<PAGE> 1
As filed with the Securities and Exchange Commission on October 1, 1999
Registration No. 333-**
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------------------
STAFFMARK, INC.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
DELAWARE 71-0788538
(State or Other Jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization)
234 EAST MILLSAP ROAD
FAYETTEVILLE, AR 72703
(Address of principal executive offices) (Zip Code)
</TABLE>
STAFFMARK, INC.
1999 EMPLOYEE STOCK PURCHASE PLAN
(Full title of the plan)
STAFFMARK, INC.
AMENDED AND RESTATED
1996 STOCK OPTION PLAN
(Full title of the plan)
GORDON Y. ALLISON, ESQ.
EXECUTIVE VICE PRESIDENT AND GENERAL COUNSEL
STAFFMARK, INC.
234 EAST MILLSAP ROAD
FAYETTEVILLE, AR 72703
(Name and address of agent for service)
(501) 973-6000
(Telephone number, including area code, of agent for service)
---------------------------
Copy of all communications to:
BRIAN J. LYNCH, ESQ.
MORGAN, LEWIS & BOCKIUS LLP
1701 MARKET STREET
PHILADELPHIA, PA 19103
(215) 963-5523
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
==========================================================================================================================
Proposed maximum Proposed maximum
Title of securities Amount to be offering price aggregate Amount of
to be registered registered per share offering price registration fee(3)
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par 2,800,000(1)(3) $ 7.79 (4) $ 21,812,000 $ 6,063.74
value $.01 per share
- --------------------------------------------------------------------------------------------------------------------------
Common Stock, par 700,000(2)(3) $ 7.79 (4) $ 5,453,000 $ 1,515.93
value $.01 per share
==========================================================================================================================
</TABLE>
(1) This Registration Statement registers an additional 2,800,000 shares of
Common Stock of StaffMark, Inc. (the "Company") issuable pursuant to
the terms of the Company's Amended and Restated 1996 Stock Option Plan,
which along with a prior registration statement registering 1,700,000
shares of Common Stock of the Company, results in 4,500,000 shares of
the Company's Common Stock being registered under the Securities Act of
1933 under such plan. See Registration Statement No. 333-30209
previously filed by the Company on Form S-8 and declared effective June
27, 1997.
(2) The 1999 Employee Stock Purchase Plan (the "1999 ESPP") supersedes the
Company's Employee Stock Purchase Plan (the "ESPP"). This Registration
Statement registers, for issuance under the 1999 ESPP, a number of
shares of Company Common Stock equal to 700,000 plus such number of
authorized but unissued shares of Company Common Stock under the ESPP
as of October 1, 1999. See Registration Statement No. 333-29689
previously filed by the Company on Form S-8 and declared effective on
June 20, 1997.
(3) This Registration Statement also covers any additional shares of Common
Stock which become issuable by reason of any stock dividend, stock
split, recapitalization or similar transaction.
(4) Estimated pursuant to paragraphs (c) and (h) of Rule 457 solely for the
purpose of calculating the registration fee, based upon the average of
the reported high and low sale prices of shares of Common Stock on
September 24, 1999, reported on the Nasdaq National Market.
<PAGE> 2
================================================================================
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The documents containing the information required to be included in
Part I of this Registration Statement will be given or sent to all persons who
participate in the StaffMark, Inc. 1999 Employee Stock Purchase Plan and the
StaffMark, Inc. Amended and Restated 1996 Stock Option Plan (hereinafter
collectively referred to as the "Plans"), as specified by Rule 428 under the
Securities Act of 1933, as amended.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents, as filed by StaffMark, Inc. (the "Company")
with the Securities and Exchange Commission, are incorporated by reference in
this Registration Statement and made a part hereof:
(a) The Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1998;
(b) All other reports filed pursuant to Section 13(a) or
15(d) of the Securities Exchange Act of 1934 since
the end of the fiscal year covered by the Annual
Report referred to in (a) above; and
(c) The description of the Common Stock of the Company
that is contained in its Registration Statement on
Form 8-A filed with the Securities and Exchange
Commission on September 17, 1996 under the Securities
Exchange Act of 1934, including any amendment or
report filed for the purpose of updating such
description.
Any statement contained in a document incorporated by reference herein
shall be deemed to be modified or superseded for purposes hereof to the extent
that a statement contained or incorporated by reference herein modifies or
supersedes such statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute part hereof.
All reports and other documents subsequently filed by the Company
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act
of 1934, prior to the filing of a post-effective amendment that indicates that
all securities offered hereby have been sold or that deregisters all securities
then remaining unsold, shall be deemed to be incorporated by reference herein
and to be part hereof from the date of filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
<PAGE> 3
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Company's By-laws provide that Company 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, suit or proceeding, whether civil, criminal,
administrative or investigative, by reason of the fact that he or she is or was
or has agreed to become a director or officer of the Company, or is or was
serving or has agreed to serve at the request to the Company as a director or
officer of another corporation, partnership, joint venture, trust or other
enterprise, or by reason of any action alleged to have been taken or omitted in
such capacity, and may indemnify any person who was or is a party or is
threatened to be made a party to such an action, suit or proceeding by reason of
the fact that he or she is or was or has agreed to become an employee or agent
of the Company, or is or was serving or has agreed to serve at the request of
the Company, as an employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid settlement actually and reasonably
incurred by him or her or on his or her behalf in connection with such action,
suit or proceeding and any appeal therefrom, if he or she acted in good faith
and in a manner he or she reasonably believed to be in or not opposed to the
best interests of the Company, and, with respect to any criminal action or
proceeding had no reasonable cause to believe his or her conduct was unlawful,
except that in the case of an action or suit by or in the right of the Company
to procure a judgment in its favor (1) such indemnification shall be limited to
expenses (including attorneys' fees) actually and reasonably incurred by such
person in the defense or settlement of such action or suit, and (2) no
indemnification shall be made in respect of any claim, issue or matter as to
which such person shall have been adjudged to be liable to the Company unless
and only to the extent that the Delaware Court of Chancery or the court in which
such action or suit was brought shall determine upon application that, despite
the adjudication of liability but in view of all the circumstances of the case,
such person is fairly and reasonably entitled to indemnity for such expenses
which the Delaware Court of Chancery or such other court shall deem proper. To
the extent that a director, officer, employee or agent of the Company has been
successful on the merits or otherwise in defense of any action, suit or
proceeding referred to above or in defense of any claim, issue or matter
therein, he shall be indemnified against expenses (including attorneys' fees)
actually and reasonably incurred by him or her in connection therewith.
Article Eight of the Company's Certificate of Incorporation provides
that the Company's directors will not be personally liable to the Company or its
stockholders for monetary damages resulting from breaches of their fiduciary
duty as directors except (a) for any breach of the duty of loyalty to the
Company or its stockholders, (b) for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law, (c) under
Section 174 of the General Corporation Law of the State of Delaware, which makes
directors liable for unlawful dividends or unlawful stock repurchases or
redemptions or (d) for transactions from which directors derive improper
personal benefit.
In accordance with Delaware law and its bylaws, the Company has entered
into indemnification agreements with its directors and officers pursuant to
which it will agree to pay certain expenses, including attorneys' fees,
judgments, fines and amounts paid in settlement incurred by such directors in
connection with certain actions, suits or proceedings. These agreements require
directors to repay the amount of any expenses advanced if it shall be determined
that they are not entitled to indemnification.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
<PAGE> 4
ITEM 8. EXHIBITS.
The exhibits filed as part of this Registration Statement are as
follows:
<TABLE>
<CAPTION>
EXHIBIT NUMBERS DESCRIPTION
--------------- -----------
<S> <C>
4.1 Certificate of Incorporation of the Company
(Incorporated by reference from Exhibit 3.1 to the
Company's Registration Statement on Form S-1 (File No.
333-7513)).
4.2 Certificate of Amendment of Certificate of
Incorporation (Incorporated by reference from Exhibit
3.2 to the Company's Registration Statement on Form S-1
(File No. 333-7513)).
4.3 Certificate of Amendment of Certificate of
Incorporation (Incorporated by reference from Exhibit
3.3 to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1998).
4.4 Amended and Restated By-Laws of the Company, as amended
(Incorporated by reference from Exhibit 3.5 to the
Company's Quarterly Report on Form 10-Q for the period
ended June 30, 1999).
4.5 Form of certificate evidencing ownership of Common
Stock of the Company (Incorporated by reference from
Exhibit 4.1 to the Company's Registration Statement on
Form S-1 (File No. 333-7513)).
4.6 StaffMark, Inc. 1999 Employee Stock Purchase Plan.
4.7 StaffMark, Inc. Amended and Restated 1996 Stock Option
Plan.
5 Opinion of Morgan, Lewis & Bockius LLP.
23.1 Consent of Arthur Andersen LLP.
23.2 Consent of Morgan, Lewis & Bockius LLP (included as
part of Exhibit 5).
24 Power of Attorney (included as part of the signature
page).
</TABLE>
ITEM 9. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement
(or the most recent post-effective amendment thereof)
which, individually or in the aggregate, represent a
fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered
(if the total dollar value of securities offered would
not exceed that which was registered) and any deviation
from the low or high end of the estimated maximum
<PAGE> 5
offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule
424(b) (Section 230.424(b) of this chapter) if, in the
aggregate, the changes in volume and price represent no
more than a 20% change in the maximum aggregate offering
price set forth in the "Calculation of Registration Fee"
table in the effective registration statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the
registration statement or any material change to such
information in the registration statement;
provided, however, that subparagraphs (a)(1)(i) and
(a)(1)(ii) of this section do not apply if the information
required to be included in a post-effective amendment by those
subparagraphs is contained in periodic reports filed by the
Company pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by
reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered that remain unsold at
the termination of the offering.
(b) The undersigned registrant hereby undertakes that, for the purpose
of determining any liability under the Securities Act of 1933, each filing of
the Company's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in this
registration statement shall be deemed to be a new registration statement
relating to the securities offered herein and the offering of such securities at
that time shall be deemed to be the initial bona fide offering thereof.
(c) The undersigned registrant hereby undertakes to deliver or cause to
be delivered with the prospectus, to each person to whom the prospectus is sent
or given, the latest annual report to security holders that is incorporated by
reference in the prospectus and furnished pursuant to and meeting the
requirements of Rule 14a-3 or Rule 14c-3 under the Securities Exchange Act of
1934; and, where interim financial information required to be presented by
Article 3 of Regulation S-X are not set forth in the prospectus, to deliver, or
cause to be delivered to each person to whom the prospectus is sent or given,
the latest quarterly report that is specifically incorporated by reference in
the prospectus to provide such interim financial information.
(d) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
<PAGE> 6
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 Fayetteville, State of Arkansas, on this 30th day of
September , 1999.
STAFFMARK, INC.
By: /s/ CLETE T. BREWER
------------------------------
Clete T. Brewer
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by or on behalf of the following
persons in the capacities and on the dates indicated. Each person, in so
signing, also makes, constitutes and appoints Clete T. Brewer, Terry C. Bellora
and Gordon Y. Allison, and each of such officers acting singly, his true and
lawful attorney-in-fact, in his or her name, place and stead to execute and
cause to be filed with the Securities and Exchange Commission any or all
amendments to this Registration Statement, with all exhibits and any and all
documents required to be filed with respect thereto, and to do and perform each
and every act and thing necessary to effectuate the same.
<TABLE>
<CAPTION>
NAME TITLE DATE
- ---- ----- ----
<S> <C> <C>
/s/ CLETE T. BREWER
- ---------------------------- Chairman, Chief Executive Officer and Director September 30, 1999
Clete T. Brewer (Principal Executive Officer)
/s/ STEPHEN R. BOVA
- ---------------------------- President, Chief Operating Officer and Director September 30, 1999
Stephen R. Bova
/s/ TERRY C. BELLORA
- ---------------------------- Chief Financial Officer (Principal Financial Officer) September 30, 1999
Terry C. Bellora
/s/ ALEX STALLINGS
- ---------------------------- Vice President, Controller (Principal Accounting Officer) September 30, 1999
Alex Stallings
/s/ W. DAVID BARTHOLOMEW
- ---------------------------- President -- Commercial Staffing Division and Director September 30, 1999
W. David Bartholomew
/s/ STEVEN E. SCHULTE
- ---------------------------- Executive Vice President -- Administration and Director September 30, 1999
Steven E. Schulte
- ---------------------------- President -- Clinical Trials Support Services Division and September , 1999
Janice Blethen Director
- ---------------------------- Director September , 1999
William J. Lynch
/s/ R. CLAYTON MCWHORTER
- ---------------------------- Director September 30, 1999
R. Clayton McWhorter
/s/ CHARLES A. SANDERS, M.D.
- ---------------------------- Director September 30, 1999
Charles A. Sanders, M.D.
- ---------------------------- Director September 30, 1999
Bob L. Martin
</TABLE>
<PAGE> 7
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT NUMBERS DESCRIPTION
--------------- -----------
<S> <C>
4.1 Certificate of Incorporation of the Company
(Incorporated by reference from Exhibit 3.1 to the
Company's Registration Statement on Form S-1 (File No.
333-7513)).
4.2 Certificate of Amendment of Certificate of
Incorporation (Incorporated by reference from Exhibit
3.2 to the Company's Registration Statement on Form S-1
(File No. 333-7513)).
4.3 Certificate of Amendment of Certificate of
Incorporation (Incorporated by reference from Exhibit
3.3 to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1998).
4.4 Amended and Restated By-Laws of the Company, as amended
(Incorporated by reference from Exhibit 3.5 to the
Company's Quarterly Report on Form 10-Q for the period
ended June 30, 1999).
4.5 Form of certificate evidencing ownership of Common
Stock of the Company (Incorporated by reference from
Exhibit 4.1 to the Company's Registration Statement on
Form S-1 (File No. 333-7513)).
4.6 StaffMark, Inc. 1999 Employee Stock Purchase Plan.
4.7 StaffMark, Inc. Amended and Restated 1996 Stock Option
Plan.
5 Opinion of Morgan, Lewis & Bockius LLP.
23.1 Consent of Arthur Andersen LLP.
23.2 Consent of Morgan, Lewis & Bockius LLP (included as
part of Exhibit 5).
24 Power of Attorney (included as part of the signature
page).
</TABLE>
<PAGE> 1
EXHIBIT 4.6
STAFFMARK, INC.
1999 EMPLOYEE STOCK PURCHASE PLAN
<PAGE> 2
ARTICLE I
Introduction
Sec. 1.01 Statement of Purpose. The purpose of the StaffMark, Inc.
Employee Stock Purchase Plan is to provide eligible employees of the Company and
its subsidiaries, who wish to become shareholders, an opportunity to purchase
common stock of the Company. The Board of Directors of the Company believes that
employee participation in stock ownership will be to the mutual benefit of the
employees and the Company.
Sec. 1.02 Internal Revenue Code Considerations. The Plan is intended to
constitute an "employee stock purchase plan" within the meaning of section 423
of the Internal Revenue Code of 1986, as amended. The Plan shall be submitted to
the Company's shareholders for approval within 12 months after the Plan is
adopted by the Board of Directors.
Sec. 1.03 ERISA Considerations. The Plan is not intended and shall not
be construed as constituting an "employee benefit plan," within the meaning of
section 3(3) of the Employee Retirement Income Security Act of 1974, as amended.
ARTICLE II
Definitions
Sec. 2.01 "Board of Directors" means the board of directors of the
Company or a committee of the board of directors authorized to act on its
behalf.
Sec. 2.02 "Code" means the Internal Revenue Code of 1986, as amended,
and any successor statute of similar nature. References to specific sections of
the Code shall be taken to be references to corresponding sections of any
successor statute.
Sec. 2.03 "Committee" means the committee appointed by the Board of
Directors to administer the Plan, as provided in Section 6.03 hereof.
Sec. 2.04 "Company" means StaffMark, Inc., a Delaware corporation.
Sec. 2.05 "Effective Date" means October 1, 1999.
Sec. 2.06 "Election Date" means each January 1 and July 1 or such other
dates as the Committee shall specify.
Sec. 2.07 "Eligible Employee" means each person employed as an employee
of an Employer who is not deemed for purposes of section 423(b)(3) of the Code
to own stock possessing five percent or more of the total combined voting power
or value of all classes of stock of the Company or any Subsidiary.
Sec. 2.08 "Employer" means the Company and each Subsidiary.
<PAGE> 3
Sec. 2.09 "Exchange Act" means the Securities Exchange Act of 1934, as
amended, and as the same may hereafter be amended.
Sec. 2.10 "Market Value" means the last price for the Stock as reported
on the Nasdaq National Market for the date of reference. If there was no such
price reported for the date of reference, "Market Value" means the "Market
Value" as of the date next preceding the date of reference for which such price
was reported.
Sec. 2.11 "Participant" means each Eligible Employee who elects to
participate in the Plan.
Sec. 2.12 "Plan" means the StaffMark, Inc. 1999 Employee Stock Purchase
Plan, as the same is set forth herein and as the same may hereafter be amended.
Sec. 2.13 "Purchase Agreement" means the instrument prescribed by the
Committee pursuant to which an Eligible Employee may enroll as a Participant and
subscribe for the purchase of shares of Stock on the terms and conditions
offered by the Company. The Purchase Agreement also is intended to evidence the
Company's offer of an option to the Eligible Employee to purchase Stock on the
terms and conditions set forth therein and herein.
Sec. 2.14 "Purchase Date" means December 31, 1999 and the last day of
each Purchase Period ending thereafter.
Sec. 2.15 "Purchase Period" means, beginning October 1, 1999, each
calendar quarter or other period specified by the Board of Directors during
which the Participant's stock purchase is funded through payroll deduction
accumulations.
Sec. 2.16 "Stock" means the common stock of the Company.
Sec. 2.17 "Subsidiary" means any present or future corporation (i)
which constitutes a "subsidiary corporation" of the Company as that term is
defined in section 424 of the Code, and (ii) is designated as a participating
entity in the Plan by the Committee. Unless the Committee specifically
designates otherwise, a Canadian or other foreign subsidiary shall not be
considered a Subsidiary for purposes of the Plan, and employees of such a
subsidiary shall not be Eligible Employees.
-2-
<PAGE> 4
ARTICLE III
Admission to Participation
Sec. 3.01 Initial Participation. Any Eligible Employee may elect to be
participate in the Plan and may become a Participant by executing and filing
with the Committee a Purchase Agreement at such time in advance of the effective
date of the election as the Committee shall prescribe. An Eligible Employee's
initial election to participate in the Plan may be made at any time after he or
she first becomes eligible to participate in the Plan and shall be effective as
soon as practicable after the Eligible Employee submits the necessary
documentation to the Committee. After an Eligible Employee has first become a
Participant in the Plan, subsequent elections to participate in the Plan shall
be made pursuant to Section 3.03. A Participant's Purchase Agreement shall
remain in effect until modified or canceled in accordance with the further terms
of this Plan, as hereinafter set forth.
Sec. 3.02 Discontinuance of Participation. A Participant may
voluntarily cease his or her participation in the Plan and stop payroll
deductions at any time by filing a notice of cessation of participation on such
form and at such time in advance of the effective date as the Committee shall
prescribe. Notwithstanding anything in the Plan to the contrary, if a
Participant ceases to be an Eligible Employee, his or her participation
automatically shall cease and no further purchase of Stock shall be made for
such Participant hereunder.
Sec. 3.03 Readmission to Participation. Any Eligible Employee who has
previously been a Participant, who has discontinued participation (whether by
cessation of eligibility or otherwise), and who wishes to be reinstated as a
Participant may again become a Participant by executing and filing with the
Committee a new Purchase Agreement. Reinstatement to Participant status shall be
effective as of any Election Date, provided the Participant files such new
Purchase Agreement with the Committee at such time in advance of such Election
Date as the Committee shall prescribe.
ARTICLE IV
Stock Purchase and Resale
Sec. 4.01 Reservation of Shares. There shall be 700,000 shares of Stock
reserved for issuance under the Plan, plus any shares of Stock that were
authorized for issuance under the Company's prior Employee Stock Purchase Plan
(which terminates after the end of the purchase period ending September 30,
1999) and were not issued under that Plan, subject to adjustment in accordance
with the antidilution provisions hereinafter set forth. Except as provided in
Section 5.02 hereof, the aggregate number of shares of Stock that may be
purchased under the Plan shall not exceed the number of shares of Stock reserved
for the Plan.
-3-
<PAGE> 5
Sec. 4.02 Limitation on Shares Available.
(a) Subject to the limitations of Section 4.04, the maximum
number of shares of Stock that may be purchased for each Participant on a
Purchase Date is the lesser of (a) the number of whole and fractional shares of
Stock that can be purchased by applying the full balance of the Participant's
withheld funds to the purchase of shares of Stock at the Purchase Price, or (b)
the Participant's proportionate part of the maximum number of shares of Stock
available under the Plan, as stated in Section 4.01.
(b) Notwithstanding the foregoing, if any person entitled to
purchase shares pursuant to any offering under the Plan would be deemed for
purposes of section 423(b)(3) of the Code to own stock (including any number of
shares of Stock that such person would be entitled to purchase under the Plan)
possessing five percent or more of the total combined voting power or value of
all classes of stock of Company, the maximum number of shares of Stock that such
person shall be entitled to purchase pursuant to the Plan shall be reduced to
that number which, when added to the number of shares of stock that such person
is deemed to own (excluding any number of shares of Stock that such person would
be entitled to purchase under the Plan), is one less than such five percent. Any
amounts withheld from a Participant's compensation that cannot be applied to the
purchase of Stock by reason of the foregoing limitation shall be returned to the
Participant as soon as practicable.
Sec. 4.03 Purchase Price of Shares. The Purchase Price per share of the
Stock sold to Participants pursuant to any offering hereunder shall be the lower
of (i) 85% of the Market Value per share on the first day of the Purchase Period
or (ii) 85% of the Market Value per share on the Purchase Date. Notwithstanding
the foregoing, the Board of Directors may determine that the Purchase Price
shall be the Market Value, or a percentage of the Market Value on either of such
dates or the lower of such dates, so long as such percentage shall not be lower
than 85% of such Market Value.
Sec. 4.04 Exercise of Purchase Privilege.
(a) Each Participant shall be granted an option to purchase
shares of Stock as of the first day of each Purchase Period at the Purchase
Price specified in Section 4.03. The option shall continue in effect through the
Purchase Date for the Purchase Period. Subject to the provisions of Section 4.02
above and Sections 4.04(b) and 4.04(d) below, on each Purchase Date, the
Participant shall be automatically deemed to have exercised his or her option to
purchase shares of Stock on the Purchase Date, unless he or she notifies the
Committee, in such manner and at such time in advance of the Purchase Date as
the Committee shall prescribe, of his or her desire not to make such purchase.
(b) The maximum number of shares which a Participant may
purchase during a Purchase Period is 4,000 shares, adjusted as described in
Section 5.02 and subject to Section 4.04(d) below, or such other number as the
Committee establishes before the beginning of the Purchase Period.
-4-
<PAGE> 6
(c) There shall be purchased for the Participant on such
Purchase Date at the Purchase Price for such Purchase Period the largest number
of whole and fractional shares of Stock as can be purchased with the amounts
withheld from the Participant's compensation during the Purchase Period. Each
such purchase shall be deemed to have occurred on the Purchase Date occurring at
the close of the Purchase Period for which the purchase was made.
(d) Notwithstanding the foregoing, a Participant may not
purchase shares of Stock having an aggregate Market Value of more than $25,000,
determined at the beginning of each Purchase Period, for any calendar year in
which one or more such offerings are outstanding at any time, and a Participant
may not purchase a share of Stock under any offering after the expiration of the
Purchase Period for such offering.
Sec. 4.05 Payroll Deductions. Each Participant shall authorize payroll
deductions from his or her compensation for the purpose of funding the purchase
of Stock pursuant to his or her Purchase Agreement. In the Purchase Agreement,
each Participant shall authorize an after-tax payroll deduction from each
payment of his compensation during a Purchase Period, of an amount not less than
$10 per paycheck ($20 for any Participant on a monthly payroll period) and not
more than 10% of such Participant's compensation. A Participant may change the
deduction to any permissible level effective as of any Election Date. Such
change shall be made by the Participant's filing with the Committee a notice in
such form and at such time in advance of the date on which such change is to be
effective as the Committee shall prescribe.
Sec. 4.06 Payment for Stock. The Purchase Price for all shares of Stock
purchased by a Participant under the Plan shall be paid out of the Participant's
authorized payroll deductions. All funds received or held by the Company under
the Plan are general assets of the Company, free of any trust or other
restriction, and may be used for any corporate purpose.
Sec. 4.07 Share Ownership; Issuance of Certificates.
(a) The shares of Stock purchased by a Participant on a Purchase
Date shall, for all purposes, be deemed to have been issued or sold at the close
of business on such Purchase Date. Prior to that time, none of the rights or
privileges of a shareholder of the Company shall inure to the Participant with
respect to such shares of Stock. All the shares of Stock purchased under the
Plan shall be delivered by the Company in a manner as determined by the
Committee.
(b) The Committee, in its sole discretion, may determine that
the shares of Stock shall be delivered by the Company by (i) issuing and
delivering to the Participant a certificate for the number of shares of Stock
purchased by such Participant on a Purchase Date or during a calendar year or
other period determined by the Committee, (ii) issuing and delivering a
certificate or certificates for the number of shares of Stock purchased by all
Participants on a Purchase Date or during a calendar year or other period
determined by
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the Committee to a firm which is a member of the National Association of
Securities Dealers, as selected by the Committee from time to time, which shares
shall be maintained by such firm in separate brokerage accounts of each
Participant, or (iii) issuing and delivering a certificate or certificates for
the number of shares of Stock purchased by all Participants on a Purchase Date
or during the calendar year or other period determined by the Committee to a
bank or trust company or affiliate thereof, as selected by the Committee from
time to time, which shares may be held by such bank or trust company or
affiliate in "street name", but with separate accounts maintained by such entity
for each Participant reflecting such Participant's whole share interests in the
Stock. Each certificate or account, as the case may be, may be in the name of
the Participant or, if he or she designates on the Participant's Purchase
Agreement, in the Participant's name jointly with the Participant's spouse, with
right of survivorship. A Participant who is a resident of a jurisdiction that
does not recognize such joint tenancy may have a certificate or account in the
Participant's name as tenant in common with the Participant's spouse, without
right of survivorship. Such designation may be changed by filing notice thereof.
(c) In addition to any restrictions or limitations on the resale
of Stock purchased under the Plan set forth in Section 4.08 hereof or otherwise
hereunder, the Committee, in its sole discretion, may impose such restrictions
or limitations, as it shall determine, on the resale of Stock, the issuance of
individual stock certificates or withdrawal from any shareholder accounts
established for a Participant pursuant to the terms hereof.
(d) Any dividends payable with respect to whole or fractional
shares of Stock credited to a shareholder account of a Participant established
pursuant to Section 4.07(b) hereof will be reinvested in shares of Stock and
credited to such Participant's account. Such reinvestment shall be made based on
the Market Value of the Stock at the date of the reinvestment, with no discount
from Market Value.
Sec. 4.08 Withdrawal of Shares or Resale of Stock.
(a) A Participant may not sell any shares of Stock purchased
hereunder or withdraw his or her shares of Stock from any shareholder account
established pursuant to Section 4.07(b) hereof prior to the first anniversary of
the Purchase Date on which the shares were purchased. After the first
anniversary of the Purchase Date for shares of Stock, the Participant may
request a withdrawal of those shares or order the sale of those shares at any
time by making a request in such form and at such time as the Committee shall
prescribe.
(b) In the event a Participant terminates his or her employment
with all Employers or otherwise ceases to be an Eligible Employee, he or she
shall receive a distribution of his or her shares of Stock held in any
shareholder account established pursuant to Section 4.07(b) after the first
anniversary of the Purchase Date on which the shares were purchased or, after
such first anniversary, he or she may elect to have such shares of Stock sold in
accordance with such procedures as the Committee shall prescribe.
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(c) If a Participant is to receive a withdrawal or distribution
of shares of Stock, the withdrawal or distribution shall be paid in whole shares
of Stock, with fractional shares paid in cash.
ARTICLE V
Special Adjustments
Sec. 5.01 Shares Unavailable. If, on any Purchase Date, the aggregate
funds available for the purchase of Stock would purchase a number of shares in
excess of the number of shares of Stock then available for purchase under the
Plan, the following events shall occur:
(a) The number of shares of Stock that would otherwise be
purchased by each Participant shall be proportionately reduced on the Purchase
Date in order to eliminate such excess; and
(b) The Plan shall automatically terminate immediately after the
Purchase Date as of which the supply of available shares is exhausted.
Sec. 5.02 Anti-Dilution Provisions. The aggregate number of shares of
Stock reserved for purchase under the Plan, as hereinabove provided, and the
calculation of the Purchase Price per share may be appropriately adjusted to
reflect any increase or decrease in the number of issued shares of Stock
resulting from a subdivision or consolidation of shares or other capital
adjustment, or the payment of a stock dividend, or other increase or decrease in
such shares, if effected without receipt of consideration by the Company. Any
such adjustment shall be made by the Committee acting with the consent of, and
subject to the approval of, the Board of Directors.
Sec. 5.03 Effect of Certain Transactions. Subject to any required
action by the shareholders, if the Company shall be the surviving or resulting
corporation in any merger or consolidation, any offering hereunder shall pertain
to and apply to the shares of stock of the Company. However, in the event of a
dissolution or liquidation of the Company, or of a merger or consolidation in
which the Company is not the surviving or resulting corporation, the Plan and
any offering hereunder shall terminate upon the effective date of such
dissolution, liquidation, merger or consolidation, and the balance of any
amounts withheld from the Participant's compensation, which had not by such time
been applied to the purchase of stock shall be returned to the Participant.
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ARTICLE VI
Miscellaneous.
Sec. 6.01 Non-Alienation. The right to purchase shares of Stock under
the Plan is personal to the Participant, is exercisable only by the Participant
during the Participant's lifetime except as hereinafter set forth, and may not
be assigned or otherwise transferred by the Participant. Notwithstanding the
foregoing, there shall be delivered to the executor, administrator or other
personal representative of a deceased Participant such shares of Stock and such
residual amounts as may remain to the Participant's credit from amounts withheld
from the Participant's compensation as of the Purchase Date occurring at the
close of the period in which the Participant's death occurs, including shares of
Stock purchased as of that date or prior thereto with moneys withheld from the
Participant's compensation.
Sec. 6.02 Administrative Costs. The Company shall pay all
administrative expenses associated with the operation of the Plan.
Sec. 6.03 The Committee. The Board of Directors shall appoint a
Committee, which shall have the authority and power to administer the Plan and
to make, adopt, construe, and enforce rules and regulations not inconsistent
with the provisions of the Plan. The Committee shall adopt and prescribe the
contents of all forms required in connection with the administration of the
Plan, including, but not limited to, the Purchase Agreement, payroll withholding
authorizations, withdrawal documents, and all other notices required hereunder.
The Committee shall have the fullest discretion permissible under law in the
discharge of its duties. The Committee's interpretations and decisions in
respect of the Plan, the rules and regulations pursuant to which it is operated,
and the rights of Participants hereunder shall be final and conclusive.
Sec. 6.04 Withholding of Taxes. All acquisitions of Stock under the
Plan shall be subject to applicable federal, state and local tax withholding
requirements if the Internal Revenue Service or other taxing authority requires
such withholding. The Company may require that Participants pay to the Company
(or make other arrangements satisfactory to the Company for the payment of) the
amount of any federal, state or local taxes that the Company is required to
withhold with respect to the purchase of Stock or the sale of Stock acquired
under the Plan, or the Company may deduct from the Participant's wages or other
compensation the amount of any withholding taxes dues with respect to the
purchase of Stock or the sale of Stock acquired under the Plan.
Sec. 6.05 Amendment of the Plan. The Board of Directors (or its
delegate) may amend or terminate the Plan at any time; provided, however, that
the Board of Directors (or its delegate) shall not amend the Plan without
stockholder approval if such approval is required by section 423 of the Code.
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Sec. 6.06 Expiration and Termination of the Plan. The Plan shall
continue in effect for 10 years from the Effective Date, unless terminated prior
thereto pursuant to the provisions of the Plan or pursuant to action by the
Board of Directors, which shall have the right to terminate the Plan at any time
without prior notice to any Participant and without liability to any
Participant. Upon the expiration or termination of the Plan, the balance, if
any, then standing to the credit of each Participant from amounts withheld from
the Participant's compensation which had not, by such time, been applied to the
purchase of Stock shall be refunded to the Participant.
Sec. 6.07 Repurchase of Stock. The Company shall not be required to
purchase or repurchase from any Participant any of the shares of Stock that the
Participant acquired under the Plan.
Sec. 6.08 Notice. A Purchase Agreement and any notice that a
Participant files pursuant to the Plan shall be on the form prescribed by the
Committee and shall be effective only when received by the Committee. Delivery
of such forms may he made by hand or by certified mail, sent postage prepaid, to
StaffMark, Inc. 302 East Millsap Road, Fayetteville, AR 72703 Attention:
Employee Stock Purchase Plan Administrator. Delivery by any other mechanism
shall be deemed effective at the option and discretion of the Committee.
Sec. 6.09 Government Regulation. The Company's obligation to sell and
to deliver the Stock under the Plan is at all times subject to all approvals of
any governmental authority required in connection with the authorization,
issuance, sale or delivery of such Stock.
Sec. 6.10 Headings, Captions, Gender. The headings and captions herein
are for convenience of reference only and shall not be considered as part of the
text. The masculine shall include the feminine, and vice versa.
Sec. 6.11 Severability of Provisions, Prevailing Law. The provisions of
the Plan shall be deemed severable. In the event any such provision is
determined to be unlawful or unenforceable by a court of competent jurisdiction
or by reason of a change in an applicable statute, the Plan shall continue to
exist as though such provision had never been included therein (or, in the case
of a change in an applicable statute, had been deleted as of the date of such
change). The Plan shall be governed by the laws of the State of Delaware to the
extent such laws are not in conflict with, or superseded by, federal law.
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EXHIBIT 4.7
STAFFMARK, INC.
AMENDED AND RESTATED 1996 STOCK OPTION PLAN
SECTION 1. PURPOSE. The Plan (i) authorizes the Committee to provide to
Employees and Consultants of the Corporation and its Subsidiaries, who are in a
position to contribute materially to the long-term success of the Corporation,
with options to acquire Common Stock, par value $.01 per share, of the
Corporation, and (ii) provides for the automatic grant of options to
Non-Employee Directors of the Corporation in accordance with the terms specified
herein. The Corporation believes that this incentive program will cause those
persons to increase their interest in the Corporation's welfare, and aid in
attracting and retaining Employees, Consultants and Directors of outstanding
ability.
SECTION 2. DEFINITIONS. Unless the context clearly indicates otherwise, the
following terms, when used in this Plan, shall have the meanings set forth in
this Section:
(a) "Board" shall mean the Board of Directors of the Corporation.
(b) A "Change in Control" shall be deemed to have occurred if:
(i) any person, other than the Corporation or an employee benefit
plan of the Corporation, acquires directly or indirectly the
Beneficial Ownership of any voting security of the Corporation and
immediately after such acquisition such Person is, directly or
indirectly, the Beneficial Owner of voting securities representing
50% or more of the total voting power of the then-outstanding voting
securities of the Corporation;
(ii) the individuals (A) who, as of the closing date of the
Initial Public Offering, constitute the Board (the"Original
Directors") or (B) who thereafter are elected to the Board and whose
election, or nomination for election, to the Board was approved by a
vote of at least two-thirds (2/3) of the Original Directors then
still in office (such directors becoming "Additional Original
Directors" immediately following their election) or (C) who are
elected to the Board and whose election, or nomination for election,
to the Board was approved by a vote of at least two-thirds (2/3) of
the Original Directors and Additional Original Directors then still
in office (such directors also becoming "Additional Original
Directors" immediately following their election)(such individuals
being the "Continuing Directors"), cease for any reason to constitute
a majority of the members of the Board;
(iii) the stockholders of the Corporation shall approve a merger,
consolidation, recapitalization, or reorganization of the
Corporation, a reverse stock split of outstanding voting securities,
or consummation of any such
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transaction if stockholder approval is not sought or obtained, other
than any such transaction which would result in at least 75% of the
total voting power represented by the voting securities of the
surviving entity outstanding immediately after such transaction being
Beneficially Owned by at least 75% of the holders of outstanding
voting securities of the Corporation immediately prior to the
transaction, with the voting power of each such continuing holder
relative to other such continuing holders not substantially altered
in the transaction; or
(iv) the stockholders of the Corporation shall approve a plan of
complete liquidation of the Corporation or an agreement for the sale
or disposition by the Corporation of all or a substantial portion of
the Corporation's assets (i.e. 50% or more of the total assets of the
Corporation).
(c) "Code" shall mean the Internal Revenue Code of 1986 as it may be
amended from time to time.
(d) "Committee" shall mean the Board, or any committee of two or more
Directors that may be designated by the Board to administer the Plan. The
Committee may be comprised of "non-employee directors" within the meaning
of Rule 16b-3 under the Exchange Act and "outside directors" under section
162(m) of the Code.
(e) "Consultant" shall mean (i) any person who is engaged to perform
services for the Corporation or its Subsidiaries, other than as an Employee
or Director, or (ii) any person who has agreed to become a consultant
within the meaning of clause (i).
(f) "Control Person" shall mean any person who, as of the date of
grant of an Option, owns (within the meaning of Section 422(b)(6) of the
Code) stock possessing more than ten percent (10%) of the total combined
voting power or value of all classes of stock of the Corporation or of any
Parent or "subsidiary corporation" (within the meaning of Section 424(f) of
the Code).
(g) "Corporation" shall mean StaffMark, Inc., a Delaware corporation.
(h) "Director" shall mean any member of the Board.
(i) "Employee" shall mean (i) any full-time employee of the
Corporation or its Subsidiaries (including Directors who are otherwise
employed on a full-time basis by the Corporation or its Subsidiaries), or
(ii) any person who has agreed to become an employee within the meaning of
clause (i).
(j) "Exchange Act" shall mean the Securities Exchange Act of 1934 as
it may be amended from time to time.
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(k) "Fair Market Value" of the Stock on a given date shall be based
upon: (i) if the Stock is listed on a national securities exchange or
quoted in an interdealer quotation system, the last sales price or, if
unavailable, the average of the closing bid and asked prices per share of
the Stock on such date (or, if there was no trading or quotation in the
Stock on such date, on the next preceding date on which there was trading
or quotation) as provided by one of such organizations; or (ii) if the
Stock is not listed on a national securities exchange or quoted in an
interdealer quotation system, as determined by the Board in good faith in
its sole discretion, provided, however, that the "fair market value" of
Stock on the date on which shares of Stock are first issued and sold
pursuant to a registration statement filed with and declared effective by
the Securities and Exchange Commission shall be the Initial Public Offering
price of the shares so issued and sold, as set forth in the first
prospectus used in such offering.
(l) "Grantee" shall mean a person granted an Option under the Plan.
(m) "Initial Public Offering" shall mean an initial public offering
of shares of Stock in a firm commitment underwriting registered with the
Securities and Exchange Commission in compliance with the provisions of the
1933 Act.
(n) "ISO" shall mean an Option granted pursuant to the Plan to
purchase shares of Stock and intended to qualify as an incentive stock
option under Section 422 of the Code, as now or hereafter constituted.
(o) "1933 Act" shall mean the Securities Act of 1933, as amended.
(p) "Non-Employee Director" shall mean a Director of the Corporation
who is not an Employee, and who was not an Employee at any time during the
prior one year period.
(q) "NQSO" shall mean an Option granted pursuant to the Plan to
purchase shares of the Stock that are not ISOs.
(r) "Options" shall refer collectively to NQSOs and ISOs issued under
and subject to the Plan.
(s) "Parent" shall mean any parent corporation as defined in Section
424(e) of the Code.
(t) "Plan" shall mean this Amended and Restated 1996 Stock Option
Plan as set forth herein and as amended from time to time.
(u) "Stock" shall mean shares of the common stock of the Corporation.
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(v) "Stock Option Agreement" shall mean a written agreement between
the Corporation and the Grantee, or a certificate accepted by the Grantee,
evidencing the grant of an Option hereunder and containing such terms and
conditions, not inconsistent with the Plan, as the Committee shall approve.
(w) "Subsidiary" shall mean (i) any company (whether a corporation,
partnership, joint venture or other entity) in which the Company owns,
directly or indirectly, a majority of the shares of capital stock or other
equity interest, or (ii) any entity which the Committee reasonably expects
to become a subsidiary within the meaning of clause (i).
SECTION 3. SHARES OF STOCK SUBJECT TO THE PLAN. Subject to adjustment as
described in section 10, the total amount of Stock that may be subject to
outstanding Options, determined immediately after the grant of any Option, shall
not exceed 15% percent of the total number of shares of Stock outstanding.
Notwithstanding the foregoing, subject to adjustment as described in section 10,
the number of shares that may be delivered upon exercise of ISOs shall not
exceed 650,000. For purposes of the foregoing limits, shares subject to Options
shall not be deemed delivered if such Options are forfeited, expire or otherwise
terminate without delivery of shares to the Grantee. Any shares of Stock
delivered pursuant to an Option may consist, in whole or in part, of authorized
and unissued shares or treasury shares.
SECTION 4. ADMINISTRATION OF THE PLAN. The Plan shall be administered by the
Committee. Subject to the express provisions of the Plan, the Committee shall
have the authority to interpret the Plan, to prescribe, amend and rescind rules
and regulations relating to the Plan, to determine the terms and provisions of
Stock Option Agreements thereunder and to make all other determinations
necessary or advisable for the administration of the Plan. Any controversy or
claim arising out of or related to this Plan or the Options granted thereunder
shall be determined unilaterally by, and at the sole discretion of, the
Committee. Any action of the Committee with respect to the Plan shall be final,
conclusive, and binding on all persons, including the Corporation, Subsidiaries
of the Corporation, Grantees, and any person claiming any rights under the Plan
from or through any Grantee and stockholders. The express grant of any specific
power to the Committee, and the taking of any action by the Committee, shall not
be construed as limiting any power or authority of the Committee. The Committee
may delegate to officers or managers of the Corporation or any Subsidiary the
authority, subject to such terms as the Committee shall determine, to perform
administrative functions to the extent permitted under Rule 16b-3, if
applicable, Code section 162(m), and other applicable law.
SECTION 5. TYPES OF OPTIONS. Options granted under the Plan may be of two types:
ISOs or NQSOs. The Committee shall have the authority and discretion to grant to
an eligible Employee either ISOs, NQSOs or both, but shall clearly designate the
nature of each Option at the time of grant in the Stock Option Agreement.
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SECTION 6. GRANT OF OPTIONS TO EMPLOYEES AND CONSULTANTS.
(a) Employees and Consultants of the Corporation and its Subsidiaries
shall be eligible to receive Options under the Plan. Grantees who are not
employees of the Corporation or a "subsidiary corporation" (within the
meaning of Section 424(f) of the Code) on the date an Option is granted
shall only receive NQSOs.
(b) The exercise price per share of Stock subject to an Option
granted to an Employee or Consultant shall be determined by the Committee
and specified in the Stock Option Agreement, provided, however, that the
exercise price of each share subject to an Option shall be not less than
100%, or, in the case of an ISO granted to a Control Person, 110% of the
Fair Market Value of a share of the Stock on the date such Option is
granted.
(c) The term of each Option granted to an Employee or Consultant
shall be determined by the Committee and specified in a Stock Option
Agreement, provided that no Option shall be exercisable more than ten years
from the date such Option is granted, and provided further that no ISO
granted to a Control Person shall be exercisable more than five years from
the date of the Option grant.
(d) The Committee shall determine and designate from time to time
Employees or Consultants who are to be granted Options, and shall specify
in the Stock Option Agreement the nature of each Option granted and the
number of shares of Stock subject to each such Option, provided, however,
that in any calendar year, no Employee or Consultant may be granted an
Option to purchase more than 500,000 shares of Stock (determined without
regard to when such Option is exercisable), subject to adjustment pursuant
to Section 10.
(e) Notwithstanding any other provisions hereof, the aggregate Fair
Market Value (determined at the time the ISO is granted) of the Stock with
respect to which ISOs are exercisable for the first time by any Employee
during any calendar year under all plans of the Corporation and any Parent
or "subsidiary corporation" (within the meaning of Section 424(f) of the
Code) shall not exceed $100,000. To the extent the limitation set forth in
the preceding sentence is exceeded, the Options with respect to such excess
shall be treated as NQSOs.
(f) The Committee shall determine whether any Option granted to an
Employee or Consultant shall become exercisable in one or more installments
and specify the installment dates in the Stock Option Agreement. The
Committee may also specify in the Stock Option Agreement such other
provisions, not inconsistent with the terms of this Plan, as it may deem
desirable, including such provisions as it may deem necessary to qualify
any ISO under the provisions of Section 422 of the Code. Unless otherwise
determined by the Committee and specified in the Stock Option Agreement,
all Options shall immediately become exercisable upon a Change in Control.
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(g) All Options granted hereunder prior to the Initial Public
Offering shall be conditional upon, and for all purposes hereunder, deemed
granted upon, the Initial Public Offering.
(h) The Committee may, at any time, grant new or additional options
to any eligible Employee or Consultant who has previously received Options
under this Plan, or options under other plans, whether such prior Options
or other options are still outstanding, have been exercised previously in
whole or in part, or have been canceled. The exercise price of such new or
additional Options may be established by the Committee, subject to Section
6(b) hereof, without regard to such previously granted Options or other
options.
SECTION 7. GRANTS OF OPTIONS TO NON-EMPLOYEE DIRECTORS.
(a) Non-Employee Directors of the Corporation shall be eligible to
receive Options under the Plan only pursuant to the provisions of this
Section 7. Each individual who agrees to become a Non-Employee Director
after September 1, 1999 shall receive upon his or her first election to the
Board, without the exercise of the discretion of any person, an NQSO under
the Plan relating to the purchase of 20,000 shares of Stock at an exercise
price per share equal to the Fair Market Value of one share of Stock as of
the date of grant (an "Initial Grant"). Non-Employee Directors in office
subsequent to the Initial Public Offering and prior to September 1, 1999,
shall receive, as of the date of the first grant described in the preceding
sentence, without the exercise of the discretion of any person, an NQSO
under the Plan relating to the purchase of 10,000 shares of Stock at an
exercise price equal to the Fair Market Value of one share of Stock at the
date of grant. On the day of each annual meeting of stockholders, each
person who is a continuing Non-Employee Director (excluding any
newly-elected Non-Employee Director entitled to receive an Initial Grant)
shall receive, without the exercise of the discretion of any person, an
NQSO under the Plan relating to the purchase of 5,000 shares of Stock. In
the event that there are not sufficient shares available under this Plan to
allow for the grant to each Non-Employee Director of an NQSO for the number
of shares provided herein, each Non-Employee Director shall receive an NQSO
for his pro rata share of the total number of shares of Stock available
under the Plan.
(b) The exercise price of each share of Stock subject to an Option
granted to a Non-Employee Director shall equal the Fair Market Value of a
share of Stock on the date such Option is granted.
(c) Each Option granted to a Non-Employee Director shall become
exercisable in three equal installments on the date of grant and on each of
the first two anniversaries of the date of grant, and shall have a term of
five years from the date of grant. Notwithstanding the exercise period of
any Option granted to a Non-Employee Director, all such Options shall
immediately become exercisable upon a Change in Control.
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SECTION 8. EXERCISE OF OPTIONS.
(a) A Grantee or other permitted holder shall exercise an Option by
delivery of written notice to the Corporation setting forth the number of
shares with respect to which the Option is to be exercised, together with
cash, certified check, bank draft, wire transfer, or postal or express
money order payable to the order of the Corporation for an amount equal to
the Option price of such shares and any income tax which may be required to
be withheld as determined by the Committee pursuant to Section 12. The
Committee may, in its sole discretion, permit a Grantee to pay all or a
portion of the exercise price by delivery of Stock or other property
(including notes or other contractual obligations of Grantees to make
payment on a deferred basis, such as through "cashless exercise"
arrangements, to the extent permitted by applicable law), and the methods
by which Stock will be delivered or deemed to be delivered to Grantees.
(b) Except as provided pursuant to section 9(a), no Option granted to
an Employee or Consultant shall be exercised unless at the time of such
exercise the Grantee is then: (i) an employee of the Company or a
Subsidiary (determined with reference to Section 2(w)(i) only); or (ii) a
Consultant (determined with reference to Section 2(e)(i) only) of the
Corporation or a Subsidiary (determined with reference to Section 2(w)(i)
only).
(c) Except as provided in Section 9(a), no Option granted to a
Non-Employee Director shall be exercised unless at the time of such
exercise the Grantee is then a Non-Employee Director.
SECTION 9. EXERCISE OF OPTIONS UPON TERMINATION.
(a) Unless otherwise determined by the Committee, upon termination of
a Grantee's employment with the Corporation and its Subsidiaries, such
Grantee may exercise any Options during the three month period following
such termination of employment, but only to the extent such Option was
exercisable immediately prior to such termination of employment.
Notwithstanding the foregoing, if the Committee determines that such
termination is for cause, all Options held by the Grantee shall immediately
terminate. In addition, all Options granted on the basis of clause (ii) of
Section 2(e), Section 2(i) or Section 2(w) shall immediately terminate if
the Committee determines, in its sole discretion, that the Consultant,
Employee, or Subsidiary, as the case may be, will not become a Consultant,
Employee or Subsidiary within the meaning of clause (i) of such Sections.
(b) Unless otherwise determined by the Committee and specified in the
Stock Option Agreement, in no event shall any Option be exercisable for
more than the maximum number of shares that the Grantee was entitled to
purchase at the date of termination of the relationship with the
Corporation and its Subsidiaries.
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(c) The sale of any Subsidiary shall be treated as a termination of
employment with respect to any Grantee employed by such Subsidiary.
(d) Subject to the foregoing, in the event of death, Options may be
exercised by a Grantee's legal representative. Options transferred pursuant
to Section 14 may also be exercised by a permitted holder.
SECTION 10. ADJUSTMENT UPON CHANGES IN CAPITALIZATION. In the event any dividend
or other distribution (whether in the form of cash, Stock, or other property),
recapitalization, forward or reverse split, reorganization, merger,
consolidation, spin-off, combination, repurchase, or share exchange, or other
similar corporate transaction or event affects the Stock such that an adjustment
is appropriate in order to prevent dilution or enlargement of the rights of
Grantees under the Plan, then the Committee shall, in such manner as it may deem
equitable, adjust any or all of (i) the number and kind of shares of Stock
deemed to be available thereafter for grants of Options under Section 3, (ii)
the number and kind of shares of Stock that may be delivered or deliverable in
respect of outstanding Options, (iii) the number of shares with respect to which
Options may be granted to a given Grantee in the specified period as set forth
in Section 6(d), and (iv) the exercise price or, if deemed appropriate, the
Committee may make provision for a cash payment with respect to any conditions
of, and the criteria included in, Options (including, without limitation, cash
payments in exchange for an Option or substitution of Options using stock of a
successor or other entity) in recognition of unusual or nonrecurring events
(including, without limitation, events described in the preceding sentence)
affecting the Corporation or any Subsidiary or the financial statements of the
Corporation or any Subsidiary, or in response to changes in applicable laws,
regulations, or accounting principles.
SECTION 11. RESTRICTIONS ON ISSUING SHARES. The Corporation shall not be
obligated to deliver Stock upon the exercise or settlement of any Options or
take other actions under the Plan until the Corporation shall have determined
that applicable federal and state laws, rules, and regulations have been
complied with and such approvals of any regulatory or governmental agency have
been obtained and contractual obligations to which the Option may be subject
have been satisfied. The Corporation, in its discretion, may postpone the
issuance or delivery of Stock under any Option until completion of such stock
exchange listing or registration or qualification of such Stock or other
required action under any federal or state law, rule, or regulation as the
Corporation may consider appropriate, and may require any Grantee to make such
representations and furnish such information as it may consider appropriate in
connection with the issuance or delivery of Stock under the Plan.
SECTION 12. TAX WITHHOLDING. To the extent required by applicable federal,
state, local or foreign law, a Grantee shall make arrangements satisfactory to
the Company for the satisfaction of any withholding tax obligations that arise
by reason of an Option exercise or any sale of shares. The Company shall not be
required to issue shares until such obligations are satisfied. The Committee may
permit these obligations to be satisfied by having the Company withhold a
portion of the shares of the stock that otherwise would be issued to him or her
upon
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the exercise of the Option, or to the extent permitted, by tendering shares
previously acquired. The Committee may also, upon the request of a Grantee
desiring to exercise an Option, direct the Company to lend the Grantee an amount
necessary to pay any federal and state income tax withholding requirements in
connection with such exercise, which loan may be forgiven over a three-year
period subject to continued service with the Company.
SECTION 13. LOANS TO GRANTEES. The Committee may, upon the request of a Grantee,
direct the Company to lend the Grantee an amount necessary to satisfy the
exercise price of any Option. Such loan may be forgiven over a three-year period
subject to continued service with the Company.
SECTION 14. TRANSFERABILITY.
(a) Except as provided below, no Option shall be subject to
anticipation, sale, assignment, pledge, encumbrance, charge or transfer
except by will or the laws of descent and distribution, and an Option shall
be exercisable during the Grantee's lifetime only by the Grantee.
(b) Notwithstanding the foregoing, the Committee may provide, in a
Stock Option Agreement, that the Grantee may transfer NQSOs to family
members or other persons or entities according to such terms as the
Committee may determine; provided that the Grantee receives no
consideration for the transfer of the NQSO and the transferred NQSO shall
continue to be subject to the same terms and conditions as were applicable
to the NQSO immediately before the transfer.
SECTION 15. GENERAL PROVISIONS.
(a) Each Option shall be evidenced by a Stock Option Agreement. The
terms and provisions of such Stock Option Agreements may vary among
Grantees and among different Options granted to the same Grantee.
(b) The grant of an Option in any year shall not give the Grantee any
right to similar grants in future years, any right to continue such
Grantee's employment relationship with the Corporation or its Subsidiaries,
or, until such Option is exercised and share certificates are issued, any
rights as a stockholder of the Corporation. All Grantees shall remain
subject to discharge to the same extent as if the Plan were not in effect.
(c) No Grantee, and no beneficiary or other persons claiming under or
through the Grantee shall have any right, title or interest by reason of
any Option to any particular assets of the Corporation or its Subsidiaries,
or any shares of Stock allocated or reserved for the purposes of the Plan
or subject to any Option except as set forth herein. The Corporation shall
not be required to establish any fund or make any other segregation of
assets to assure the payment of any Option.
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(d) The issuance of shares of Stock to Grantees, their legal
representatives or other permitted holders shall be subject to any
applicable taxes and other laws or regulations of the United States or of
any state having jurisdiction thereof.
SECTION 16. AMENDMENT OR TERMINATION. The Board may, at any time, alter, amend,
suspend, discontinue or terminate this Plan; provided, however, that no such
action shall adversely affect the rights of Grantees to Options previously
granted hereunder and, provided further, however, that any shareholder approval
necessary or desirable in order to comply with Section 162(m) or Section 422 of
the Code (or other applicable law or regulation) shall be obtained in the manner
required therein. The Committee may waive any conditions or rights under, or
amend, alter, suspend, discontinue, or terminate, any Option theretofore granted
and any Stock Option Agreement relating thereto; provided, however, that,
without the consent of an affected Grantee, no such action may materially impair
the rights of such Grantee under such Option.
SECTION 17. EFFECTIVE DATE OF PLAN. This Plan is effective upon its initial
adoption by the Board and shall continue in effect until terminated by the
Board. No ISO may be granted more than ten years after the adoption of the Plan
by the Board or approval of the Plan by the stockholders, whichever is earlier.
- - - - - - - - - - - - - -
This Plan was amended and restated on August 12, 1999.
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Exhibit 5
September 30, 1999
StaffMark, Inc.
234 East Millsap Road
Fayetteville, AR 72703
Re: Registration Statement on Form S-8 Relating to StaffMark, Inc.
(the "Company") 1999 Employee Stock Purchase Plan and Amended
and Restated 1996 Stock Option Plan
Dear Sir or Madam:
We have acted as counsel to the Company in connection with the
preparation of a registration statement on Form S-8 (the "Registration
Statement") filed with the Securities and Exchange Commission under the
Securities Act of 1933, as amended (the "Act"), relating to the offering of up
to 2,800,000 shares and 700,000 shares, respectively, of the Company's Common
Stock, par value $.01 per share (the "Common Stock"), which may be issued
pursuant to the Company's Amended and Restated 1996 Stock Option Plan and the
1999 Employee Stock Purchase Plan (hereinafter collectively referred to as the
"Plans"). We have examined such records, documents, statutes and decisions as we
have deemed relevant in rendering this opinion.
In our opinion, the shares of the Company's Common Stock that may be
issued in accordance with the terms of the Plans will be, when issued in
accordance with the terms of the Plans, validly issued, fully paid and
nonassessable shares of the Common Stock of the Company.
We hereby consent to the use of this opinion as Exhibit 5 to the
Registration Statement. In giving such opinion, we do not thereby admit that we
are acting within the category of persons whose consent is required under
Section 7 of the Act or the rules or regulations of the Securities and Exchange
Commission thereunder.
Very truly yours,
/s/ MORGAN, LEWIS & BOCKIUS LLP
Morgan, Lewis & Bockius LLP
<PAGE> 1
EXHIBIT 23.1
Consent of Independent Public Accountants
As independent public accountants, we hereby consent to the incorporation by
reference into this Registration Statement of StaffMark, Inc. on Form S-8 (to be
filed on or around October 1, 1999) of our report dated January 29, 1999,
appearing on page 22 of the StaffMark, Inc. Annual Report on Form 10-K for the
year ended December 31, 1998, and to all references to our Firm included in this
Registration Statement.
ARTHUR ANDERSEN LLP
Little Rock, Arkansas
October 1, 1999
