<PAGE> 1
As filed with the Securities and Exchange Commission on March 26, 1997
Registration No. 333-_____
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
--------------------------
UNIVERSAL ELECTRONICS INC.
(Exact name of registrant as specified in its charter)
Delaware 33-0304817
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
1864 Enterprise Parkway West
Twinsburg, Ohio 44087
(Address of principal executive offices, including zip code)
-----------------------------
UNIVERSAL ELECTRONICS INC. 1996 STOCK INCENTIVE PLAN
(Full title of the plan)
Copy to:
Richard A. Firehammer, Jr. Thomas F. McKee, Esq.
General Counsel and Secretary Calfee, Halter & Griswold LLP
Universal Electronics Inc. 1400 McDonald Investment Center
1864 Enterprise Parkway West 800 Superior Avenue
Twinsburg, Ohio 44087 Cleveland, Ohio 44114
(216) 487-1110 (216) 622-8200
(Name, address and telephone number, including area code, of agent for
service)
-----------------------------
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
- ----------------------------------------------------------------------------------------------------------
Proposed Proposed
Title of maximum maximum
securities Amount offering aggregate Amount of
to be to be price offering registration
registered registered per share (1) price (1) fee
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, 400,000 shares $5.00 $2,000,000 $607.00
$0.01 par value
- ----------------------------------------------------------------------------------------------------------
(1) Estimated in accordance with Rule 457(c) solely for the purpose of
calculating the registration fee and based upon the average of the high
and low prices as quoted on The Nasdaq Stock Market for March 25, 1997.
</TABLE>
<PAGE> 2
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Certain Documents by Reference
-----------------------------------------------
The following documents of Universal Electronics Inc. (the
"Company"), previously filed with the Securities and Exchange Commission (the
"Commission"), are incorporated herein by reference:
1. The Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1995;
2. The Company's Quarterly Reports on Form 10-Q for the fiscal
quarters ended March 31, 1996, June 30, 1996 and September 30,
1996; and
3. The description of the common stock, par value $0.01 per share,
of the Company (the "Common Stock") contained in the Company's
Form 8-A dated June 6, 1995 (Reg. No. 0-21044);
other than the portions of such documents, which by statute, by designation in
such document or otherwise, are not deemed to be filed with the Commission or
are not required to be incorporated herein by reference.
All documents filed by the Company pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934 after the date of this
Registration Statement, prior to the filing of a post-effective amendment which
indicates that all securities offered have been sold or which deregisters all
securities then remaining unsold, shall be deemed to be incorporated by
reference in the Registration Statement and to be a part hereof from the date of
filing of such documents other than the portions of such documents, which by
statute, by designation in such document or otherwise, are not deemed to be
filed with the Commission or are not required to be incorporated herein by
reference.
Any statement contained in a document incorporated or deemed to be
incorporated by reference in this Registration Statement shall be deemed to be
modified or superseded for purposes of this Registration Statement to the extent
that a statement contained in this Registration Statement or in any other
subsequently filed document that also is, or is deemed to be, incorporated by
reference in this Registration Statement 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.
Item 4. Description of Securities
-------------------------
Not applicable.
Item 5. Interests of Named Experts and Counsel
--------------------------------------
Not applicable.
Item 6. Indemnification of Directors and Officers
-----------------------------------------
Section 145 of the General Corporation Law of the State of Delaware
grants each corporation organized thereunder the power to indemnify any person
who is or was a director, officer, employee or agent of the corporation, or is
or was serving at its request as a director, officer, employee or agent of
another corporation or enterprise, against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred
by him in connection with any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative (other than
an action by or in the right of the corporation), by reason of being or having
been in any such capacity, if he acted in good faith and in a manner reasonably
believed to be in or not opposed to the best interests of the corporation, and,
with respect to any criminal action or proceeding, had no reasonable cause to
believe his conduct was unlawful. Section 102(b)(7) of the General Corporation
Law of the State of Delaware enables a corporation in its certificate of
incorporation or an amendment thereto validly approved by stockholders to limit
or eliminate the personal liability of its board of directors for violations of
the directors' fiduciary duty of care.
<PAGE> 3
Article Seventh of the Restated Certificate of Incorporation
of Universal Electronics Inc., as amended, and Article Twelfth of its Amended
and Restated By-laws provide that the Company shall indemnify its officers and
Directors to the full extent permitted by applicable law and that such
indemnification shall not be deemed exclusive of any other rights to which any
person indemnified may be entitled by law or otherwise. In addition, Article
Twelfth of the Restated Certificate of Incorporation of the Company limits the
personal liability of its Board of Directors for a breach of the fiduciary duty
of care.
The Company has obtained liability insurance on behalf of its
Directors and officers which provides coverage for certain liabilities and
expenses incurred by each Director and officer in his capacity as such including
certain liabilities under the Securities Act of 1933.
The effect of the foregoing provisions of the General
Corporation Law of the State of Delaware, the Restated Certificate of
Incorporation, as amended, and the Company's Amended and Restated By-Laws would
be to permit such indemnification by the Company for liabilities arising under
the Securities Act of 1933.
Item 7. Exemption from Registration Claimed
-----------------------------------
Not applicable.
Item 8. Exhibits
--------
See the Exhibit Index at Page E-1 of this Registration Statement.
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 offering range may be reflected
in the form of prospectus filed with the Commission pursuant
to Rule 424(b) if, in the aggregate, the changes in volume
and price represent no more than a 20 percent 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 paragraphs (a)(1)(i) and (a)(1)(ii) do
not apply if the Registration Statement is on Form S-3, Form S-8 or Form F-3 and
the information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the registrant pursuant to Sections 13 or 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.
<PAGE> 4
(3) To remove from registration by means of a
post-effective amendment any of the securities being
registered which remain unsold at the termination of
the offering.
B. The undersigned registrant undertakes that, for purposes of
determining any liability under the Securities Act of 1933,
each filing of the registrant's annual report pursuant to
Sections 13(a) or 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 therein, and the offering of such securities at that
time shall be deemed to be the initial BONA FIDE offering
thereof.
C. 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 described under
Item 6 above, 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 Securities Act of 1933 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 Securities Act of 1933 and will be governed by the
final adjudication of such issue.
<PAGE> 5
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Twinsburg, State of Ohio, this 21st day of
March, 1997.
UNIVERSAL ELECTRONICS INC.
By: /s/ David M. Gabrielsen
---------------------------------
David M. Gabrielsen
Chairman, President and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed below by the following persons in
the capacities indicated on March 21, 1997.
Signature Title
--------- -----
/s/ Paul D. Arling Senior Vice President and Chief Financial
- ------------------------ Officer and Director (Principal Financial
Paul D. Arling Officer)
/s/ David M. Gabrielsen Chairman, President and Chief Executive Officer
- ------------------------ and Director (Principal Executive Officer)
David M. Gabrielsen
/s/ Peter L. Gartman Director
- ------------------------
Peter L. Gartman
/s/ Bruce A. Henderson Director
- ------------------------
Bruce A. Henderson
/s/ Brian J. Jackman Director
- ------------------------
Brian J. Jackman
/s/ Mark S. Kopaskie Executive Vice President and Chief
- ------------------------ Operating Officer and Director
Mark S. Kopaskie
/s/ Dennis P. Mansour Controller (Principal Accounting Officer)
- -----------------------
Dennis P. Mansour
/s/ William C. Mulligan Director
- ------------------------
William C. Mulligan
/s/ Thomas G. Murdough, Jr. Director
- ---------------------------
Thomas G. Murdough, Jr.
<PAGE> 6
<TABLE>
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UNIVERSAL ELECTRONICS INC.
EXHIBIT INDEX
Exhibit Number Description Sequential Page
-------------- ----------- ---------------
<S> <C> <C> <C>
4.1 Restated Certificate of Incorporation of the
Company, as amended (incorporated herein by
reference to Exhibit 3.1 to the Company's Form S-1
Registration Statement filed on or about December
24, 1992 (File No. 33-56358))
4.2 Amended and Restated By-laws of the Company
(incorporated herein by reference to Exhibit
3.2 to the Company's Form S-1 Registration
Statement filed on or about December 24, 1992
(File No. 33-56358))
4.3 Certificate of Amendment, dated June 2, 1995,
to the Certificate of Incorporation of the
Company (incorporated herein by reference to
Exhibit 3.3 to the Company's Annual Report on
Form 10-K for the year ended December 31, 1995
(File No. 0-21044))
4.5 Universal Electronics Inc. 1996 Stock Incentive
Plan (filed herewith)
4.6 Form of Stock Option Agreement dated under the
Universal Electronics Inc. 1996 Stock Incentive
Plan (filed herewith)
5.1 Opinion of Calfee, Halter & Griswold LLP regarding
the validity of the securities being registered
(filed herewith)
23.1 Consent of Price Waterhouse LLP, Independent
Accountants (filed herewith)
23.2 Consent of Calfee, Halter & Griswold LLP (included
in Exhibit 5.1)
</TABLE>
<PAGE> 1
Exhibit 4.5
UNIVERSAL ELECTRONICS INC.
1996 STOCK INCENTIVE PLAN
TO BE EFFECTIVE DECEMBER 1, 1996
<PAGE> 2
<TABLE>
<CAPTION>
TABLE OF CONTENTS
<S> <C>
SECTION 1.GENERAL PURPOSE OF PLAN; DEFINITIONS.............................. 1
SECTION 2.ADMINISTRATION.................................................... 3
SECTION 3.NUMBER OF SHARES OF STOCK SUBJECT TO PLAN......................... 4
SECTION 4.ELIGIBILITY....................................................... 5
SECTION 5.STOCK OPTIONS..................................................... 5
SECTION 6.STOCK APPRECIATION RIGHTS......................................... 9
SECTION 7.RESTRICTED STOCK UNITS AND PERFORMANCE STOCK UNITS................ 11
SECTION 8.AMENDMENT AND TERMINATION......................................... 12
SECTION 9.UNFUNDED STATUS OF PLAN........................................... 13
SECTION 10.GENERAL PROVISIONS............................................... 13
SECTION 11.EFFECTIVE DATE OF PLAN........................................... 15
SECTION 12.TERM OF PLAN..................................................... 15
</TABLE>
<PAGE> 3
UNIVERSAL ELECTRONICS INC.
1996 STOCK INCENTIVE PLAN
SECTION 1. GENERAL PURPOSE OF PLAN; DEFINITIONS.
The name of this Plan is the Universal Electronics Inc. 1996 Stock
Incentive Plan (the "Plan"). The purpose of this Plan is to enable the
Corporation (as hereinafter defined) and its Subsidiaries (as hereinafter
defined) to obtain and retain competent personnel who will contribute to the
Corporation's success by their ability, ingenuity and industry and to provide
incentives to the participating officers and key employees which are related to
increases in stockholder value and will therefore inure to the benefit of all
stockholders of the Corporation.
For purposes of this Plan, the following terms shall be defined as set
forth below:
(a) "Award" means any grant under this Plan in the form of Stock Options,
Stock Appreciation Rights, Performance Stock Units, Restricted Stock Units or
any combination of the foregoing.
(b) "Board" means the Board of Directors of the Corporation.
(c) "Code" means the Internal Revenue Code of 1986, as amended from time to
time, or any successor thereto.
(d) "Committee" means the Compensation Committee or any other committee the
Board may subsequently appoint to administer this Plan. The Committee shall be
composed entirely of directors who meet the qualifications referred to in
Section 2 of this Plan.
(e) "Corporation" means Universal Electronics Inc., a corporation
incorporated under the laws of the State of Delaware (or any successor
corporation).
(f) "Disability" means an event of illness or other incapacity of Optionee
resulting in Optionee's failure or inability to discharge Optionee's duties as
an employee of the Corporation, any Subsidiary or any Related Entity for ninety
(90) or more days during any period of 120 consecutive days.
(g) "Eligible Employee" means an employee of the Corporation, any
Subsidiary or any Related Entity as described in Section 4 of this Plan.
(h) "Fair Market Value" means, as of any given date, with respect to any
Awards granted hereunder, the mean of the high and low trading price of the
Stock on such date as reported on The Nasdaq Stock Market or if the Stock is not
then traded on The Nasdaq Stock
1
<PAGE> 4
Market, on such other national securities exchange on which the Stock is
admitted to trade or, if none, on the National Association of Securities Dealers
Automated Quotation System if the Stock is admitted for quotation thereon;
provided, however, that if any such system, exchange or quotation system is
closed on any day on which Fair Market Value is to be determined, Fair Market
Value shall be determined as of the first day immediately proceeding such day on
which such system, exchange or quotation system was open for trading; provided,
further, that in all other circumstances, "Fair Market Value" means the value
determined by the Committee after obtaining an appraisal by one or more
independent appraisers meeting the requirements of regulations issued under
Section 170(a)(1) of the Code.
(i) "Incentive Stock Option" means any Stock Option intended to qualify as
an "incentive stock option" within the meaning of Section 422 of the Code.
(j) "Non-Employee Director" shall have the meaning set forth in Rule 16b-3
("Rule 16b-3"), as promulgated by the Securities and Exchange Commission under
the Securities Exchange Act of 1934, as amended from time to time (the "Exchange
Act"), or any successor definition adopted by the Securities and Exchange
Commission.
(k) "Nonqualified Stock Option" means any Stock Option that is not an
Incentive Stock Option.
(l) "Optionee" means a Participant granted a Stock Option pursuant to
Section 5 of this Plan which remains outstanding.
(m) "Participant" means any Eligible Employee selected by the Committee,
pursuant to the Committee's authority in Section 2 of this Plan, to receive
Awards.
(n) "Performance Stock Unit" means the right to receive one share of Stock
as set forth in an Award granted pursuant to Section 7 of this Plan.
(o) "Related Entity" means any corporation, joint venture or other entity,
domestic or foreign, other than a Subsidiary, in which the Corporation owns,
directly or indirectly, a substantial equity interest.
(p) "Restricted Stock Unit" means the right to receive one share of Stock
as set forth in an Award granted pursuant to Section 7 of this Plan.
(q) "Retirement" means (i) retirement from active employment under a
retirement plan of the Corporation, any Subsidiary or Related Entity or under an
employment contract with any of them or (ii) termination of employment at or
after age 55 under circumstances which the Committee, in its sole discretion,
deems equivalent to retirement.
(r) "Stock" means the common stock, par value $0.01 per share, of the
Corporation.
2
<PAGE> 5
(s) "Stock Appreciation Right" means the right pursuant to an Award granted
under Section 6 of this Plan, (i) in the case of a Related Stock Appreciation
Right (as defined in Section 6 of this Plan), to surrender to the Corporation
all or a portion of the related Stock Option and receive an amount equal to the
excess of the Fair Market Value of one share of Stock as of the date such Stock
Option or portion thereof is surrendered over the option price per share
specified in such Stock Option, multiplied by the number of shares of Stock in
respect of which such Stock Option is being surrendered and (ii) in the case of
a Freestanding Stock Appreciation Right (as defined in Section 6 of this Plan)
and receive an amount equal to the excess of the Fair Market Value of one share
of Stock as of the date of exercise over the price per share specified in such
Freestanding Stock Appreciation Right, multiplied by the number of shares of
Stock in respect of which such Freestanding Stock Appreciation Right is being
exercised.
(t) "Stock Option" means any option to purchase shares of Stock granted
pursuant to Section 5 of this Plan.
(u) "Subsidiary" means any corporation in an unbroken chain of corporations
beginning with the Corporation, if each of the corporations (other than the last
corporation in the unbroken chain) owns stock possessing 50% or more of the
total combined voting power of all classes of stock in one of the other
corporations in the chain.
SECTION 2. ADMINISTRATION.
This Plan shall be administered by the Committee, composed solely of two or
more directors who are Non-Employee Directors, who shall be appointed by the
Board and who shall serve at the pleasure of the Board. In the event that a
Committee has not been appointed or in the Board's sole discretion, this Plan
shall be administered by the Board which shall have all of the power and
authority of the Committee set forth below. The Committee shall have the power
and authority in its sole discretion to grant Awards pursuant to the terms and
provisions of this Plan.
In particular, the Committee shall have the full authority, not
inconsistent with this Plan:
(a) to select Participants;
(b) to determine whether and to what extent Awards are to be granted to
Participants hereunder;
(c) to determine the number of shares of Stock to be covered by each such
Award granted hereunder, but in no case shall such number be in the aggregate
greater than that allowed under this Plan;
3
<PAGE> 6
(d) to approve or ratify transactions by Participants involving
acquisitions from the Corporation or dispositions to the Corporation of equity
securities of the Corporation made pursuant to the terms of this Plan;
(e) to determine the terms and conditions of any Award granted hereunder
(including, without limitation, (i) the restrictive periods applicable to
Restricted Stock Unit Awards and (ii) the performance objectives and periods
applicable to Performance Stock Unit Awards);
(f) to waive compliance by a Participant with any obligation to be
performed by such Participant under any Award and to waive any term or condition
of any such Award (provided, however, that no such waiver shall detrimentally
affect the rights of the Participant without such Participant's consent); and
(g) to determine the terms and conditions which shall govern all written
agreements evidencing the Awards.
The Committee shall have the authority to adopt, alter and repeal such
administrative rules, guidelines and practices governing this Plan as it shall,
from time to time deem advisable; to interpret the provisions of this Plan and
the terms and conditions of any Award issued, expired, terminated, canceled or
surrendered under this Plan (and any agreements relating thereto); and to
otherwise supervise the administration of this Plan.
All decisions made by the Committee pursuant to the provisions of this Plan
and as to the terms and conditions of any Award (and any agreements relating
thereto) shall be final and binding on all persons, including the Corporation
and the Optionees.
SECTION 3. NUMBER OF SHARES OF STOCK SUBJECT TO PLAN.
The total number of shares of Stock reserved and available for issuance
under this Plan shall be four hundred thousand (400,000). Such shares of Stock
may consist, in whole or in part, of authorized and unissued shares of Stock or
issued shares of Stock reacquired by the Corporation at any time, as the Board
may determine.
To the extent that (a) a Stock Option expires or is otherwise terminated,
canceled or surrendered without being exercised (including, without limitation,
in connection with the grant of a replacement option) or (b) any Restricted
Stock Unit Award or Performance Stock Unit Award granted hereunder expires or is
otherwise terminated or is canceled, the shares of Stock underlying such Stock
Option or subject to such Restricted Stock Unit Award or Performance Stock Unit
Award shall again be available for issuance in connection with future Awards
under this Plan. Upon the exercise of a Related Stock Appreciation Right (as
defined in Section 6 of this Plan), the Stock Option, or the part thereof to
which such Related Stock Appreciation Right is related, shall be deemed to have
been exercised for the purpose of the limitation on the number of shares of
Stock in respect of which the Related Stock Appreciation
4
<PAGE> 7
Right was exercised.
In the event of any merger, reorganization, consolidation,
recapitalization, stock dividend, spin-off, or other change in corporate
structure or capitalization affecting the Stock, the Committee shall make an
equitable adjustment or substitution in the number and class of shares reserved
for issuance under this Plan, the number and class of shares covered by
outstanding Awards and the option price per share of Stock Options or the
applicable price per share specified in Stock Appreciation Rights to reflect the
effect of such change in corporate structure or capitalization on the Stock;
provided, however, that any fractional shares resulting from such adjustment
shall be eliminated; provided further, however, that if by reason of any such
change in corporate structure or capitalization a Participant holding a
Restricted Stock Unit Award or Performance Stock Unit Award shall be entitled,
subject to the terms and conditions of such Award, to additional or different
shares of any security, the issuance of such additional or different shares
shall thereupon be subject to all of the terms and conditions (including
restrictions and performance criteria) which were applicable to such Award prior
to such change in corporate structure or capitalization; and, provided, further,
however, that unless the Committee in its sole discretion determines otherwise,
any issuance by the Corporation of shares of stock of any class or securities
convertible into shares of stock of any class shall not affect, and no such
adjustment or substitution by reason thereof shall be made with respect to, the
number or class of shares reserved for issuance under this Plan, the number or
class of shares covered by outstanding Awards or any option price or applicable
price.
SECTION 4. ELIGIBILITY.
Officers and other key employees of the Corporation, its Subsidiaries
and its Related Entities who are responsible for or contribute to the
management, growth or profitability of the business of the Corporation, its
Subsidiaries or its Related Entities shall be eligible to be granted Awards;
provided however, with respect to an employee of a Related Entity, that such
person was an employee of the Corporation, a Subsidiary or, if originally an
employee of the Corporation or a Subsidiary, of another Related Entity
immediately prior to becoming employed by such Related Entity and accepted
employment with such Related Entity at the request of the Corporation or a
Subsidiary. The Participants under this Plan shall be selected, from time to
time, by the Committee, in its sole discretion, from among those Eligible
Employees.
SECTION 5. STOCK OPTIONS.
(a) GRANT AND EXERCISE. Stock Options may be granted either alone or in
addition to other Awards granted under this Plan. Any Stock Option granted under
this Plan shall be in such form as the Committee may, from time to time,
approve, and the terms and conditions of Stock Option Awards need not be the
same with respect to each Optionee. Each Optionee shall enter into a Stock
Option agreement ("Stock Option Agreement") with the Corporation, in such
5
<PAGE> 8
form as the Corporation shall determine, which agreement shall set forth, among
other things, the option price of the option, the term of the option and
conditions regarding exercisability of the option granted thereunder.
(i) NATURE OF OPTIONS. The Committee shall have the authority
to grant any Participant either Incentive Stock Options, Nonqualified
Stock Options or both types of Stock Options (in each case with or
without Stock Appreciation Rights), except that the Committee shall not
grant any Incentive Stock Options to an employee of a Related Entity.
Any Stock Option which does not qualify as an Incentive Stock Option,
or the terms of which at the time of its grant provide that it shall
not be treated as an Incentive Stock Option, shall constitute a
Nonqualified Stock Option.
(ii) EXERCISABILITY. Subject to such terms and conditions as
shall be determined by the Committee in its sole discretion at or after
the time of grant, Stock Options shall be exercisable from time to time
to the extent of 33% of the number of shares of Stock covered by the
Stock Option immediately upon the date of grant of the Stock Option, to
the extent of 67% of the number of shares of Stock covered by the Stock
Option on and after the first anniversary and before the second
anniversary of the date of grant of the Stock Option, and to the extent
of 100% of the number of shares of Stock covered by the Stock Option on
and after the second anniversary and before the expiration of the
stated term of the Stock Option (or to such lesser extent as the
Committee in its sole discretion shall determine at the time of grant
or to such greater extent as the Committee in its sole discretion shall
determine at or after the time of grant).
(iii) METHOD OF EXERCISE. Stock Options may be exercised by
giving written notice of exercise delivered in person or by mail as
required by the terms of any Stock Option Agreement at the
Corporation's principal executive office, specifying the number of
shares of Stock with respect to which the Stock Option is being
exercised, accompanied by payment in full of the option price in cash
or its equivalent as determined by the Committee in its sole
discretion. If requested by the Committee, the Optionee shall deliver
to the Corporation the Stock Option Agreement evidencing the Stock
Option being exercised for notation thereon of such exercise and return
thereafter of such agreement to the Optionee. As determined by the
Committee in its sole discretion at or after the time of grant, payment
of the option price in full or in part may also be made in the form of
shares of unrestricted Stock already owned by the Optionee (based on
the Fair Market Value of the Stock on the date the Stock Option is
exercised); provided, however, that in the case of an Incentive Stock
Option, the right to make payment of the option price in the form of
already owned shares of Stock may be authorized only at the time of
grant. The Committee also may allow cashless exercise as permitted
under Federal Reserve Board's Regulation T, subject to applicable
securities law restrictions, or by any other means which the Committee
determines to be consistent with this Plan's purpose and applicable
law. An Optionee shall generally
6
<PAGE> 9
have the rights to dividends or other rights of a stockholder with
respect to shares of Stock subject to the Stock Option when the
Optionee has given written notice of exercise, has paid in full for
such shares of Stock, and, if requested, has made representations
described in Section 11(a) of this Plan.
(b) TERMS AND CONDITIONS. Stock Options granted under this Plan shall
be subject to the following terms and conditions and shall contain such
additional terms and conditions, not inconsistent with the terms of this Plan,
as the Committee shall deem desirable.
(i) OPTION PRICE. The option price per share of Stock
purchasable under a Stock Option shall be determined by the Committee
at the time of grant, but shall be not less than 100% of the Fair
Market Value of the Stock on the date of the grant; provided, however,
that if any Participant owns or is deemed to own (by reason of the
attribution rules of Section 424(d) of the Code) more than 10% of the
combined voting power of all classes of stock of the Corporation or any
Subsidiary when an Incentive Stock Option is granted to such
Participant, the option price of such Incentive Stock Option (to the
extent required by the Code at the time of grant) shall be not less
than 110% of the Fair Market Value of the Stock on the date such
Incentive Stock Option is granted.
(ii) OPTION TERM. The term of each Stock Option shall be fixed
by the Committee at the time of grant, but no Stock Option shall be
exercisable more than ten years after the date such Stock Option is
granted; provided, however, that if any Participant owns or is deemed
to own (by reason of the attribution rules of Section 424(d) of the
Code) more than 10% of the combined voting power of all classes of
stock of the Corporation or any Subsidiary when an Incentive Stock
Option is granted to such Participant, such Stock Option (to the extent
required by the Code at time of grant) shall not be exercisable more
than five years from the date such Incentive Stock Option is granted.
(iii) TRANSFERABILITY OF OPTIONS. Except as otherwise
determined by the Committee, no Stock Options shall be transferable by
the Optionee otherwise than by will or by the laws of descent and
distribution and all Stock Options shall be exercisable, during the
Optionee's lifetime, only by the Optionee, or in the case of Optionee's
legal incompetency, only by Optionee's guardian or legal
representative.
(iv) OPTION EXERCISE AFTER TERMINATION BY REASON OF DEATH OR
DISABILITY. If an Optionee's employment with the Corporation, any
Subsidiary or any Related Entity terminates by reason of death or
Disability, and Stock Option held by such Optionee may thereafter be
exercised for a period of one year (or such shorter period as the
Committee in its sole discretion shall specify at or after the time of
grant) from the date of such termination or until the expiration of the
stated term if such Stock Option, whichever period is shorter, to the
extent to which the Optionee would on the date of
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termination have been entitled to exercise the Stock Option (or to
such greater or lesser extent as the Committee in its sole discretion
shall determine at or after the time of grant). In the event of a
termination of employment by reason of death or Disability, if an
Incentive Stock Option is exercised after the expiration of the
exercise period that applies for purposes of Section 422 of the Code,
such Stock Option will thereafter be treated as a Nonqualified Stock
Option.
(v) OPTION EXERCISE AFTER TERMINATION WITHOUT CAUSE OR
CONSTRUCTIVE TERMINATION. If an Optionee's employment with the
Corporation, any Subsidiary, or any Related Entity is terminated, by
the Corporation or such Subsidiary or such Related Entity, without
"Cause" (as such term is defined within the Stock Option Agreement) or
in the event of "Constructive Termination" (as such term is defined
within the Stock Option Agreement) of the Optionee's employment with
the Corporation or such Subsidiary or such Related Entity is so
terminated the Committee, in its sole discretion, may permit the
Optionee to exercise any Stock Option held by such Optionee, to the
extent not theretofore exercised, in whole or in part with respect to
all remaining shares covered by the Stock Option at any time prior to
the expiration of the Stock Option (or such shorter period as the
Committee in its sole discretion shall specify at or after the time of
grant), to the extent to which the Optionee would on the date of
termination have been entitled to exercise the Stock Option (or to such
greater or lesser extent as the Committee in it sole discretion shall
determine at or after the time of grant). An Optionee's acceptance of
employment, at the request of the Corporation or a Subsidiary, with a
Related Entity (or acceptance of employment, at the request of the
Corporation or a Subsidiary, with any other Related Entity), shall not
be deemed a termination of employment hereunder and any Stock Option
held by Optionee may be exercised thereafter to the extent that the
Optionee would on the date of exercise have been entitled to exercise
such Stock Option if such Optionee had continued to be employed by the
Corporation or such Subsidiary (or such initial Related Entity),
provided that the Optionee has been in continuous employ with the
Related Entity to which such Optionee has moved from the date of
acceptance of employment therewith until the date of exercise. In the
event of termination of employment by the Corporation, any Subsidiary
or any Related Entity without Cause or in the event of Constructive
Termination of the Optionee's employment or the acceptance of
employment with a Related Entity, if an Incentive Stock Option is
exercised after the expiration of the exercise period that applies for
purposes of Section 422 of the Code, such Stock Option will thereafter
be treated as a Nonqualified Stock Option.
(vi) OPTION EXERCISE AFTER TERMINATION TO RESIGNATION. If an
Optionee's employment with the Corporation, any Subsidiary, or any
Related Entity terminates for any reason not set forth in Sections
5(iv) or (v) above, the Committee, in its sole discretion, may permit
the Optionee to exercise any Stock Option held by such Optionee to the
extent such Option was exercisable on the date of such termination (or
to such greater or lesser extent as the Committee in its sole
discretion shall determine at
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or after the time of grant) for a period of ninety (90) days from the
date of such termination (or such shorter period as the Committee in
its sole discretion shall specify at or after the time of grant).
(vii) OTHER TERMINATION. Except as otherwise provided in this
Section 5 of this Plan, or as determined by the Committee in its sole
discretion, if an Optionee's employment with the Corporation, any
Subsidiary or any Related Entity terminates, all Stock Options held by
the Optionee will terminate.
(viii) ANNUAL LIMIT ON INCENTIVE STOCK OPTIONS. To the extent
required for incentive stock option treatment under Section 422 of the
Code, the aggregate Fair Market Value (determined as of the date of
Incentive Stock Option is granted) of the shares of Stock with respect
to which Incentive Stock Options granted under this Plan and all other
option plans of the Corporation or any Subsidiary become exercisable
for the first time by an Optionee during any calendar year shall not
exceed $100,000; provided, however, that if the aggregate Fair Market
Value (so determined) of the shares of Stock covered by such options
exceeds $100,000 during any year in which they become exercisable, such
options with a Fair Market Value in excess of $100,000 will be
Nonqualified Stock Options.
SECTION 6. STOCK APPRECIATION RIGHTS.
(a) GRANT AND EXERCISE. Stock Appreciation Rights may be granted either
in conjunction with all or part of any Stock Option granted under this Plan
("Related Stock Appreciation Rights") or alone ("Freestanding Stock Appreciation
Rights") and, in either case, in addition to other Awards granted under this
Plan. Participants shall enter into a Stock Appreciation Rights Agreement with
the Corporation if requested by the Committee, in such form as the Committee
shall determine.
(i) TIME OF GRANT. Related Stock Appreciation Rights related
to a Nonqualified Stock Option may be granted either at or after the
time of the grant of such Nonqualified Stock Option. Related Stock
Appreciation Rights related to such an Incentive Stock Option may be
granted only at the time of the grant of such Incentive Stock Option.
Freestanding Stock Appreciation Rights may be granted at any time.
(ii) EXERCISABILITY. Related Stock Appreciation Rights shall
be exercisable only at such time or times and to the extent that the
Stock Options to which they relate shall be exercisable in accordance
with the provisions of Section 5(a)(ii) of this Plan and Freestanding
Stock Appreciation Rights shall be exercisable, subject to such terms
and conditions as shall be determined by the Committee in its sole
discretion at or after the time of grant, from time to time, to the
extent that Stock Options are exercisable in accordance with the
provisions of Section 5(a)(ii) of this Plan. A Related Stock
Appreciation Right granted in connection with an Incentive Stock Option
may be
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exercised only if and when the Fair Market Value of the Stock subject
to the Incentive Stock Option exceeds the option price of such Stock
Option.
(iii) METHOD OF EXERCISE. Stock Appreciation Rights shall be
exercised by a Participant by giving written notice of exercise
delivered in person or by mail as required by the terms of any
agreement evidencing the Stock Appreciation Right at the Corporation's
principal executive office, specifying the number of shares of Stock in
respect of which the Stock Appreciation Right is being exercised. If
requested by the Committee, the Participant shall deliver to the
Corporation the agreement evidencing the Stock Appreciation Right being
exercised and, in the case of a Related Stock Appreciation Right, the
Stock Option Agreement evidencing any related Stock Option, for
notation thereon of such exercise and return thereafter of such
agreements to the Participant.
(iv) AMOUNT PAYABLE. Upon the exercise of a Related Stock
Appreciation Right, an Optionee shall be entitled to receive an amount
in cash or shares of Stock equal in value to the excess of the Fair
Market Value of one share of Stock on the date of exercise over the
option price per share specified in the related Stock Option,
multiplied by the number of shares of Stock in respect of which the
Related Stock Appreciation Rights shall have been exercised, with the
Committee having in its sole discretion the right to determine the form
of payment. Upon the exercise of a Freestanding Stock Appreciation
Right, a Participant shall be entitled to receive an amount in cash or
shares of Stock equal in value to the excess of the Fair Market Value
of one share of Stock on the date of exercise over the price per share
specified in the Freestanding Stock Appreciation Right, which shall be
not less than 100% of the Fair Market Value of the Stock on the date of
Grant, multiplied by the number of shares of Stock in respect of which
the Freestanding Stock Appreciation Rights shall have been exercised,
with the Committee having in its sole discretion the right to determine
the form of payment
(b) TERMS AND CONDITIONS. Stock Appreciation Rights under this Plan
shall be subject to the following terms and conditions and shall contain such
additional terms and conditions not inconsistent with the terms of this Plan, as
the Committee shall deem desirable.
(i) TERMS OF STOCK APPRECIATION RIGHTS. The term of a Related
Stock Appreciation Right shall be the same as the term of the related
Stock Option. A Related Stock Appreciation Right or applicable portion
thereof shall terminate and no longer be exercisable upon the exercise,
termination, cancellation or surrender of the related Stock Option,
except that, unless otherwise provided by the Committee in its sole
discretion at or after the time of grant, a Related Stock Appreciation
Right granted with respect to less than the full number of shares of
Stock covered by a related Stock Option shall terminate and no longer
be exercisable if and to the extent that the number of shares of Stock
covered by the exercise, termination, cancellation or surrender of the
related Stock Option exceeds the number of shares of Stock not covered
by the Related
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Stock Appreciation Right.
The term of each Freestanding Stock Appreciation Right shall
be fixed by the Committee, but no Freestanding Stock Appreciation Right
shall be exercisable more than ten years after the date such right is
granted.
(ii) TRANSFERABILITY OF STOCK APPRECIATION RIGHTS.
Stock Appreciation Rights shall be transferable only when and to the
extent that a Stock Option would be transferable under Section
5(b)(iii) of this Plan.
(iii) TERMINATION OF EMPLOYMENT. In the event of the
termination of employment of an Optionee holding a Related Stock
Appreciation Right, such right shall be exercisable to the same extent
that the related Stock Option is exercisable after such termination. In
the event of the termination of employment of the holder of a
Freestanding Stock Appreciation Right, such right shall be exercisable
to the same extent that a Stock Option with the same terms and
conditions as such Freestanding Stock Appreciation Right would have
been exercisable in the event of the termination of employment of the
holder of such Stock Option.
SECTION 7. RESTRICTED STOCK UNITS AND PERFORMANCE STOCK UNITS.
(a) GRANT. Awards of Restricted Stock Units or Performance Stock Units
may be granted either alone or in addition to other Awards granted under this
Plan. Each Restricted Stock Unit or Performance Stock Unit represents the right
to receive, subject to the terms and provisions of this Plan and any agreements
evidencing such Awards, one share of Stock. If the Committee in its sole
discretion so determines at the time of grant, a Participant to whom a
Restricted Stock Unit Award or Performance Stock Unit Award has been granted may
be credited with an amount equivalent to all cash dividends ("Dividend
Equivalents") that would have been paid to the holder of such Restricted Stock
Unit Award or Performance Stock Unit Award if one share of Stock for every
Restricted Stock Unit or Performance Stock Unit awarded had been issued to the
holder on the date of grant of such Restricted Stock Unit Award or Performance
Stock Unit Award. The Committee shall determine the terms and conditions of each
Restricted Stock Unit Award and Performance Stock Unit, including without
limitation, the number of Restricted Stock Units or Performance Stock Units to
be covered by such Awards, the restricted period applicable to Restricted Stock
Unit Awards and the performance objectives applicable to Performance Stock Unit
Awards. The Committee in its sole discretion may prescribe terms and conditions
applicable to the vesting of such Restricted Stock Unit Awards or Performance
Stock Unit Awards in addition to those provided in this Plan. The Committee
shall establish such rules and guidelines governing the crediting of Dividend
Equivalents, including the timing, form of payment and payment contingencies of
Dividend Equivalents, as it may deem desirable. The Committee in its sole
discretion may at any time accelerate the time at which the restrictions on all
or any part of a Restricted Stock Unit Award lapse or deem the performance
objectives with respect to all or any part of a
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<PAGE> 14
Performance Stock Unit Award to have been attained. Restricted Stock Units
Awards and Performance Stock Unit Awards shall not be transferable otherwise
than by will or by the laws of descent and distribution. Shares of Stock shall
be deliverable upon the vesting of Restricted Stock Unit Awards and Performance
Stock Unit Awards for no consideration other than services rendered or, in the
Committee's sole discretion, the minimum amount of consideration other than
services (such as the par value of Stock) required to be received by the
Corporation in order to assure compliance with applicable state law, which
amount shall not exceed 10% of the Fair Market Value of such shares of Stock on
the date of issuance. Each such Award shall be evidenced by a Restricted Stock
Unit agreement ("Restricted Stock Unit Award Agreement") or Performance Stock
Unit Award agreement ("Performance Stock Unit Award Agreement").
(b) TERMS AND CONDITIONS. Unless otherwise determined by the
Committee in its sole discretion:
(i) a breach of any term or condition provided in this Plan,
the Restricted Stock Unit Award Agreement or the Performance Stock Unit
Award Agreement or established by the Committee with respect to such
Restricted Stock Unit Award or Performance Stock Unit Award will cause
a cancellation of the unvested portion of such Restricted Stock Unit
Award or Performance Stock Unit Award (including any Dividend
Equivalents credited in respect thereof) and the Participant shall not
be entitled to receive any consideration in respect of such
cancellation; and
(ii) termination of such holder's employment with the
Corporation, any Subsidiary or any Related Entity prior to the lapsing
of the applicable restriction period or attainment of applicable
performance objectives will cause a cancellation of the unvested
portion of such Restricted Stock Unit Award or Performance Stock Unit
Award (including any Dividend Equivalents credited in respect thereof)
and the Participant shall not be entitled to receive any consideration
in respect of such cancellation.
(c) COMPLETION OF RESTRICTION PERIOD AND ATTAINMENT OF PERFORMANCE
OBJECTIVES. To the extent that restrictions with respect to any Restricted Stock
Unit Award lapse or performance objectives with respect to any Performance Stock
Unit Award are attained and provided that other applicable terms and conditions
have been satisfied:
(i) such of the Restricted Stock Units or Performance Stock
Units as to which restrictions have lapsed or performance objectives
have been attained shall become vested and the Committee shall cause to
be issued and delivered to the Participant a stock certificate
representing a number of shares of Stock equal to such number of
Restricted Stock Units or Performance Stock Units, and, subject to
Section 11(a) hereof, free of all restrictions; and
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(ii) any Dividend Equivalents credited in respect of such
Restricted Stock Units or Performance Stock Units shall become vested
to the extent that such Restricted Stock Units or Performance Stock
Units shall have become vested and the Committee shall cause such
Dividend Equivalents to be delivered to the Participant.
Any such Restricted Stock Unit Award or Performance Stock Unit Award
(including any Dividend Equivalents credited in respect thereof) that shall not
have become vested at the end of the applicable restricted period or the period
given for the attainment of performance objectives shall expire, terminate and
be cancelled and the Participant shall not thereafter have any rights with
respect to the Restricted Stock Units or Performance Stock Units (or any
Dividend Equivalents credited in respect thereto) covered thereby.
SECTION 8. AMENDMENT AND TERMINATION.
The Board may amend, alter, or discontinue this Plan, but no amendment,
alteration, or discontinuation shall be made which would impair the rights of a
Participant under any Award theretofore granted without such Participant's
consent, or which, without the approval of the stockholders of the Corporation
(where such approval is necessary to satisfy then applicable requirements of
Rule 16b-3 under the Exchange Act, any Federal tax law relating to Incentive
Stock Options or applicable state law), would:
(a) except as provided in Section 3 of this Plan, increase the total
number of shares of Stock which may be issued under this Plan;
(b) except as provided in Section 3 of this Plan, decrease the option
price of any Stock Option to less than 100% of the Fair Market Value on the date
of the grant of the Option;
(c) change the class of employees eligible to participate in this
Plan; or
(d) extend (i) the period during which Stock Options may be granted or
(ii) the maximum period of any Award under Sections 5(b)(ii) or 6(b)(i) of this
Plan.
Except as restricted herein with respect to Incentive Stock Options,
the Committee may amend or alter the terms and conditions of any Award
theretofore granted, and of any agreement evidencing such Award, prospectively
or retroactively, but no such amendment or alteration shall impair the rights of
any Optionee under such Award or agreement without such Optionee's consent.
SECTION 9. UNFUNDED STATUS OF PLAN.
This Plan is intended to constitute an "unfunded" plan. With respect to
any payments not yet made and due to a Participant by the Corporation, nothing
contained herein shall give
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any such Participant any rights that are greater than those of a general
unsecured creditor of the Corporation.
SECTION 10. GENERAL PROVISIONS.
(a) The Committee may require each Optionee purchasing shares of Stock
pursuant to a Stock Option to represent to and agree with the Corporation in
writing that such Optionee is acquiring the shares of Stock without a view to
distribution thereof. All certificates for shares of Stock delivered under this
Plan and, to the extent applicable, all evidences of ownership with respect to
Dividend Equivalents delivered under this Plan, shall be subject to such
stock-transfer orders and other restrictions as the Committee may deem advisable
under the rules, regulations and other requirements of the Securities and
Exchange Commission, any stock exchange upon which the Stock is then listed or
quotation system on which the Stock is admitted for trading and any applicable
Federal or state securities law, and the Committee may cause a legend or legends
to be put on any such certificates to make appropriate reference to such
restrictions.
(b) Nothing contained in this Plan shall prevent the Board from
adopting other or additional compensation arrangements, subject to stockholder
approval if such approval is required, and such arrangements may be either
generally applicable or applicable only in specific cases. The adoption of this
Plan shall not confer upon any employee of the Corporation, any Subsidiary or
any Related Entity any right to continued employment with the Corporation, any
Subsidiary or any Related Entity as the case may be, nor shall it interfere in
any way with the right of the Corporation, any Subsidiary or any Related Entity
to terminate the employment of any of its employees at any time.
(c) Each Participant shall be deemed to have been granted an Award on
the date the Committee took action to grant such Award under this Plan or such
later date as the Committee in its sole discretion shall determine at the time
such grant is authorized.
(d) Unless the Committee otherwise determines, each Participant shall,
no later than the date as of which the value of an Award first becomes
includable in the gross income of the Participant for federal income tax
purposes, pay to the Corporation, or make arrangements satisfactory to the
Committee regarding payment of, any federal, state or local taxes of any kind
required by law to be withheld with respect to the Award. The obligations of the
Corporation under this Plan shall be conditional on such payment or arrangements
and the Corporation (and, where applicable, its Subsidiaries and its Related
Entities) shall, to the extent permitted by law, have the right to deduct any
such taxes from any payment of any kind otherwise due to the Participant. A
Participant may elect to have such tax withholding obligation satisfied, in
whole or in part, by (i) authorizing the Corporation to withhold from shares of
Stock to be issued upon the exercise of a Stock Option or upon the vesting of
any Restricted Stock Unit Award or the Performance Stock Unit Award a number of
shares of Stock with an aggregate Fair Market Value that would satisfy the
withholding amount due, or
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(ii) transferring to the Corporation shares of Stock owned by the Participant
with an aggregate Fair Market Value that would satisfy the withholding amount
due. With respect to any Participant who is an executive officer, the election
to satisfy the tax withholding obligations relating to the exercise of a Stock
Option or to the vesting of a Restricted Stock Unit Award or Performance Stock
Unit Award in the manner permitted by this subsection (d) shall be made during
the "window period" as described within the Corporation Insider Trading Policy
unless otherwise determined in the sole discretion of the Committee of the
Board.
(e) No member of the Board or the Committee, nor any officer or
employee of the Corporation acting on behalf of the Board or the Committee,
shall be personally liable for any action, failure to act, determination or
interpretation taken or made in good faith with respect to this Plan, and all
members of the Board or the Committee and each and any officer or employee of
the Corporation acting on their behalf shall, to the extent permitted by law, be
fully indemnified and protected by the Corporation in respect of any such
action, failure to act, determination or interpretation.
(f) This Plan is intended to satisfy the conditions of Rule 16b-3 under
the Exchange Act, and all interpretations of this Plan shall, to the extent
permitted by law, regulations and rulings, be made in a manner consistent with
and so as to satisfy the conditions of Rule 16b-3 under the Exchange Act. The
term "executive officer" as used in this Plan means any director or officer who
is subject to the provisions of Section 16(b) of the Exchange Act. Any
provisions of this Plan or the application of any provision of this Plan
inconsistent with Rule 16b-3 under the Exchange Act shall be inoperative and
shall not affect the validity of this Plan.
(g) In interpreting and applying the provisions of this Plan, any Stock
Option granted as an Incentive Stock Option pursuant to this Plan shall, to the
extent permitted by law, regulations and rulings be construed as, and any
ambiguity shall be resolved in favor of preserving its status as, an "incentive
stock option" within the meaning of Section 422 of the Code. Once an Incentive
Stock Option has been granted, no action by the Committee that would cause such
Stock Option to lose its status under the Code as an "incentive stock option"
shall be effective as to such Incentive Stock Option unless taken at the request
of or with the consent of the Participant. Notwithstanding any provision to the
contrary in this Plan or in any Incentive Stock Option granted pursuant to this
Plan, if any change in law or any regulation or ruling of the Internal Revenue
Service shall have the effect of disqualifying any Stock Option granted under
this Plan which is intended to be an "incentive stock option" within the meaning
of Section 422 of the Code, the Stock Option granted shall nevertheless continue
to be outstanding as and shall be deemed to be a Nonqualified Stock Option under
this Plan.
(h) Notwithstanding any other provision herein to the contrary, the
maximum number of shares with respect to which Awards may be granted to the same
Participant under this Plan may not exceed, in the aggregate, 266,666 shares,
except to the extent of adjustments authorized by Section 3 of this Plan.
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SECTION 11. EFFECTIVE DATE OF PLAN.
This Plan shall be effective December 1, 1996, subject to the approval
by the affirmative vote of the holders of a majority of the shares of Stock of
the Corporation present in person or by proxy at the meeting of stockholders on
that date.
SECTION 12. TERM OF PLAN.
No Award shall be granted under this Plan on or after the tenth
anniversary of the effective date of this Plan; provided, however, that Awards
granted prior to such tenth anniversary may extend beyond that date.
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Exhibit 4.6
STOCK OPTION AGREEMENT
THIS STOCK OPTION AGREEMENT is made as of the date set forth on the
signature page hereof by and between Universal Electronics Inc., a Delaware
corporation (the "Corporation") and the undersigned Optionee (the "Optionee").
As used in this Agreement, the term "Corporation" shall include, where
applicable, any and all of its subsidiaries.
WHEREAS, the Board of Directors of the Corporation (the "Board") has
approved the Universal Electronics Inc. 1996 Stock Incentive Plan (the "Plan")
and will submit the Plan to the stockholders of the Corporation for their
approval at the next regularly scheduled meeting of stockholders; and
WHEREAS, the Corporation desires to grant to the Optionee an option
("Option") to purchase shares of the Corporation's common stock, par value $0.01
per share (the "Stock"), upon the terms and conditions set forth in this
Agreement;
NOW, THEREFORE, the parties, intending to be legally bound, hereto
agree as follows:
1. GRANT AND DESIGNATION OF OPTION. Upon the execution and delivery of
this Agreement and the related Stock Option Certificate of even date herewith
(the "Certificate"), the Corporation hereby grants to the Optionee the Option to
purchase the aggregate number of shares of Stock set forth on the Certificate at
the price per share ("Option Price") further set forth on the Certificate. The
Option granted hereunder shall not be treated as an incentive stock option
within the meaning of Section 422A of the Internal Revenue Code of 1986, as
amended.
2. TERM AND EXERCISE OF OPTION. Subject to earlier termination,
acceleration or cancellation of the Option as provided herein, the term of the
Option shall be for that period of time also set forth on the Certificate (the
"Option Period") and, subject to the provisions of this Agreement, the Option
shall be exercisable at such times and as to such number of shares as determined
on the schedule set forth on the Certificate.
3. METHOD OF EXERCISE. The Option may be exercised by written notice to
the Corporation (the "Exercise Notice") at its offices at 1864 Enterprise
Parkway West, Twinsburg, Ohio 44087 (or such other offices of the Corporation
which are hereinafter designated by the Corporation) to the attention of the
Secretary of the Corporation. The Exercise Notice shall state (i) the election
to exercise the Option, (ii) the total number of full shares in respect to which
it is being exercised, and (iii) shall be signed by the person or persons
exercising the Option. The Exercise Notice shall be accompanied by the
Certificate and a certified or cashier's check for the full amount of the
purchase price of such shares, or as may be permitted by the Board, by
certificates for shares of Stock which have been owned by the Optionee for more
than six months prior to the date of exercise and which have a fair market value
of the date of exercise equal to the purchase price, or by a combination of such
methods of payment. Upon receipt of the foregoing, the Corporation shall issue
the shares of Stock as to which the Option has been duly
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exercised and shall return the Certificate, duly endorsed to reflect such
exercise, to the Optionee.
4. OPTIONEE'S REPRESENTATIONS.
(a) Optionee represents and warrants that any and all shares acquired
through the exercise of rights under the Option granted pursuant to this
Agreement will be acquired for Optionee's own account and not with a view to, or
present intention of, distribution thereof in violation of the Securities Act of
1933, as amended and the rules and regulations promulgated thereunder (the "1933
Act") and will not be disposed of in contravention of the 1933 Act.
(b) Optionee acknowledges that Optionee is able to bear the economic
risk of the investment in any and all shares of Stock acquired through the
exercise of rights under the Option for an indefinite period of time because the
Stock has not been registered under the 1933 Act and, therefore, cannot be sold
unless subsequently registered under the 1933 Act or an exemption from such
registration is available.
(c) Optionee has reviewed this Agreement and has had an opportunity to
ask questions and receive answers concerning the terms and conditions of the
offering of Stock and has had full access to such other information concerning
the Corporation as Optionee has requested.
5. RESTRICTION ON EXERCISE. This Option may not be exercised if the
issuance of such shares upon such exercise or the method of payment of
consideration for such shares would constitute a violation of any applicable
federal or state securities or other law or regulation. As a condition to the
exercise of this Option, the Corporation may require Optionee to make any
representation and warranty to the Corporation as may be required by any
applicable law or regulation. All exercises of the Option must be for full
shares of Stock only.
6. EFFECT OF TERMINATION OF EMPLOYMENT. Except as set forth in
Paragraphs 7 and 8 below, in the event that Optionee's employment with the
Corporation ceases for any reason, Optionee may (or Optionee's estate or
representative, in the event of Optionee's death during the applicable exercise
period as set forth in this Paragraph 6), during the earlier of (i) the 180 day
period following such cessation of employment or (ii) the remaining term of the
Option Period, exercise the Option to the extent such Option was exercisable on
the date such employment ceased and, on such date, that portion of the Option
which was not exercisable shall automatically terminate without further action
by the parties hereto and, in all events, to the extent not exercised, the
Option shall terminate in its entirety at the end of business on the applicable
exercise period as set forth in this Paragraph 6.
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7. EFFECT OF TERMINATION OF EMPLOYMENT WITHOUT CAUSE OR DUE TO
CONSTRUCTIVE TERMINATION.
(a) In the event that Optionee's employment with the
Corporation is terminated by the Corporation without "Cause" (as such term is
defined in subparagraph 7(b) below) or in the event of "Constructive
Termination" (as such term is defined in subparagraph 7(c) below), Optionee
shall become immediately fully vested in the Option without further action by
the parties hereto, and, to the extent not previously exercised, shall be
exercisable in whole or in part with respect to all remaining shares of Stock
covered by the Option and may be exercised by Optionee (or Optionee's estate or
representative, in the event of Optionee's death) at any time prior to the
expiration of the Option Period.
(b) For purposes of this Agreement, "Cause" shall mean (i) the
willful and continued failure by Optionee to substantially perform Optionee's
duties with the Corporation (other than a failure resulting from Optionee's
death or "Total Disability" (as such term is defined in subparagraph 7(e)
below)) after a demand for substantial performance is delivered to Optionee by
the Corporation which specifically identifies the manner in which it is believed
that Optionee has not substantially performed Optionee's duties; (ii) the
willful engaging by Optionee in gross misconduct materially and demonstrably
injurious to the property or business of the Corporation; or (iii) Optionee's
commission of fraud, misappropriation or a felony. For purposes of this
definition of "Cause", no act or failure to act on Optionee's part will be
considered "willful" unless done, or omitted to be done, by Optionee not in good
faith and without reasonable belief that Optionee's action or omission was in
the interests of the Corporation or not opposed to the interests of the
Corporation.
(c) For purposes of this Agreement, "Constructive Termination"
shall occur on that date on which Optionee resigns from employment with the
Corporation, if such resignation occurs within eighteen (18) months after the
occurrence of (i) the failure of Optionee to be elected or re-elected or
appointed or reappointed to such office which Optionee holds (other than as a
result of a termination for "Cause") if Optionee is an officer of the
Corporation and the office which Optionee holds is one to which Optionee is
elected according to the Corporation's By-laws; (ii) a change in Optionee's
functions, duties, or responsibilities such that Optionee's position with the
Corporation becomes substantially less in responsibility, importance, or scope;
or (iii) a "Change in Control" (as such term is defined in subparagraph 7(d)
below).
(d) For purposes of this Agreement, a "Change in Control"
shall be deemed to occur when (i) any "person" or "group" (as such terms are
used in Sections 3(a), 13(d) and 14(d) of the Securities Exchange Act of 1934,
as amended, and the rules and regulations promulgated thereunder (the "1934
Act")), other than (1) a trustee or other fiduciary holding securities under any
employee benefit plan of the Corporation or (2) a corporation owned directly or
indirectly by the stockholders of the Corporation in substantially the same
proportions as their ownership of Stock in the Corporation immediately prior to
any such occurrence, is or becomes the "beneficial owner" (as defined in Rule
13d-3 under the 1934 Act), directly or indirectly, of securities of the
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Corporation representing 20% or more of the total voting power of the then
outstanding securities of the Corporation entitled to vote generally in the
election of directors (the "Voting Stock"); (ii) individuals who are members of
the Board on the date of this Agreement and any individual who becomes a member
of the Board hereafter whose nomination for election as a director was approved
by the affirmative vote of a majority of such Directors, cease to constitute a
majority of the members of the Board; (iii) there occurs a merger or
consolidation of the Corporation with any other corporation or entity, other
than a merger or consolidation which would result in the Voting Stock of the
Corporation immediately outstanding prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting securities of
the surviving entity) at least 80% of the total voting power represented by the
Voting Stock or the voting securities of such surviving entity outstanding
immediately after such merger or consolidation; (iv) there occurs a sale or
transfer or disposition of all or substantially all of the Corporation's assets
to any other corporation or entity, other than a corporation owned directly or
indirectly by the stockholders of the Corporation in substantially the same
proportions as their ownership of Stock in the Corporation immediately prior to
such sale, transfer or disposition; (v) there occurs a sale or transfer or
disposition of a material part of the Corporation's assets or business (such as
a sale or transfer or disposition of the Corporation's One For All United States
retail business sector) to any other corporation or entity, other than a
corporation owned directly or indirectly by the stockholders of the Corporation
in substantially the same proportions as their ownership of Stock in the
Corporation immediately prior to such sale, transfer or disposition; or (vi) the
dissolution or liquidation of the Corporation.
(e) For purposes of this Agreement, "Total Disability" shall
mean an event of illness or other incapacity of Optionee resulting in Optionee's
failure or inability to discharge Optionee's duties as an employee of the
Corporation for ninety (90) or more days during any period of 120 consecutive
days.
8. EFFECT OF TERMINATION OF EMPLOYMENT DUE TO DEATH OR TOTAL
DISABILITY. In the event that Optionee's employment with the Corporation ceases
or is terminated due to Optionee's death or Total Disability, Optionee (or
Optionee's estate or representative, in the event of Optionee's death) may
during the earlier of (i) the one (1) year period following such cessation or
termination of employment or (ii) the remaining term of the Option Period,
exercise the Option to the extent such Option was exercisable on the date such
employment ceased or was terminated and, on such date, that portion of the
Option which was not exercisable shall automatically terminate without further
action by the parties hereto and, in all events, to the extent not exercised,
the Option shall terminate in its entirety at the end of business on the
applicable exercise period as set forth in this Paragraph 8; PROVIDED, HOWEVER,
the Board, in its sole discretion, may approve the full vesting to Optionee (or
Optionee's estate or representative, in the event of Optionee's death) in the
Option and, in such event, to the extent not previously exercised, the Option
shall be exercisable in whole or in part with respect to all remaining shares of
Stock covered the Option and may be exercised by Optionee (or Optionee's estate
or representative, in the event of Optionee's death) at any time prior to the
expiration of the Option Period.
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9. RIGHT OF A STOCKHOLDER. Optionee shall not have any rights as a
stockholder with respect to any shares of Stock unless and until legended
certificates for such shares of such Stock are issued.
10. WITHHOLDING OF TAXES. Whenever the Corporation is required to issue
shares of Stock upon exercise hereunder, the Corporation shall have the right to
require the recipient to remit in cash (or with the consent of the Board, shares
of Stock previously owned by the recipient or issuable upon such exercise) to
the Corporation an amount sufficient to satisfy any federal, state and/or local
withholding tax requirements prior to the delivery of any certificate or
certificates for such shares of Stock.
11. ADJUSTMENTS. In the event of any change in the outstanding shares
of Stock of the Corporation by reason of a stock dividend or distribution,
recapitalization, spin-off, merger, consolidation, split-up, combination,
exchange of shares or the like, the Board shall adjust the number of shares of
Stock which may be issued under the Plan and shall provide for an equitable
adjustment of any outstanding Option or shares of Stock issuable pursuant to an
outstanding Option under the Plan.
12. COMPLIANCE WITH CERTAIN LAWS AND REGULATIONS. If the Board shall
determine, in its sole discretion, that the listing, registration or
qualification of the shares subject to the Option upon any securities exchange
or under any law or regulation, or that the consent or approval of any
governmental regulatory body is necessary or desirable in connection with the
granting of the Option or the acquisition of shares thereunder, the Optionee
shall supply the Board or the Corporation, as the case may be, with such
certificates, representations and information as the Board or the Corporation,
as the case may be, may request and shall otherwise cooperate with the
Corporation in obtaining any such listing, registration, qualification, consent
or approval.
13. TRANSFERABILITY OF OPTION. The Option is not transferable by the
Optionee otherwise than by will or by the laws of descent and distribution and
is exercisable, during the Optionee's lifetime, only by the Optionee, or in the
case of Optionee's legal incompetency, only by Optionee's guardian or legal
representative.
14. ADDITIONAL RESTRICTIONS ON TRANSFER. The certificates representing
the Stock purchased upon the exercise of the Option will bear the following
legend until such shares of Stock have been registered under an effective
registration statement under the 1933 Act:
The securities represented by this certificate were originally issued
on _____________________, 19___, have not been registered under the
Securities Act of 1933, as amended, or under the securities laws of any
state or other jurisdiction (together, the "Securities Laws") and may
not be offered for sale, sold or otherwise transferred or encumbered in
the absence of compliance with such
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Securities Laws and until the issuer hereof shall have received from
counsel acceptable to issuer a written opinion reasonably satisfactory
to issuer that the proposed transaction will not violate any
applicable Securities Laws.
15. NOTICES. Any notice or demand provided for in this Agreement must
be in writing and must be either personally delivered, delivered by overnight
courier, or mailed by first class mail, to the Optionee at Optionee's most
recent address on file in the records of the Corporation, to the Corporation at
the address set forth or established pursuant to Paragraph 3 or to such other
address or to the attention of such other person as the recipient party shall
have specified by prior written notice to the sending party. Any notice or
demand under this Agreement will be deemed to have been given when received.
16. SEVERABILITY. This Agreement and each provision hereof shall be
valid and enforced to the fullest extent permitted by law. The invalidity or
unenforceability of any provision of this Agreement shall not affect the
validity or enforceability of any other provision. Without limiting the
generality of the foregoing, if the scope of any provision contained in this
Agreement is too broad to permit enforcement to its fullest extent, such
provision shall be enforced to the maximum extent permitted by law, and the
parties hereby agree that such scope may be judicially modified accordingly.
17. COMPLETE AGREEMENT. This Agreement and those documents expressly
referred to herein embody the complete agreement and understanding among the
parties and supersede and preempt any prior understandings, agreements or
representations by or among the parties, written or oral, which may have related
to the subject matter hereof in any way.
18. COUNTERPARTS. This Agreement may be executed in separate
counterparts, each of which shall be deemed an original and all of which taken
together shall constitute one and the same agreement.
19. SUCCESSORS AND ASSIGNS. This Agreement is intended to bind and
inure to the benefit of and be enforceable by Optionee, the Corporation and
their respective permitted successors and assigns (including personal
representatives, heirs and legatees), and is intended to bind all successors and
assigns of the respective parties, except that Optionee may not assign any of
Optionee's rights or obligations under this Agreement except to the extent and
in the manner expressly permitted hereby.
20. REMEDIES. Each of the parties to this Agreement will be entitled to
enforce its rights under this Agreement specifically, to recover damages by
reason of any breach of any provision of this Agreement and to exercise all
other rights existing in its favor. The parties hereto agree and acknowledge
that money damages may not be an adequate remedy for any breach of the
provisions of this Agreement and that any party may, in its sole discretion,
apply to any court of law or equity of competent jurisdiction for specific
performance and/or injunctive relief in order to enforce or prevent any
violations of the provisions of this Agreement, without
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the necessity of posting bond or any other security.
21. WAIVER OR MODIFICATION. Any waiver or modification of any
of the provisions of this Agreement shall not be valid unless made in writing
and signed by the parties hereto. A waiver by either party of any breach of this
Agreement shall not operate as a waiver of any subsequent breach.
IN WITNESS WHEREOF, the parties have executed this Agreement
effective on the __ day of ____________________, 199_.
OPTIONEE UNIVERSAL ELECTRONICS INC.
By:
--------------------------
Signature Its:
Print Name
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Certificate Number: ____
UNIVERSAL ELECTRONICS INC.
STOCK OPTION CERTIFICATE
------------------------
THIS CERTIFIES THAT ____________has been awarded an OPTION to purchase
________ shares of common stock, par value $0.01 per share, of UNIVERSAL
ELECTRONICS INC. at a price per share of $____. This Certificate is issued in
accordance with and is subject to the terms and conditions of the related Stock
Option Agreement of even date herewith (the "Agreement").
THIS OPTION is not transferable except in accordance with the terms and
conditions of the Agreement.
THIS OPTION shall expire ten (10) years from the date of this
Certificate.
THIS OPTION shall be exercisable as to all or a portion of the number
of shares set forth above as follows:
On and After the Following Maximum Percentage Taking
Dates, But Prior to Expiration Into Account Prior Exercises
- ------------------------------ ----------------------------
The date of this Certificate 33%
________ 67%
________ 100%
IN WITNESS WHEREOF, UNIVERSAL ELECTRONICS INC. has caused this Stock
Option Certificate to be signed by its duly authorized officer the __ day of
__________199_.
UNIVERSAL ELECTRONICS INC.
By:
Its:
(See Reverse for Record of Option Exercises)
<PAGE> 1
Exhibit 5.1
[LETTERHEAD OF CALFEE, HALTER & GRISWOLD LLP]
March 21, 1997
Universal Electronics Inc.
1864 Enterprise Parkway West
Twinsburg, Ohio 44087
We are familiar with the proceedings taken by Universal
Electronics Inc., a Delaware corporation (the "Company"), with respect to
400,000 shares of Common Stock, $0.01 par value per share (the "Shares"), of the
Company to be offered and sold from time to time pursuant to the Universal
Electronics Inc. 1996 Stock Incentive Plan (the "Plan"). As counsel for the
Company, we have assisted in the preparation of a Registration Statement on Form
S-8 (the "Registration Statement") to be filed by the Company with the
Securities and Exchange Commission to effect the registration of the Shares
under the Securities Act of 1933, as amended.
In this connection, we have examined the Restated Certificate
of Incorporation of the Company, as amended, and the Amended and Restated
By-laws of the Company, records of proceedings of the Board of Directors of the
Company, and such other records and documents as we have deemed necessary or
advisable to render the opinion contained herein. Based upon our examination and
inquiries, we are of the opinion that the Shares are duly authorized and, when
issued pursuant to the terms and conditions of the Plan, will be validly issued,
fully paid and nonassessable.
This opinion is intended solely for your use in the
above-described transaction and may not be reproduced, filed publicly or relied
upon by any other person for any purpose without the express written consent of
the undersigned.
This opinion is limited to the General Corporation Laws of the
State of Delaware and we express no view as to the effect of any other law on
the opinion set forth herein.
We hereby consent to the filing of this opinion as Exhibit 5.1
to the Registration Statement.
Very truly yours,
/s/ Calfee, Halter & Griswold LLP
CALFEE, HALTER & GRISWOLD LLP
<PAGE> 1
Exhibit 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this
Registration Statement on Form S-8 of our report dated January 24, 1996
appearing on page 21 of Universal Electronics Inc.'s Annual Report Form 10-K for
the year ended December 31, 1995.
/s/ Price Waterhouse LLP
PRICE WATERHOUSE LLP
Cleveland, Ohio
March 21, 1997
