<PAGE>
As filed with the Securities and Exchange Commission on January 30, 1998
Registration No.
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
EMB CORPORATION
(Exact name of Registrant as specified in its charter)
HAWAII 95-3811580
------ ----------
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER IDENTIFICATION NO.)
INCORPORATION OR ORGANIZATION)
3200 BRISTOL AVENUE, 8/TH/ FLOOR, COSTA MESA, CALIFORNIA 92626
---------------------------------------------------------------
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
1996 STOCK OPTION, SAR AND
STOCK BONUS PLAN
--------------------------------
(Full title of Plan)
JAMES E. SHIPLEY, PRESIDENT
EMB CORPORATION
3200 BRISTOL AVENUE, 8/TH/ FLOOR
COSTA MESA, CALIFORNIA 92626
-------------------------------------------------------
(Name and address of agent for service)
(714) 437-0738
-------------------------------------------------------------
(Telephone number, including area code, of agent for service)
With copies to:
STEPHEN A. ZRENDA, JR., ESQ.
STEPHEN A. ZRENDA, JR., P.C.
1520 BANK ONE CENTER
100 NORTH BROADWAY
OKLAHOMA CITY, OKLAHOMA 73102-8601
(405) 235-2111
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------
Proposed Maximum Proposed Maximum
Title of Securities Amount to be Offering Price per Aggregate Offering Amount of
to be Registered Registered (1) Share (2) Price Registration Fee
- ------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, no par 1,250,000 shares $2.20 $2,753,125 $812.17
value
- ------------------------------------------------------------------------------------------------------
</TABLE>
(1) In addition, pursuant to Rule 416(c) under the Securities Act of 1933, as
amended (the "Securities Act"), this Registration Statement also covers an
indeterminate number of additional shares that may be issuable in
connection with share splits, share dividends or similar transactions.
(2) Estimated pursuant to Rule 457(c) under the Securities Act, solely for the
purpose of calculating the registration fee, based on the average of the
bid and asked prices of the Company's common stock as reported within five
business days prior to the date of this filing.
1
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
ITEM 1. PLAN INFORMATION.
*
ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.
*
*The document(s) containing the information specified in Part I of Form S-8
will be sent or given to participants as specified by Rule 428(b)(1) promulgated
by the Securities and Exchange Commission (the "Commission") under the
Securities Act of 1933 (the "Securities Act"). Such document(s) are not being
filed with the Commission, but constitute (along with the documents incorporated
by reference into the Registration Statement pursuant to Item 3 of Part II
hereof) a prospectus that meets the requirements of Section 10(a) of the
Securities Act.
2
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents previously or concurrently filed by the Company
with the Commission are hereby incorporated by reference into this Registration
Statement:
(a) The Company's Annual Report on Form 10-KSB for the fiscal year ended
September 30, 1997 (the "Annual Report") filed by the Company (SEC
File No. 1-11883) under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), with the Commission on January 13, 1998.
(b) All other reports filed pursuant to Section 13(a) or 15(d) of the
Exchange Act since the end of the fiscal year covered by the Annual
Report referred to in (a) above.
(c) The description of the Company's Common Stock set forth under the
caption "Description of Capital Stock" in Amendment No. 2 to its Form
SB-2 Registration Statement (File No. 333-21719) filed with the
Commission on August 27, 1997, is hereby incorporated by reference.
All of the above documents and documents subsequently filed by the Company
with the Commission pursuant to Sections 13(a), 13(c), 14 or 15(d) of the
Exchange Act, prior to the filing of a post-effective amendment which indicates
that all securities offered hereby have been sold or which deregisters all
securities then remaining unsold, shall be deemed incorporated by reference into
this Registration Statement and to be a part thereof from the date of the filing
of such documents. Any statement contained in the documents incorporated, or
deemed to be incorporated, by reference herein or therein shall be deemed to be
modified or superseded for purposes of this Registration Statement and the
prospectus which is a part hereof (the "Prospectus") to the extent that a
statement contained herein or therein or in any other subsequently filed
document which also is, or is deemed to be, incorporated by reference herein or
therein modifies or supersedes such statement. Any such statement so modified
or superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Registration Statement and the Prospectus.
All documents incorporated by reference herein will be made available to
all participants in the 1996 Stock Option, SAR and Stock Bonus Plan without
charge, upon written or oral request. Other documents required to be delivered
to participants pursuant to Rule 428(b)(1) under the Securities Act of 1933 are
also available without charge, upon written or oral request. All requests for
documents shall be directed to:
B. Joe Wimer
EMB Corporation
3200 Bristol Avenue, 8/th/ Floor
Costa Mesa, California 92626
(714) 437-0738
3
<PAGE>
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Company is a Hawaii corporation. Section 415-48.5 of the Hawaii
Business Corporation Act (the "HBCA") provides authority for broad
indemnification of officers, directors, employees and agents of a corporation,
with certain specified exceptions.
Article XIII of the Company's Restated Articles of Incorporation provides
that the Company shall have the power to indemnify its directors, officers,
employees and agents to the fullest extent allowed by the HBCA.
Article III, Section 6 of the Company's By-Laws provides for extensive
indemnification of its directors, officers, employees and agents.
At the present time, the Company does not have any officer-director
liability insurance, nor does the Company have indemnification agreements with
any of its directors, officers, employees or agents.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not Applicable.
ITEM 8. EXHIBITS.
See the Exhibit Index following the signature page in this Registration
Statement, which Exhibit Index is incorporated herein by reference.
ITEM 9. UNDERTAKINGS.
(a) The undersigned Company hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to the Registration Statement
to: (i) include any prospectus required by Section 10(a)(3) of
the Securities Act; (ii) reflect in the prospectus any facts or
events arising after the effective date of the Registration
Statement which, individually or in the aggregate, represent a
fundamental change in the information set forth in the
Registration Statement; and notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not
4
<PAGE>
exceed that which was registered) and any deviation from the low
or high end of the estimated maximum offering range may be
selected in the form of a prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than a 20 percent change in
the maximum aggregate offering price set forth in the
"Calculation of Registration" table in the effective registration
statement; and (iii) include any material information with
respect to the plan of distribution not previously disclosed in
the Registration Statement or any material change to such
information in the Registration Statement, provided however, that
provisions (i) and (ii) of this undertaking are inapplicable if
the information to be filed thereunder is contained in periodic
reports filed by the Company pursuant to the Exchange Act that
are incorporated by reference into the Registration Statement;
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be
deemed to be a new registration statement relating to the
securities offered therein and the offering of such securities at
that time shall be deemed to be the initial bona fide offering
thereof; and
(3) To remove from registration by means of post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers, and
controlling persons of the Company pursuant to the foregoing
provisions, or otherwise, the Company has been advised that in the
opinion of the Commission such indemnification is against public
policy as expressed in the Securities Act and, is, therefore,
unenforceable. In the event that a claim for indemnification against
such liabilities (other than director, officer or controlling person
in the successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in connection
with the securities being registered, the Company will, unless in the
opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final
adjudication of such issue.
(c) The Company hereby undertakes that, for purposes of determining any
liability under the Securities Act, each filing of the Company's
annual report pursuant to Section 13(a) or 15(d) of the Exchange Act
(and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in Registration Statement shall be deemed to
be a new Registration Statement relating to the securities offered
therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act, the Registrant has duly
caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Costa Mesa, State of
California, on January 28, 1998.
EMB CORPORATION
By: /s/ James E. Shipley
-------------------------------------
James E. Shipley, President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated. Each person whose signature to the
Registration Statement appears below hereby appoints James E. Shipley and B. Joe
Wimer, or either one of them, as such person's attorney-in-fact with full power
to act alone, with full power of substitution or resubstitution, for such person
and in such person's name, place and stead, in any and all capacities to sign on
such person's behalf, individually and in the capacities stated below, and to
file any and all amendments and post-effective amendments to this Registration
Statement, which amendment or amendments may make such changes and additions as
such attorney-in-fact may deem necessary or appropriate.
/s/ James E. Shipley /s/ B. Joe Wimer
- -------------------------------------- --------------------------------------
James E. Shipley B. Joe Wimer
Director (Chairman) and President Secretary, Treasurer and Director
(Principal Financial and Accounting
Officer)
/s/ Bruce J. Brosky /s/ William V. Perry
- -------------------------------------- --------------------------------------
Bruce J. Brosky William V. Perry
Director and Vice President-Marketing Director and Executive Vice
and President, and Public Relations President of EMB Mortgage
Corporation
/s/ Michael P. Roth /s/ Joseph K. Brick
- -------------------------------------- --------------------------------------
Michael P. Roth, Director and Joseph K. Brick, Director and
Vice President Vice President of
EMB Mortgage Corporation
<PAGE>
EMB CORPORATION
EXHIBIT INDEX
TO
FORM S-8 REGISTRATION STATEMENT
EXHIBIT NO. DESCRIPTION
4.1 1996 Stock Option, SAR and Stock Bonus Plan
5.1 Opinion of Stephen A. Zrenda, Jr., P.C.
23.1 Consent of Harlan & Boettger
24.1 Power of Attorney (included on Signature Page to the
Registration Statement)
<PAGE>
EXHIBIT 4.1
EMB CORPORATION
1996 STOCK OPTION, SAR AND STOCK BONUS PLAN
ARTICLE 1
GENERAL PROVISIONS
1.1 PURPOSE. The purpose of the EMB CORPORATION 1996 STOCK OPTION, SAR AND
STOCK BONUS PLAN (the "Plan") shall be to attract, retain and motivate key
management employees and independent consultants (the "Participants") of EMB
Corporation (the "Company") and its subsidiaries, if any, by way of granting (i)
non-qualified stock options ("Stock Options"), (ii) non-qualified stock options
with stock appreciation rights attached ("Stock Option SARs"), (iii) incentive
stock options ("ISO Options"), and (iv) ISO Options with stock appreciation
rights attached ("ISO Option SARs"). For the purpose of this Plan, Stock Option
SARs and ISO Option SARs are sometimes collectively herein called "SARs;" and
Stock Options and ISO Options are sometimes collectively herein called
"Options." The ISO Options to be granted under the Plan are intended to be
qualified pursuant to Section 422 of the Internal Revenue Code of 1986, as
amended (the "Code"); and the Stock Options to be granted are intended to be
"non-qualified stock options" as described in Sections 83 and 421 of the Code.
Furthermore, under the Plan, the terms "parent" and "subsidiary" shall have the
same meaning as set forth in Subsections (e) and (f) of Section 425 of the Code
unless the context herein clearly indicates to the contrary.
1.2 GENERAL. The terms and provisions of this Article I shall be applicable to
Stock Options, SARs and ISO Options unless the context herein clearly indicates
to the contrary.
1.3 ADMINISTRATION OF THE PLAN. The Plan shall be administered by the Stock
Option Committee (the "Committee") appointed by the Board of Directors (the
"Board") of the Company and consisting of not less than three members from the
Board. The members of the Committee shall serve at the pleasure of the Board.
The Committee shall have the power where consistent with the general purpose and
intent of the Plan to (i) modify the requirements of the Plan to conform with
the law or to meet special circumstances not anticipated or covered in the Plan,
(ii) suspend or discontinue the Plan, (iii) establish policies and (iv) adopt
rules and regulations and prescribe forms for carrying out the purposes and
provisions of the Plan including the form of any "stock option agreements"
("Stock Option Agreements"). Unless otherwise provided in the Plan, the
Committee shall have the authority to interpret and construe the Plan, and
determine all questions arising under the Plan and any agreement made pursuant
to the Plan. Any interpretation, decision or determination made by the
Committee shall be final, binding and conclusive. A majority of the Committee
shall constitute a quorum, and an act of the majority of the members present at
any meeting at which a quorum is present shall be the act of the Committee.
1.4 SHARES SUBJECT TO THE PLAN. Shares of stock ("Stock") covered by Stock
Options, SARs and ISO Options shall consist of 1,250,000 shares of the Common
Stock, no par value, of the Company. Either authorized and unissued shares or
treasury shares may be delivered pursuant to the Plan. If
Exhibit 4.1-Page 1
<PAGE>
EXHIBIT 4.1
any Option for shares of Stock, granted to a Participant lapses, or is otherwise
terminated, the Committee may grant Stock Options, SARs or ISO Options for such
shares of Stock to other Participants. However, neither Stock Options, SARs nor
ISO Options shall be granted again for shares of Stock which have been subject
to SARs which are surrendered in exchange for cash or shares of Stock issued
pursuant to the exercise of SARs as provided in Article II hereof.
1.5 PARTICIPATION IN THE PLAN. The Committee shall determine from time to time
those Participants who are to be granted Stock Options, SARs and ISO Options and
the number of shares of Stock covered thereby. Directors who are not employees
of the Company or of a subsidiary shall not be eligible to participate in the in
ISO Options or ISO in Option SARs. During any period that the Committee is
comprised of less than three Directors each of whom is a Disinterested Director,
the maximum number of shares of Stock for which employee-Directors may be
granted options in any calendar year shall not exceed 33 percent of the
aggregate number of shares of Stock with respect to which Options may be granted
under the Plan.
1.6 DETERMINATION OF FAIR MARKET VALUE. As used in the Plan, "fair market
value" shall mean on any particular day (i) if the Stock is listed or admitted
for trading on any national securities exchange or the National Market System of
the National Association of Securities Dealers, Inc. Automated Quotation System,
the last sale price, or if no sale occurred, the mean between the closing high
bid and low asked quotations, for such day of the Stock on the principal
securities exchange on which shares of Stock are listed, (ii) if Stock is not
traded on any national securities exchange but is quoted on the National
Association of Securities Dealers, Inc., Automated Quotation System, or any
similar system of automated dissemination of quotations or securities prices in
common use, the mean between the closing high bid and low asked quotations for
such day of the Stock on such system, (iii) if neither clause (i) nor (ii) is
applicable, the mean between the high bid and low asked quotations for the Stock
as reported by the National Quotation Bureau, Incorporated if at least two
securities dealers have inserted both bid and asked quotations for shares of the
Stock on at least five (5) of the ten (10) preceding days, (iv) in lieu of the
above, if actual transactions in the shares of Stock are reported on a
consolidated transaction reporting system, the last sale price of the shares of
Stock on such system or, (v) if none of the conditions set forth above is met,
the fair market value of shares of Stock as determined by the Board. Provided,
for purposes of determining "fair market value" of the Common Stock of the
Company, such value shall be determined without regard to any restriction other
than a restriction which will never lapse.
1.7 ADJUSTMENTS UPON CHANGES IN CAPITALIZATION. The aggregate number of shares
of Stock under Stock Options and ISO Options granted under the Plan, the Option
Price and the ISO Price and the total number of shares of Stock which may be
purchased by a Participant on exercise of a Stock Option and an ISO Option shall
be approximately adjusted by the Committee to reflect any recapitalization,
stock split, merger, consolidation, reorganization, combination, liquidation,
stock dividend or similar transaction involving the Company except that a
dissolution or liquidation of the Company or a merger or consolidation in which
the Company is not the surviving or the resulting corporation, shall cause the
Plan and any Stock Option, SAR or ISO Option granted thereunder, to terminate
upon the effective date of such dissolution, liquidation, merger or
consolidation. Provided, that for the purposes of this Section 1.7, if any
merger, consolidation or combination occurs in which
Exhibit 4.1-Page 2
<PAGE>
EXHIBIT 4.1
the Company is not the surviving corporation and is the result of a mere change
in the identity, form or place of organization of the Company accomplished in
accordance with Section 368(a)(1)(F) of the Code, then, such event will not
cause a termination. Appropriate adjustment may also be made by the Committee
in the terms of a SAR to reflect any of the foregoing changes.
1.8 AMENDMENT AND TERMINATION OF THE PLAN. The Plan shall terminate at
midnight, April 30, 1999, but prior thereto may be altered, changed, modified,
amended or terminated by written amendment approved by the Board. Provided,
that no action of the Board may, without the approval of the shareholders,
increase the aggregate number of shares of Stock which may be purchased under
Stock Options, SARs or ISO Options granted under the Plan; withdraw the
administration of the Plan from the Committee; amend or alter the Option Price
or ISO Price, as applicable; change the manner of computing the spread upon the
exercise of a SAR or amend the Plan in any manner which would impair the
applicability of Rule 16b-3 under the Securities Exchange Act of 1934, as
amended, to the Plan. Except as provided in this Article I, no amendment,
modification or termination of the Plan shall in any manner adversely affect any
Stock Option, SAR or ISO Option theretofore granted under the Plan without the
consent of the affected Participant.
1.9 EFFECTIVE DATE. The Plan shall be effective May 21, 1996, subject to
approval by the holders of a majority of the Common Stock of the Company
present, or represented, and entitled to vote at a meeting called for such
purpose, and upon the issuance of a favorable opinion of counsel with respect to
certain tax consequences of the Plan as it affects Stock Options, ISO Options
and SARs.
1.10 SECURITIES LAW REQUIREMENTS. The Company shall have no liability to issue
any Stock hereunder unless the issuance of such shares would comply with any
applicable federal or state securities laws or any other applicable law or
regulations thereunder.
1.11 SEPARATE CERTIFICATES. Separate certificates representing the Common Stock
of the Company to be delivered to a Participant upon the exercise of any Stock
Option, SAR, or ISO Option will be issued to such Participant.
1.12 PAYMENT FOR STOCK; RECEIPT OF STOCK OR CASH IN LIEU OF PAYMENT.
(a) PAYMENT FOR STOCK. Payment for shares of Stock purchased under this
Plan shall be made in full and in cash or check made payable to the Company.
Provided, payment for shares of Stock purchased under this Plan may also be made
in Common Stock of the Company or a combination of cash and Common Stock of the
Company in the event that the purchase of shares is pursuant to the exercise of
rights under an SAR attached to the Option and which is exercisable on the date
of exercise of the Option. In the event that Common Stock of the Company is
utilized in consideration for the purchase of Stock upon the exercise of a Stock
Option or an ISO Option, then, such Common Stock shall be valued at the "fair
market value" as defined in Section 1.6 of the Plan.
(b) RECEIPT OF STOCK OR CASH IN LIEU OF PAYMENT. Furthermore, a
Participant may exercise an Option without payment of the Option Price or ISO
Price in the event that the exercise is pursuant to rights under an SAR attached
to the Option and which is exercisable on the date of
Exhibit 4.1-Page 3
<PAGE>
EXHIBIT 4.1
exercise of the Option. In the event an Option with an SAR attached is
exercised without payment of the Option Price or ISO Price, the Participant
shall be entitled to receive either (i) a cash payment from the Company equal to
the excess of the total fair market value of the shares of Stock on such date as
determined with respect to which the Option is being exercised over the total
cash Option Price or ISO Price of such shares of Stock as set forth in the
Option or (ii) that number of whole shares of Stock as is determined by dividing
(A) an amount equal to the fair market value per share of Stock on the date of
exercise into (B) an amount equal to the excess of the total fair market value
of the shares of Stock on such date with respect to which the Option is being
exercised over the total cash Option Price or ISO Price of such shares of Stock
as set forth in the Option, and fractional shares will be rounded to the next
lowest number and the Participant will receive cash in lieu thereof.
1.13 INCURRENCE OF DISABILITY AND RETIREMENT. A Participant shall be deemed to
have terminated employment or consulting and incurred a disability
("Disability") if such Participant suffers a physical or mental condition which,
in the judgment of the Committee, totally and permanently prevents a Participant
from engaging in any substantial gainful employment or consulting with the
Company or a subsidiary. A Participant shall be deemed to have terminated
employment as an employee or a consultant due to retirement ("Retirement") if
such Participant ceases to be an employee or a consultant of the Company or its
subsidiary, without cause, after attaining the age of 55.
1.14 STOCK OPTIONS AND ISO OPTIONS GRANTED SEPARATELY. Since the Committee is
authorized to grant Stock Options, SARs and ISO Options to Participants, the
grant thereof and Stock Option Agreements relating thereto will be made
separately and totally independent of each other. Except as it relates to the
total number of shares of Stock which may be issued under the Plan, the grant or
exercise of a Stock Option or SARs shall in no manner affect the grant and
exercise of any ISO Options. Similarly, the grant and exercise of any ISO
Option shall in no manner affect the grant and exercise of any Stock Option or
SARs.
1.15 GRANTS OF OPTIONS AND STOCK OPTION AGREEMENT. Each Stock Option, ISO
Option and/or SAR granted under this Plan shall be evidenced by the minutes of a
meeting of the Committee or by the written consent of the Committee and by a
written Stock Option Agreement effective on the date of grant and executed by
the Company and the Participant. Each Option granted hereunder shall contain
such terms, restrictions and conditions as the Committee may determine, which
terms, restrictions and conditions may or may not be the same in each case.
1.16 USE OF PROCEEDS. The proceeds received by the Company from the sale of
Stock pursuant to the exercise of Options granted under the Plan shall be added
to the Company's general funds and used for general corporate purposes.
1.17 NON-TRANSFERABILITY OF OPTIONS. Except as otherwise herein provided, any
Option or SAR granted shall not be transferable otherwise than by will or the
laws of descent and distribution, and the Option may be exercised, during the
lifetime of the Participant, only by him. More particularly (but without
limiting the generality of the foregoing), the Option and/or SAR may not be
assigned, transferred (except as provided above), pledged or hypothecated in any
way, shall not be assignable by operation of law and shall not be subject to
execution, attachment, or similar process. Any
Exhibit 4.1-Page 4
<PAGE>
EXHIBIT 4.1
attempted assignment, transfer, pledge, hypothecation, or other disposition of
the Option and/or SAR contrary to the provisions hereof shall be null and void
and without effect.
1.18 ADDITIONAL DOCUMENTS ON DEATH OF PARTICIPANT. No transfer of an Option
and/or SAR by the Participant by will or the laws of descent and distribution
shall be effective to bind the Company unless the Company shall have been
furnished with written notice and an unauthenticated copy of the will and/or
such other evidence as the Committee may deem necessary to establish the
validity of the transfer and the acceptance by the successor to the Option
and/or SAR of the terms and conditions of such Option and/or SAR.
1.19 CHANGES IN EMPLOYMENT. So long as the Participant shall continue to be an
employee or consultant of the Company or any one of its subsidiaries, any Option
granted to him shall not be affected by any change of duties or position.
Nothing in the Plan or in any Stock Option Agreement which relates to the Plan
shall confer upon any Participant any right to continue in the employ as an
employee or consultant of the Company or of any of its subsidiaries, or
interfere in any way with the right of the Company or any of its subsidiaries to
terminate his employment or consulting arrangement at any time.
1.20 SHAREHOLDER RIGHTS. No Participant shall have a right as a shareholder
with respect to any shares of Stock subject to an Option prior to the purchase
of such shares of Stock by exercise of the Option.
1.21 RIGHT TO EXERCISE UPON COMPANY CEASING TO EXIST. Where dissolution or
liquidation of the Company or any merger consolidation or combination in which
the Company is not the surviving corporation occurs, the Participant shall have
the right immediately prior to such dissolution, liquidation, merger,
consolidation or combination, as the case may be, to exercise, in whole or in
part, his then remaining Options whether or not then exercisable, but limited to
that number of shares that can be acquired without causing the Participant to
have an "excess parachute payment" as determined under Section 280G of the Code
determined by taking into account all of Participant's "parachute payments"
determined under Section 280G of the Code. Provided, the foregoing
notwithstanding, after the Participant has been afforded the opportunity to
exercise his then remaining Options as provided in this Section 1.21, and to the
extent such Options are not timely exercised as provided in this Section 1.21,
then, the terms and provisions of this Plan and any Stock Option Agreement will
thereafter continue in effect, and the Participant will be entitled to exercise
any such remaining and unexercised Options in accordance with the terms and
provisions of this Plan and such Stock Option Agreement as such Options
thereafter become exercisable. Provided further, that for the purposes of this
Section 1.21, if any merger, consolidation or combination occurs in which the
Company is not the surviving corporation and is the result of a mere change in
the identity, form, or place of organization of the Company accomplished in
accordance with Section 368(a)(1)(F) of the Code, then, such event shall not
cause an acceleration of the exercisability of any such Options granted
hereunder.
1.22 ASSUMPTION OF OUTSTANDING OPTIONS AND SARS. To the extent permitted by the
then applicable provisions of the Code, any successor to the Company succeeding
to, or assigned the
Exhibit 4.1-Page 5
<PAGE>
EXHIBIT 4.1
business of, the Company as the result of or in connection with a corporate
merger, consolidation, combination, reorganization or liquidation transaction
shall assume Options and SARs outstanding under the Plan or issue new Options
and/or SARs in place of outstanding Options and/or SARs under the Plan.
ARTICLE II
TERMS OF STOCK OPTIONS AND EXERCISE
2.1 GENERAL TERMS.
(a) GRANT AND TERMS FOR STOCK OPTIONS. Stock Options shall be granted by
the Committee on the following terms and conditions: No Stock Option shall be
exercisable within six months from the date of grant (except as specifically
provided in Subsection 2.l(c) hereof, with regard to the death or Disability of
a Participant), nor more than 10 years after the date of grant. Subject to such
limitation, the Committee shall have the discretion to fix the period (the
"Option Period") during which any Stock Option may be exercised. Stock Options
granted shall not be transferable except by will or by the laws of descent and
distribution, Stock Options shall be exercisable only by the Participant while
actively employed as an employee or a consultant by the Company or a subsidiary,
except that (i) any such Stock Option granted and which is otherwise
exercisable, may be exercised by the personal representative of a deceased
Participant within 12 months after the death of such Participant (but not beyond
the Option Period of such Stock Option), (ii) if a Participant terminates his
employment as an employee or a consultant with the Company or a subsidiary on
account of Retirement, such Participant may exercise any Stock Option which is
otherwise exercisable at any time within three months of such date of
termination and (iii) if a Participant terminates his employment as an employee
or a consultant with the Company or a subsidiary on account of incurring a
Disability, such Participant may exercise any Stock Option which is otherwise
exercisable at any time within 12 months of such date of termination. If a
Participant should die during the applicable three-month or 12-month period
following the date of such Participant's Retirement or termination on account of
Disability, the rights of the personal representative of such deceased
Participant as such relate to any Stock Options granted to such deceased
Participant shall be governed in accordance with Subsection 2.1(a)(i) of this
Article II.
(b) OPTION PRICE. The option price ("Option Price") for shares of Stock
subject to a Stock Option shall be determined by the Committee, but in no event
shall the Option Price of an ISO be less than 100% of the "fair market value" of
the Stock on the date of grant and in no event shall the Option Price of Stock
Options be less than 85% of the "fair market value" of the Stock on the date of
grant.
(c) ACCELERATION OF OTHERWISE UNEXERCISABLE STOCK OPTION ON RETIREMENT,
DEATH, DISABILITY OR OTHER SPECIAL CIRCUMSTANCES. The Committee, in its sole
discretion, may permit (i) a Participant who terminates employment as an
employee or a consultant due to Retirement, (ii) a Participant who terminates
employment as an employee or a consultant due to a Disability, (iii) the
personal representative of a deceased Participant, or (iv) any other Participant
who terminates
Exhibit 4.1-Page 6
<PAGE>
EXHIBIT 4.1
employment as an employee or a consultant upon the occurrence of special
circumstances (as determined by the Committee) to exercise and purchase (within
three months of such date of termination of employment or consulting
arrangement, or 12 months in the case of a deceased or disabled Participant; all
or any part of the shares subject to Stock Option on the date of the
Participant's Retirement, Disability, death, or as the Committee otherwise so
determines, notwithstanding that all installments, if any, with respect to such
Stock Option, had not accrued on such date. Provided, such discretionary
authority of the Committee shall not be exercised with respect to any Stock
Option (or portion thereof) if the applicable six-month waiting period for
exercise had not expired except in the event of the death or disability of the
Participant when the personal representative of the deceased Participant or the
disabled Participant may, with the consent of the Committee, exercise such Stock
Option notwithstanding the fact that the applicable six-month waiting period had
not yet expired.
(d) NUMBER OF STOCK OPTIONS GRANTED. Participants may be granted more
than one Stock Option. In making any such determination, the Committee shall
obtain the advice and recommendation of the officers of the Company or a
subsidiary which have supervisory authority over such Participants. The
granting of a Stock Option under the Plan shall not affect any outstanding Stock
Option previously granted to a Participant under the Plan .
(e) NOTICE OF EXERCISE STOCK OPTION. Upon exercise of a stock option, a
Participant shall give written notice to the Secretary of the Company, or other
officer designated by the Committee, at the Company's main office in Dallas,
Texas. No Stock shall be issued to any Participant until the Company receives
full payment for the Stock purchased, if applicable, and any required state and
federal withholding taxes.
ARTICLE III
SARS
3.1 GENERAL TERMS.
(a) GRANT AND TERMS OF SARS. The Committee, when comprised of three or
more Directors all of whom are Disinterested Directors, may grant SARs to
Participants in connection with Stock Options or ISO Options granted under the
Plan. SARs shall not be exercisable (i) at such time that the Committee is
comprised of less than three Disinterested Directors or is not comprised solely
of Disinterested Directors, (ii) earlier than six months from the date of grant
except as specifically provided in Subsection 3.l(b) hereof in the case of the
death or Disability of a Participant, and (iii) shall terminate at such time as
the Committee determines and shall be exercised only upon surrender of the
related Stock Option or ISO Option and only to the extent that the related Stock
Option or ISO Option (or the portion thereof as to which the SAR is exercisable)
is exercised. SARs may be exercised only by the Participant while actively
employed as an employee or a consultant by the Company or a subsidiary except
that (i) any SARs previously granted to a Participant which are otherwise
exercisable may be exercised, with the approval of the Committee, by the
personal representative of a deceased Participant, even if such death should
occur within six months of the date
Exhibit 4.1-Page 7
<PAGE>
EXHIBIT 4.1
of grant (but not beyond the expiration date of such SAR), and (ii) if a
Participant terminates his employment as an employee or a consultant with the
Company or a subsidiary, as the case may be, on account of Retirement or
incurring a Disability, such Participant may exercise any SARs which are
otherwise exercisable, with the approval of the Committee, anytime within three
months of the date of the termination by Retirement or within 12 months of
termination by Disability. If a Participant should die during the applicable
three-month period following the date of such Participant's Retirement or during
the applicable 12 month period following the date of termination on account of
Disability, the rights of the personal representative of such deceased
Participant as such relate to any SARs granted to such deceased Participant
shall be governed in accordance with (i) of the second sentence of this
Subsection 3.l(a) of this Article III. The applicable SAR shall (i) terminate
upon the termination of the underlying Stock Option or ISO Option, as the case
may be, (ii) only be transferable at the same time and under the same conditions
as the underlying Stock Option or ISO Option is transferable, (iii) only be
exercised when the underlying Stock Option or ISO Option is exercised, and (iv)
may be exercised only if there is a positive spread between the Option Price or
ISO Price, as applicable and the "fair market value" of the Stock for which the
SAR is exercised.
(b) ACCELERATION OF OTHERWISE UNEXERCISABLE SARS ON RETIREMENT, DEATH,
DISABILITY OR OTHER SPECIAL CIRCUMSTANCES. The Committee, in its sole
discretion, may permit (i) a Participant who terminates employment as an
employee or a consultant with the Company or a subsidiary due to Retirement,
(ii) a Participant who terminates employment as an employee or a consultant with
the Company or a subsidiary due to a Disability, (iii) the personal
representative of such deceased Participant, or (iv) any other Participant who
terminates employment as an employee or a consultant with the Company or a
subsidiary upon the occurrence of special circumstances (as determined by the
Committee) to exercise (within three months of such date of termination of such
employment or 12 months in the case of a disabled or deceased Participant) all
or any part of any such SARs previously granted to such Participant as of the
date of such Participant's Retirement, Disability, death, or as the Committee
otherwise so determines, notwithstanding that all installments, if any with
respect to such SARs, had not accrued on such date. Provided, such
discretionary authority of the Committee may not be exercised with respect to
any SAR (or portion thereof if the applicable six-month waiting period for
exercise had not expired as of such date, except (i) in the event of the
Disability of the Participant or (ii) the death of the Participant, when such
disabled Participant or the personal representative of such deceased Participant
may, with the consent of the Committee, exercise such SARs notwithstanding the
fact that the applicable six-month waiting period had not yet expired.
(c) FORM OF PAYMENT OF SARS. The Participant may request the method and
combination of payment upon the exercise of a SAR; however, the Committee has
the final authority to determine whether the value of the SAR shall be paid in
cash or shares of Stock or both. Upon exercise of a SAR, the holder is entitled
to receive the excess amount of the "fair market value" of the Stock (as of the
date of exercise) for which the SAR is exercised over the Option Price or ISO
Price, as applicable, under the related Stock Option or ISO Option, as the case
may be. All applicable federal and state withholding taxes will be paid by the
Participant to the Company upon the exercise of a SAR since the excess amount
described above will be required to be included within taxable income in
accordance with Sections 61 and 83 of the Code.
Exhibit 4.1-Page 8
<PAGE>
EXHIBIT 4.1
(d) DISINTERESTED DIRECTORS. As used in this Article III, "Disinterested
Directors" shall have the same meaning as the term "disinterested person" set
forth in Rule 16b-3(d) under the Securities Exchange Act of 1934, as amended,
and shall mean a Director who is not at the time he exercises discretion in
administering the Plan eligible, and has not at any time within one year prior
thereto been eligible for selection as a person to whom stock may be allocated
or to whom stock options or stock appreciation rights may be granted pursuant to
the Plan or any other plan of the Company or its affiliates entitling the
participants therein to acquire stock, stock options or stock appreciation
rights of the Company or any of its affiliates; provided, however, that in the
event that the definition of "disinterested person" contained in Rule 16b-3 is
amended, the term "Disinterested Person" as it is defined herein shall
automatically be deemed amended so as to the have the same meaning as the
amended term "disinterested person" under Rule 16b-3.
ARTICLE IV
GRANTING OF ISO OPTIONS
4.1 GENERAL. With respect to ISO Options granted on or after the effective
date of the Plan the following provisions in this Article IV shall apply to the
exclusion of any inconsistent provision in any other Article in this Plan since
the ISO Options to be granted under the Plan are intended to qualify as
"incentive stock options" as defined in Section 422 of the Code.
4.2 GRANT AND TERMS OF ISO OPTIONS. ISO Options may be granted only to
employees of the Company and any of its subsidiaries. No ISO Options shall be
granted to any person who is not eligible to receive "incentive stock options"
as provided in Section 422 of the Code. No ISO Options shall be granted to any
management employee if, immediately before the grant of an ISO Option, such
employee owns more than 10% of the total combined voting power of all classes of
stock of the Company or its subsidiaries (as determined in accordance with the
stock attribution rules contained in Section 425(d) of the Code). Provided, the
preceding sentence shall not apply if, at the time the ISO Option is granted,
the ISO Price is at least 110% of the "fair market value" of the Stock subject
to the ISO Option, and such ISO Option by its terms is not exercisable after the
expiration of five years from the date such ISO Option is granted.
(a) ISO OPTION PRICE. The option price for shares of Stock subject to an
ISO Option ("ISO Price") shall be determined by the Committee, but in no event
shall such ISO Price be less than the fair market value of the Stock on the date
of grant.
(b) ANNUAL ISO OPTION LIMITATION. The aggregate "fair market value"
(determined as of the time the ISO Option is granted) of the Stock with respect
to which ISO Options are exercisable for the first time by any Participant
during in any calendar year (under all "incentive stock option" plans qualified
under Section 422 of the Code sponsored by the Company and its subsidiary
corporations) shall not exceed $100,000.
(c) TERMS OF ISO OPTIONS. ISO Options shall be granted on the following
terms and conditions: No ISO Option shall be exercisable within six months from
the date of grant (except as
Exhibit 4.1-Page 9
<PAGE>
EXHIBIT 4.1
specifically provided in Subsection 4.2(d) hereof with regard to the Disability
or death of a Participant), nor more than 10 years after the date of grant. The
Committee shall have the discretion to fix the period (the "ISO Period") during
which any ISO Option may be exercised. ISO Options granted shall not be
transferable except by will or by the laws of descent and distribution. ISO
Options shall be exercisable only by the Participant while actively employed by
the Company or a subsidiary, except that (i) any such ISO Option granted and
which is otherwise exercisable, may be exercised by the personal representative
of a deceased Participant within 12 months after the death of such Participant
(but not beyond the expiration date of such ISO Option), (ii) if a Participant
terminates his employment as an employee with the Company or a subsidiary on
account of Retirement, such Participant may exercise any ISO Option which is
otherwise exercisable at any time within three months of such date of
termination and (iii) if a Participant terminates his employment with the
Company or a subsidiary on account of incurring a Disability, such Participant
may exercise any ISO Option which is otherwise exercisable at any time within 12
months of such date of termination. If a Participant should die during the
applicable three-month or 12 month period following the date of such
Participant's Retirement or Disability, then in such event, the rights of the
personal representative of such deceased Participant as such relate to any ISO
Options granted to such deceased Participant shall be governed in accordance
with Subsection 4.1(c) of this Article IV.
(d) ACCELERATION OF OTHERWISE UNEXERCISABLE ISO OPTION ON RETIREMENT,
DEATH, DISABILITY OR OTHER SPECIAL CIRCUMSTANCES. The Committee, in its sole
discretion, may permit (i) a Participant who terminates employment as an
employee with the Company or a subsidiary due to Retirement, (ii) a Participant
who terminates employment as an employee with the Company or a subsidiary due to
a Disability, (iii) the personal representative of a deceased Participant, or
(iv) any other Participant who terminates employment as an employee with the
Company or a subsidiary upon the occurrence of special circumstances (as
determined by the Committee) to exercise and purchase (within three months of
such date of termination of employment as an employee or 12 months in the case
of a disabled or deceased Participant) all or any part of the shares of Stock
subject to ISO Option on the date of the Participant's Retirement, Disability,
death, or as the Committee otherwise so determines, notwithstanding that all
installments, if any, had not accrued on such date. Provided, such
discretionary authority of the Committee may not be exercised with respect to
any ISO Option (or portion thereof if the applicable six-month waiting period
for exercise had not expired as of such date except in the event of the
Disability of the Participant or death of the Participant, when the disabled
Participant or the personal representative of such deceased Participant, may,
with the consent of the Committee, exercise such ISO Option notwithstanding the
fact that the applicable six-month waiting period had not yet expired.
(e) NUMBER OF ISO OPTIONS GRANTED. Subject to the applicable limitations
contained in the Plan with respect to ISO Options, Participants may be granted
more than one ISO Option. In making any such determination, the Committee shall
obtain the advice and recommendation of the officers of the Company or a
subsidiary which have supervisory authority over such Participants. The granting
of an ISO Option under the Plan shall not affect any outstanding ISO Option
previously granted to a Participant under the Plan.
Exhibit 4.1-Page 10
<PAGE>
EXHIBIT 4.1
(f) NOTICE TO EXERCISE ISO OPTION. Upon exercise of an ISO Option, a
Participant shall give written notice to the Secretary of the Company, or other
officer designated by the Committee, at the Company's main office in Costa Mesa,
California.
ARTICLE V
OPTIONS NOT QUALIFYING AS
INCENTIVE STOCK OPTIONS
5.1 NON-QUALIFYING OPTIONS. With respect to all or any portion of any option
granted under the Plan not qualifying as an "incentive stock option" under
Section 422 of the Code, such option shall be considered as a Stock Option
granted under this Plan for all purposes.
EMB CORPORATION
By: /s/ James E. Shipley
-------------------------------------
James E. Shipley, President
Date Plan adopted and approved by the
Board of Directors: April 29, 1996
Date Plan adopted and approved by the
Stockholders: May 21, 1996
Exhibit 4.1-Page 11
<PAGE>
EXHIBIT 5.1
January 29, 1998
EMB Corporation
3200 Bristol Avenue
8/th/ Floor
Costa Mesa, California 92626
Dear Sirs:
We have acted as special counsel to EMB Corporation (the "Company") in
connection with its Form S-8 Registration Statement regarding the Company's 1996
Stock Option, SAR and Stock Bonus Plan (the "Plan").
In connection with this opinion, we have examined originals or copies,
certified or otherwise identified to our satisfaction, of such corporate
records, agreements, instruments and documents of the Company, certificates of
public officials and of officers of the Company, and such other certificates,
documents and records, and have made such other investigations, as we have
deemed necessary or appropriate as a basis for the opinions hereinafter
expressed. As to questions of fact material to such opinions we have, when
relevant facts were not independently established, relied upon such certificates
of public officials and of such officers, such other certificates, documents and
records, and upon the representations of such parties. In addition, we have
assumed: (i) the genuineness of all signatures on all documents seen or reviewed
by us, (ii) the authenticity of documents submitted to us as originals, and
(iii) the conformity with the original and certified copies of all documents
submitted to us as copies and the authenticity of the originals thereof. We
have also examined such matters of law and such additional matters of fact as we
consider necessary or appropriate in connection with the opinions hereinafter
expressed.
Based on and subject to the foregoing, it is our opinion that:
1. The Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Hawaii; and
2. Assuming the accuracy of the documents, representations and warranties
of the Company, the offer, issuance and sale of the Common Stock under the Plan
will have been duly authorized and validly issued and will be fully paid and
nonassessable.
The opinions expressed herein are solely for your benefit in connection
with the Form S-8 Registration Statement of the Company and may not be relied
upon in any manner or for any purpose by any other person or entity without the
prior written consent of this firm.
Exhibit 5.1-Page 1
<PAGE>
EXHIBIT 5.1
Very truly yours,
STEPHEN A. ZRENDA, JR., P.C.
By: /s/ Stephen A. Zrenda, Jr.
------------------------------------
Stephen A. Zrenda, Jr., Esq.
Exhibit 5.1-Page 2
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the use in the Form S-8 Registration Statement of our
report dated December 3, 1997, relating to the financial statements of EMB
Corporation and Subsidiary (formerly called Pacific International, Inc.), which
is incorporated by reference therein.
San Diego, California
January 29, 1998
Exhibit 23.1-Page 1
