; Termination of Plan.........................................16
</TABLE>
6
<PAGE> 3
H.T.E., INC.
1997 EMPLOYEE INCENTIVE COMPENSATION PLAN
1. PURPOSE. The purpose of this 1997 Employee Incentive
Compensation Plan (the "Plan") is to assist H.T.E., Inc. (the "Company") and its
subsidiaries in attracting, motivating, retaining and rewarding high-quality
executives and other employees, officers, Directors and independent contractors
enabling such persons to acquire or increase a proprietary interest in the
Company in order to strengthen the mutuality of interests between such persons
and the Company's stockholders, and providing such persons with annual and long
term performance incentives to expend their maximum efforts in the creation of
shareholder value. The Plan is also intended to qualify certain compensation
awarded under the Plan for tax deductibility under Section 162(m) of the Code
(as hereafter defined) to the extent deemed appropriate by the Committee (or any
successor committee) of the Board of Directors of the Company.
2. DEFINITIONS. For purposes of the Plan, the following terms
shall be defined as set forth below, in addition to such terms defined in
Section 1 hereof.
(a) "Annual Incentive Award" means a conditional right
granted to a Participant under Section 8(c) hereof to receive a cash payment,
Stock or other Award, unless otherwise determined by the Committee, after the
end of a specified fiscal year.
(b) "Award" means any Option, SAR (including Limited
SAR), Restricted Stock, Deferred Stock, Stock granted as a bonus or in lieu of
another award, Dividend Equivalent, Other Stock-Based Award, Performance Award
or Annual Incentive Award, together with any other right or interest granted to
a Participant under the Plan.
(c) "Beneficiary" means the person, persons, trust or
trusts which have been designated by a Participant in his or her most recent
written beneficiary designation filed with the Committee to receive the benefits
specified under the Plan upon such Participant's death or to which Awards or
other rights are transferred if and to the extent permitted under Section 10(b)
hereof. If, upon a Participant's death, there is no designated Beneficiary or
surviving designated Beneficiary, then the term Beneficiary means the person,
persons, trust or trusts entitled by will or the laws of descent and
distribution to receive such benefits.
(d) "Beneficial Owner", "Beneficially Owning" and
"Beneficial Ownership" shall have the meanings ascribed to such terms in Rule
13d-3 under the Exchange Act and any successor to such Rule.
(e) "Board" means the Company's Board of Directors.
(f) "Change in Control" means Change in Control as
defined with related terms in Section 9 of the Plan.
(g) "Change in Control Price" means the amount calculated
in accordance with Section 9(c) of the Plan.
(h) "Code" means the Internal Revenue Code of 1986, as
amended from time to time, including regulations thereunder and successor
provisions and regulations thereto.
(i) "Committee" means a committee designated by the Board
to administer the Plan; provided, however, that the Committee shall consist
solely of at least two directors, each of whom shall be (i) a "non-employee
director" within the meaning of Rule 16b-3 under the Exchange Act, unless
administration of the
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<PAGE> 4
Plan by "non-employee directors" is not then required in order for exemptions
under Rule 16b-3 to apply to transactions under the Plan, and (ii) an "outside
director" as defined under Section 162(m) of the Code, unless administration of
the Plan by "outside directors" is not then required in order to qualify for tax
deductibility under Section 162(m) of the Code.
(j) "Corporate Transaction" means a transaction as
defined in Section 9(b) of the Plan.
(k) "Covered Employee" means an Eligible Person who is a
Covered Employee as specified in Section 8(e) of the Plan.
(l) "Deferred Stock" means a right, granted to a
Participant under Section 6(e) hereof, to receive Stock, cash or a combination
thereof at the end of a specified deferral period.
(m) "Director" means a member of the Board.
(n) "Disability" means a permanent and total disability
(within the meaning of Section 22(e) of the Code), as determined by a medical
doctor satisfactory to the Committee.
(o) "Dividend Equivalent" means a right, granted to a
Participant under Section 6(g) hereof, to receive cash, Stock, other Awards or
other property equal in value to dividends paid with respect to a specified
number of shares of Stock, or other periodic payments.
(p) "Effective Date" means the effective date of the
Plan, which shall be January 29, 1997.
(q) "Eligible Person" means each executive officer of the
Company (as defined under the Exchange Act) and other officers, Directors and
employees of the Company or of any subsidiary, and independent contractors with
the Company or any subsidiary. The foregoing notwithstanding, no independent
contractor shall be an Eligible Person for purposes of receiving any Awards
other than Options under Section 6(b) of the Plan. An employee on leave of
absence may be considered as still in the employ of the Company or a subsidiary
for purposes of eligibility for participation in the Plan.
(r) "Exchange Act" means the Securities Exchange Act of
1934, as amended from time to time, including rules thereunder and successor
provisions and rules thereto.
(s) "Executive Officer" means an executive officer of the
Company as defined under the Exchange Act.
(t) "Fair Market Value" means the fair market value of
Stock, Awards or other property as determined by the Committee or under
procedures established by the Committee. Unless otherwise determined by the
Committee, the Fair Market Value of Stock as of any given date shall be the
closing sale price per share reported on a consolidated basis for stock listed
on the principal stock exchange or market on which Stock is traded on the date
as of which such value is being determined or, if there is no sale on that date,
then on the last previous day on which a sale was reported.
(u) "Incentive Stock Option" or "ISO" means any Option
intended to be designated as an incentive stock option within the meaning of
Section 422 of the Code or any successor provision thereto.
(v) "Incumbent Board" means the Board as defined in
Section 9(b) of the Plan.
(w) "Limited SAR" means a right granted to a Participant
under Section 6(c) hereof.
8
<PAGE> 5
(x) "Option" means a right granted to a Participant under
Section 6(b) hereof, to purchase Stock or other Awards at a specified price
during specified time periods.
(y) "Other Stock-Based Awards" means Awards granted to a
Participant under Section 6(h) hereof.
(z) "Parent Corporation" means any corporation (other
than the Company) in an unbroken chain of corporations ending with the Company,
if each of the corporations in the chain (other than the Company) owns stock
possessing 50% or more of the combined voting power of all classes of stock in
one of the other corporations in the chain.
(aa) "Participant" means a person who has been granted an
Award under the Plan which remains outstanding, including a person who is no
longer an Eligible Person.
(bb) "Performance Award" means a right, granted to a
Eligible Person under Section 8 hereof, to receive Awards based upon performance
criteria specified by the Committee.
(cc) "Person" shall have the meaning ascribed to such term
in Section 3(a)(9) of the Exchange Act and used in Sections 13(d) and 14(d)
thereof, and shall include a "group" as defined in Section 13(d) thereof.
(dd) "Restricted Stock" means Stock granted to a
Participant under Section 6(d) hereof, that is subject to certain restrictions
and to a risk of forfeiture.
(ee) "Rule 16b-3" and "Rule 16a-1(c)(3)" means Rule 16b-3
and Rule 16a-1(c)(3), as from time to time in effect and applicable to the Plan
and Participants, promulgated by the Securities and Exchange Commission under
Section 16 of the Exchange Act.
(ff) "Stock" means the Company's Common Stock, and such
other securities as may be substituted (or resubstituted) for Stock pursuant to
Section 10(c) hereof.
(gg) "Stock Appreciation Rights" or "SAR" means a right
granted to a Participant under Section 6(c) hereof.
(hh) "Subsidiary" means any corporation or other entity in
which the Company has a direct or indirect ownership interest of 50% or more of
the total combined voting power of the then outstanding securities or interests
of such corporation or other entity entitled to vote generally in the election
of directors or in which the Company has the right to receive 50% or more of the
distribution of profits or 50% or more of the assets on liquidation or
dissolution.
3. ADMINISTRATION
(a) AUTHORITY OF THE COMMITTEE. The Plan shall be
administered by the Committee. The Committee shall have full and final
authority, in each case subject to and consistent with the provisions of the
Plan, to select Eligible Persons to become Participants, grant Awards, determine
the type, number and other terms and conditions of, and all other matters
relating to, Awards, prescribe Award agreements (which need not be identical for
each Participant) and rules and regulations for the administration of the Plan,
construe and interpret the Plan and Award agreements and correct defects, supply
omissions or reconcile inconsistencies therein, and to make all other decisions
and determinations as the Committee may deem necessary or advisable for the
administration of the Plan. In exercising any discretion granted to the
Committee under the Plan or pursuant to any Award, the Committee shall not be
required to follow past practices, act in a manner consistent with past
practices, or treat any Eligible Person in a manner consistent with the
treatment of other Eligible Persons.
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<PAGE> 6
(b) MANNER OF EXERCISE OF COMMITTEE AUTHORITY. The
Committee shall exercise sole and exclusive discretion on any matter relating to
a Participant then subject to Section 16 of the Exchange Act with respect to the
Company to the extent necessary in order that transactions by such Participant
shall be exempt under Rule 16b-3 under the Exchange Act. Any action of the
Committee shall be final, conclusive and binding on all persons, including the
Company, its subsidiaries, Participants, Beneficiaries, transferees under
Section 10(b) hereof or other persons claiming rights from or through a
Participant, and stockholders. The express grant of any specific power to the
Committee, and the taking of any action by the Committee, shall not be construed
as limiting any power or authority of the Committee. The Committee may delegate
to officers or managers of the Company or any subsidiary, or committees thereof,
the authority, subject to such terms as the Committee shall determine, (i) to
perform administrative functions, (ii) with respect to Participants not subject
to Section 16 of the Exchange Act, to perform such other functions as the
Committee may determine, and (iii) with respect to Participants subject to
Section 16, to perform such other functions of the Committee as the Committee
may determine to the extent performance of such functions will not result in the
loss of an exemption under Rule 16b-3 otherwise available for transactions by
such persons, in each case to the extent permitted under applicable law and
subject to the requirements set forth in Section 8(d). The Committee may appoint
agents to assist it in administering the Plan.
(c) LIMITATION OF LIABILITY. The Committee and each
member thereof shall be entitled to, in good faith, rely or act upon any report
or other information furnished to him or her by any executive officer, other
officer or employee of the Company or a subsidiary, the Company's independent
auditors, consultants or any other agents assisting in the administration of the
Plan. Members of the Committee and any officer or employee of the Company or a
subsidiary acting at the direction or on behalf of the Committee shall not be
personally liable for any action or determination taken or made in good faith
with respect to the Plan, and shall, to the extent permitted by law, be fully
indemnified and protected by the Company with respect to any such action or
determination.
4. STOCK SUBJECT TO PLAN.
(a) LIMITATION ON OVERALL NUMBER OF SHARES SUBJECT TO
AWARDS. Subject to adjustment as provided in Section 10(c) hereof, the total
number of shares of Stock reserved and available for delivery in connection with
Awards under the Plan shall be the sum of (i) 2,908,000, plus (ii) the number of
shares with respect to Awards previously granted under the Plan that terminate
without being exercised, expire, are forfeited or canceled, and the number of
shares of Stock that are surrendered in payment of any Awards or any tax
withholding with regard thereto. Any shares of Stock delivered under the Plan
may consist, in whole or in part, of authorized and unissued shares or treasury
shares. Subject to adjustment as provided in Section 10(c) hereof, in no event
shall the aggregate number of shares of Stock which may be issued pursuant to
ISOs exceed 2,908,000 shares.
(b) APPLICATION OF LIMITATIONS. The limitation contained
in Section 4(a) shall apply not only to Awards that are settleable by the
delivery of shares of Stock but also to Awards relating to shares of Stock but
settleable only in cash (such as cash-only SARs). The Committee may adopt
reasonable counting procedures to ensure appropriate counting, avoid double
counting (as, for example, in the case of tandem or substitute awards) and make
adjustments if the number of shares of Stock actually delivered differs from the
number of shares previously counted in connection with an Award.
5. ELIGIBILITY; PER-PERSON AWARD LIMITATIONS. Awards may be
granted under the Plan only to Eligible Persons. In each fiscal year during any
part of which the Plan is in effect, an Eligible Person may not be granted
Awards relating to more than 265,000 shares of Stock, subject to adjustment as
provided in Section 10(c), under each of Sections 6(b), 6(c), 6(d), 6(e), 6(f),
6(g), 6(h), 8(b) and 8(c). In addition, the maximum amount that may be earned as
an Annual Incentive Award or other cash Award in any fiscal year by any one
Participant
10
<PAGE> 7
shall be $1,000,000, and the maximum amount that may be earned as a Performance
Award or other cash Award in respect of a performance period by any one
Participant shall be $2,000,000.
6. SPECIFIC TERMS OF AWARDS.
(a) GENERAL. Awards may be granted on the terms and
conditions set forth in this Section 6. In addition, the Committee may impose on
any Award or the exercise thereof, at the date of grant or thereafter (subject
to Section 10(e)), such additional terms and conditions, not inconsistent with
the provisions of the Plan, as the Committee shall determine, including terms
requiring forfeiture of Awards in the event of termination of employment by the
Participant and terms permitting a Participant to make elections relating to his
or her Award. The Committee shall retain full power and discretion to
accelerate, waive or modify, at any time, any term or condition of an Award that
is not mandatory under the Plan. Except in cases in which the Committee is
authorized to require other forms of consideration under the Plan, or to the
extent other forms of consideration must be paid to satisfy the requirements of
Florida law, no consideration other than services may be required for the grant
(but not the exercise) of any Award.
(b) OPTIONS. The Committee is authorized to grant Options
to Participants on the following terms and conditions:
(i) EXERCISE PRICE. The exercise price per share
of Stock purchasable under an Option shall be determined by the Committee,
provided that such exercise price shall not, in the case of Incentive Stock
Options, be less than 100% of the Fair Market Value of the Stock on the date of
grant of the Option and shall not, in any event, be less than the par value of a
share of Stock on the date of grant of such Option. If an employee owns or is
deemed to own (by reason of the attribution rules applicable under Section
424(d) of the Code) more than 10% of the combined voting power of all classes of
stock of the Company or any Parent Corporation and an Incentive Stock Option is
granted to such employee, the option price of such Incentive Stock Option (to
the extent required by the Code at the time of grant) shall be no less than 110%
of the Fair Market Value of the Stock on the date such Incentive Stock Option is
granted.
(ii) TIME AND METHOD OF EXERCISE. The Committee
shall determine the time or times at which or the circumstances under which an
Option may be exercised in whole or in part (including based on achievement of
performance goals and/or future service requirements), the time or times at
which Options shall cease to be or become exercisable following termination of
employment or upon other conditions, the methods by which such exercise price
may be paid or deemed to be paid (including in the discretion of the Committee a
cashless exercise procedure), the form of such payment, including, without
limitation, cash, Stock, other Awards or awards granted under other plans of the
Company or any subsidiary, or other property (including notes or other
contractual obligations of Participants to make payment on a deferred basis),
and the methods by or forms in which Stock will be delivered or deemed to be
delivered to Participants.
(iii) ISOs. The terms of any ISO granted under the
Plan shall comply in all respects with the provisions of Section 422 of the
Code. Anything in the Plan to the contrary notwithstanding, no term of the Plan
relating to ISOs (including any SAR in tandem therewith) shall be interpreted,
amended or altered, nor shall any discretion or authority granted under the Plan
be exercised, so as to disqualify either the Plan or any ISO under Section 422
of the Code, unless the Participant has first requested the change that will
result in such disqualification. Thus, if and to the extent required to comply
with Section 422 of the Code, Options granted as Incentive Stock Options shall
be subject to the following special terms and conditions:
(A) the Option shall not be exercisable
more than ten years after the date such Incentive Stock Option is granted;
provided, however, that if a Participant owns or is deemed to own (by reason of
the attribution rules of Section 424(d) of the Code) more than 10% of the
combined voting power of all classes of stock of the Company or any Parent
Corporation and the Incentive Stock Option is granted to such
11
<PAGE> 8
Participant, the term of the Incentive Stock Option shall be for no more than
five years from the date of grant; and
(B) The aggregate Fair Market Value
(determined as of the date the Incentive Stock Option is granted) of the shares
of stock with respect to which Incentive Stock Options granted under the Plan
and all other option plans of the Company or its Parent Corporation during any
calendar year exercisable for the first time by the Participant during any
calendar year shall not exceed $100,000.
(c) STOCK APPRECIATION RIGHTS. The Committee is
authorized to grant SAR's to Participants on the following terms and conditions:
(i) RIGHT TO PAYMENT. A SAR shall confer on the
Participant to whom it is granted a right to receive, upon exercise thereof, the
excess of (A) the Fair Market Value of one share of stock on the date of
exercise (or, in the case of a "Limited SAR", the Fair Market Value determined
by reference to the Change in Control Price, as defined under Section 9(c)
hereof), over (B) the grant price of the SAR as determined by the Committee. The
grant price of an SAR shall not be less than the Fair Market Value of a share of
Stock on the date of grant except as provided under Section 7(a) hereof.
(ii) OTHER TERMS. The Committee shall determine
at the date of grant or thereafter, the time or times at which and the
circumstances under which a SAR may be exercised in whole or in part (including
based on achievement of performance goals and/or future service requirements),
the time or times at which SARs shall cease to be or become exercisable
following termination of employment or upon other conditions, the method of
exercise, method of settlement, form of consideration payable in settlement,
method by or forms in which Stock will be delivered or deemed to be delivered to
Participants, whether or not a SAR shall be in tandem or in combination with any
other Award, and any other terms and conditions of any SAR. Limited SARs that
may only be exercised in connection with a Change in Control or other event as
specified by the Committee may be granted on such terms, not inconsistent with
this Section 6(c), as the Committee may determine. SARs and Limited SARs may be
either freestanding or in tandem with other Awards.
(d) RESTRICTED STOCK. The Committee is authorized to
grant Restricted Stock to Participants on the following terms and conditions:
(i) GRANT AND RESTRICTIONS. Restricted Stock
shall be subject to such restrictions on transferability, risk of forfeiture and
other restrictions, if any, as the Committee may impose, which restrictions may
lapse separately or in combination at such times, under such circumstances
(including based on achievement of performance goals and/or future service
requirements), in such installments or otherwise, as the Committee may determine
at the date of grant or thereafter. Except to the extent restricted under the
terms of the Plan and any Award agreement relating to the Restricted Stock, a
Participant granted Restricted Stock shall have all of the rights of a
stockholder, including the right to vote the Restricted Stock and the right to
receive dividends thereon (subject to any mandatory reinvestment or other
requirement imposed by the Committee). During the restricted period applicable
to the Restricted Stock, subject to Section 10(b) below, the Restricted Stock
may not be sold, transferred, pledged, hypothecated, margined or otherwise
encumbered by the Participant.
(ii) FORFEITURE. Except as otherwise determined
by the Committee at the time of the Award, upon termination of a Participant's
employment during the applicable restriction period, the Participant's
Restricted Stock that is at that time subject to restrictions shall be forfeited
and reacquired by the Company; provided that the Committee may provide, by rule
or regulation or in any Award agreement, or may determine in any individual
case, that restrictions or forfeiture conditions relating to Restricted Stock
shall be waived in whole or in part in the event of terminations resulting from
specified causes, and the Committee may in other cases waive in whole or in part
the forfeiture of Restricted Stock, and the Committee may in other cases waive
in whole or in part the forfeiture of Restricted Stock.
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(iii) CERTIFICATES FOR STOCK. Restricted Stock
granted under the Plan may be evidenced in such manner as the Committee shall
determine. If certificates representing Restricted Stock are registered in the
name of the Participant, the Committee may require that such certificates bear
an appropriate legend referring to the terms, conditions and restrictions
applicable to such Restricted Stock, that the Company retain physical possession
of the certificates, and that the Participant deliver a stock power to the
Company, endorsed in blank, relating to the Restricted Stock.
(iv) DIVIDENDS AND SPLITS. As a condition to the
grant of an Award of Restricted Stock, the Committee may require that any cash
dividends paid on a share of Restricted Stock be automatically reinvested in
additional shares of Restricted Stock or applied to the purchase of additional
Awards under the Plan. Unless otherwise determined by the Committee, Stock
distributed in connection with a Stock split or Stock dividend, and other
property distributed as a dividend, shall be subject to restrictions and a risk
of forfeiture to the same extent as the Restricted Stock with respect to which
such Stock or other property has been distributed.
(e) DEFERRED STOCK. The Committee is authorized to grant
Deferred Stock to Participants, which are rights to receive Stock, cash, or a
combination thereof at the end of a specified deferral period, subject to the
following terms and conditions:
(i) AWARD AND RESTRICTIONS. Satisfaction of an
Award of Deferred Stock shall occur upon expiration of the deferral period
specified for such Deferred Stock by the Committee (or, if permitted by the
Committee, as elected by the Participant). In addition, Deferred Stock shall be
subject to such restrictions (which may include a risk of forfeiture) as the
Committee may impose, if any, which restrictions may lapse at the expiration of
the deferral period or at earlier specified times (including based on
achievement of performance goals and/or future service requirements), separately
or in combination, in installments or otherwise, as the Committee may determine.
Deferred Stock may be satisfied by delivery of Stock, cash equal to the Fair
Market Value of the specified number of shares of Stock covered by the Deferred
Stock, or a combination thereof, as determined by the Committee at the date of
grant or thereafter. Prior to satisfaction of an Award of Deferred Stock, an
Award of Deferred Stock carries no voting or dividend or other rights associated
with share ownership.
(ii) FORFEITURE. Except as otherwise determined
by the Committee, upon termination of a Participant's employment during the
applicable deferral period thereof to which forfeiture conditions apply (as
provided in the Award agreement evidencing the Deferred Stock), the
Participant's Deferred Stock that is at that time subject to deferral (other
than a deferral at the election of the Participant) shall be forfeited; provided
that the Committee may provide, by rule or regulation or in any Award agreement,
or may determine in any individual case, that restrictions or forfeiture
conditions relating to Deferred Stock shall be waived in whole or in part in the
event of terminations resulting from specified causes, and the Committee may in
other cases waive in whole or in part the forfeiture of Deferred Stock.
(iii) DIVIDEND EQUIVALENTS. Unless otherwise
determined by the Committee at date of grant, Dividend Equivalents on the
specified number of shares of Stock covered by an Award of Deferred Stock shall
be either (A) paid with respect to such Deferred Stock at the dividend payment
date in cash or in shares of unrestricted Stock having a Fair Market Value equal
to the amount of such dividends, or (B) deferred with respect to such Deferred
Stock and the amount or value thereof automatically deemed reinvested in
additional Deferred Stock, other Awards or other investment vehicles, as the
Committee shall determine or permit the Participant to elect.
(f) BONUS STOCK AND AWARDS IN LIEU OF OBLIGATIONS. The
Committee is authorized to grant Stock as a bonus, or to grant Stock or other
Awards in lieu of Company obligations to pay cash or deliver other property
under the Plan or under other plans or compensatory arrangements, provided that,
in the case of Participants subject to Section 16 of the Exchange Act, the
amount of such grants remains within the discretion of the Committee to the
extent necessary to ensure that acquisitions of Stock or other Awards are exempt
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from liability under Section 16(b) of the Exchange Act. Stock or Awards granted
hereunder shall be subject to such other terms as shall be determined by the
Committee.
(g) DIVIDEND EQUIVALENTS. The Committee is authorized to
grant Dividend Equivalents to a Participant entitling the Participant to receive
cash, Stock, other Awards, or other property equal in value to dividends paid
with respect to a specified number of shares of Stock, or other periodic
payments. Dividend Equivalents may be awarded on a free-standing basis or in
connection with another Award. The Committee may provide that Dividend
Equivalents shall be paid or distributed when accrued or shall be deemed to have
been reinvested in additional Stock, Awards, or other investment vehicles, and
subject to such restrictions on transferability and risks of forfeiture, as the
Committee may specify.
(h) OTHER STOCK-BASED AWARDS. The Committee is
authorized, subject to limitations under applicable law, to grant to
Participants such other Awards that may be denominated or payable in, valued in
whole or in part by reference to, or otherwise based on, or related to, Stock,
as deemed by the Committee to be consistent with the purposes of the Plan,
including, without limitation, convertible or exchangeable debt securities,
other rights convertible or exchangeable into Stock, purchase rights for Stock,
Awards with value and payment contingent upon performance of the Company or any
other factors designated by the Committee, and Awards valued by reference to the
book value of Stock or the value of securities of or the performance of
specified subsidiaries or business units. The Committee shall determine the
terms and conditions of such Awards. Stock delivered pursuant to an Award in the
nature of a purchase right granted under this Section 6(h) shall be purchased
for such consideration, paid for at such times, by such methods, and in such
forms, including, without limitation, cash, Stock, other Awards or other
property, as the Committee shall determine. Cash awards, as an element of or
supplement to any other Award under the Plan, may also be granted pursuant to
this Section 6(h).
7. CERTAIN PROVISIONS APPLICABLE TO AWARDS.
(a) STAND-ALONE, ADDITIONAL, TANDEM, AND SUBSTITUTE
AWARDS. Awards granted under the Plan may, in the discretion of the Committee,
be granted either alone or in addition to, in tandem with, or in substitution or
exchange for, any other Award or any award granted under another plan of the
Company, any subsidiary, or any business entity to be acquired by the Company or
a subsidiary, or any other right of a Participant to receive payment from the
Company or any subsidiary. Such additional, tandem, and substitute or exchange
Awards may be granted at any time. If an Award is granted in substitution or
exchange for another Award or award, the Committee shall require the surrender
of such other Award or award in consideration for the grant of the new Award. In
addition, Awards may be granted in lieu of cash compensation, including in lieu
of cash amounts payable under other plans of the Company or any subsidiary, in
which the value of Stock subject to the Award is equivalent in value to the cash
compensation (for example, Deferred Stock or Restricted Stock), or in which the
exercise price, grant price or purchase price of the Award in the nature of a
right that may be exercised is equal to the Fair Market Value of the underlying
Stock minus the value of the cash compensation surrendered (for example, Options
granted with an exercise price "discounted" by the amount of the cash
compensation surrendered).
(b) TERM OF AWARDS. The term of each Award shall be for
such period as may be determined by the Committee; provided that in no event
shall the term of any Option or SAR exceed a period of ten years (or such
shorter term as may be required in respect of an ISO under Section 422 of the
Code).
(c) FORM AND TIMING OF PAYMENT UNDER AWARDS; DEFERRALS.
Subject to the terms of the Plan and any applicable Award agreement, payments to
be made by the Company or a subsidiary upon the exercise of an Option or other
Award or settlement of an Award may be made in such forms as the Committee shall
determine, including, without limitation, cash, Stock, other Awards or other
property, and may be made in a single payment or transfer, in installments, or
on a deferred basis. The settlement of any Award may be accelerated, and cash
paid in lieu of Stock in connection with such settlement, in the discretion of
the Committee or upon occurrence of one or more specified events (in addition to
a Change in Control). Installment or deferred
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<PAGE> 11
payments may be required by the Committee (subject to Section 10(e) of the Plan)
or permitted at the election of the Participant on terms and conditions
established by the Committee. Payments may include, without limitation,
provisions for the payment or crediting of a reasonable interest rate on
installment or deferred payments or the grant or crediting of Dividend
Equivalents or other amounts in respect of installment or deferred payments
denominated in Stock.
(d) EXEMPTIONS FROM SECTION 16(b) LIABILITY. It is the
intent of the Company that this Plan comply in all respects with applicable
provisions of Rule 16b-3 or Rule 16a-1(c)(3) to the extent necessary to ensure
that neither the grant of any Awards to nor other transaction by a Participant
who is subject to Section 16 of the Exchange Act is subject to liability under
Section 16(b) thereof (except for transactions acknowledged in writing to be
non-exempt by such Participant). Accordingly, if any provision of this Plan or
any Award agreement does not comply with the requirements of Rule 16b-3 or Rule
16a-1(c)(3) as then applicable to any such transaction, such provision will be
construed or deemed amended to the extent necessary to conform to the applicable
requirements of Rule 16b-3 or Rule 16a-1(c)(3) so that such Participant shall
avoid liability under Section 16(b). In addition, the purchase price of any
Award conferring a right to purchase Stock shall be not less than any specified
percentage of the Fair Market Value of Stock at the date of grant of the Award
then required in order to comply with Rule 16b-3.
8. PERFORMANCE AND ANNUAL INCENTIVE AWARDS.
(a) PERFORMANCE CONDITIONS. The right of a Participant to
exercise or receive a grant or settlement of any Award, and the timing thereof,
may be subject to such performance conditions as may be specified by the
Committee. The Committee may use such business criteria and other measures of
performance as it may deem appropriate in establishing any performance
conditions, and may exercise its discretion to reduce the amounts payable under
any Award subject to performance conditions, except as limited under Sections
8(b) and 8(c) hereof in the case of a Performance Award or Annual Incentive
Award intended to qualify under Code Section 162(m).
(b) PERFORMANCE AWARDS GRANTED TO DESIGNATED COVERED
EMPLOYEES. If and to the extent that the Committee determines that a Performance
Award to be granted to an Eligible Person who is designated by the Committee as
likely to be a Covered Employee should qualify as "performance-based
compensation" for purposes of Code Section 162(m), the grant, exercise and/or
settlement of such Performance Award shall be contingent upon achievement of
pre-established performance goals and other terms set forth in this Section
8(b).
(i) PERFORMANCE GOALS GENERALLY. The performance
goals for such Performance Awards shall consist of one or more business criteria
and a targeted level or levels of performance with respect to each of such
criteria, as specified by the Committee consistent with this Section 8(b).
Performance goals shall be objective and shall otherwise meet the requirements
of Code Section 162(m) and regulations thereunder including the requirement that
the level or levels of performance targeted by the Committee result in the
achievement of performance goals being "substantially uncertain." The Committee
may determine that such Performance Awards shall be granted, exercised and/or
settled upon achievement of any one performance goal or that two or more of the
performance goals must be achieved as a condition to grant, exercise and/or
settlement of such Performance Awards. Performance goals may differ for
Performance Awards granted to any one Participant or to different Participants.
(ii) BUSINESS CRITERIA. One or more of the
following business criteria for the Company, on a consolidated basis, and/or
specified subsidiaries or business units of the Company (except with respect to
the total stockholder return and earnings per share criteria), shall be used
exclusively by the Committee in establishing performance goals for such
Performance Awards: (1) total stockholder return; (2) such total stockholder
return as compared to total return (on a comparable basis) of a publicly
available index such as, but not limited to,
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<PAGE> 12
the Standard & Poor's 500 Stock Index or the S&P Specialty Retailer Index; (3)
net income; (4) pretax earnings; (5) earnings before interest expense, taxes,
depreciation and amortization; (6) pretax operating earnings after interest
expense and before bonuses, service fees, and extraordinary or special items;
(7) operating margin; (8) earnings per share; (9) return on equity; (10) return
on capital; (11) return on investment; (12) operating earnings; (13) working
capital or inventory; and (14) ratio of debt to stockholders' equity. One or
more of the foregoing business criteria shall also be exclusively used in
establishing performance goals for Annual Incentive Awards granted to a Covered
Employee under Section 8(c) hereof.
(iii) PERFORMANCE PERIOD; TIMING FOR ESTABLISHING
PERFORMANCE GOALS. Achievement of performance goals in respect of such
Performance Awards shall be measured over a performance period of up to ten
years, as specified by the Committee. Performance goals shall be established not
later than 90 days after the beginning of any performance period applicable to
such Performance Awards, or at such other date as may be required or permitted
for "performance-based compensation" under Code Section 162(m).
(iv) PERFORMANCE AWARD POOL. The Committee may
establish a Performance Award pool, which shall be an unfunded pool, for
purposes of measuring Company performance in connection with Performance Awards.
The amount of such Performance Award pool shall be based upon the achievement of
a performance goal or goals based on one or more of the business criteria set
forth in Section 8(b)(ii) hereof during the given performance period, as
specified by the Committee in accordance with Section 8(b)(iii) hereof. The
Committee may specify the amount of the Performance Award pool as a percentage
of any of such business criteria, a percentage thereof in excess of a threshold
amount, or as another amount which need not bear a strictly mathematical
relationship to such business criteria.
(v) SETTLEMENT OF PERFORMANCE AWARDS; OTHER
TERMS. Settlement of such Performance Awards shall be in cash, Stock, other
Awards or other property, in the discretion of the Committee. The Committee may,
in its discretion, reduce the amount of a settlement otherwise to be made in
connection with such Performance Awards. The Committee shall specify the
circumstances in which such Performance Awards shall be paid or forfeited in the
event of termination of employment by the Participant prior to the end of a
performance period or settlement of Performance Awards.
(c) ANNUAL INCENTIVE AWARDS GRANTED TO DESIGNATED COVERED
EMPLOYEES. If and to the extent that the Committee determines that an Annual
Incentive Award to be granted to an Eligible Person who is designated by the
Committee as likely to be a Covered Employee should qualify as
"performance-based compensation" for purposes of Code Section 162(m), the grant,
exercise and/or settlement of such Annual Incentive Award shall be contingent
upon achievement of pre-established performance goals and other terms set forth
in this Section 8(c).
(i) ANNUAL INCENTIVE AWARD POOL. The Committee
may establish an Annual Incentive Award pool, which shall be an unfunded pool,
for purposes of measuring Company performance in connection with Annual
Incentive Awards. The amount of such Annual Incentive Award pool shall be based
upon the achievement of a performance goal or goals based on one or more of the
business criteria set forth in Section 8(b)(ii) hereof during the given
performance period, as specified by the Committee in accordance with Section
8(b)(iii) hereof. The Committee may specify the amount of the Annual Incentive
Award pool as a percentage of any such business criteria, a percentage thereof
in excess of a threshold amount, or as another amount which need not bear a
strictly mathematical relationship to such business criteria.
(ii) POTENTIAL ANNUAL INCENTIVE AWARDS. Not later
than the end of the 90th day of each fiscal year, or at such other date as may
be required or permitted in the case of Awards intended to be "performance-based
compensation" under Code Section 162(m), the Committee shall determine the
Eligible Persons who will potentially receive Annual Incentive Awards, and the
amounts potentially payable thereunder, for
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that fiscal year, either out of an Annual Incentive Award pool established by
such date under Section 8(c)(i) hereof or as individual Annual Incentive Awards.
In the case of individual Annual Incentive Awards intended to qualify under Code
Section 162(m), the amount potentially payable shall be based upon the
achievement of a performance goal or goals based on one or more of the business
criteria set forth in Section 8(b)(ii) hereof in the given performance year, as
specified by the Committee; in other cases, such amount shall be based on such
criteria as shall be established by the Committee. In all cases, the maximum
Annual Incentive Award of any Participant shall be subject to the limitation set
forth in Section 5 hereof.
(iii) PAYOUT OF ANNUAL INCENTIVE AWARDS. After the
end of each fiscal year, the Committee shall determine the amount, if any, of
(A) the Annual Incentive Award pool, and the maximum amount of potential Annual
Incentive Award payable to each Participant in the Annual Incentive Award pool,
or (B) the amount of potential Annual Incentive Award otherwise payable to each
Participant. The Committee may, in its discretion, determine that the amount
payable to any Participant as a final Annual Incentive Award shall be reduced
from the amount of his or her potential Annual Incentive Award, including a
determination to make no final Award whatsoever. The Committee shall specify the
circumstances in which an Annual Incentive Award shall be paid or forfeited in
the event of termination of employment by the Participant prior to the end of a
fiscal year or settlement of such Annual Incentive Award.
(d) WRITTEN DETERMINATIONS. All determinations by the
Committee as to the establishment of performance goals, the amount of any
Performance Award pool or potential individual Performance Awards and as to the
achievement of performance goals relating to Performance Awards under Section
8(b), and the amount of any Annual Incentive Award pool or potential individual
Annual Incentive Awards and the amount of final Annual Incentive Awards under
Section 8(c), shall be made in writing in the case of any Award intended to
qualify under Code Section 162(m). The Committee may not delegate any
responsibility relating to such Performance Awards or Annual Incentive Awards.
(e) STATUS OF SECTION 8(b) AND SECTION 8(c) AWARDS UNDER
CODE SECTION 162(m). It is the intent of the Company that Performance Awards and
Annual Incentive Awards under Section 8(b) and 8(c) hereof granted to persons
who are designated by the Committee as likely to be Covered Employees within the
meaning of Code Section 162(m) and regulations thereunder shall, if so
designated by the Committee, constitute "qualified performance-based
compensation" within the meaning of Code Section 162(m) and regulations
thereunder. Accordingly, the terms of Sections 8(b), (c), (d) and (e), including
the definitions of Covered Employee and other terms used therein, shall be
interpreted in a manner consistent with Code Section 162(m) and regulations
thereunder. The foregoing notwithstanding, because the Committee cannot
determine with certainty whether a given Participant will be a Covered Employee
with respect to a fiscal year that has not yet been completed, the term Covered
Employee as used herein shall mean only a person designated by the Committee, at
the time of grant of Performance Awards or an Annual Incentive Award, as likely
to be a Covered Employee with respect to that fiscal year. If any provision of
the Plan or any agreement relating to such Performance Awards or Annual
Incentive Awards does not comply or is inconsistent with the requirements of
Code Section 162(m) or regulations thereunder, such provision shall be construed
or deemed amended to the extent necessary to conform to such requirements.
9. CHANGE IN CONTROL.
(a) EFFECT OF "CHANGE IN CONTROL." (a) If and to the
extent provided in the Award, in the event of a "Change in Control," as defined
in Section 9(b), the following provisions shall apply:
(i) Any Award carrying a right to exercise that
was not previously exercisable and vested shall become fully exercisable and
vested as of the time of the Change in Control, subject only to applicable
restrictions set forth in Section 10(a) hereof;
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(ii) Limited SARs (and other SARs if so provided
by their terms) shall become exercisable for amounts, in cash, determined by
reference to the Change in Control Price.
(iii) The restrictions, deferral of settlement,
and forfeiture conditions applicable to any other Award granted under the Plan
shall lapse and such Awards shall be deemed fully vested as of the time of the
Change in Control, except to the extent of any waiver by the Participant and
subject to applicable restrictions set forth in Section 10(a) hereof; and
(iv) With respect to any such outstanding Award
subject to achievement of performance goals and conditions under the Plan, such
performance goals and other conditions will be deemed to be met if and to the
extent so provided by the Committee in the Award agreement relating to such
Award.
(b) DEFINITION OF "CHANGE IN CONTROL." A "Change in
Control" shall be deemed to have occurred upon:
(i) An acquisition by any Person of Beneficial
Ownership of the shares of Common Stock of the Company then outstanding (the
"Company Common Stock Outstanding") or the voting securities of the Company then
outstanding entitled to vote generally in the election of directors (the
"Company Voting Securities Outstanding") if such acquisition of Beneficial
Ownership results in the Person's Beneficially Owning 30% or more of the Company
Common Stock Outstanding or 30% or more of the combined voting power of the
Company Voting Securities Outstanding; PROVIDED, HOWEVER, that the event
described in this paragraph (i) shall not be deemed to be a Change in Control by
virtue of any of the following acquisitions: (A) by the Company or any Parent
Corporation or any Subsidiary, (B) by any employee benefit plan sponsored or
maintained by the Company or any Parent Corporation or any Subsidiary, (C) by
any underwriter temporarily holding securities pursuant to an offering of such
securities, (D) pursuant to a Non-Qualifying Transaction (as defined in
paragraph below), (E) pursuant to any acquisition by one or more Participants
(or any entity controlled by one or more Participants); or (F) a transaction
(other than one described in (ii) below) in which Company Voting Securities
Outstanding are acquired from the Company or any other person, if a majority of
the Incumbent Board (as defined in (iii) below) approve a resolution providing
expressly that the acquisition pursuant to this clause (F) does not constitute a
Change in Control under this paragraph (i); or
(ii) The approval by the stockholders of the
Company of a reorganization, merger, consolidation, complete liquidation or
dissolution of the Company, sale or disposition of all or substantially all of
the assets of the Company, or similar corporate transaction (in each case
referred to in this Section 9(b) as a "Corporate Transaction") or, if
consummation of such Corporate Transaction is subject, at the time of such
approval by stockholders, to the consent of any government or governmental
agency, the obtaining of such consent (either explicitly or implicitly);
provided, however, that any merger, consolidation, sale, disposition or other
similar transaction to or with one or more Participants or entities controlled
by one or more Participants shall not constitute a Corporate Transaction in
respect of such Participant(s); or
(iii) A change in the composition of the Board
such that the individuals who, as of the Effective Date, constitute the Board
(such Board shall be hereinafter referred to as the "Incumbent Board") cease for
any reason to constitute at least a majority of the Board; provided, however,
for purposes of this Section 9(b), that any individual who becomes a member of
the Board subsequent to the Effective Date whose election, or nomination for
election by the Company's stockholders, was approved by a vote (either by
specific vote or by approval of the proxy statement of the Company in which such
person is named as a nominee for director, without objection to such nomination)
of at least a majority of those individuals who are members of the Board and who
were also members of the Incumbent Board (or deemed to be such pursuant to this
proviso) shall be considered as though such individual were a member of the
Incumbent Board; and, provided, further, that any such individual whose initial
assumption of office occurs as a result of either an actual or threatened
election contest subject to Rule 14a-11 of Regulation 14A under the Exchange
Act, including any successor to such Rule, or other actual or
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threatened solicitation of proxies or consents by or on behalf of a Person other
than the Board shall in no event be considered as a member of the Incumbent
Board.
Notwithstanding the provisions set forth in subparagraphs (i) and (ii)
of this Section 9(b), the following transactions ("Non-Qualifying Transactions")
shall not constitute a Change in Control for purposes of the Plan: (1) any
acquisition by, or consummation of a Corporate Transaction with, any entity that
was a Parent Corporation or a Subsidiary of the Company immediately prior to the
transaction or an employee benefit plan (or related trust) sponsored or
maintained by the Company or an entity that was a Parent Corporation or a
Subsidiary of the Company immediately prior to the transaction if, immediately
after such transaction (including consummation of all related transactions), the
surviving entity is controlled by no Person other than such Parent Corporation
or Subsidiary, employee benefit plan (or related trust) and/or other Persons who
controlled the Company immediately prior to such transaction; (2) any
acquisition or consummation of a Corporate Transaction following which more than
50% of, respectively, the shares then outstanding of common stock of the
corporation resulting from such acquisition or Corporate Transaction and the
combined voting power of the voting securities then outstanding of such
corporation entitled to vote generally in the election of directors is then
Beneficially Owned, directly or indirectly, by all or substantially all of the
individuals and entities who were Beneficial Owners, respectively, of the
Company Common Stock Outstanding and Company Voting Securities Outstanding
immediately prior to such acquisition or Corporate Transaction in substantially
the same proportions as their ownership, immediately prior to such acquisition
or Corporate Transaction, of the Company Common Stock Outstanding and Company
Voting Securities Outstanding, as the case may be; or (3) any person acquires
Beneficial Ownership of 30% or more of the Company Common Stock Outstanding or
30% or more of the Company Voting Securities Outstanding as a result of the
acquisition by the Company of Company Common Stock Outstanding or Company Voting
Securities Outstanding which reduces the number of Company Common Stock
Outstanding or Company Voting Securities Outstanding.
(c) DEFINITION OF "CHANGE IN CONTROL PRICE." The "Change
in Control Price" means an amount in cash equal to the higher of (i) the amount
of cash and fair market value of property that is the highest price per share
paid (including extraordinary dividends) in any Corporate Transaction triggering
the Change in Control under Section 9(b)(ii) hereof or any liquidation of shares
following a sale of substantially all assets of the Company, or (ii) the highest
Fair Market Value per share at any time during the 60-day period preceding and
60-day period following the Change in Control.
10. GENERAL PROVISIONS.
(a) COMPLIANCE WITH LEGAL AND OTHER REQUIREMENTS. The
Company may, to the extent deemed necessary or advisable by the Committee,
postpone the issuance or delivery of Stock or payment of other benefits under
any Award until completion of such registration or qualification of such Stock
or other required action under any federal or state law, rule or regulation,
listing or other required action with respect to any stock exchange or automated
quotation system upon which the Stock or other Company securities are listed or
quoted, or compliance with any other obligation of the Company, as the Committee
may consider appropriate, and may require any Participant to make such
representations, furnish such information and comply with or be subject to such
other conditions as it may consider appropriate in connection with the issuance
or delivery of Stock or payment of other benefits in compliance with applicable
laws, rules, and regulations, listing requirements, or other obligations. The
foregoing notwithstanding, in connection with a Change in Control, the Company
shall take or cause to be taken no action, and shall undertake or permit to
arise no legal or contractual obligation, that results or would result in any
postponement of the issuance or delivery of Stock or payment of benefits under
any Award or the imposition of any other conditions on such issuance, delivery
or payment, to the extent that such postponement or other condition would
represent a greater burden on a Participant than existed on the 90th day
preceding the Change in Control.
(b) LIMITS ON TRANSFERABILITY; BENEFICIARIES. No Award or
other right or
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interest of a Participant under the Plan, including any Award or right which
constitutes a derivative security as generally defined in Rule 16a-1(c) under
the Exchange Act, shall be pledged, hypothecated or otherwise encumbered or
subject to any lien, obligation or liability of such Participant to any party
(other than the Company or a subsidiary), or assigned or transferred by such
Participant otherwise than by will or the laws of descent and distribution or to
a Beneficiary upon the death of a Participant, and such Awards or rights that
may be exercisable shall be exercised during the lifetime of the Participant
only by the Participant or his or her guardian or legal representative, except
that Awards and other rights (other than ISOs and SARs in tandem therewith) may
be transferred to one or more Beneficiaries or other transferees during the
lifetime of the Participant, and may be exercised by such transferees in
accordance with the terms of such Award, but only if and to the extent such
transfers and exercises are permitted by the Committee pursuant to the express
terms of an Award agreement (subject to any terms and conditions which the
Committee may impose thereon, and further subject to any prohibitions or
restrictions on such transfers pursuant to Rule 16b-3). A Beneficiary,
transferee, or other person claiming any rights under the Plan from or through
any Participant shall be subject to all terms and conditions of the Plan and any
Award agreement applicable to such Participant, except as otherwise determined
by the Committee, and to any additional terms and conditions deemed necessary or
appropriate by the Committee.
(c) ADJUSTMENTS. In the event that any dividend or other
distribution (whether in the form of cash, Stock, or other property),
recapitalization, forward or reverse split, reorganization, merger,
consolidation, spin-off, combination, repurchase, share exchange, liquidation,
dissolution or other similar corporate transaction or event affects the Stock
such that a substitution or adjustment is determined by the Committee to be
appropriate in order to prevent dilution or enlargement of the rights of
Participants under the Plan, then the Committee shall, in such manner as it may
deem equitable, substitute or adjust any or all of (i) the number and kind of
shares of Stock which may be delivered in connection with Awards granted
thereafter, (ii) the number and kind of shares of Stock by which annual
per-person Award limitations are measured under Section 5 hereof, (iii) the
number and kind of shares of Stock subject to or deliverable in respect of
outstanding Awards and (iv) the exercise price, grant price or purchase price
relating to any Award and/or make provision for payment of cash or other
property in respect of any outstanding Award. In addition, the Committee is
authorized to make adjustments in the terms and conditions of, and the criteria
included in, Awards (including Performance Awards and performance goals, and
Annual Incentive Awards and any Annual Incentive Award pool or performance goals
relating thereto) in recognition of unusual or nonrecurring events (including,
without limitation, events described in the preceding sentence, as well as
acquisitions and dispositions of businesses and assets) affecting the Company,
any subsidiary or any business unit, or the financial statements of the Company
or any subsidiary, or in response to changes in applicable laws, regulations,
accounting principles, tax rates and regulations or business conditions or in
view of the Committee's assessment of the business strategy of the Company, any
subsidiary or business unit thereof, performance of comparable organizations,
economic and business conditions, personal performance of a Participant, and any
other circumstances deemed relevant; provided that no such adjustment shall be
authorized or made if and to the extent that such authority or the making of
such adjustment would cause Options, SARs, Performance Awards granted under
Section 8(b) hereof or Annual Incentive Awards granted under Section 8(c) hereof
to Participants designated by the Committee as Covered Employees and intended to
qualify as "performance-based compensation" under Code Section 162(m) and the
regulations thereunder to otherwise fail to qualify as "performance-based
compensation" under Code Section 162(m) and regulations thereunder.
(d) TAXES. The Company and any subsidiary is authorized
to withhold from any Award granted, any payment relating to an Award under the
Plan, including from a distribution of Stock, or any payroll or other payment to
a Participant, amounts of withholding and other taxes due or potentially payable
in connection with any transaction involving an Award, and to take such other
action as the Committee may deem advisable to enable the Company and
Participants to satisfy obligations for the payment of withholding taxes and
other tax obligations relating to any Award. This authority shall include
authority to withhold or receive Stock or other property and to make cash
payments in respect thereof in satisfaction of a Participant's tax obligations,
either on a mandatory or elective basis in the discretion of the Committee.
20
<PAGE> 17
(e) CHANGES TO THE PLAN AND AWARDS. The Board may amend,
alter, suspend, discontinue or terminate the Plan or the Committee's authority
to grant Awards under the Plan without the consent of stockholders or
Participants, except that any amendment or alteration to the Plan shall be
subject to the approval of the Company's stockholders not later than the annual
meeting next following such Board action if such stockholder approval is
required by any federal or state law or regulation (including, without
limitation, Rule 16b-3 or Code Section 162(m)) or the rules of any stock
exchange or automated quotation system on which the Stock may then be listed or
quoted, and the Board may otherwise, in its discretion, determine to submit
other such changes to the Plan to stockholders for approval; provided that,
without the consent of an affected Participant, no such Board action may
materially and adversely affect the rights of such Participant under any
previously granted and outstanding Award. The Committee may waive any conditions
or rights under, or amend, alter, suspend, discontinue or terminate any Award
theretofore granted and any Award agreement relating thereto, except as
otherwise provided in the Plan; provided that, without the consent of an
affected Participant, no such Committee action may materially and adversely
affect the rights of such Participant under such Award. Notwithstanding anything
in the Plan to the contrary, if any right under this Plan would cause a
transaction to be ineligible for pooling of interest accounting that would, but
for the right hereunder, be eligible for such accounting treatment, the
Committee may modify or adjust the right so that pooling of interest accounting
shall be available, including the substitution of Stock having a Fair Market
Value equal to the cash otherwise payable hereunder for the right which caused
the transaction to be ineligible for pooling of interest accounting.
(f) LIMITATION ON RIGHTS CONFERRED UNDER PLAN. Neither
the Plan nor any action taken hereunder shall be construed as (i) giving any
Eligible Person or Participant the right to continue as an Eligible Person or
Participant or in the employ of the Company or a subsidiary; (ii) interfering in
any way with the right of the Company or a subsidiary to terminate any Eligible
Person's or Participant's employment at any time, (iii) giving an Eligible
Person or Participant any claim to be granted any Award under the Plan or to be
treated uniformly with other Participants and employees, or (iv) conferring on a
Participant any of the rights of a stockholder of the Company unless and until
the Participant is duly issued or transferred shares of Stock in accordance with
the terms of an Award.
(g) UNFUNDED STATUS OF AWARDS; CREATION OF TRUSTS. The
Plan is intended to constitute an "unfunded" plan for incentive and deferred
compensation. With respect to any payments not yet made to a Participant or
obligation to deliver Stock pursuant to an Award, nothing contained in the Plan
or any Award shall give any such Participant any rights that are greater than
those of a general creditor of the Company; provided that the Committee may
authorize the creation of trusts and deposit therein cash, Stock, other Awards
or other property, or make other arrangements to meet the Company's obligations
under the Plan. Such trusts or other arrangements shall be consistent with the
"unfunded" status of the Plan unless the Committee otherwise determines with the
consent of each affected Participant. The trustee of such trusts may be
authorized to dispose of trust assets and reinvest the proceeds in alternative
investments, subject to such terms and conditions as the Committee may specify
and in accordance with applicable law.
(h) NONEXCLUSIVITY OF THE PLAN. Neither the adoption of
the Plan by the Board nor its submission to the stockholders of the Company for
approval shall be construed as creating any limitations on the power of the
Board or a committee thereof to adopt such other incentive arrangements as it
may deem desirable including incentive arrangements and awards which do not
qualify under Code Section 162(m).
(i) PAYMENTS IN THE EVENT OF FORFEITURES; FRACTIONAL
SHARES. Unless otherwise determined by the Committee, in the event of a
forfeiture of an Award with respect to which a Participant paid cash or other
consideration, the Participant shall be repaid the amount of such cash or other
consideration. No fractional shares of Stock shall be issued or delivered
pursuant to the Plan or any Award. The Committee shall determine whether cash,
other Awards or other property shall be issued or paid in lieu of such
fractional shares or whether such fractional shares or any rights thereto shall
be forfeited or otherwise eliminated.
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(j) GOVERNING LAW. The validity, construction and effect
of the Plan, any rules and regulations under the Plan, and any Award agreement
shall be determined in accordance with the laws of the State of Florida without
giving effect to principles of conflicts of laws, and applicable federal law.
(k) PLAN EFFECTIVE DATE AND STOCKHOLDER APPROVAL;
TERMINATION OF PLAN. The Plan shall become effective on the Effective Date,
subject to subsequent approval within 12 months of its adoption by the Board by
stockholders of the Company eligible to vote in the election of directors, by a
vote sufficient to meet the requirements of Code Section 162(m) and 422, Rule
16b-3 under the Exchange Act, applicable NASDAQ requirements, and other laws,
regulations, and obligations of the Company applicable to the Plan. Awards may
be granted subject to stockholder approval, but may not be exercised or
otherwise settled in the event stockholder approval is not obtained. The Plan
shall terminate at such time as no shares of Common Stock remain available for
issuance under the Plan and the Company has no further rights or obligations
with respect to outstanding Awards under the Plan.
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EXHIBIT 5.1
June 29, 1999
H.T.E., Inc.
1000 Business Center Drive
Lake Mary, Florida 32746
Ladies and Gentlemen:
This opinion is delivered in our capacity as counsel to H.T.E., Inc., a
Florida corporation (the "Company"), in connection with the preparation and
filing with the Securities and Exchange Commission under the Securities Act of
1933, as amended (the "Securities Act"), of a Registration Statement on Form S-8
(the "Registration Statement") relating to an additional 1,000,000 shares (the
"Shares") of the Company's common stock, par value $.01 per share, which the
Company may issue pursuant to the Company's 1997 Employee Incentive Compensation
Plan, as amended (the "Plan").
As counsel for the Company, we have examined copies of the Plan, the
Company's Articles of Incorporation, as amended to date, and Bylaws, each as
presently in effect, and such records, certificates and other documents of the
Company as we have deemed necessary or appropriate for the purposes of this
opinion.
Based upon the foregoing, assuming that the Company maintains on
adequate number of authorized and unissued shares of Common Stock available for
purchases made under the Plan, we are of the opinion that upon the issuance and
delivery of the Shares against payment therefor in accordance with the terms of
the Plan, the Shares will be validly issued, fully paid and non-assessable.
We hereby consent to the inclusion of this opinion as an exhibit to the
Registration Statement. In giving such consent, we do not admit that we come
within the category of persons whose consent is required by Section 7 of the
Securities Act or the rules and regulations promulgated thereunder.
Very truly yours,
/s/ Greenberg Traurig, P.A.
<PAGE> 1
EXHIBIT 23.2
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
As independent certified public accountants, we hereby consent to the
incorporation by reference in this S-8 registration statement of our report
dated February 10, 1999, included in H.T.E., Inc.'s Form 10-K for the year ended
December 31, 1998, and to all references to our firm in this registration
statement.
/s/ ARTHUR ANDERSEN LLP
Orlando, Florida,
June 25, 1999
<PAGE> 1
EXHIBIT 23.3
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We hereby consent to the incorporation by reference in this
Registration Statement on Form S-8 of our reports dated April 10, 1998 and July
7, 1998, relating to the financial statements of UCS, Inc., which appear
in Form 10-K of H.T.E., Inc. for the year ended December 31, 1998.
/s/ PricewaterhouseCoopers LLP
Miami, Florida
June 25, 1999
