<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 9, 1998
REGISTRATION NO. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
-------------------------
REMEDYTEMP, INC.
(Exact name of Registrant as specified in its charter)
32122 CAMINO CAPISTRANO
SAN JUAN CAPISTRANO, CALIFORNIA 92675
(714) 661-1211
(Address of Principal Executive Offices)
CALIFORNIA 95-2890471
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
AMENDED AND RESTATED REMEDYTEMP, INC.
1996 STOCK INCENTIVE PLAN
(Full title of the plan)
-------------------------
ALAN M. PURDY BRIAN W. COPPLE, ESQ.
CHIEF FINANCIAL OFFICER GIBSON, DUNN & CRUTCHER LLP
32122 CAMINO CAPISTRANO 4 PARK PLAZA, SUITE 1800
SAN JUAN CAPISTRANO, CALIFORNIA 92675 IRVINE, CALIFORNIA 92614-8557
(714) 661-1211 (714) 451-3874
(Name, address, zip code, (Name, address, zip code,
and telephone number, and telephone number,
including area code, of including area code, of
agent for service) agent for service)
-------------------------
CALCULATION OF REGISTRATION FEE
================================================================================
<TABLE>
<CAPTION>
PROPOSED
PROPOSED MAXIMUM
TITLE OF MAXIMUM AGGREGATE AMOUNT OF
SECURITIES TO BE AMOUNT TO BE OFFERING PRICE OFFERING REGISTRATION
REGISTERED REGISTERED PER SHARE(1) PRICE(1) FEE
- -------------------------- ---------- -------- ---------- ----------
<S> <C> <C> <C> <C>
Class A Common Stock,
par value $0.01 per share 325,000 $24.6875 $8,023,438 $ 2,367
</TABLE>
================================================================================
(1) Estimated solely for purposes of determining the registration fee
pursuant to Rule 457(h) and Rule 457(c) based on the average of the high
and low prices for the Class A Common Stock of RemedyTemp, Inc. as
reported on March 3, 1998, on the Nasdaq National Market.
- --------------------------------------------------------------------------------
<PAGE> 2
INTRODUCTION
This Registration Statement on Form S-8 is filed by RemedyTemp, Inc.
(the "Company") relating to an additional 325,000 shares of the Company's Class
A Common Stock, par value $0.01 per share (the "Common Stock"), issuable to
officers, directors, key employees and consultants of the Company upon exercise
of stock options or pursuant to certain other awards granted under the Amended
and Restated RemedyTemp, Inc. 1996 Stock Incentive Plan (the "Plan"), amended
effective February 18, 1998 to increase to 1,225,000 the number of shares that
may be issued pursuant to awards under the Plan, and consists of only those
items required by General Instruction E to Form S-8.
INCORPORATION OF PREVIOUSLY FILED REGISTRATION STATEMENT
Pursuant to General Instruction E to Form S-8, the contents of the
Registration Statement on Form S-8 (Registration No. 333-11307), filed with the
Securities and Exchange Commission on September 3, 1996, are incorporated herein
by reference and made a part hereof.
For purposes of this Registration Statement, any statement contained in
a document incorporated or deemed to be incorporated herein by reference shall
be deemed to be modified or superseded to the extent that a statement contained
herein or in any other subsequently filed document which also is or is deemed to
be incorporated herein by reference modifies or supersedes such statement in
such document. Any statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constituted a part of this Registration
Statement.
ITEM 8. EXHIBITS.
4.1 Specimen Stock Certificate*
4.2 Shareholder Rights Agreement*
4.3 Amended and Restated Articles of Incorporation of the Company**
4.4 Amended and Restated Bylaws of the Company
4.5 Amended and Restated RemedyTemp, Inc. 1996 Stock Incentive Plan
5 Opinion of Gibson, Dunn & Crutcher LLP as to the legality of the
securities being registered
23.1 Consent of Price Waterhouse LLP, independent accountants
23.2 Consent of Gibson, Dunn & Crutcher LLP (contained in Exhibit 5 hereto)
24 Power of Attorney (contained on signature page hereto)
* Incorporated by reference to the exhibit of the same number to the
Company's Registration Statement on Form S-1 (Reg. No. 333-4276), as
amended.
** Incorporated by reference to Exhibit 3.1 to the Company's Registration
Statement on Form S-1 (Reg. No. 333-4276), as amended.
1
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Company
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 San Juan Capistrano, State of California, on March 6,
1998.
REMEDYTEMP, INC.
By: /s/ Paul W. Mikos
-----------------------------
Paul W. Mikos
President and
Chief Executive Officer
POWER OF ATTORNEY
Each person whose signature appears below constitutes and appoints Paul
W. Mikos and Alan M. Purdy his or her true and lawful attorneys-in-fact and
agents, each acting alone, with full powers of substitution and resubstitution,
for him or her and in his or her name, place and stead, in any and all
capacities, to sign any and all amendments (including post-effective amendments)
to this Registration Statement and to file the same, with all exhibits thereto,
and other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, each acting alone,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as he or she might or could do in person, hereby ratifying
and confirming that all said attorneys-in-fact and agents, each acting alone, 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 by the following persons in the
capacities and on the dates indicated.
NAME TITLE DATE
/s/ Paul W. Mikos Director, President and Chief March 6, 1998
- ------------------------------ Executive Officer (Principal
Paul W. Mikos Executive Officer)
/s/ Alan M. Purdy Chief Financial Officer March 6, 1998
- ------------------------------ (Principal Financial Officer
Alan M. Purdy and Principal Accounting
Officer)
/s/ Robert E. McDonough, Sr. Director, Chairman of the Board March 6, 1998
- ------------------------------
Robert E. McDonough, Sr.
/s/ Susan McDonough Mikos Director, Secretary March 6, 1998
- ------------------------------
Susan McDonough Mikos
/s/ William D. Cvengros Director March 6, 1998
- ------------------------------
William D. Cvengros
/s/ James L. Doti Director March 6, 1998
- ------------------------------
James L. Doti
/s/ Robert A. Elliott Director March 6, 1998
- ------------------------------
Robert A. Elliott
/s/ John B. Zaepfel Director March 6, 1998
- ------------------------------
John B. Zaepfel
2
<PAGE> 4
INDEX TO EXHIBITS
Exhibit No. Description
4.1 Specimen Stock Certificate *
4.2 Shareholder Rights Agreement *
4.3 Amended and Restated Articles of Incorporation **
4.4 Amended and Restated Bylaws
4.5 Amended and Restated RemedyTemp, Inc. 1996 Stock
Incentive Plan
5 Opinion of Gibson, Dunn & Crutcher LLP as to the legality of
the securities being registered
23.1 Consent of Price Waterhouse LLP, independent accountants
23.2 Consent of Gibson, Dunn & Crutcher LLP (contained in
Exhibit 5 hereto)
24 Power of Attorney (contained on signature page hereof)
* Incorporated by reference to the exhibit of the same number to the Company's
Registration Statement on Form S-1 (Reg. No. 333-4276), as amended.
** Incorporated by reference to Exhibit 3.1 to the Company's Registration
Statement on Form S-1 (Reg. No. 333-4276), as amended.
3
<PAGE> 1
EXHIBIT 4.4
AMENDED AND RESTATED BYLAWS
OF
REMEDYTEMP, INC.,
A CALIFORNIA CORPORATION
(EFFECTIVE FEBRUARY 18, 1998)
<PAGE> 2
TABLE OF CONTENTS
ARTICLE I OFFICES..........................................................1
Section 1.01 Principal Executive Office.................................1
ARTICLE II SHAREHOLDERS....................................................1
Section 2.01 Annual Meetings............................................1
Section 2.02 Special Meetings...........................................3
Section 2.03 Conduct of Meetings........................................4
Section 2.04 Elimination of Cumulative Voting...........................4
ARTICLE III DIRECTORS......................................................4
Section 3.01 Number of Directors........................................4
Section 3.02 Creation and Filling of Vacancies on the Board.............4
Section 3.03 Fees and Compensation......................................4
Section 3.04 Organization Meeting.......................................5
Section 3.05 Other Regular Meetings.....................................5
Section 3.06 Special Meetings...........................................5
Section 3.07 Place of Meetings..........................................6
Section 3.08 Committees of the Board....................................6
Section 3.09 Loans to Officers..........................................6
ARTICLE IV OFFICERS........................................................6
Section 4.01 Officers...................................................6
Section 4.02 Election and Term of Office................................6
Section 4.03 Removal and Resignation....................................6
Section 4.04 Vacancies..................................................7
Section 4.05 Duties and Compensation....................................7
ARTICLE V INDEMNIFICATION OF AGENTS OF THE CORPORATION;
PURCHASE OF LIABILITY INSURANCE.........................................7
Section 5.01 Indemnification of Agents..................................7
CERTIFICATE OF SECRETARY..................................................11
i
<PAGE> 3
AMENDED AND RESTATED BYLAWS
OF
REMEDYTEMP, INC.,
A CALIFORNIA CORPORATION
ARTICLE I
OFFICES
Section 1.01 Principal Executive Office. The principal executive
office of the corporation is located at: 32122 Camino Capistrano, San Juan
Capistrano, State of California. The board of directors shall have full power
and authority to, and to authorize appropriate officers of the corporation to,
change the location of said principal executive office and to establish other
offices of the corporation.
ARTICLE II
SHAREHOLDERS
Section 2.01 Annual Meetings.
(a) The annual meeting of shareholders shall be held each year on
a date and at a time designated by the board of directors. At each annual
meeting, directors shall be elected and any other proper business may be
transacted. The date so designated shall be within five (5) months after the end
of the fiscal year of the corporation and within fifteen (15) months after the
last annual meeting.
(b) At an annual meeting of shareholders, only such business
shall be conducted, and only such proposals shall be acted upon, as shall have
been brought before the annual meeting by or at the direction of a majority of
the directors or by any shareholder of the corporation who complies with the
notice procedures set forth in this Section 2.01(b). For a proposal to be
properly brought before an annual meeting by a shareholder, the shareholder must
have given timely notice thereof in writing to the secretary of the corporation.
To be timely, a shareholder's notice must be delivered to, or mailed and
received at, the principal executive offices of the corporation not less than
sixty (60) days nor more than one hundred twenty (120) days prior to the
scheduled annual meeting, regardless of any postponements, deferrals or
adjournments of that meeting to a later date; provided, however, that if less
than seventy (70) days notice or prior public disclosure of the date of the
scheduled annual meeting is given or made, notice by the shareholder, to be
timely, must be so delivered or received not later than the close of business on
the tenth day following the earlier of the day on which such notice of the date
of the scheduled annual meeting was mailed or the day on which such public
disclosure was made. A shareholder's notice to the secretary shall set forth as
to each matter the shareholder proposes to bring before the annual meeting (i) a
brief description of the proposal desired to be brought before the annual
meeting and the reasons for conducting such business at the annual meeting, (ii)
the name and address, as they appear on the corporation's books, of the
shareholder proposing such business and any other shareholders known by such
shareholder to be supporting such proposal, (iii) the class and number of shares
of the corporation's stock which are beneficially owned by the shareholder on
the date of such shareholder notice and by any other shareholders known by such
<PAGE> 4
shareholder to be supporting such proposal on the date of such shareholder
notice, and (iv) any financial interest of the shareholder in such proposal. The
presiding officer of the annual meeting shall determine and declare at the
annual meeting whether the shareholder proposal was made in accordance with the
terms of this Section 2.01(b). If the presiding officer determines that a
shareholder proposal was not made in accordance with the terms of this Section
2.01(b), he or she shall so declare at the annual meeting and any such proposal
shall not be acted upon at the annual meeting. This provision shall not prevent
the consideration and approval or disapproval at the annual meeting of reports
of officers, directors and committees of the board of directors, but, in
connection with such reports, no new business shall be acted upon at such annual
meeting unless stated, filed and received as herein provided.
(c) Subject to the rights, if any, of the holders of shares of
Preferred Stock then outstanding, only persons who are nominated in accordance
with the following procedures shall be eligible for election as directors.
Nominations of persons for election to the board of directors of the corporation
may be made at a meeting of shareholders by or at the direction of the board of
directors, by any nominating committee or person appointed by the board of
directors or by any shareholder of the corporation entitled to vote for the
election of directors at the meeting who complies with the notice procedures set
forth in this Section 2.01(c). Such nominations, other than those made by or at
the direction of the board of directors, shall be made pursuant to timely notice
in writing to the secretary of the corporation. To be timely, a shareholder's
notice must be delivered to, or mailed and received at, the principal executive
offices of the corporation not less than sixty (60) days nor more than one
hundred twenty (120) days prior to the scheduled annual meeting, regardless of
any postponements, deferrals or adjournments of that meeting to a later date;
provided, however, that if less than seventy (70) days notice or prior public
disclosure of the date of the scheduled annual meeting is given or made, notice
by the shareholder, to be timely, must be so delivered or received not later
than the close of business on the tenth day following the earlier of the day on
which such notice of the date of the scheduled annual meeting was mailed or the
day on which such public disclosure was made. A shareholder's notice to the
secretary shall set forth (i) as to each person whom the shareholder proposes to
nominate for election or re-election as a director, (A) the name, age and
business address of the person, (B) the principal occupation or employment of
the person (C) the class and number of shares of capital stock of the
corporation which are beneficially owned by the person and (D) any other
information relating to the person that is required to be disclosed in
solicitations for proxies for election of directors pursuant to applicable rules
and regulations of the Securities and Exchange Commission (the "SEC")
promulgated under the Securities Exchange Act of 1934, as amended (the
"Securities Exchange Act of 1934"); and (ii) as to the shareholder giving the
notice (A) the name and address, as they appear on the corporation's books, of
the shareholder and (B) the class and number of shares of the corporation's
stock which are beneficially owned by the shareholder on the date of such
shareholder notice. The corporation may require any proposed nominee to furnish
such other information as may reasonably be required by the corporation to
determine the eligibility of such proposed nominee to serve as director of the
corporation. The presiding
2
<PAGE> 5
officer of the annual meeting shall determine and declare at the annual meeting
whether the nomination was made in accordance with the terms of this Section
2.01(c). If the presiding officer determines that a nomination was not made in
accordance with the terms of this Section 2.01(c), he or she shall so declare at
the annual meeting and any such defective nomination shall be disregarded.
Section 2.02 Special Meetings.
(a) A special meeting of the shareholders may be called at any
time by the board of directors, or by the chairman of the board, or by the
president, or by one or more shareholders holding shares in the aggregate
entitled to cast not less than twenty percent (20%) of the votes at that
meeting.
(b) For a special meeting of shareholders to be properly called
by any person or persons other than the board of directors, the request must be
in writing, specifying the date and time of such meeting and the information set
forth in Section 2.02(c) hereof, and must be delivered to, or mailed and
received by, the chairman of the board, the president or the secretary of the
corporation not less than forty (40) nor more than sixty (60) days prior to the
date requested for such meeting. The officer receiving the request shall cause
notice to be promptly given to the shareholders entitled to vote that a meeting
will be held at the time requested by the person or persons calling the meeting.
If the notice is not given within twenty (20) days after receipt of the request,
the person or persons requesting the meeting may give the notice. Nothing
contained in this Section 2.02(b) shall be construed as limiting, fixing or
affecting the time when a meeting of shareholders called by action of the board
of directors may be held.
(c) Any request for a special meeting submitted pursuant to
Section 2.02(b) hereof shall set forth as to each matter the shareholder
proposes to bring before the special meeting (i) a brief description of the
proposal desired to be brought before the special meeting and the reasons for
conducting such business at the special meeting, (ii) the name and address, as
they appear on the corporation's books, of the shareholder proposing such
business and any other shareholders known by such shareholder to be supporting
such proposal, (iii) the class and number of shares of the corporation's stock
which are beneficially owned by the shareholder on the date of such shareholder
request and by any other shareholders known by such shareholder to be supporting
such proposal on the date of such shareholder request, and (iv) any financial
interest of the shareholder in such proposal. In addition to whatever other
limitations are imposed by applicable law, no person may be nominated for
election to the board of directors of the corporation by any of the person or
persons making a request for a special meeting pursuant to Section 2.02(b)
hereof unless the request sets forth as to each person whom the requesting
person or persons propose to nominate for election as a director, (A) the name,
age and business address of the person, (B) the principal occupation or
employment of the person (C) the class and number of shares of capital stock of
the corporation which are beneficially owned by the person and (D) any other
information relating to the person that is required to be disclosed in
solicitations for proxies for election of directors
3
<PAGE> 6
pursuant to applicable rules and regulations of the SEC promulgated under the
Securities Exchange Act of 1934.
Section 2.03 Conduct of Meetings. Subject to the requirements of
applicable law, and the express provisions of the Articles of Incorporation and
these bylaws, all annual and special meetings of shareholders shall be conducted
in accordance with such rules and procedures as the board of directors may
determine and, as to matters not governed by such rules and procedures, as the
chairman of such meeting shall determine. The chairman of any annual or special
meeting of shareholders shall be designated by the board of directors and, in
the absence of any such designation, shall be the president of the corporation.
Section 2.04 Elimination of Cumulative Voting. The right of
shareholders to cumulate votes shall be eliminated when the corporation becomes
a listed corporation within the meaning of Section 301.5 of the California
Corporations Code.
ARTICLE III DIRECTORS
Section 3.01 Number of Directors. The authorized number of
directors of the corporation shall be not less than five (5) nor more than nine
(9), until changed in accordance with applicable law. The exact number of
directors shall be fixed from time to time, within the limits specified above by
resolution of the board of directors or the shareholders of the corporation.
Section 3.02 Creation and Filling of Vacancies on the Board. A
vacancy or vacancies on the board of directors shall be deemed to exist in case
of the death, removal or resignation of any director, if the authorized number
of directors is increased, or if the shareholders fail, at any annual or special
meeting of shareholders at which any director or directors are to be elected, to
elect the full authorized number of directors to be elected at that meeting.
Any director may resign effective upon giving written notice to
the chairman of the board, the president, the secretary or the board of
directors of the corporation, or at any later time specified therein; and,
unless otherwise specified therein, the acceptance of such resignation shall not
be necessary to make it effective. If the resignation is effective at a future
time, a successor may be elected to take office when the resignation becomes
effective.
Unless otherwise provided in the Articles of Incorporation,
vacancies in the board of directors, including without limitation vacancies
created by the removal of a director, may be filled by a majority of the
remaining directors, though less than a quorum, or by a sole remaining director,
and each director so elected shall hold office until occurrence of an event
specified above creating a vacancy in such director's office or until such
director's successor is elected and qualified.
Section 3.03 Fees and Compensation. By resolution of the board of
directors, one or more of the directors may be paid a retainer for their
services as directors, or a fixed fee (with or without expenses of attendance)
for attendance at each meeting, or both. Payment
4
<PAGE> 7
of such fees shall not preclude participation in stock option or
incentive plans. Nothing herein contained shall be construed to preclude any
director from serving the corporation in any other capacity as an officer,
agent, employee, or otherwise, and receiving compensation therefor.
Section 3.04 Organization Meeting. Immediately following each
annual meeting of shareholders, the board of directors shall hold a regular
meeting at the place of said annual meeting or at such other place as shall be
fixed by the board of directors, for the purpose of organization, election of
officers, and the transaction of other business. Call and notice of such
meeting are hereby dispensed with.
Section 3.05 Other Regular Meetings. Other regular meetings of
the board of directors may be held at the time and place of regular meetings of
the board fixed in advance by the board of directors. Call and notice of such
regular meetings of the board of directors are hereby dispensed with.
Section 3.06 Special Meetings. Special meetings of the board of
directors, for the purpose of taking any action permitted by the directors under
the General Corporation Law and the Articles of Incorporation, may be called at
any time by the chairman of the board, the president, any vice president, the
secretary or by any two directors.
Notice of a meeting need not be given to any director who signs a
waiver of notice or a consent to hold the meeting or an approval of the minutes
thereof, whether before or after the meeting, or who attends the meeting without
protesting, prior to the meeting or at its commencement, the lack of notice to
such director. All such waivers, consents and approvals shall be filed with the
corporate records or made a part of the minutes of the meeting. Subject to the
preceding sentence, notice of the time and place of special meetings shall be
given to each director (a) personally or by telephone, including a voice
messaging system or other system or technology designed to record and
communicate messages, telegraph, facsimile, electronic mail, or other electronic
means, in each case forty-eight (48) hours prior to the holding of the meeting,
or (b) by mail, charges prepaid, addressed to him at his address as it is shown
upon the records of the corporation or, if it is not so shown on such records
and is not readily ascertainable, at the place at which the meetings of the
directors are regularly held, at least four (4) days prior to the holding of the
meeting. Notice by mail shall be deemed to have been given at the time a written
notice is deposited in the United States mails, postage prepaid. Any other
written notice shall be deemed to have been given at the time it is personally
delivered to the recipient or is delivered to a common carrier for transmission,
or actually transmitted by the person giving the notice by electronic means, to
the recipient. Oral notice shall be deemed to have been given at the time it is
communicated, in person or by telephone or wireless, to the recipient or to a
person at the office of the recipient who the person giving the notice has
reason to believe will promptly communicate it to the recipient.
Any notice, waiver of notice or consent to holding a meeting
shall state the time and place of the meeting but need not specify the purpose
of the meeting.
5
<PAGE> 8
Section 3.07 Place of Meetings. Regular and special meetings of
the board of directors may be held at any place within or without the State
which has been designated by resolution of the board. In the absence of such
designation, meetings shall be held at the principal executive office of the
corporation.
Section 3.08 Committees of the Board. By resolution adopted by a
majority of the authorized number of directors, the board of directors may
designate such committees as it shall determine, each consisting of two or more
directors, to serve at the pleasure of the board and having such authority as
prescribed by the board, subject to applicable restrictions on committee
authority imposed by the California Corporations Code. Unless, to the extent
permitted by the General Corporation Law, the board of directors shall otherwise
prescribe the manner of proceedings of any such committee, the provisions of
these bylaws with respect to notice and conduct of meetings of the board shall
govern committees of the board and action by such committees.
Section 3.09 Loans to Officers. If the corporation has
outstanding shares held of record by 100 or more persons (determined as provided
by Section 605 of the California Corporations Code) on the date of board
approval, the board may approve a loan of money or property to, or a guarantee
of the obligation of, an officer, whether or not a director, or an employee
benefit plan authorizing such a loan or guaranty to an officer, if the board
determines that such loan, guaranty or plan may reasonably be expected to
benefit the corporation in accordance with the provisions of Section 315 of the
California Corporations Code. Board approval shall require a vote sufficient
without counting the vote of any interested director or directors to approve
such loan, guaranty or benefit plan.
ARTICLE IV
OFFICERS
Section 4.01 Officers. The officers of the corporation shall be a
chairman of the board, a chief executive officer, a president, a secretary and a
chief financial officer. The corporation may also have, at the discretion of the
board of directors, such other officers, with such titles and duties as may be
determined by the board of directors. One person may hold two or more offices,
except that the offices of president and secretary shall not be held by the same
person.
Section 4.02 Election and Term of Office. The officers of the
corporation shall be chosen by the board of directors, and each shall hold
office at the pleasure of the board or until such officer shall resign, subject,
in each case, to the rights, if any, of the corporation and any such officer
under any contract of employment with the corporation.
Section 4.03 Removal and Resignation. Any officer may be removed,
either with or without cause, by a majority of the directors at the time in
office, at any regular or special meeting of the board of directors, or, except
in case of an officer chosen by the board of directors, by any officer upon whom
such power of removal may be conferred by the board of directors, subject, in
each case, to the rights, if any, of any such officer under any contract of
employment with the corporation.
6
<PAGE> 9
Any officer may resign at any time by giving written notice to
the corporation, without prejudice, however, to the rights, if any, of the
corporation under any contract to which such officer is a party. Any such
resignation shall take effect at the date of the receipt of such notice or at
any later time specified therein; and, unless otherwise specified therein, the
acceptance of such resignation shall not be necessary to make it effective.
Section 4.04 Vacancies. A vacancy in any office shall be filled
in the manner prescribed in these bylaws for regular appointments to such
office.
Section 4.05 Duties and Compensation. Officers of the corporation
shall have such powers and duties, and shall receive such compensation therefor,
as may be specified from time to time by the board of directors.
ARTICLE V
INDEMNIFICATION OF AGENTS OF THE CORPORATION;
PURCHASE OF LIABILITY INSURANCE
Section 5.01 Indemnification of Agents.
(a) For the purposes of this Section, "Agent" means any person
who is or was a director or officer of this corporation, or is or was serving at
the request of the Board of Directors of this corporation as a director,
officer, employee or agent of another foreign or domestic corporation,
partnership, joint venture, trust or other enterprise, including any such entity
which was a predecessor of the corporation or of such other enterprise;
"proceeding" means any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative (including
without limitation an action by or in the right of this corporation); and
"expenses" includes, without limitation, attorneys' fees and any expenses of
establishing a right to indemnification under paragraph (d) or subparagraph (e)
(3) of this Section.
(b) This corporation shall indemnify any person who was or is a
party, or is threatened to be made a party, to any threatened, pending or
completed proceeding (other than an action by or in the right of this
corporation to procure a judgment in its favor) by reason of the fact that such
person is or was an Agent of this corporation, against expenses, judgments,
fines, settlements and other amounts actually and reasonably incurred in
connection with such proceeding if such person acted in good faith and in a
manner such person reasonably believed to be in the best interests of this
corporation and, in the case of a criminal proceeding, had no reasonable cause
to believe the conduct of such person was unlawful. The termination of any
proceeding by judgment, order, settlement, conviction or upon a plea of nolo
contendere or its equivalent shall not, of itself, create a presumption that the
person did not act in good faith and in a manner which the person reasonably
believed to be in the best interests of this corporation or that the person had
reasonable cause to believe that the person's conduct was unlawful.
(c) This corporation shall indemnify any person who was or is a
party, or is threatened to be made a party, to any threatened, pending or
completed action by or in the right of this corporation to procure a judgment in
its favor by reason of the fact that such
7
<PAGE> 10
person is or was an Agent of this corporation, against expenses actually and
reasonably incurred by such person in connection with the defense or settlement
of such action if such person acted in good faith, in a manner such person
believed to be in the best interests of this corporation and its shareholders.
No indemnification shall be made under this paragraph (c) for any
of the following:
(1) In respect of any claim, issue or matter as to which
such person shall have been adjudged to be liable to this corporation in
the performance of such person's duty to this corporation and its
shareholders, unless and only to the extent that the court in which such
proceeding is or was pending shall determine upon application that, in
view of all the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for expenses and then only to the
extent that such court shall determine;
(2) Of amounts paid in settling or otherwise disposing of
a pending action without court approval;
(3) Of expenses incurred in defending a pending action
which is settled or otherwise disposed of without court approval; or
(4) Of amounts or expenses the corporation is otherwise
prohibited from paying under California Law.
(d) To the extent that an Agent of this corporation has been
successful on the merits in defense of any proceeding referred to in paragraph
(b) or (c) or in defense of any claim, issue or matter therein, the Agent shall
be indemnified against expenses actually and reasonably incurred by the Agent in
connection therewith.
(e) Except as provided in paragraph (d), any indemnification
under this Section shall be made by this corporation only if authorized in the
specific case, upon a determination that indemnification of the Agent is proper
in the circumstances because the Agent has met the applicable standard of
conduct set forth in paragraph (b) or (c), by any of the following:
(1) A majority vote of a quorum consisting of directors
who are not parties to such proceeding;
(2) Approval or ratification by the affirmative vote of
the holders of a majority of the shares of this corporation entitled to
vote represented at a duly held meeting at which a quorum is present or
by the written consent of holders of a majority of the outstanding
shares entitled to vote, and by the affirmative vote or written consent
of such greater proportion of the shares of any class or series as may
be provided in the Articles of Incorporation for such action. For
purposes of determining the required quorum of any meeting of
shareholders called to approve or ratify indemnification of
8
<PAGE> 11
an Agent and the vote or written consent required therefor, the shares
owned by the person to be indemnified shall not be considered
outstanding and shall not be entitled to vote thereon; or
(3) The court in which such proceeding is or was pending,
upon application made by this corporation or the agent or the attorney
or other person rendering services in connection with the defense,
whether or not such application by the agent, attorney or other person
is opposed by this corporation.
(f) Expenses incurred by or on behalf of an Agent in defending or
investigating any proceeding shall be advanced by this corporation prior to the
final disposition of such proceeding if such Agent undertakes in writing to
repay any such advances if it is ultimately determined that such Agent is not
entitled to be indemnified. Notwithstanding the foregoing, no advance shall be
made by this corporation if a determination is reasonably and promptly made by
the Board of Directors by a majority vote of a quorum of disinterested
directors, or (if such a quorum is not obtainable or, even if obtainable, a
quorum of disinterested directors so directs) by independent legal counsel,
that, based upon the facts known to the Board or counsel at the time such
determination is made, (a) the Agent acted in bad faith or deliberately breached
a duty to the corporation or its shareholders, and (b) as a result of such
actions by the Agent, it is more likely than not that it will ultimately be
determined that such Agent is not entitled to indemnification.
(g) This Section shall create a right of indemnification for each
person referred to in this Section, whether or not the proceeding to which the
indemnification relates arose in whole or in part prior to adoption of this
Section. The indemnification provided by this Section shall not be exclusive of
any other rights to which those seeking indemnification may be entitled under
any agreement, vote of shareholders or disinterested directors or otherwise,
both as to action in an official capacity and as to action in another capacity
while holding such office, to the extent such additional rights to
indemnification are authorized in the Articles of Incorporation. The rights to
indemnity under this Section shall continue as to a person who has ceased to be
a director, officer, employee or Agent and shall inure to the benefit of the
heirs, executors and administrators of such person. Nothing contained in this
Section shall affect any right to indemnification to which persons other than
such directors and officers may be entitled by contract, insurance policy or
otherwise.
(h) No indemnification or advance shall be made under this
Section, except as provided in paragraph (d) or subparagraph (e)(3), in any
circumstance where it appears:
(1) That it would be inconsistent with a provision of the
Articles of Incorporation, these bylaws, a resolution of the
shareholders or an agreement in effect at the time of the accrual of the
alleged cause of action asserted in the proceeding in which the expenses
were incurred or other amounts were paid, which prohibits or otherwise
limits indemnification; or
(2) That it would be inconsistent with any condition
expressly imposed by a court in approving a settlement.
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<PAGE> 12
(i) Upon determination by the board of directors, this
corporation may purchase and maintain insurance on behalf of any Agent of this
corporation against any liability asserted against or incurred by the Agent in
such capacity or arising out of the Agent's status as such, whether or not this
corporation would have the power to indemnify the Agent against such liability
under the provisions of this Section.
(j) This Section does not apply to any proceeding against any
trustee, investment manager or other fiduciary of an employee benefit plan in
such person's capacity as such, even though such person may also be an Agent of
this corporation as defined in paragraph (a). This corporation shall have power
to indemnify such a trustee, investment manager or other fiduciary to the extent
permitted by Section 207(f) of the California Corporations Code.
(k) As a condition precedent to the right to indemnification
under this Section, notice shall be given to this corporation in writing as soon
as practicable of any claim for which indemnity will or could be sought under
this Section. In addition, no costs, charges or expenses for which indemnity
shall be sought hereunder shall be incurred without this corporation's consent,
which consent shall not be unreasonably withheld.
(l) If a claim under this Section is not paid by this
corporation, or on its behalf, within ninety (90) days after a written claim has
been received by this corporation, the Agent may at any time thereafter bring
suit against this corporation to recover the unpaid amount of the claim and, if
successful in whole or in part, the Agent shall be entitled to be paid also the
expense of prosecuting such claim.
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<PAGE> 13
CERTIFICATE OF SECRETARY
I, the undersigned, do hereby certify:
1. That I am the duly elected and acting assistant secretary
of RemedyTemp, Inc., a California corporation; and
2. That the foregoing bylaws, consisting of ten (10) pages,
including this page, constitute the amended and restated bylaws of said
corporation as duly adopted by the shareholders of the corporation on February
18, 1998.
IN WITNESS WHEREOF, I have executed this Certificate as secretary
of the corporation effective as of the 19th day of February, 1998.
-----------------------------------
Alan M. Purdy
Assistant Secretary
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<PAGE> 1
EXHIBIT 4.5
AMENDED AND RESTATED REMEDYTEMP, INC.
1996 STOCK INCENTIVE PLAN
(EFFECTIVE AS OF FEBRUARY 18, 1998)
ARTICLE I
DEFINITIONS
1.01 DEFINITIONS. Capitalized terms used in the Plan and not
otherwise defined shall have the meanings set forth below:
(a) "AWARD" means an Incentive Award or a Non-employee Director's
Option.
(b) "BOARD" means the Board of Directors of the Company.
(c) "CODE" means the Internal Revenue Code of 1986, as amended
from time to time. Where the context so requires, a reference to a particular
Code section or regulation thereunder shall also be a reference to any successor
provision of the Code to such section or regulation.
(d) "COMMISSION" means the Securities and Exchange Commission.
(e) "COMMITTEE" means the committee appointed by the Board to
administer the Plan and, to the extent required to comply with Rule 16b-3 under
the Exchange Act, consisting of two or more Board members, each of whom shall be
a "Non-Employee Director" within the meaning of Rule 16b-3 under the Exchange
Act. In addition, if Incentive Awards are to be made to persons subject to
Section 162(m) of the Code and such awards are intended to constitute
Performance-Based Compensation, then each of the Committee's members shall also
be an "outside director," as such term is defined in the regulations under
Section 162(m) of the Code.
(f) "COMMON STOCK" means the Class A Common Stock of the Company,
$0.01 par value.
(g) "DIVIDEND EQUIVALENT" means a right granted by the Company
under Section 3.07 to a holder of a Stock Option, Stock Appreciation Right, or
other Award denominated in shares of Common Stock to receive from the Company
during the Applicable Dividend Period (as defined in Section 3.07) payments
equivalent to the amount of dividends payable to holders of the number of shares
of Common Stock underlying such Stock Option, Stock Appreciation Right, or other
Award.
(h) "ELIGIBLE PERSON" shall include officers or key employees,
consultants, and advisors of the Company (as determined by the Committee) other
than Non-employee Directors.
(i) "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended. Where the context so requires, a reference to a particular section of
the Exchange Act or rule thereunder shall also refer to any successor provision
to such section or rule.
(j) "FAIR MARKET VALUE" of a share of the Company's capital stock
as of a particular date shall be: (i) if the stock is listed on an established
stock exchange or exchanges
<PAGE> 2
(including, for this purpose, The Nasdaq National Market), the mean between the
highest and lowest sale prices of the stock quoted for such date in the
Transactions Index of each such exchange as averaged with such mean price as
reported on any and all other exchanges, as published in The Wall Street Journal
and determined by the Committee, or, if no sale price was quoted in any such
Index for such date, then as of the next preceding date on which such a sale
price was quoted; or (ii) if the stock is not then listed on an exchange, the
average of the closing bid and asked prices per share for the stock in the
over-the-counter market as quoted on the NASDAQ system on such date (in the case
of (i) or (ii), subject to adjustment as and if necessary and appropriate to set
an exercise price not less than 100% of the fair market value of the stock on
the date an option is granted); or (iii) if the stock is not then listed on an
exchange or quoted in the over-the-counter market, an amount determined in good
faith by the Committee; provided, however, that when appropriate, the Committee
in determining Fair Market Value of capital stock of the Company may take into
account such other factors as it may deem appropriate under the circumstances.
Notwithstanding the foregoing, the Fair Market Value of capital stock for
purposes of grants of Incentive Stock Options shall be determined in compliance
with applicable provisions of the Code. The Fair Market Value of rights or
property other than capital stock of the Company means the fair market value
thereof as determined by the Committee on the basis of such factors as it may
deem appropriate.
(k) "INCENTIVE AWARD" means any Stock Option, Restricted Stock,
Stock Appreciation Right or Dividend Equivalent granted or sold to an Eligible
Person under the Plan, but not a Non-employee Director's Option.
(l) "INCENTIVE STOCK OPTION" means a Stock Option that qualifies
as an incentive stock option under Section 422 of the Code and the regulations
thereunder.
(m) "JUST CAUSE DISMISSAL" means a termination of a Recipient's
employment for any of the following reasons: (i) the Recipient violates any
reasonable rule or regulation of the Board or the Recipient's superiors or the
Chief Executive Officer or President of the Company that results in damage to
the Company or which the Recipient fails to correct within a reasonable time
after written notice; (ii) any willful misconduct or gross negligence by the
Recipient in the discharge of the responsibilities assigned to him or her; (iii)
any willful failure to perform his or her job as required to meet Company
objectives; (iv) any wrongful conduct of a Recipient which has an adverse impact
on the Company or which constitutes a misappropriation of Company assets; (v)
the Recipient's performing services for any other person or entity which
competes with the Company while he or she is employed by the Company, without
the written approval of the Chief Executive Officer or President of the Company;
or (vi) any other conduct that the Board or Committee determines constitutes
Just Cause for Dismissal, provided, however, that if a Recipient is party to an
employment agreement with the Company providing for just cause dismissal (or
some comparable notion) of Recipient from his or her employment with the
Company, "Just Cause Dismissal" purposes of the Plan shall have the same meaning
as ascribed thereto or to such comparable notion in such employment agreement.
(n) "NON-EMPLOYEE DIRECTOR" means a director of the Company who
qualifies as a "Non-Employee Director" under Rule 16b-3 under the Exchange Act.
(o) "NON-EMPLOYEE DIRECTOR'S OPTION" means a Stock Option granted
to a Non-employee Director pursuant to Article IV of the Plan.
(p) "NON-QUALIFIED STOCK OPTION" means a Stock Option that is not
an Incentive Stock Option.
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<PAGE> 3
(q) "OPTION" or "STOCK OPTION" means a right to purchase Common
Stock granted under the Plan, and can be an Incentive Stock Option or a
Non-qualified Stock Option.
(r) "PAYMENT EVENT" means the event or events giving rise to the
right to payment of a Performance Award.
(s) "PERFORMANCE AWARD" means an award granted under Section
3.03, payable in cash, Common Stock or a combination thereof, which vests and
becomes payable over a period of time upon attainment of performance criteria
established in connection with the grant of the award.
(t) "PERFORMANCE-BASED COMPENSATION" means performance-based
compensation as described in Section 162(m) of the Code and the regulations
thereunder. If the amount of compensation a Recipient will receive under any
Incentive Award is not based solely on an increase in the value of Common Stock
after the date of grant or award, the Committee, in order to qualify an
Incentive Award as performance-based compensation under Section 162(m) of the
Code and the regulations thereunder, can condition the grant, award, vesting, or
exercisability of such an award on the attainment of a preestablished, objective
performance goal. For this purpose, a preestablished, objective performance goal
may include one or more of the following performance criteria: (i) cash flow,
(ii) earnings per share (including earnings before interest, taxes, and
amortization), (iii) return on equity, (iv) total stockholder return, (v) return
on capital, (vi) return on assets or net assets, (vii) income or net income,
(viii) operating margin, (ix) return on operating revenue, and (x) any other
similar performance criteria contemplated by the regulations under Section
162(m).
(u) "PERMANENT DISABILITY" means that the Recipient becomes
physically or mentally incapacitated or disabled so that he or she is unable to
perform substantially the same services as he or she performed prior to
incurring such incapacity or disability (the Company, at its option and expense,
being entitled to retain a physician to confirm the existence of such incapacity
or disability, and the determination of such physician to be binding upon the
Company and the Recipient), and such incapacity or disability continues for a
period of three consecutive months or six months in any 12-month period or such
other period(s) as may be determined by the Committee with respect to any
Option, provided that for purposes of determining the period during which an
Incentive Stock Option may be exercised pursuant to Section 3.02(g)(ii) hereof,
Permanent Disability shall mean "permanent and total disability" as defined in
Section 22(e) of the Code.
(v) "PURCHASE PRICE" means the purchase price (if any) to be paid
by a Recipient for Restricted Stock as determined by the Committee (which price
shall be at least equal to the minimum price required under applicable laws and
regulations for the issuance of Common Stock which is nontransferable and
subject to a substantial risk of forfeiture until specific conditions are met).
(w) "RECIPIENT" means a recipient of an Award hereunder.
(x) "RESTRICTED STOCK" means Common Stock that is the subject of
an award made under Section 3.04 and which is nontransferable and subject to a
substantial risk of forfeiture until specific conditions are met as set forth in
this Plan and in any statement evidencing the grant of such Award.
(y) "SECURITIES ACT" means the Securities Act of 1933, as
amended.
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<PAGE> 4
(z) "STOCK APPRECIATION RIGHT" or "SAR" means a right granted
under Section 3.05 to receive a payment that is measured with reference to the
amount by which the Fair Market Value of a specified number of shares of Common
Stock appreciates from a specified date, such as the date of grant of the SAR,
to the date of exercise.
(aa) "STOCK PAYMENT" means a payment in shares of the Company's
Common Stock to replace all or any portion of the compensation (other than base
salary) that would otherwise become payable to a Recipient.
ARTICLE II
GENERAL
2.01 ADOPTION. The Plan has been adopted by the Board and
approved by the shareholders of the Company and is effective immediately prior
to the closing of the initial public offering of the Company's securities.
2.02 PURPOSE. The purpose of the Plan is to promote the interests
of the Company and its shareholders by using investment interests in the Company
to attract and retain key personnel, to encourage and reward their contributions
to the performance of the Company, and to align their interests with the
interests of Company's shareholders.
2.03 ADMINISTRATION OF THE PLAN. The Plan shall be administered
by the Committee, which, subject to the express provisions of the Plan, shall
have the power to construe the Plan and any agreements or memoranda defining the
rights and obligations of the Company and Recipients thereunder, to determine
all questions arising thereunder, to adopt and amend such rules and regulations
for the administration thereof as it may deem desirable, and otherwise to carry
out the terms of the Plan and such agreements and confirming memoranda. The
interpretation and construction by the Committee of any provisions of the Plan
or of any Award granted under the Plan shall be final. Any action taken by, or
inaction of, the Committee relating to the Plan or Awards shall be within the
absolute discretion of the Committee and shall be conclusive and binding upon
all persons. No member of the Committee shall be liable for any such action or
inaction except in circumstances involving bad faith of himself or herself.
Subject only to compliance with the express provisions hereof, the Committee may
act in its absolute discretion in matters related to the Plan or Awards,
provided, however, that notwithstanding anything herein to the contrary, the
Committee shall have no authority or discretion as to the selection of persons
eligible to receive Non-employee Director's Options or the timing, exercise
price, or number of shares covered by Non-employee Director's Options, which
matters are specifically governed by the Plan. Any action of the Committee with
respect to administration of the Plan shall be taken pursuant to a majority vote
or unanimous written consent of its members. Subject to the requirements of
Section 1.01(e), the Board may from time to time increase or decrease the number
of members of the Committee, remove from membership on the Committee all or any
portion of its members, and appoint such person or persons as it desires to fill
any vacancy existing on the Committee, whether caused by removal, resignation or
otherwise.
2.04 PARTICIPATION. A person shall be eligible to receive grants
of Incentive Awards under the Plan if, at the time of the Award's grant, he or
she is an Eligible Person.
2.05 SHARES OF COMMON STOCK SUBJECT TO PLAN.
(a) Plan Limit and Counting. The shares that may be issued upon
exercise of or in the form of Awards under the Plan shall be authorized and
unissued shares of Common Stock, previously issued shares of Common Stock
reacquired by the Company, and unused
4
<PAGE> 5
Award shares pursuant to the final sentence of this Section 2.05(a). The
aggregate number of shares that may be issued pursuant to Awards under the Plan
shall not exceed 1,225,000 shares of Common Stock, subject to adjustment in
accordance with Article V. Shares of Common Stock subject to unexercised
portions of any Award granted under the Plan that expire, terminate or are
cancelled, and shares of Common Stock issued pursuant to an Award under the Plan
that are reacquired by the Company pursuant to the terms of the Award under
which such shares were issued, will again become available for the grant of
further Awards under this Plan.
(b) Annual Limit. Notwithstanding any other provision of this
Plan, no Eligible Person shall be granted Incentive Awards with respect to more
than 100,000 shares of Common Stock in any one calendar year; provided, however,
that this limitation shall not apply if it is not required in order for the
compensation attributable to Incentive Awards hereunder to qualify as
Performance-Based Compensation. The limitation set forth in this Section 2.05(b)
shall be subject to adjustment as provided in Article V, but only to the extent
such adjustment would not affect the status of compensation attributable to
Incentive Awards hereunder as Performance-Based Compensation.
2.06 AWARDS SUBJECT TO PLAN.
(a) Terms. Each Award shall be subject to the terms and
conditions of the Plan and such other terms and conditions (whether or not
applicable to any other award) established by the Committee as are not
inconsistent with the purpose and provisions of the Plan including, without
limitation, provisions to assist the Recipient in financing the purchase of
Common Stock through the exercise of Stock Options, provisions for the
forfeiture of or restrictions on resale or other disposition of shares of Common
Stock acquired under any Award, provisions giving the Company the right to
repurchase shares of Common Stock acquired under any Award in the event the
Recipient elects to dispose of such shares, and provisions to comply with
federal and state securities laws and federal and state income tax withholding
requirements.
(b) Award Documents. Each Award granted under the Plan shall be
evidenced by an award agreement duly executed on behalf of the Company and by
the Recipient or, in the Committee's discretion, a confirming memorandum issued
by the Company to the Recipient, setting forth such terms and conditions
applicable to the Award as the Committee may in its discretion determine. Such
option agreements or confirming memoranda may but need not be identical and
shall comply with and be subject to the terms and conditions of the Plan, a copy
of which shall be provided to each Recipient and incorporated by reference into
each option agreement or confirming memorandum. Any award agreement or
confirming memorandum may contain such other terms, provisions and conditions
not inconsistent with the Plan as may be determined by the Committee.
2.07 AMENDMENTS.
(a) Amendment and Suspension of the Plan. The Board or the
Committee may, insofar as permitted by applicable laws and regulations, from
time to time suspend or discontinue the Plan or revise or amend it in any
respect whatsoever, and the Plan as so revised or amended will govern all
options thereunder, including those granted before such revision or amendment,
except that no such amendment shall impair or diminish in any material respect
any rights or impose additional material obligations under any Award theretofore
granted under the Plan without the consent of the person to whom such Award was
granted. Amendments shall be subject to approval by the Company's shareholders
only to the extent required to comply with applicable laws or regulations.
5
<PAGE> 6
(b) Amendment of Incentive Awards. Subject to the requirements
set forth in the Plan for amendment of particular Incentive Awards, the
Committee may, with the consent of a Recipient, make such modifications in the
terms and conditions of an Incentive Award as it deems advisable. Without
limiting the generality of the foregoing, the Committee may, in its discretion
with the consent of the Recipient, at any time and from time to time after the
grant of any Incentive Award accelerate or extend the vesting or exercise period
of the Incentive Award in whole or part, and adjust or reduce the purchase or
exercise price of Incentive Awards held by such Recipient by cancellation of
such Incentive Awards and granting of Incentive Awards at lower purchase or
exercise prices or by modification, extension or renewal of such Incentive
Awards.
(c) Other Rights. Except as otherwise provided in this Plan or in
the applicable award agreement or confirming memorandum, no amendment,
suspension or termination of the Plan will, without the consent of the
Recipient, alter, terminate, impair or adversely affect any right or obligation
under any Award previously granted under the Plan.
2.08 TERM OF PLAN. Awards may be granted under the Plan until the
tenth anniversary of the effective date of the Plan, whereupon the Plan shall
terminate. No Awards may be granted during any suspension of the Plan or after
its termination for any reason. Notwithstanding the foregoing, each Award
properly granted under the Plan shall remain in effect until such Award has been
exercised or terminated in accordance with its terms and the terms of the Plan.
2.09 RESTRICTIONS. All Awards granted under the Plan shall be
subject to the requirement that, if at any time the Company shall determine, in
its discretion, that the listing, registration or qualification of the shares
subject to Awards granted under the Plan upon any securities exchange or under
any state or federal law, or the consent or approval of any government or
regulatory body or authority, is necessary or desirable as a condition of, or in
connection with, the granting of such an Award or the issuance, if any, or
purchase of shares in connection therewith, such Award may not be exercised in
whole or in part unless such listing, registration, qualification, consent or
approval shall have been effected or obtained free of any conditions not
acceptable to the Company. Unless the shares of stock covered by an Award
granted under the Plan have been effectively registered under the Securities
Act, the Company shall be under no obligation to issue such shares unless the
Recipient shall give a written representation and undertaking to the Company
satisfactory in form and scope to counsel to the Company and upon which, in the
opinion of such counsel, the Company may reasonably rely, that he or she is
acquiring such shares for his or her own account as an investment and not with a
view to, or for sale in connection with, the distribution of any such shares of
stock, and that he or she will make no transfer of the same except in compliance
with any rules and regulations in force at the time of such transfer under the
Securities Act, or any other applicable law or regulation, and that if shares of
stock are issued without such registration, a legend to this effect may be
endorsed upon the securities so issued, and the Company may order its transfer
agent to stop transfers of such shares.
2.10 NONASSIGNABILITY. No Award granted under the Plan shall be
assignable or transferable except (a) by will or by the laws of descent and
distribution, or (b) subject to the final sentence of this Section 2.10, upon
dissolution of marriage pursuant to a qualified domestic relations order or, in
the discretion of the Committee and under circumstances that would not adversely
affect the interests of the Company, pursuant to a nominal transfer that does
not result in a change in beneficial ownership. During the lifetime of a
Recipient, an Award granted to him or her shall be exercisable only by the
Recipient (or the Recipient's permitted transferee) or his or her guardian or
legal representative. Notwithstanding the foregoing, (x) no Award owned by a
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<PAGE> 7
Recipient subject to Section 16 of the Exchange Act may be assigned or
transferred in any manner inconsistent with Rule 16b-3 as interpreted and
administered by the Commission and its staff, and (y) Incentive Stock Options
(or other Awards subject to transfer restrictions under the Code) may not be
assigned or transferred in violation of Section 422(b)(5) of the Code or the
Treasury Regulations thereunder, and nothing herein is intended to allow such
assignment or transfer.
2.11 WITHHOLDING TAXES. Whenever shares of stock are to be issued
upon exercise of or in connection with an Award granted under the Plan or
subsequently transferred, the Committee shall have the right to require the
Recipient to remit to the Company an amount sufficient to satisfy any federal,
state and local withholding tax requirements prior to issuance of such shares.
The Committee may, in the exercise of its discretion, allow satisfaction of tax
withholding requirements by accepting delivery of stock of the Company or by
withholding a portion of the stock otherwise issuable in connection with an
Award.
2.12 RIGHTS OF ELIGIBLE PERSONS AND RECIPIENTS. Except as
otherwise set forth herein, a Recipient or a permitted transferee of an Award
shall have no rights as a shareholder with respect to any shares issuable or
issued in connection with the Award until the date of the receipt by the Company
of all amounts payable in connection with exercise of the Award and performance
by the Recipient of all obligations thereunder. Status as an Eligible Person
shall not be construed as a commitment that any Award will be granted under this
Plan to an Eligible Person or to Eligible Persons generally. Nothing contained
in this Plan (or in award agreements or confirming memoranda or in any other
documents related to this Plan or to Awards granted hereunder) shall confer upon
any Eligible Person or Recipient any right to continue in the employ of the
Company or any of its subsidiaries or affiliates or constitute any contract or
agreement of employment or engagement, or interfere in any way with the right of
the Company or any of its subsidiaries or affiliates to reduce such person's
compensation or other benefits or to terminate the employment of such Eligible
Person or Recipient, with or without cause. No person shall have any right,
title or interest in any fund or in any specific asset (including shares of
capital stock) of the Company or any of its subsidiaries or affiliates by reason
of any Award granted hereunder. Neither this Plan (or any documents related
hereto) nor any action taken pursuant hereto shall be construed to create a
trust of any kind or a fiduciary relationship between the Company or any of its
subsidiaries or affiliates and any person. To the extent that any person
acquires a right to receive an Award hereunder, such right shall be no greater
than the right of any unsecured general creditor of the Company.
2.13 OTHER COMPENSATION PLANS. The adoption of the Plan shall not
affect any other stock option, incentive or other compensation plans in effect
for the Company, and the Plan shall not preclude the Company from establishing
any other forms of incentive or other compensation for employees, directors, or
advisors of the Company, whether or not approved by shareholders.
2.14 PLAN BINDING ON SUCCESSORS. The Plan shall be binding upon
the successors and assigns of the Company.
2.15 PARTICIPATION BY FOREIGN EMPLOYEES. Notwithstanding anything
to the contrary herein, the Committee may, consistent with the purposes of the
Plan, modify grants of Awards to confer the intended benefits of the Plan upon
Recipients who are foreign nationals or employed outside of the United States to
recognize differences in applicable law, tax policy or local custom.
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<PAGE> 8
ARTICLE III
AWARDS
3.01 GRANTS OF AWARDS. Subject to the express provisions of the
Plan, the Committee may from time to time in its discretion select the Eligible
Persons to whom, and the time or times at which, Incentive Awards shall be
granted or sold, the nature of each Incentive Award, the number of shares of
Common Stock or the number of rights that make up or underlie each Incentive
Award, the period for the exercise of each Incentive Award, the performance
criteria (which need not be identical) utilized to measure the value of
Performance Awards, and such other terms and conditions applicable to each
individual Incentive Award as the Committee shall determine. The Committee may
grant at any time new Incentive Awards to an Eligible Person who has previously
received Incentive Awards or other grants (including other stock options)
whether such prior Incentive Awards or such other grants are still outstanding,
have previously been exercised in whole or in part, or are cancelled in
connection with the issuance of new Incentive Awards. The Committee may grant
Incentive Awards singly or in combination or in tandem with other Incentive
Awards as it determines in its discretion. The purchase price or initial value
and any and all other terms and conditions of the Incentive Awards may be
established by the Committee without regard to existing Incentive Awards or
other grants. Further, the Committee may amend in a manner not inconsistent with
the Plan the terms of any existing Incentive Award previously granted to such
Eligible Person, provided that the consent of the Recipient shall be required
for amendments that impair or diminish in any material respect any rights or
impose additional material obligations under the Incentive Award to be amended.
Notwithstanding the foregoing, however, members of the Committee shall not be
eligible to receive Incentive Awards.
3.02 STOCK OPTIONS.
(a) Nature of Stock Options. Stock Options may be Incentive Stock
Options or Non-qualified Stock Options; Stock Options granted as Incentive Stock
Options that fail or cease to qualify as such shall be treated as Non-qualified
Stock Options hereunder.
(b) Setting the Exercise Price. The exercise price for each
Option shall be determined by the Committee at the date such Option is granted.
The exercise price may be less than the Fair Market Value of the Common Stock
subject to the Option, provided that in no event shall the exercise price be
less than the par value of the shares of Common Stock subject to the Option, and
provided further that the exercise price of an Incentive Stock Option shall be
not less than such amount as is necessary to enable such Option to be treated as
an "incentive stock option" within the meaning of Section 422 of the Code. The
Committee, with the consent of the Recipient, and subject to compliance with
statutory or administrative requirements applicable to Incentive Stock Options,
may amend the terms of any Option (other than a Non-employee Director's Option)
to provide that the exercise price of the shares remaining subject to the Option
shall be reestablished at a price below the existing exercise price thereof or
effect a reduction in exercise price by cancellation of an existing option and
grant of a replacement option at an exercise price below the existing exercise
price thereof. If the exercise price of an Option is reduced (or such Option is
canceled for a new Option) and such Option is Performance-Based Compensation,
the reduction of the Option's price (or the cancellation and grant of a new
Option) shall be treated as the grant of a new Option and both the old and new
Option shall be taken into account for purposes of applying the stock limit of
Section 2.05(b). No modification of any other term or provision of any Option
which is amended in accordance with the foregoing shall be required, although
the Committee may, in its discretion, make such further modifications of any
such Option (other than Non-employee Director's Options) as are not inconsistent
with the Plan.
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(c) Payment of the Exercise Price. The exercise price shall be
payable upon the exercise of an Option in legal tender of the United States or
capital stock of the Company delivered in transfer to the Company by or on
behalf of the person exercising the Option and duly endorsed in blank or
accompanied by stock powers duly endorsed in blank, with signatures guaranteed
in accordance with the Exchange Act if required by the Committee, or retained by
the Company from the Stock otherwise issuable upon exercise or surrender of
vested and/or exercisable Awards or other equity incentive awards previously
granted to the Recipient and being exercised (if applicable) (in either case
valued at Fair Market Value as of the exercise date); or such other
consideration as the Committee may from time to time in the exercise of its
discretion deem acceptable in any particular instance, provided, however, that
the Committee may, in the exercise of its discretion, (i) allow exercise of an
Option in a broker-assisted or similar transaction in which the exercise price
is not received by the Company until promptly after exercise, and/or (ii) allow
the Company to loan the exercise price to the person entitled to exercise the
Option, if the exercise will be followed by a prompt sale of some or all of the
underlying shares and a portion of the sales proceeds is dedicated to full
payment of the Exercise Price and amounts required pursuant to Section 2.11.
(d) Option Period and Vesting. Options granted hereunder (other
than Non-employee Director's Options) shall vest and may be exercised as
determined by the Committee, except that exercise of such Options after
termination of the Recipient's employment shall be subject to Section 3.02(g).
Each Option granted hereunder (other than a Non-employee Director's Option) and
all rights or obligations thereunder shall expire on such date as shall be
determined by the Committee, but not later than ten years after the date the
Option is granted, or five years after the date of grant in the case of a
Recipient of an Incentive Stock Option who at the time of grant owns more than
10% of the combined voting power of the Company (after application of the
constructive ownership rules of Section 424(d) of the Code), or any Parent or
Subsidiary (as defined in Sections 424(e) and (f) of the Code, respectively),
and shall be subject to earlier termination as herein provided.
(e) Exercise of Options. Except as otherwise provided herein, an
Option may become exercisable, in whole or in part, on the date or dates
specified by the Committee (or, in the case of Non-employee Director's Options,
the Plan) and thereafter shall remain exercisable until the expiration or
earlier termination of the Option. No Option shall be exercisable except in
respect of whole shares, and fractional share interests shall be disregarded.
Not less than 100 shares of stock (or such other amount as is set forth in the
applicable option agreement or confirming memorandum) may be purchased at one
time and Options must be exercised in multiples of 100 unless the number
purchased upon exercise is the total number at the time available for purchase
under the terms of the Option. An Option shall be deemed to be exercised when
the Secretary or other designated official of the Company receives written
notice of such exercise from the Recipient, together with payment of the
exercise price and any amounts required under Section 2.11. Notwithstanding any
other provision of the Plan, the Committee may impose, by rule and in option
agreements or confirming memoranda, such conditions upon the exercise of Options
(including, without limitation, conditions limiting the time of exercise to
specified periods) as may be required to satisfy applicable regulatory
requirements, including without limitation Rule 10b-5 or Rule 16b-3 (or any
successor rule) under the Exchange Act and any applicable section of or
regulation under the Code.
(f) Limitation on Exercise of Incentive Stock Options. The
aggregate Fair Market Value (determined as of the respective date or dates of
grant) of the stock for which one or more Options granted to any Recipient under
the Plan (or any other option plan of the Company or any of its subsidiaries or
affiliates) may for the first time become exercisable as Incentive Stock Options
under the federal tax laws during any one calendar year shall not exceed
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$100,000. Any Options granted as Incentive Stock Options pursuant to the Plan in
excess of such limitation shall be treated as Non-qualified Stock Options.
(g) Termination of Employment.
(i) Termination for Cause. Except as otherwise provided
in a written agreement between the Company and the Recipient, which may be
entered into at any time before or after termination, in the event of a Just
Cause Dismissal of a Recipient all of the Recipient's unexercised Options,
whether or not vested, shall expire and become unexercisable as of the date of
such Just Cause Dismissal.
(ii) Termination other than Just Cause Dismissal.
Subject to subsection (i) above and subsection (iii) below, and except as
otherwise provided in a written agreement between the Company and the Recipient,
or a confirming memorandum issued by the Company to the Recipient with the
Recipient's consent, which may be entered into or delivered at any time before
or after termination, in the event of a Recipient's termination of employment
for:
(A) any reason other than Just Cause Dismissal,
death, or Permanent Disability, the Recipient's unexercised Options,
whether or not vested, shall expire and become unexercisable as of the
earlier of (1) the date such Options would expire in accordance with
their terms if the Recipient remained employed or (2) three calendar
months after the date of termination in the case of Incentive Stock
Options, or six months after the date of termination in the case of
Non-qualified Stock Options.
(B) death or Permanent Disability, the Recipient's
unexercised Options, whether or not vested, shall expire and become
unexercisable as of the earlier of (1) the date such Options would
expire in accordance with their terms if the Recipient remained employed
or (2) 12 months after the date of termination.
(iii) Alteration of Vesting and Exercise Periods.
Notwithstanding anything to the contrary in subsections (i) or (ii) above, the
Committee may in its discretion pursuant to Section 2.07(b) designate shorter or
longer periods to exercise Options following a Recipient's termination of
employment. Options shall be exercisable by a Recipient (or his successor in
interest) following such Recipient's termination of employment only to the
extent that installments thereof had become exercisable on or prior to the date
of such termination unless the Company has a written agreement with the
Recipient of the Option providing otherwise or the vesting period is extended
pursuant to Section 2.07(b).
3.03 PERFORMANCE AWARDS.
(a) Grant of Performance Award. The Committee shall determine the
performance criteria (which need not be identical and may be established on an
individual or group basis) governing Performance Awards, the terms thereof, and
the form and time of payment of Performance Awards.
(b) Payment of Award; Limitation. Upon satisfaction of the
conditions applicable to a Performance Award, payment will be made to the
Recipient in cash or in shares of Common Stock valued at Fair Market Value or a
combination of Common Stock and cash, as the Committee in its discretion may
determine.
(c) Annual Limit. Notwithstanding any other provision of this
Plan, no Eligible Person shall be paid a Performance Award in excess of $250,000
in any one calendar
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year; provided, however, that this limitation shall not apply to the extent it
is not required in order for the compensation attributable to the Performance
Award hereunder to qualify as Performance-Based Compensation.
(d) Expiration of Performance Award. If any Recipient's
employment with the Company is terminated for any reason other than normal
retirement, death, or Permanent Disability prior to the time a Performance Award
or any portion thereof becomes payable, all of the Recipient's rights under the
unpaid portion of the Performance Award shall expire and terminate unless
otherwise determined by the Committee. In the event of termination of employment
by reason of death, Permanent Disability or normal retirement, the Committee, in
its discretion, may determine what portions, if any, of the Performance Award
should be paid to the Recipient.
3.04 RESTRICTED STOCK.
(a) Award of Restricted Stock. The Committee shall determine the
Purchase Price (if any) applicable to Restricted Stock, the terms of payment of
the Purchase Price, the restrictions upon the Restricted Stock, and when such
restrictions shall lapse.
(b) Requirements of Restricted Stock. All shares of Restricted
Stock granted or sold pursuant to the Plan will be subject to the following
conditions:
(i) No Transfer. The shares may not be sold, assigned,
transferred, pledged, hypothecated or otherwise disposed of, alienated or
encumbered until the restrictions are removed or expire;
(ii) Certificates. The Committee may require that the
certificates representing Restricted Stock granted or sold to a Recipient
pursuant to the Plan remain in the physical custody of an escrow holder or the
Company until all restrictions are removed or expire;
(iii) Restrictive Legends. Each certificate representing
Restricted Stock granted or sold to a Recipient pursuant to the Plan will bear
such legend or legends making reference to the restrictions imposed upon such
Restricted Stock as the Committee in its discretion deems necessary or
appropriate to enforce such restrictions; and
(iv) Other Restrictions. The Committee may impose such
other conditions on Restricted Stock as the Committee may deem advisable
including, without limitation, restrictions under the Securities Act, under the
Exchange Act, under the requirements of any stock exchange upon which such
Restricted Stock or shares of the same class are then listed and under any blue
sky or other securities laws applicable to such shares.
(c) Lapse of Restrictions. The restrictions imposed upon
Restricted Stock will lapse in accordance with such schedule or other conditions
as are determined by the Committee.
(d) Rights of Recipient. Subject to the provisions of Section
3.04(b) and any restrictions imposed upon the Restricted Stock, the Recipient
will have all rights of a shareholder with respect to the Restricted Stock
granted or sold to such Recipient under the Plan, including the right to vote
the shares and receive all dividends and other distributions paid or made with
respect thereto.
(e) Termination of Employment. Unless the Committee in its
discretion determines otherwise, upon a Recipient's termination of employment
for any reason, all of the
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Recipient's Restricted Stock remaining subject to restrictions imposed pursuant
to the Plan on the date of such termination of employment shall be repurchased
by the Company at the Purchase Price (if any) paid therefor by the Recipient.
3.05 STOCK APPRECIATION RIGHTS.
(a) Granting of Stock Appreciation Rights. The Committee may
approve the grant to Eligible Persons of Stock Appreciation Rights, related or
unrelated to Options, at any time.
(b) SARs Related to Options.
(i) A Stock Appreciation Right granted in connection
with an Option granted under this Plan will entitle the holder of the related
Option, upon exercise of the Stock Appreciation Right, to surrender such Option,
or any portion thereof to the extent unexercised, with respect to the number of
shares as to which such Stock Appreciation Right is exercised, and to receive
payment of an amount computed pursuant to Section 3.05(b)(iii). Such Option
will, to the extent surrendered, then cease to be exercisable.
(ii) A Stock Appreciation Right granted in connection
with an Option hereunder will be exercisable at such time or times, and only to
the extent that, the related Option is exercisable, and will not be transferable
except to the extent that such related Option may be transferable.
(iii) Upon the exercise of a Stock Appreciation Right
related to an Option, the Holder will be entitled to receive payment of an
amount determined by multiplying: (i) the difference obtained by subtracting the
Exercise Price of a share of Common Stock specified in the related Option from
the Fair Market Value of a share of Common Stock on the date of exercise of such
Stock Appreciation Right (or as of such other date or as of the occurrence of
such event as may have been specified in the instrument evidencing the grant of
the Stock Appreciation Right), by (ii) the number of shares as to which such
Stock Appreciation Right is exercised.
(c) SARs Unrelated to Options. The Committee may grant Stock
Appreciation Rights unrelated to Options to Eligible Persons. Section
3.05(b)(iii) shall be used to determine the amount payable at exercise under
such Stock Appreciation Right, except that in lieu of the Option Exercise Price
specified in the related Option the initial base amount specified in the Award
shall be used.
(d) Limits. Notwithstanding the foregoing, the Committee, in its
discretion, may place a dollar limitation on the maximum amount that will be
payable upon the exercise of a Stock Appreciation Right under the Plan.
(e) Payments. Payment of the amount determined under the
foregoing provisions may be made solely in whole shares of Common Stock valued
at their Fair Market Value on the date of exercise of the Stock Appreciation
Right or, alternatively, at the sole discretion of the Committee, in cash or in
a combination of cash and shares of Common Stock as the Committee deems
advisable. The Committee has full discretion to determine the form in which
payment of A Stock Appreciation Right will be made and to consent to or
disapprove the election of a Recipient to receive cash in full or partial
settlement of a Stock Appreciation Right. If the Committee decides to make full
payment in shares of Common Stock, and the amount payable results in a
fractional share, payment for the fractional share will be made in cash.
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(f) Rule 16b-3. The Committee may, at the time a Stock
Appreciation Right is granted, impose such conditions on the exercise of the
Stock Appreciation Right as may be required to satisfy the requirements of Rule
16b-3 under the Exchange Act (or any other comparable provisions in effect at
the time or times in question).
(g) Termination of Employment. Section 3.02(g) will govern the
treatment of Stock Appreciation Rights upon the termination of a Recipient's
employment with the Company.
3.06 STOCK PAYMENTS. The Committee may approve Stock Payments of
the Company's Common Stock to any Eligible Person for all or any portion of the
compensation (other than base salary) or other payment that would otherwise
become payable by the Company to the Eligible Person in cash.
3.07 DIVIDEND EQUIVALENTS. The Committee may grant Dividend
Equivalents to any Recipient who has received a Stock Option, SAR, or other
Award denominated in shares of Common Stock. Such Dividend Equivalents shall be
effective and shall entitle the recipients thereof to payments during the
"APPLICABLE DIVIDEND PERIOD," which shall be (i) the period between the date the
Dividend Equivalent is granted and the date the related Stock Option, SAR, or
other Award is exercised, terminates, or is converted to Common Stock, or (ii)
such other time as the Committee may specify in the written instrument
evidencing the grant of the Dividend Equivalent. Dividend Equivalents may be
paid in cash, Common Stock, or other Awards; the amount of Dividend Equivalents
paid other than in cash shall be determined by the Committee by application of
such formula as the Committee may deem appropriate to translate the cash value
of dividends paid to the alternative form of payment of the Dividend Equivalent.
Dividend Equivalents shall be computed as of each dividend record date and shall
be payable to recipients thereof at such time as the Committee may determine.
Notwithstanding the foregoing, if it is intended that an Incentive Award qualify
as Performance-Based Compensation and the amount of the compensation the
Eligible Person could receive under the award is based solely on an increase in
value of the underlying stock after the date of grant or award (i.e., the grant,
vesting, or exercisability of the award is not conditioned upon the attainment
of a preestablished, objective performance goal described in Section 1.01(t)),
then the payment of any Dividend Equivalents related to the award shall not be
made contingent on the exercise of the award.
ARTICLE IV
NON-EMPLOYEE DIRECTOR'S OPTIONS
4.01 GRANTS OF ORIGINAL AND INITIAL OPTIONS.
(a) Original Options. Persons serving as Non-employee Directors
as of the closing of the initial public offering of the Company's securities
shall, upon such closing, receive a one-time grant of an option to purchase up
to 10,000 shares (or 15,000 shares if such person has served as a director of
the Company for at least two years) of the Company's Common Stock at an exercise
price per share equal to the price to the public in such initial public
offering, subject to adjustment as set forth in Article V. Options granted under
this Section 4.01(a) are "ORIGINAL OPTIONS" for purposes hereof.
(b) Initial Options. Each Non-employee Director who joins the
Board after the consummation of the initial public offering of the Company's
securities shall, upon first becoming a Non-employee Director ("Eligible
Director"), receive a one-time grant of an option to purchase up to 10,000
shares of the Company's Common Stock at an exercise price per share equal to the
Fair Market Value of the Company's Common Stock on the date of grant, subject to
(a) vesting as
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set forth in Section 4.03, and (b) adjustment as set forth in Article V. Options
granted under this Section 4.01(b) are "INITIAL OPTIONS" for purposes hereof.
4.02 GRANTS OF ADDITIONAL OPTIONS. Immediately following the
annual meeting of shareholders of the Company next following an Eligible
Director's becoming an Eligible Director, and immediately following each
subsequent annual meeting of shareholders of the Company, in each case if the
Eligible Director has served as a director since his or her election or
appointment and has been re-elected as a director at such annual meeting or is
continuing as a director without being re-elected due to the classification of
the board, such Eligible Director shall automatically receive an option to
purchase up to 5,000 shares of the Company's Common Stock (an "ADDITIONAL
OPTION"). In addition to the Additional Options described above, an individual
who was previously an Eligible Director and received an initial grant of stock
options under the Plan or pursuant to a prior option plan for the Company's
directors, who then ceased to be a director for any reason, and who then again
becomes an Eligible Director, shall upon again becoming an Eligible Director
automatically receive an Additional Option. The exercise price per share for all
Additional Options shall be equal to the fair market value of the Company's
Common Stock on the date of grant, subject to (a) vesting as set forth in
Section 4.03, and (b) adjustment as set forth in Article V. No individual may
receive Additional Options to purchase more than an aggregate of 20,000 shares
of the Company's Common Stock, less the number of additional options received
under any other option plan for the Company's directors.
4.03 VESTING. Original Options shall vest and become exercisable
with respect to all underlying shares upon grant. Initial Options shall vest and
become exercisable with respect to 50% of the underlying shares upon the date of
grant and 50% of the underlying shares immediately prior to the next annual
shareholders' meeting following the date of grant (or, if an annual meeting of
shareholders occurs within six months after the grant date, then immediately
prior to the second annual shareholders' meeting after the date of grant), if
the Recipient has remained a director from the grant date to such vesting time.
Additional Options shall vest and become exercisable with respect to all
underlying shares upon the earlier of (y) the first anniversary the grant date
or (z) immediately prior to the annual meeting of shareholders of the Company
next following the grant date, if the optionee has served as a director from the
grant date to such earlier date. Notwithstanding the foregoing, however, Initial
Options and Additional Options that have not vested and become exercisable at
the time the optionee ceases to be a director shall terminate.
4.04 EXERCISE. The exercise price for Non-employee Directors'
Options shall be payable as set forth in Section 3.02(c). Non-employee
Directors' Options shall be exercised in the manner provided in Section 3.02(e).
4.05 TERM OF OPTIONS AND EFFECT OF TERMINATION. Notwithstanding
any other provision of the Plan, no Non-employee Director's Option granted under
the Plan shall be exercisable after the expiration of ten years from the
effective date of its grant. In the event that the recipient of any Non-employee
Directors' Options granted under the Plan shall cease to be a director of the
Company, (a) all Original Options and Initial Options granted under this plan to
such recipient shall be exercisable, to the extent already exercisable at the
date such recipient ceases to be a director and regardless of the reason the
recipient ceases to be a director, for a period of 365 days after that date (or,
if sooner, until the expiration of the option according to its terms), and shall
then terminate; and (b) all Additional Options granted under this Plan to such
recipient shall be exercisable, to the extent already exercisable at the date
such recipient ceases to be a director, for a period of 365 days after that date
(or, if sooner, until the expiration of the option according to its terms) if he
or she ceases to be a director because of death or permanent disability, or for
a period of 90 days after that date (or, if sooner, until the expiration of the
option
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according to its terms) if he or she ceases to be a director for any other
reason, and shall then terminate. In the event of the death of an optionee while
such optionee is a director of the Company or within the period after
termination of such status during which he or she is permitted to exercise an
option, such option may be exercised by any person or persons designated by the
optionee on a beneficiary designation form adopted by the Plan administrator for
such purpose or, if there is no effective beneficiary designation form on file
with the Company, by the executors or administrators of the optionee's estate or
by any person or persons who shall have acquired the option directly from the
optionee by his or her will or the applicable laws of descent and distribution.
ARTICLE V
CORPORATE TRANSACTIONS
5.01 ANTI-DILUTION ADJUSTMENTS. The number of shares of Common
Stock available for issuance upon exercise of Awards granted under the Plan, the
number of shares for which each Award can be exercised, and the exercise price
per share of Awards shall be appropriately and proportionately adjusted for any
increase or decrease in the number of issued and outstanding shares of Common
Stock resulting from a subdivision or consolidation of shares or the payment of
a stock dividend or any other increase or decrease in the number of issued and
outstanding shares of capital stock of the Company effected without receipt of
consideration by the Company. No fractional interests will be issued under the
Plan resulting from any such adjustments. The preceding sentence shall not
result in an adjustment to the terms of an Incentive Stock Option unless such
adjustment either (a) would not cause the Option to lose its status as an
Incentive Stock Option or (b) is agreed to in writing by the Committee and the
Recipient.
5.02 REORGANIZATIONS; MERGERS; CHANGES IN CONTROL. Subject to the
other provisions of this Section 5.02, if the Company shall consummate any
reorganization or merger or consolidation in which holders of shares of the
Company's Common Stock are entitled to receive in respect of such shares any
other consideration (including, without limitation, a different number of such
shares), each Award outstanding under the Plan exercisable for Common Stock
shall thereafter be exercisable, in accordance with the Plan, only for the kind
and amount of securities, cash and/or other property receivable upon such
reorganization or merger or consolidation by a holder of the same number of
shares of Common Stock as are subject to that Award immediately prior to such
reorganization or merger or consolidation, and any appropriate adjustments will
be made to the exercise price thereof. In addition, if a Change in Control (as
defined below) occurs and in connection with such Change in Control any
Recipient's employment with the Company is terminated, then subject to the terms
of any written employment agreement between the Company and the Recipient and
the specific terms of any Award, such Recipient shall have the right to exercise
or receive the full benefit of his or her Awards granted under the Plan in whole
or in part during the applicable time period provided in Section 3.02(g) without
regard to any vesting or performance requirements or other milestones. For
purposes hereof, but without limitation, a Recipient's employment with the
Company will be deemed to have been terminated in connection with a Change of
Control if (i) the Recipient is removed from his or her employment with the
Company by or resigns his or her employment with the Company upon request of a
Person (as defined in paragraph (a) below) exercising practical voting control
over the Company following the Change in Control or a person acting upon
authority or at the instruction of such Person, or (ii) the Recipient's position
is eliminated as a result of a reduction in force within 150 days after the
consummation of the Change in Control. In addition, if a Change in Control
occurs and in connection with such Change in Control any recipient of a
Non-employee Director's Option granted under the Plan ceases to be a director of
the Company or its successor, then such recipient shall have the right to
exercise his or her Non-Employee Director's Options granted under the Plan in
whole or in part during the applicable time period provided in Section 4.05
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without regard to any vesting requirements. For purposes hereof, but without
limitation, a director will be deemed to have ceased to be a director of the
Company or its successor in connection with a Change in Control if such director
(i) is removed by or resigns upon request of a Person (as defined in paragraph
(a) below) exercising practical voting control over the Company following the
Change in Control or a person acting upon authority or at the instruction of
such Person, or (ii) is willing and able to continue as a director of the
Company or its successor but is not re-elected to or retained on the Company's
board of directors by the Company's shareholders through the shareholder vote or
consent action for election of directors that precedes and is taken in
connection with, or next follows, the Change in Control, and is not elected or
appointed to the board of directors of the successor. For purposes hereof, a
"CHANGE IN CONTROL" means the following and shall be deemed to occur if any of
the following events occur:
(a) Any person, entity or group, within the meaning of Section
13(d) or 14(d) of the Exchange Act, but excluding the Company, its subsidiaries,
any employee benefit or stock ownership plan of the Company or its subsidiaries,
and any shareholder of the Company who, together with such shareholder's
Affiliates, owned at least 25% of the Common Stock prior to the effective date
of the Plan ("affiliate" being defined for such purpose as an entity controlled
by or under common control with such shareholder), and also excluding an
underwriter or underwriting syndicate that has acquired the Company's securities
solely in connection with a public offering thereof (such person, entity or
group being referred to herein as a "Person"), becomes the beneficial owner
(within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 50% or
more of either the then outstanding shares of Common Stock or the combined
voting power of the Company's then outstanding securities entitled to vote
generally in the election of directors; or
(b) Individuals who, as of the effective date hereof, constitute
the Board of Directors of the Company (the "Incumbent Board") cease for any
reason to constitute at least a majority of the Board of Directors of the
Company, provided that any individual who becomes a director after the effective
date hereof whose election, or nomination for election by the Company's
shareholders, is approved by a vote of at least a majority of the directors then
comprising the Incumbent Board shall be considered to be a member of the
Incumbent Board; or
(c) Consummation by the Company of the sale or other disposition
by the Company of all or substantially all of the Company's assets or a
reorganization or merger or consolidation of the Company with any other person,
entity or corporation, other than
(i) a reorganization or merger or consolidation that
would result in the voting securities of the Company outstanding immediately
prior thereto (or, in the case of a reorganization or merger or consolidation
that is preceded or accomplished by an acquisition or series of related
acquisitions by any Person, by tender or exchange offer or otherwise, of voting
securities representing 5% or more of the combined voting power of all
securities of the Company, immediately prior to such acquisition or the first
acquisition in such series of acquisitions) continuing to represent, either by
remaining outstanding or by being converted into voting securities of another
entity, more than 50% of the combined voting power of the voting securities of
the Company or such other entity outstanding immediately after such
reorganization or merger or consolidation (or series of related transactions
involving such a reorganization or merger or consolidation), or
(ii) a reorganization or merger or consolidation
effected to implement a recapitalization or reincorporation of the Company (or
similar transaction) that does not result in a material change in beneficial
ownership of the voting securities of the Company or its successor; or
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(d) Approval by the shareholders of the Company or an order by a
court of competent jurisdiction of a plan of liquidation of the Company.
5.03 DETERMINATION BY THE COMMITTEE. To the extent that the foregoing
adjustments relate to stock or securities of the Company, such adjustments shall
be made by the Committee, whose determination in that respect shall be final,
binding and conclusive. The grant of an Award pursuant to the Plan shall not
affect in any way the right or power of the Company to make adjustments,
reclassifications, reorganizations or changes of its capital or business
structure or to merge or to consolidate or to dissolve, liquidate or sell, or
transfer all of any part of its business or assets.
17
<PAGE> 1
EXHIBIT 5
[GIBSON, DUNN CRUTCHER LLP LETTERHEAD]
March 9, 1998
(714) 451-3800 C 75293-00032
RemedyTemp, Inc.
32122 Camino Capistrano
San Juan Capistrano, CA 92675
Re: Registration Statement on Form S-8
for Amended and Restated 1996 Stock Incentive Plan
Ladies and Gentlemen:
We have acted as your counsel in connection with the preparation of a
Registration Statement on Form S-8 (the "Registration Statement") to be filed
with the Securities and Exchange Commission on the date hereof, to register
under the Securities Act of 1933, as amended (the "Act"), an additional 325,000
shares of the Company's Class A Common Stock, par value $0.01 per share (the
"Common Stock"), available to be issued pursuant to awards granted under the
Company's Amended and Restated 1996 Stock Incentive Plan (the "Plan").
For purposes of rendering this opinion, we have made such legal and
factual examinations as we have deemed necessary under the circumstances and, as
part of such examination, we have examined originals and copies, certified or
otherwise, identified to our satisfaction, of the Plan, the Company's Amended
and Restated Articles of Incorporation and Amended and Restated Bylaws, and the
records of corporate proceedings and other actions taken by the Company in
connection with the Plan and the Common Stock issuable thereunder, and such
other documents, corporate records and other instruments as we have deemed
necessary or appropriate. Based upon the foregoing and in reliance thereon, and
subject to (i) compliance with applicable state securities laws and (ii) the
effectiveness of the Registration Statement pursuant to the Act, it is our
opinion that the Common Stock, when issued and paid for in accordance with the
Registration Statement and the Plan, will be validly issued, fully paid and
non-assessable.
<PAGE> 2
RemedyTemp, Inc.
March 9, 1998
Page 2
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. In giving this consent, we do not thereby admit that we
are within the category of persons whose consent is required under Section 7 of
the Act or the Rules and Regulations thereunder.
Very truly yours,
/s/ Gibson, Dunn & Crutcher
------------------------------------
GIBSON, DUNN & CRUTCHER LLP
WLS/CNL/MJB
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated November 14, 1997, which appears on
page 29 of the 1997 Annual Report to Shareholders of RemedyTemp, Inc., which is
incorporated by reference in RemedyTemp, Inc.'s Annual Report on Form 10-K for
the year ended September 28, 1997. We also consent to the incorporation by
reference of our report on the Financial Statement Schedule, which appears on
page 15 of such Annual Report on Form 10-K.
PRICE WATERHOUSE LLP
Costa Mesa, California
March 3, 1998
