SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
TURBODYNE TECHNOLOGIES INC.
(Exact Name of Registrant as Specified in Its Charter)
DELAWARE
(State or Other Jurisdiction of Incorporation or Organization)
95-4699061
(I.R.S. Employer Identification No.)
3110
(Primary Standard Industrial Classification Code Number)
21700 OXNARD STREET, SUITE 1550
WOODLAND HILLS, CALIFORNIA 91367
(Address of Principal Executive Offices) (Zip Code)
TURBODYNE TECHNOLOGIES INC. 1998 STOCK INCENTIVE PLAN
(Full Title of the Plan)
KHAL KADER, CHIEF FINANCIAL OFFICER
TURBODYNE TECHNOLOGIES INC.
21700 OXNARD STREET, SUITE 1550
WOODLAND HILLS, CALIFORNIA 91367
(Name and Address of Agent for Service)
(818) 593-2282
(Telephone Number, Including Area Code, of Agent for Service)
Copies to:
JULIE M. KAUFER, ESQ.
TROOP STEUBER PASICH REDDICK & TOBEY, LLP
2029 CENTURY PARK EAST, 24TH FLOOR
LOS ANGELES, CALIFORNIA 90067-3010
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
=========================== ============================ ========================== ======================== ======================
<S> <C> <C> <C> <C>
Proposed Maximum Proposed Maximum
Title of Securities to Amount to be Offering Price Per Aggregate Offering Amount of
be Registered Registered Share Price Registration Fee
============= ========== ================== ================== ===================
Common Stock 2,001,600 Shares $5.25 $10,508,400 $3,100
Common Stock 1,998,400 Shares $5.47(1) $10,931,248(1) $3,225
=========================== ============================ ========================== ======================== ======================
</TABLE>
(1) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457(h)(1) under the Securities Act of 1933, as amended, and based upon
the average of the high and low prices of the Common Stock on the Nasdaq
SmallCap Market on September 21, 1998.
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PART I*
INFORMATION REQUIRED IN SECTION 10(A) PROSPECTUS
ITEM 1. PLAN INFORMATION.
ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.
* Information required by Part I to be contained in the Section 10(a)
prospectus is omitted from the Registration Statement in accordance
with Rule 428 under the Securities Act of 1933, as amended, and the
Note to Part I of Form S-8.
PART II
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed by the Company with the Commission are
incorporated herein by reference:
(a) The Company's Annual Report on Form 20-F for the fiscal year ended
December 31, 1997, filed with the Commission on July 15, 1998.
(b) The Company's Quarterly Report on Form 10-Q for the quarter ended
June 30, 1998, filed with the Commission on August 14, 1998.
(c) The Company's Current Reports on Form 6-K, dated April 7, 1998,
April 9, 1998, April 10, 1998, April 27, 1998, April 28, 1998, May
26, 1998, June 2, 1998, June 11, 1998, July 2, 1998, July 7, 1998,
July 13, 1998, July 15, 1998 and July 16, 1998.
(d) The Company's Current Reports on Form 8-K, dated August 13, 1998
and September 18, 1998.
(e) The description of the Common Stock contained in the Registration
Statement on Form 20-F filed by the Company pursuant to Section 12
of the Exchange Act, and any amendment or report filed for the
purpose of updating such description.
(f) All documents subsequently filed by Registrant 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 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 this Registration Statement and to be
part hereof from the date of filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES.
The securities to be offered are registered under Section 12 of the
Exchange Act of 1934.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
None.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Registrant's Certificate of Incorporation and Bylaws provide for
the indemnification by the Registrant of each director, officer and employee of
the Registrant to the fullest extent permitted by the Delaware General
Corporation Law, as the same exists or may hereafter be amended. Section 145 of
the Delaware General Corporation Law provides in relevant part that a
corporation may 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 (other than
an action by or in the right of the corporation) by reason of the fact that such
person is or was a director, officer, employee or agent of the corporation, or
is or was serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise, against expenses (including attorneys' fees), judgments, fines
and amounts paid in settlement actually and reasonably incurred by such person
in connection with such action, suit or proceeding if such person acted in good
faith and in a manner such person 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 such person's conduct was
unlawful.
In addition, Section 145 provides that a corporation may indemnify any
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action or suit by or in the right of the
corporation to procure a judgment in its favor by reason of the fact that such
person is or was a director, officer, employee or agent of the corporation, or
is or was serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise against expenses (including attorneys' fees) actually and
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reasonably incurred by such person in connection with the defense or
settlement of such action or suit if such person acted in good faith and in a
manner such person reasonably believed to be in or not opposed to the best
interests of the corporation and except that 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 corporation 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. Delaware law further provides
that nothing in the above-described provisions shall be deemed exclusive of any
other rights to indemnification or advancement of expenses to which any person
may be entitled under any bylaw, agreement, vote of stockholders or
disinterested directors or otherwise.
The Company's Certificate of Incorporation provides that a director of
the Registrant shall not be liable to the Registrant or its stockholders for
monetary damages for breach of fiduciary duty as a director. Section 102(b)(7)
of the Delaware General Corporation Law provides that a provision so limiting
the personal liability of a director shall not eliminate or limit the liability
of a director for, among other things: breach of the duty of loyalty; acts or
omissions not in good faith or which involve intentional misconduct or a knowing
violation of the law; unlawful payment of dividends; and transactions from which
the director derived an improper personal benefit.
The Registrant has entered into separate agreements (the " Agreements")
with certain of its directors and officers (the "Indemnitees") providing for the
Indemnitees' indemnification on substantially identical terms. Pursuant to the
terms and conditions of the Agreements, the Registrant agrees to indemnify, to
the maximum extent permitted by California law, each Indemnitee against any
amounts which he or she becomes legally obligated to pay in connection with any
claim against him or her based upon any action or inaction which he or she may
commit, omit or suffer arising from or growing out of services rendered to the
Registrant, or any subsidiary, pursuant to the terms of the Agreement, provided,
however, that Indemnitee acted in good faith and in a manner Indemnitee
reasonably believed to be in or not opposed to the best interests of the
Company.
Insofar as indemnification for liabilities arising under the Securities
Act 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 Securities Act
and is, therefore, unenforceable.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
4.1 Turbodyne Technologies Inc. 1998 Stock Incentive Plan.
5.1 Opinion of Troop Steuber Pasich Reddick & Tobey, LLP.
23.1 Consent of Morgan and Company, Chartered Accountants.
23.2 Consent of KPMG Peat Marwick LLP.
23.3 Consent of Troop Steuber Pasich Reddick & Tobey, LLP (included in its
opinion as Exhibit 5.1).
24.1 Power of Attorney (included on signature page).
- -----------------------------------------------------
ITEM 9. UNDERTAKINGS.
The undersigned registrant hereby undertakes as follows:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration
Statement 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 this Registration Statement;
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be
deemed to be a new registration statement relating to the
securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial BONA
FIDE offering thereof;
(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 this offering; and
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(4) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of the registrant's annual
report pursuant to Section 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 the 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.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers or
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 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.
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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 a 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 Woodland Hills, State of California, on this 23rd
day of September 1998.
TURBODYNE TECHNOLOGIES, INC.
(Registrant)
By: /S/ LEON NOWEK
-------------------------
Leon Nowek
Vice Chairman
POWER OF ATTORNEY
Each person whose signature appears below constitutes and appoints
Leon Nowek as his true and lawful attorney-in-fact and agent with full power of
substitution and resubstitution, for him and his name, place and stead, in any
and all capacities, to sign any or all amendments (including post-effective
amendments) to this Registration Statement and to file the same, with all
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorney-in-fact and
agent full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the foregoing, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent, or his substitutes, may
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities and on the date indicated.
Signature Title Date
- ---------------------------------------------------------- -----------------
/S/ WALTER F. WARE Chief Executive Officer, September 23, 1998
- ------------------------- President and Director
Walter F. Ware
/S/ EDWARD HALIMI Chairman of the Board and September 15, 1998
- ------------------------- Director
Edward Halimi
/S/ KHAL KADER Chief Financial Officer September 23, 1998
- -------------------------
Khal Kader
/S/ LEON NOWEK
- ------------------------- Vice Chairman of the Board, September 23, 1998
Leon Nowek Secretary and Director
/S/ DANIEL GERONAZZO Director September 16, 1998
- -------------------------
Daniel Geronazzo
/S/ WENDELL R. ANDERSON Director September 16, 1998
- -------------------------
Wendell R. Anderson
Director
- ------------------------- ------------- ----
Robert Taylor
/S/ SADAYAPPA DURAIRAJ Director September 16, 1998
- -------------------------
Sadayappa Durairaj
5
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EXHIBIT INDEX
-------------
EXHIBIT NO. EXHIBIT DESCRIPTION SEQUENTIALLY
- ----------- ------------------- NUMBERED PAGE
-------------
4.1 Turbodyne Technologies Inc. 1998 Stock Incentive Plan.
5.1 Opinion of Troop Steuber Pasich Reddick & Tobey, LLP.
23.1 Consent of Morgan and Company, Chartered Accountants.
23.2 Consent of KPMG Peat Marwick LLP.
23.3 Consent of Troop Steuber Pasich Reddick & Tobey, LLP (included in its
opinion as Exhibit 5.1).
24.1 Power of Attorney (included on signature page).
6
EXHIBIT 4.1
TURBODYNE TECHNOLOGIES INC.
1998 STOCK INCENTIVE PLAN
1. PURPOSE OF THE PLAN.
The purpose of this 1998 Stock Incentive Plan (the "Plan") is to provide
incentives and rewards to selected eligible directors, officers, employees and
consultants of Turbodyne Technologies Inc. (the "Company") or its subsidiaries
in order to assist the Company and its subsidiaries in attracting, retaining and
motivating those persons by providing for or increasing the proprietary
interests of those persons in the Company, and by associating their interests in
the Company with those of the Company's stockholders.
2. ADMINISTRATION OF THE PLAN.
The Plan shall be administered by the Board of Directors of the Company (the
"Board"), or a committee of the Board (the "Committee") whose members shall
serve at the pleasure of the Board. If administration is delegated to the
Committee, the Committee shall have, in connection with the administration of
the Plan, the powers theretofore possessed by the Board (and references in this
Plan to the Board shall thereafter be to the Committee), subject, however, to
such resolutions, not inconsistent with the provisions of the Plan as may be
adopted from time to time by the Board.
The Board shall have all the powers vested in it by the terms of the Plan,
including exclusive authority (i) to select from among eligible directors,
officers, employees and consultants, those persons to be granted "Awards" (as
defined below) under the Plan; (ii) to determine the type, size and terms of
individual Awards (which need not be identical) to be made to each person
selected; (iii) to determine the time when Awards will be granted and to
establish objectives and conditions (including, without limitation, vesting and
performance conditions), if any, for earning Awards; (iv) to amend the terms or
conditions of any outstanding Award, subject to applicable legal restrictions
and to the consent of the other party to such Award; (v) to determine the
duration and purpose of leaves of absences which may be granted to holders of
Awards without constituting termination of their employment for purposes of
their Awards; (vi) to authorize any person to execute, on behalf of the Company,
any instrument required to carry out the purposes of the Plan; and (vii) to make
any and all other determinations which it determines to be necessary or
advisable in the administration of the Plan. The Board shall have full power and
authority to administer and interpret the Plan and to adopt, amend and revoke
such rules, regulations, agreements, guidelines and instruments for the
administration of the Plan and for the conduct of its business as the Board
deems necessary or advisable. The Board's interpretation of the Plan, and all
actions taken and determinations made by the Board pursuant to the powers vested
in it hereunder, shall be conclusive and binding on all parties concerned,
including the Company, its stockholders, any participants in the Plan and any
other employee of the Company or any of its subsidiaries.
3. PERSONS ELIGIBLE UNDER THE PLAN.
Any person who is a director, officer, employee or consultant of the Company,
or any of its subsidiaries (a "Participant"), shall be eligible to be considered
for the grant of Awards under the Plan.
4. AWARDS.
(a) COMMON STOCK AND DERIVATIVE SECURITY AWARDS. Awards authorized under the
Plan shall consist of any type of arrangement with a Participant that is not
inconsistent with the provisions of the Plan and that, by its terms, involves or
might involve or be made with reference to the issuance of (i) shares of the
Common Stock, $.001 par value per share, of the Company (the "Common Stock") or
(ii) a "derivative security" (as that term is defined in Rule 16a-1(c) of the
Rules and Regulations of the Securities and Exchange Commission under the
Securities Exchange Act of 1934, as amended, as the same may be amended from
time to time) with an exercise or conversion price related to the Common Stock
or with a value derived from the value of the Common Stock.
<PAGE>
(b) TYPES OF AWARDS. Awards are not restricted to any specified form or
structure and may include, but need not be limited to, sales, bonuses and other
transfers of stock, restricted stock, stock options, reload stock options, stock
purchase warrants, other rights to acquire stock or securities convertible into
or redeemable for stock, stock appreciation rights, phantom stock, dividend
equivalents, performance units or performance shares, or any other type of Award
which the Board shall determine is consistent with the objectives and
limitations of the Plan. An Award may consist of one such security or benefit,
or two or more of them in tandem or in the alternative.
(c) CONSIDERATION. Common Stock may be issued pursuant to an Award for any
lawful consideration as determined by the Board, including, without limitation,
a cash payment, services rendered, or the cancellation of indebtedness.
(d) GUIDELINES. The Board may adopt, amend or revoke from time to time
written policies implementing the Plan. Such policies may include, but need not
be limited to, the type, size and term of Awards to be made to participants and
the conditions for payment of such Awards.
(e) TERMS AND CONDITIONS. Subject to the provisions of the Plan, the Board,
in its sole and absolute discretion, shall determine all of the terms and
conditions of each Award granted pursuant to the Plan, which terms and
conditions may include, among other things:
(i) any provision necessary for such Award to qualify as an incentive
stock option under Section 422 of the Internal Revenue Code of 1986, as
amended (the "Code") (an "Incentive Stock Option");
(ii) a provision permitting the recipient of such Award to pay the
purchase price of the Common Stock or other property issuable pursuant to
such Award, or to pay such recipient's tax withholding obligation with
respect to such issuance, in whole or in part, by delivering previously owned
shares of capital stock of the Company (including "pyramiding") or other
property, or by reducing the number of shares of Common Stock or the amount
of other property otherwise issuable pursuant to such Award; or
(iii) a provision conditioning or accelerating the receipt of benefits
pursuant to the Award, or terminating the Award, either automatically or in
the discretion of the Board, upon the occurrence of specified events,
including, without limitation, a change of control of the Company, an
acquisition of a specified percentage of the voting power of the Company, the
dissolution or liquidation of the Company, a sale of substantially all of the
property and assets of the Company or an event of the type described in
Section 7 of the Plan.
(f) SUSPENSION OR TERMINATION OF AWARDS. If the Company believes that a
Participant has committed an act of misconduct as described below, the Company
may suspend the Participant's rights under any then outstanding Award pending a
determination by the Board. If the Board determines that a Participant has
committed an act of embezzlement, fraud, nonpayment of any obligation owed to
the Company or any subsidiary, breach of fiduciary duty or deliberate disregard
of the Company's rules resulting in loss, damage or injury to the Company, or if
a Participant makes an unauthorized disclosure of trade secret or confidential
information of the Company, engages in any conduct constituting unfair
competition, or induces any customer of the Company to breach a contract with
the Company, neither the Participant nor his or her estate shall be entitled to
exercise any rights whatsoever with respect to such Award. In making such
determination, the Board shall act fairly and shall give the Participant a
reasonable opportunity to appear and present evidence on his or her behalf to
the Board.
(g) MAXIMUM GRANT OF AWARDS TO ANY PARTICIPANT. No Participant shall
receive Awards representing more than 200,000 shares of Common Stock per annum,
subject to adjustment as provided in Section 7 hereof.
5. SHARES OF COMMON STOCK SUBJECT TO THE PLAN.
The aggregate number of shares of Common Stock that may be issued or issuable
pursuant to all Awards under the Plan (including Awards in the form of Incentive
Stock Options and Non-Statutory Stock Options) shall not exceed an aggregate of
4,000,000 shares of Common Stock, subject to adjustment as provided in Section 7
of the Plan.
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Shares of Common Stock subject to the Plan may consist, in whole or
in part, of authorized and unissued shares or treasury shares. Any shares of
Common Stock subject to an Award which for any reason expires or is terminated
unexercised as to such shares shall again be available for issuance under the
Plan. For purposes of this Section 5, the aggregate number of shares of Common
Stock that may be issued at any time pursuant to Awards granted under the Plan
shall be reduced by: (i) the number of shares of Common Stock previously issued
pursuant to Awards granted under the Plan, other than shares of Common Stock
subsequently reacquired by the Company pursuant to the terms and conditions of
such Awards and with respect to which the holder thereof received no benefits of
ownership, such as dividends; and (ii) the number of shares of Common Stock
which were otherwise issuable pursuant to Awards granted under this Plan but
which were withheld by the Company as payment of the purchase price of the
Common Stock issued pursuant to such Awards or as payment of the recipient's
tax withholding obligation with respect to such issuance.
6. PAYMENT OF AWARDS.
The Board shall determine the extent to which Awards shall be payable in
cash, shares of Common Stock or any combination thereof. The Board may, upon
request of a Participant, determine that all or a portion of a payment to that
Participant under the Plan, whether it is to be made in cash, shares of Common
Stock or a combination thereof, shall be deferred. Deferrals shall be for such
periods and upon such terms as the Board may determine in its sole discretion.
7. DILUTION AND OTHER ADJUSTMENT.
In the event of any change in the outstanding shares of the Common Stock or
other securities then subject to the Plan by reason of any stock split, reverse
stock split, stock dividend, recapitalization, merger, consolidation,
combination or exchange of shares or other similar corporate change, or if the
outstanding securities of the class then subject to the Plan are exchanged for
or converted into cash, property or a different kind of securities, or if cash,
property or securities are distributed in respect of such outstanding securities
as a class (other than cash dividends), then the Board may, but it shall not be
required to, make such equitable adjustments to the Plan and the Awards
thereunder (including, without limitation, appropriate and proportionate
adjustments in (i) the number and type of shares or other securities or cash or
other property that may be acquired pursuant to Incentive Stock Options and
other Awards theretofore granted under the Plan, (ii) the maximum number and
type of shares or other securities that may be issued pursuant to Incentive
Stock Options and other Awards thereafter granted under the Plan; and (iii) the
maximum number of securities with respect to which Awards may thereafter be
granted to any Participant in any fiscal year) as the Board in its sole
discretion determines appropriate, including any adjustments in the maximum
number of shares referred to in Section 5 of the Plan. Such adjustments shall be
conclusive and binding for all purposes of the Plan.
8. MISCELLANEOUS PROVISIONS.
(a) DEFINITIONS. As used herein, "subsidiary" means any current or future
corporation which would be a "subsidiary corporation," as that term is defined
in Section 424(f) of the Code, of the Company; and the term "or" means "and/or."
(b) CONDITIONS ON ISSUANCE. Securities shall not be issued pursuant to Awards
unless the grant and issuance thereof shall comply with all relevant provisions
of law and the requirements of any securities exchange or quotation system upon
which any securities of the Company are listed, and shall be further subject to
approval of counsel for the Company with respect to such compliance. Inability
of the Company to obtain authority from any regulatory body having jurisdiction,
which authority is determined by Company counsel to be necessary to the lawful
issuance and sale of any security or Award, shall relieve the Company of any
liability in respect of the nonissuance or sale of such securities as to which
requisite authority shall not have been obtained.
(c) RIGHTS AS STOCKHOLDER. A participant under the Plan shall have no rights
as a holder of Common Stock with respect to Awards hereunder, unless and until
certificates for shares of such stock are issued to the participant.
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(d) ASSIGNMENT OR TRANSFER. Subject to the discretion of the Board, and
except with respect to Incentive Stock Options which are not transferable except
by will or the laws of descent and distribution, Awards under the Plan or any
rights or interests therein shall be assignable or transferable.
(e) AGREEMENTS. All Awards granted under the Plan shall be evidenced by
written agreements in such form and containing such terms and conditions (not
inconsistent with the Plan) as the Board shall from time to time adopt.
(f) WITHHOLDING TAXES. The Company shall have the right to deduct from all
Awards hereunder paid in cash any federal, state, local or foreign taxes
required by law to be withheld with respect to such awards and, with respect to
awards paid in stock, to require the payment (through withholding from the
participant's salary or otherwise) of any such taxes. The obligation of the
Company to make delivery of Awards in cash or Common Stock shall be subject to
the restrictions imposed by any and all governmental authorities.
(g) NO RIGHTS TO AWARD. No Participant or other person shall have any right
to be granted an Award under the Plan. Neither the Plan nor any action taken
hereunder shall be construed as giving any Participant any right to be retained
in the employ of the Company or any of its subsidiaries or shall interfere with
or restrict in any way the rights of the Company or any of its subsidiaries,
which are hereby reserved, to discharge a Participant at any time for any reason
whatsoever, with or without good cause.
(h) COSTS AND EXPENSES. The costs and expenses of administering the Plan
shall be borne by the Company and not charged to any Award nor to any
Participant receiving an Award.
(i) FUNDING OF PLAN. The Plan shall be unfunded. The Company shall not be
required to establish any special or separate fund or to make any other
segregation of assets to assure the payment of any Award under the Plan.
9. AMENDMENTS AND TERMINATION.
(a) AMENDMENTS. The Board may at any time terminate or from time to time
amend the Plan in whole or in part, but no such action shall adversely affect
any rights or obligations with respect to any Awards theretofore made under the
Plan. However, with the consent of the Participant affected, the Board may amend
outstanding agreements evidencing Awards under the Plan in a manner not
inconsistent with the terms of the Plan.
(b) STOCKHOLDER APPROVAL. To the extent that Section 422 of the Code, other
applicable law, or the rules, regulations, procedures or listing agreement of
any national securities exchange or quotation system, requires that any
amendment of the Plan be approved by the stockholders of the Company, no such
amendment shall be effective unless and until it is approved by the stockholders
in such a manner and to such a degree as is required.
(c) TERMINATION. Unless the Plan shall theretofore have been terminated as
above provided, the Plan (but not the awards theretofore granted under the Plan)
shall terminate on and no awards shall be granted after September 11, 2008.
10. EFFECTIVE DATE.
The Plan is effective on September 4, 1998, the date on which it was
adopted by the Board of Directors of the Company, subject to the approval of the
Plan by the holders of at least a majority of the outstanding shares of the
Common Stock present, or represented, and entitled to vote at the 1998 Annual
Meeting of Stockholders. Awards may be made under the Plan on and after its
effective date, subject to stockholder approval of the Plan as provided above.
If approval of the stockholders is not obtained, all Awards granted under the
Plan shall be null and void.
11. GOVERNING LAW
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The Plan and any agreements entered into thereunder shall be construed and
governed by the laws of the State of Delaware applicable to contracts made
within, and to be performed wholly within, such state, without regard to the
application of conflict of laws rules thereof.
5
EXHIBIT 5.1
Troop Steuber Pasich Reddick & Tobey, LLP
lawyers
September 23, 1998
Turbodyne Technologies Inc.
Ladies/Gentlemen:
At your request, we have examined the Registration Statement on Form
S-8 (the "Registration Statement") to which this letter is attached as Exhibit
5.1 filed by Turbodyne Technologies Inc., a Delaware corporation (the
"Company"), in order to register under the Securities Act of 1933, as amended
(the "Act"), 4,000,000 shares of Common Stock of the Company (the " Shares")
issuable pursuant to the Company's 1998 Stock Incentive Plan (the "Plan").
We are of the opinion that the Shares have been duly authorized and
upon issuance and sale in conformity with and pursuant to the Plan, the Shares
will be validly issued, fully paid and non-assessable.
We consent to the use of this opinion as an Exhibit to the
Registration Statement and to the use of our name in the Prospectus constituting
a part thereof.
Respectfully submitted,
/s/ Troop Steuber Pasich Reddick & Tobey, LLP
Troop Steuber Pasich Reddick & Tobey, LLP
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the inclusion of our audit report dated February 14,
1997, except for the last paragraph of Note 5(A) which is as of March 12, 1997,
Note 2, Note 13 and Note 14(a) which are as of May 14, 1997 and Notes 14(b),
14(c), 14(d), and 14(e), which are as of June 17, 1997 on the revised
consolidated financial statements of Turbodyne Technologies Inc. for the year
ended December 31, 1996 and 1995 in Form S-8, when such financial information is
read in conjunction with the financial statements referred to in our report.
Vancouver, Canada /S/ MORGAN & COMPANY
-----------------------------------
September 21, 1998 Chartered Accountants
EXHIBIT 23.2
INDEPENDENT AUDITORS' CONSENT
The Board of Directors
Turbodyne Technologies Inc.
We consent to the incorporation by reference in the registration statement on
Form S-8 of Turbodyne Technologies Inc. of our report dated April 3, 1998, with
respect to the consolidated balance sheets of Turbodyne Technologies Inc. as of
December 31, 1997 and 1996, and the related consolidated statements of
operations, stockholders' equity, and cash flows for each of the years in the
three-year period ended December 31, 1997, which report appears in Form 20-F of
Turbodyne Technologies Inc. dated April 3, 1998.
/s/ KPMG PEAT MARWICK LLP
Los Angeles, California
September 23, 1998
