<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 21, 1998
Registration No. 333-__________
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
-----------------
TRAMMELL CROW COMPANY
(Exact name of registrant as specified in its charter)
DELAWARE 75-2721454
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2001 ROSS AVENUE, SUITE 3400
DALLAS, TEXAS 75201
(Address of principal executive offices, including zip code)
-----------------
TRAMMELL CROW COMPANY
1997 STOCK OPTION PLAN
(Full title of the plan)
GEORGE L. LIPPE
CHIEF EXECUTIVE OFFICER
TRAMMELL CROW COMPANY
2001 ROSS AVENUE, SUITE 3400
DALLAS, TEXAS 75201
(214) 863-3000
(Name, address and telephone number of agent for service)
copy to:
DEREK R. MCCLAIN J. CHRISTOPHER KIRK
GENERAL COUNSEL VINSON & ELKINS L.L.P.
TRAMMELL CROW COMPANY 3700 TRAMMELL CROW CENTER
2001 ROSS AVENUE, SUITE 3400 2001 ROSS AVENUE
DALLAS, TEXAS 75201 DALLAS, TEXAS 75201-2975
(214) 863-3000 (214) 220-7700
CALCULATION OF REGISTRATION FEE
<TABLE>
- ------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
Proposed
Title of securities Amount to be Proposed maximum maximum aggregate Amount of
to be registered registered offering price per unit* offering price* registration fee
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $0.01 par
value per share . . . . . . . 2,423,801 shares $3.85 $9,331,634 $2,753
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
===============================================================================
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents have been filed with the Securities and Exchange
Commission by Trammell Crow Company, a Delaware corporation (the "Company"), and
are incorporated herein by reference and made a part hereof:
(a) The Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1997, filed with the Commission pursuant to the
Securities Exchange Act of 1934 (the "Exchange Act") on March 31,
1998; and
(b) The description of the Company's Common Stock, $0.01 par value per
share, contained in Item 1 of the Company's Registration Statement on
Form 8-A filed with the Commission pursuant to the Exchange Act on
October 23, 1997.
All documents subsequently filed by the Company pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Exchange Act prior to the filing of a post-effective
amendment that indicates that all securities offered have been sold or that
deregisters all securities then remaining unsold shall also be deemed to be
incorporated by reference herein and to be a part hereof from the dates of
filing of such documents. Any statement contained in a document incorporated or
deemed to be incorporated by reference herein shall be deemed to be modified or
superseded for purposes of this Registration Statement to the extent that a
statement contained herein or in any other subsequently filed document which
also is or is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any statement so modified or superseded shall not be
deemed, except as so modified or superseded, to constitute a part of this
Registration Statement. Upon the written or oral request of any person to whom
a copy of this Registration Statement has been delivered, the Company will
provide without charge to such person a copy of any and all documents (excluding
exhibits thereto unless such exhibits are specifically incorporated by reference
into such documents) that have been incorporated by reference into this
Registration Statement but not delivered herewith. Requests for such documents
should be addressed to Trammell Crow Company, 2001 Ross Avenue, Suite 3400,
Dallas, Texas 75201, Attention: Secretary, (214) 863-3000.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Company's Certificate of Incorporation provides that no director of the
Company shall be personally liable to the Company or its stockholders for
monetary damages for breach of fiduciary duty as a director, except for
liability (i) for any breach of the director's duty of loyalty to the Company or
its stockholders; (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law; (iii) in respect of
certain unlawful dividend payments or stock redemptions or repurchases; or (iv)
for any transaction from which the director derived an improper personal
benefit. The effect of these provisions is to eliminate the rights of the
Company and its stockholders (through stockholders' derivative suits on behalf
of the Company) to recover monetary damages against a director for breach of
fiduciary duty as a director (including breaches resulting from grossly
negligent behavior), except in the situations described above.
Section 145 of the DGCL ("Section 145") permits indemnification of
directors, officers, agents and controlling persons of a corporation under
certain conditions and subject to certain limitations. Article Eleventh of the
Certificate of Incorporation of the Company provides that the Company shall
indemnify its officers and directors to the maximum
2
<PAGE>
extent allowed by the DGCL. Pursuant to Section 145, the Company generally
has the power to indemnify its present and former directors and officers
against expenses and liabilities incurred by them in connection with any suit
to which they are, or are threatened to be made, a party by reason of their
serving in those positions so long as they acted in good faith and in a
manner they reasonably believed to be in, or not opposed to, the best
interests of the Company, and with respect to any criminal action, so long as
they had no reasonable cause to believe their conduct was unlawful. With
respect to suits by or in the right of the Company, however, indemnification
is generally limited to attorneys' fees and other expenses and is not
available if the person is adjudged to be liable to the Company, unless the
court determines that indemnification is appropriate. The statute expressly
provides that the power to indemnify authorized thereby is not exclusive of
any rights granted under any bylaw, agreement, vote of stockholders or
disinterested directors, or otherwise. The registrant also has the power to
purchase and maintain insurance for its directors and officers. The Company
maintains officers' and directors' liability insurance which insures against
liabilities that officers and directors of the Company may incur in such
capacities. Additionally, Article Eleventh of the Certificate of
Incorporation provides that, in the event that an officer or director files
suit against the registrant seeking indemnification of liabilities or
expenses incurred, the burden will be on the registrant to prove that the
indemnification would not be permitted under the DGCL. The preceding
discussion of the registrant's Certificate of Incorporation and Section 145
of the DGCL is not intended to be exhaustive and is qualified in its entirety
by the Certificate of Incorporation and Section 145 of the DGCL.
The Company has entered into indemnity agreements with its directors and
officers. Pursuant to such agreements, the Company will, to the extent
permitted by applicable law, indemnify such persons against all expenses,
judgments, fines and penalties incurred in connection with the defense or
settlement of any actions brought against them by reason of the fact that they
were directors or officers of the Company or assumed certain responsibilities at
the direction of the Company.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
Unless otherwise indicated below as being incorporated by reference to
another filing of the Company with the Commission, each of the following
exhibits is filed herewith:
<TABLE>
<CAPTION>
<S> <C>
4.1 -- 1997 Stock Option Plan
5.1 -- Opinion of Vinson & Elkins L.L.P.
23.1 -- Consent of Ernst & Young LLP
23.2 -- Consent of Vinson & Elkins L.L.P. (included in its
opinion filed as part of Exhibit 5.1)
24.1 -- Power of Attorney (included on the signature pages
of this Registration Statement)
</TABLE>
ITEM 9. UNDERTAKINGS.
The Company 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, as amended (the "Securities Act");
3
<PAGE>
(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; and
(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 (1)(i) and (1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Company pursuant
to section 13 or section 15(d) of the Exchange Act that are incorporated by
reference in this Registration Statement.
(2) That, for the purposes 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 the offering.
(4) That, for purposes of determining any liability under the
Securities Act, each filing of the Company's annual report pursuant to
section 13(a) or section 15(d) of the Exchange Act 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.
(5) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling
persons of the Company pursuant to the foregoing provisions, or otherwise,
the Company has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Company of expenses incurred or paid by a director, officer or controlling
person of the Company in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Company will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as expressed in
the Securities Act and will be governed by the final adjudication of such
issue.
4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Company certifies that it has reasonable grounds to believe that it meets all of
the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Dallas, State of Texas, on the 20th day of April,
1998.
TRAMMELL CROW COMPANY
By: /s/ George L. Lippe
-------------------------------------
George L. Lippe, President and Chief
Executive Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints George L. Lippe, Asuka Nakahara and
William P. Leiser and each of them, his true and lawful attorneys-in-fact and
agents, each with full power of substitution and resubstitution, for him and in
his name, place and stead, in any and all capacities, to sign any and all
amendments, including pre- and post-effective amendments, to this Registration
Statement, and any registration statement relating to the offering covered by
this Registration Statement and filed pursuant to Rule 462(b) under the
Securities Act, and to file the same, with exhibits thereto and other documents
in connection therewith, with the Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary to be
done, as fully to all intents and purposes as he might or could do in person,
hereby ratifying and confirming all that each of said attorneys-in-fact and
agents or their substitute may lawfully do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed by the following persons in the capacities and on the
date indicated.
<TABLE>
<CAPTION>
Signature Capacity Date
--------- -------- ----
<S> <C> <C>
/s/ George L. Lippe President and Chief Executive April 20, 1998
- ---------------------------- Officer (Principal Executive
George L. Lippe Officer)
/s/ Asuka Nakahara Chief Financial Officer April 20, 1998
- ---------------------------- (Principal Financial Officer)
Asuka Nakahara
/s/ William P. Leiser Executive Vice-President and April 20, 1998
- ---------------------------- Treasurer (Principal
William P. Leiser Accounting Officer)
/s/ Harlan R. Crow Director April 20, 1998
- ----------------------------
Harlan R. Crow
/s/ J. McDonald Williams Director April 20, 1998
- ----------------------------
J. McDonald Williams
/s/ James D. Carreker Director April 20, 1998
- ----------------------------
James D. Carreker
S-1
<PAGE>
/s/ William F. Concannon Director April 20, 1998
- ----------------------------
William F. Concannon
/s/ James R. Erwin Director April 20, 1998
- ----------------------------
James R. Erwin
/s/ Jeffrey M. Heller Director April 20, 1998
- ----------------------------
Jeffrey M. Heller
/s/ Rowland Moriarty Director April 20, 1998
- ----------------------------
Rowland Moriarty
/s/ Robert E. Sulentic Director April 20, 1998
- ----------------------------
Robert E. Sulentic
</TABLE>
S-2
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
<C> <S>
4.1 -- 1997 Stock Option Plan
5.1 -- Opinion of Vinson & Elkins L.L.P.
23.1 -- Consent of Ernst & Young LLP
23.2 -- Consent of Vinson & Elkins L.L.P. (included as
part of Exhibit 5.1)
24.1 -- Power of Attorney (included on the signature pages
of this Registration Statement)
</TABLE>
<PAGE>
Exhibit 4.1
TRAMMELL CROW COMPANY
1997 STOCK OPTION PLAN
SCOPE AND PURPOSE OF PLAN
Trammell Crow Company, a Texas corporation (the "CORPORATION"), has adopted
this 1997 Stock Option Plan (the "PLAN") to provide for the granting of
Nonstatutory Options to certain Key Employees.
The purpose of the Plan is to provide an equity ownership opportunity for
certain Key Employees commensurate with their positions with the Corporation and
its Subsidiaries and to provide an incentive for such Key Employees to remain in
the service of the Corporation or its Subsidiaries.
SECTION 1. DEFINITIONS
1.1 "Award" means the grant of an Option to a Holder pursuant to the
terms, conditions, and limitations that the Committee may establish in order to
fulfill the objectives of the Plan.
1.2 "Award Agreement" means the written document or agreement delivered
to Holder evidencing the terms, conditions, and limitations of an Award that the
Corporation granted to that Holder.
1.3 "Board of Directors" means the board of directors of the
Corporation.
1.4 "Business Day" means any day other than a Saturday, a Sunday, or a
day on which banking institutions in the State of Texas are authorized or
obligated by law or executive order to close.
1.5 "Change in Control" means the occurrence of any of the following
events:
(i) Consummation of a reorganization, merger or consolidation or
sale or other disposition of all or substantially all of the assets of the
Corporation or an acquisition of assets of another corporation (a "BUSINESS
COMBINATION"), in each case, unless, following such Business Combination, all or
substantially all of the individuals and entities who were the beneficial
owners, respectively, of the Outstanding Corporation Common Stock and
Outstanding Corporation Voting Securities immediately prior to such Business
Combination beneficially own, directly or indirectly, more than 50% of,
respectively, the then outstanding shares of common stock and the combined
voting power of the then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the corporation
resulting from such Business Combination (including, without limitation, a
corporation which as a result of such transaction owns the Corporation or all or
substantially all of the Corporation's assets either directly or through one or
more subsidiaries); or
(ii) Approval by the shareholders of the Corporation of a
complete liquidation or dissolution of the Corporation.
1.6 "Code" means the Internal Revenue Code of 1986, as amended.
1
<PAGE>
1.7 "Committee" means any committee or subcommittee appointed pursuant
to Section 3 by the Board of Directors to administer this Plan.
1.8 "Corporation" means Trammell Crow Company, a Texas corporation, or
its successor pursuant to any provision of this Plan.
1.9 "Date of Grant" has the meaning given it in Paragraph 4.3.
1.10 "Eligible Individuals" shall have the same meaning as Key
Employees.
1.11 "Employee" means any employee of the Corporation or of any of its
Subsidiaries, including officers and directors of the Corporation who are also
employees of the Corporation or of any of its Subsidiaries.
1.12 "Exchange Act" means the Securities Exchange Act of 1934.
1.13 "Exercise Notice" has the meaning given it in Paragraph 5.5.
1.14 "Exercise Price" has the meaning given it in Paragraph 5.4.
1.15 "Fair Market Value" means, for a particular day:
(a) If shares of Stock of the same class are listed or admitted
to unlisted trading privileges on any national or regional securities
exchange at the date of determining the Fair Market Value, then the last
reported sale price, regular way, on the composite tape of that exchange on
the last Business Day before the date in question or, if no such sale takes
place on that Business Day, the average of the closing bid and asked
prices, regular way, in either case as reported in the principal
consolidated transaction reporting system with respect to securities listed
or admitted to unlisted trading privileges on that securities exchange; or
(b) If shares of Stock of the same class are not listed or
admitted to unlisted trading privileges as provided in Subparagraph 1.15(a)
and if sales prices for shares of Stock of the same class in the
over-the-counter market are reported by NASDAQ National Market System at
the date of determining the Fair Market Value, then the last reported sales
price so reported on the last Business Day before the date in question or,
if no such sale takes place on that Business Day, the average of the high
bid and low asked prices so reported; or
(c) If shares of Stock of the same class are not listed or
admitted to unlisted trading privileges as provided in Subparagraph 1.15(a)
and sales prices for shares of Stock of the same class are not reported by
the NASDAQ National Market System (or a similar system then in use) as
provided in Subparagraph 1.15(b), and if bid and asked prices for shares of
Stock of the same class in the over-the-counter market are reported by
NASDAQ (or, if not so reported, by the National Quotation Bureau
Incorporated) at the date of determining the Fair Market Value, then the
average of the high bid and low asked prices on the last Business Day
before the date in question; or
2
<PAGE>
(d) If shares of Stock of the same class are not listed or
admitted to unlisted trading privileges as provided in Subparagraph 1.15(a)
and sales prices or bid and asked prices therefor are not reported by
NASDAQ (or the National Quotation Bureau Incorporated) as provided in
Subparagraph 1.15(b) or Subparagraph 1.15(c) at the date of determining the
Fair Market Value, then the value determined in good faith by the
Committee, which determination shall be conclusive for all purposes (in
such circumstances, the Committee may, but shall not be required to, rely
on an independent appraisal of the Corporation or the Stock in making its
determination of Fair Market Value); or
(e) If shares of Stock of the same class are listed or admitted
to unlisted trading privileges as provided in Subparagraph 1.15(a) or sales
prices or bid and asked prices therefor are reported by NASDAQ (or the
National Quotation Bureau Incorporated) as provided in Subparagraph 1.15(b)
or Subparagraph 1.15(c) at the date of determining the Fair Market Value,
but the volume of trading is so low that the Board of Directors determines
in good faith that such prices are not indicative of the fair value of the
Stock, then the value determined in good faith by the Committee, which
determination shall be conclusive for all purposes notwithstanding the
provisions of Subparagraphs 1.15(a), (b), or (c).
For purposes of the redemption provided for in Subparagraph 6.3(d)(v), Fair
Market Value shall have the meaning and shall be determined as provided above;
PROVIDED, HOWEVER, that the Committee, with respect to any such redemption,
shall have the right to determine that the Fair Market Value for purposes of the
redemption should be an amount measured by the value of the shares of stock,
other securities, cash or property otherwise being received by holders of shares
of Stock in connection with the Restructure, and upon that determination the
Committee shall have the power and authority to determine Fair Market Value for
purposes of the redemption based upon the value of such shares of stock, other
securities, cash or property. Any such determination by the Committee shall be
conclusive for all purposes.
1.16 "Holder" means an Eligible Individual to whom an Award has been
granted.
1.17 "Incentive Option" means an incentive stock option as defined under
Section 422 of the Code and regulations thereunder.
1.18 "Initial Public Offering" shall mean the sale by the Corporation of
shares of its common stock to the public in a firm commitment underwriting
registered pursuant to the Securities Act.
1.19 "Key Employee" means any Employee whom the Committee identifies as
having a direct and significant effect on the performance of the Corporation or
any of its Subsidiaries.
1.20 "NASDAQ" means the National Association of Securities Dealers, Inc.
Automated Quotations, Inc.
1.21 "Nonstatutory Option" means a stock option that does not satisfy
the requirements of Section 422 of the Code or that is designated at the Date of
Grant or in the applicable Option Agreement to be an option other than an
Incentive Option.
3
<PAGE>
1.22 "Non-Surviving Event" means an event of Restructure as described in
either subparagraph (b) or (c) of Paragraph 1.27.
1.23 "Option Agreement" means an Award Agreement for an Option.
1.24 "Option" means a Nonstatutory Option granted pursuant to the Plan.
1.25 "Person" means any person or entity of any nature whatsoever,
specifically including (but not limited to) an individual, a firm, a company, a
corporation, a limited liability company, a partnership, a trust or other
entity. A Person, together with that Person's affiliates and associates (as
those terms are defined in Rule 12b-2 under the Exchange Act for purposes of
this definition only), and any Persons acting as a partnership, limited
partnership, joint venture, association, syndicate or other group (whether or
not formally organized), or otherwise acting jointly or in concert or in a
coordinated or consciously parallel manner (whether or not pursuant to any
express agreement), for the purpose of acquiring, holding, voting or disposing
of securities of the Corporation with that Person, shall be deemed a single
"Person."
1.26 "Plan" means the Trammell Crow Company 1997 Stock Option Plan, as
it may be amended from time to time.
1.27 "Restructure" means the occurrence of any one or more of the
following:
(a) The merger or consolidation of the Corporation with any
Person, whether effected as a single transaction or a series of related
transactions, with the Corporation remaining the continuing or surviving
entity of that merger or consolidation and the Stock remaining outstanding
and not changed into or exchanged for stock or other securities of any
other Person or of the Corporation, cash, or other property;
(b) The merger or consolidation of the Corporation with any
Person, whether effected as a single transaction or a series of related
transactions, with (i) the Corporation not being the continuing or
surviving entity of that merger or consolidation or (ii) the Corporation
remaining the continuing or surviving entity of that merger or
consolidation but all or a part of the outstanding shares of Stock are
changed into or exchanged for stock or other securities of any other Person
or the Corporation, cash, or other property; or
(c) The transfer, directly or indirectly, of all or
substantially all of the assets of the Corporation (whether by sale,
merger, consolidation, liquidation or otherwise) to any Person whether
effected as a single transaction or a series of related transactions.
1.28 "Securities Act" means the Securities Act of 1933.
1.29 "Stock" means the authorized Class E common stock, par value $.01
per share, as described in the Corporation's Certificate of Incorporation, or
any other securities that are substituted for the Stock as provided in Section
6.
4
<PAGE>
1.30 "Subsidiary" means, with respect to any Person, any corporation,
limited partnership, limited liability company, or other entity of which a
majority of the voting power of the voting equity securities or equity interest
is owned, directly or indirectly, by that Person.
1.31 "Total Shares" has the meaning given it in Paragraph 6.2.
1.32 "Voting Securities" means any securities that are entitled to vote
generally in the election of directors, in the admission of general partners, or
in the selection of any other similar governing body.
SECTION 2. SHARES OF STOCK SUBJECT TO THE PLAN
2.1 MAXIMUM NUMBER OF SHARES. Subject to the provisions of Section 6
of the Plan, the aggregate number of shares of Stock that the Corporation may
have subject to outstanding Awards at one time under the Plan shall not exceed
1,626.
2.2 DETERMINATION OF AVAILABLE SHARES. In computing the total number
of shares of Stock subject to outstanding Awards at one time under the Plan, the
Committee shall count the number of shares of Stock subject to issuance upon
exercise or settlement of outstanding Options and the number of shares of Stock
that have been issued upon prior exercise or settlement of Awards.
2.3 RESTORATION OF UNUSED AND SURRENDERED SHARES. If Stock subject to
any Award is not issued or transferred, or ceases to be issuable or transferable
for any reason, including (but not exclusively) because an Award is forfeited,
terminated, expires unexercised, or is exchanged for other Awards, the shares of
Stock that were subject to that Award shall no longer be charged against the
number of available shares and, subject to Section 8.1, shall again be available
for issue, transfer, or exercise pursuant to Awards under the Plan to the extent
of such forfeiture, termination, expiration, or other cessation of its
subjection to an Award.
2.4 DESCRIPTION OF SHARES. The shares to be delivered under the Plan
shall be made available from (a) authorized but unissued shares of Stock, (b)
Stock held in the treasury of the Corporation, or (c) previously issued shares
of Stock reacquired by the Corporation, including shares purchased on the open
market, in each situation as the Board of Directors or the Committee may
determine from time to time at its sole option.
2.5 REGISTRATION AND LISTING OF SHARES. From time to time, the Board
of Directors and appropriate officers of the Corporation shall be and are
authorized to take whatever actions are necessary to file required documents
with governmental authorities, stock exchanges, and other appropriate Persons to
make shares of Stock available for issuance pursuant to Awards.
SECTION 3. ADMINISTRATION OF THE PLAN
3.1 COMMITTEE. The Board of Directors shall administer the Plan with
respect to all Eligible Individuals or may delegate all or part of its duties
under this Plan to the Committee or to any officer or committee of officers of
the Corporation, subject in each case to such conditions and limitations as the
Board of Directors may establish. The number of persons that shall constitute
the Committee shall be determined
5
<PAGE>
from time to time by a majority of all the members of the Board of Directors.
Except for references in Paragraphs 3.1, 3.2, and 3.3 and unless the context
otherwise requires, references herein to the Committee shall also refer to the
Board of Directors as administrator of the Plan for Eligible Individuals or to
the appropriate delegate of the Committee or the Board of Directors.
3.2 DURATION, REMOVAL, ETC. The members of the Committee shall serve
at the pleasure of the Board of Directors, which shall have the power, at any
time and from time to time, to remove members from or add members to the
Committee. Removal from the Committee may be with or without cause. The Board
of Directors, and not the remaining members of the Committee, shall have the
power and authority to fill vacancies on the Committee, however caused.
3.3 MEETINGS AND ACTIONS OF COMMITTEE. The Board of Directors shall
designate which of the Committee members shall be the chairman of the
Committee. If the Board of Directors fails to designate a Committee chairman,
the members of the Committee shall elect one of the Committee members as
chairman, who shall act as chairman until he ceases to be a member of the
Committee or until the Board of Directors elects a new chairman. The
Committee shall hold its meetings at those times and places as the chairman
of the Committee may determine. At all meetings of the Committee, a quorum
for the transaction of business shall be required, and a quorum shall be
deemed present if at least a majority of the members of the Committee are
present. At any meeting of the Committee, each member shall have one vote.
All decisions and determinations of the Committee shall be made by the
majority vote or majority decision of all of its members present at a meeting
at which a quorum is present; provided, however, that any decision or
determination reduced to writing and signed by all of the members of the
Committee shall be as fully effective as if it had been made at a meeting
that was duly called and held. The Committee may make any rules and
regulations as it may deem advisable for the conduct of its business that are
not inconsistent with the provisions of the Plan, the Certificate of
Incorporation or the by-laws of the Corporation.
3.4 COMMITTEE'S POWERS. Subject to the express provisions of the Plan
and any applicable law with which the Corporation intends the Plan to comply,
the Committee shall have the authority, in its sole and absolute discretion,
(a) to adopt, amend, and rescind administrative and interpretive rules and
regulations relating to the Plan, including without limitation to adopt and
observe such procedures concerning the counting of Awards against the Plan as it
may deem appropriate from time to time; (b) to determine the Eligible
Individuals to whom, and the time or times at which, Awards shall be granted;
(c) to determine the number of shares of Stock that shall be the subject of each
Award; (d) to determine the terms and provisions of each Award Agreement (which
need not be identical), including provisions defining or otherwise relating to
(i) the term and the period or periods and extent of exercisability of the
Options, (ii) the extent to which the transferability of shares of Stock issued
or transferred pursuant to any Award is restricted, (iii) the effect of
termination of employment on the Award, and (iv) the effect of approved leaves
of absence (consistent with any applicable regulations of the Internal Revenue
Service); (e) to accelerate, pursuant to Section 6, the time of exercisability
of any Option that has been granted; (f) to construe the respective Award
Agreements and the Plan; (g) to make determinations of the Fair Market Value of
the Stock pursuant to the Plan; (h) to delegate its duties under the Plan to
such agents as it may appoint from time to time, subject to the second sentence
of Section 3.1; and (i) to make all other determinations, perform all other
acts, and exercise all other powers and authority necessary or advisable for
administering the Plan, including the delegation of those ministerial acts and
responsibilities as the Committee deems appropriate. The Committee may correct
any defect, supply any omission or reconcile any inconsistency in the Plan, in
any Award, or in any Award Agreement in the manner and to the extent it deems
necessary or desirable to carry the Plan into effect, and
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the Committee shall be the sole and final judge of that necessity or
desirability. The determinations of the Committee on the matters referred to in
this Paragraph 3.4 shall be final and conclusive. The Committee shall not have
the power to appoint members of the Committee or to terminate, modify, or amend
the Plan. Those powers are vested in the Board of Directors.
3.5 TRANSFERABILITY OF AWARDS. Notwithstanding any limitation on a
Holder's right to transfer an Award, the Committee may (in its sole discretion)
permit a Holder to transfer an Award, or may cause the Corporation to grant an
Award that otherwise would be granted to an Eligible Individual, in any of the
following circumstances: (a) pursuant to a qualified domestic relations order
or (b) to the spouse of the Eligible Individual or to any of the parents,
children and grandchildren of the Eligible Individual or spouse or to a trust
whose sole beneficiaries are one or more such persons. If the Committee
determines to allow such transfers or issuances of Awards, any Holder or
Eligible Individual desiring such transfers or issuances shall make application
therefor in the manner and time that the Committee specifies and shall comply
with such other requirements as the Committee may require to assure compliance
with all applicable laws, including securities laws, and to assure fulfillment
of the purposes of this Plan. The Committee shall not authorize any such
transfer or issuance if it may not be made in compliance with all applicable
federal, state and foreign securities laws. The granting of permission for such
an issuance or transfer shall not obligate the Corporation to register the
shares of Stock to be issued under the applicable Award.
SECTION 4. ELIGIBILITY AND PARTICIPATION
4.1 ELIGIBLE INDIVIDUALS. Awards may be granted pursuant to the Plan
only to persons who are Eligible Individuals at the time of the grant thereof.
4.2 GRANT OF AWARDS. Subject to the express provisions of the Plan,
the Committee shall determine which Eligible Individuals shall be granted Awards
from time to time. In making grants, the Committee shall take into
consideration the position or positions of the potential Holder with the
Corporation and its Subsidiaries, the contribution the potential Holder has made
or may make to the success of the Corporation or its Subsidiaries and such other
considerations as the Board of Directors may from time to time specify. The
Committee shall also determine the number of shares subject to each of the
Awards and shall authorize and cause the Corporation to grant Awards in
accordance with those determinations.
4.3 DATE OF GRANT. The date on which an Award is granted (the "DATE OF
GRANT") shall be the date specified by the Committee as the effective date or
date of grant of an Award or, if the Committee does not so specify, shall be the
date effective as of which the Committee adopts the resolution approving the
offer of an Award to an individual, including the specification of the number
(or method of determining the number) of shares of Stock, even though certain
terms of the Award Agreement may not be determined at that time and even though
the Award Agreement may not be executed or delivered until a later time. In no
event shall a Holder gain any rights in addition to those specified by the
Committee in its grant, regardless of the time that may pass between the grant
of the Award and the actual execution or delivery of the Award Agreement by the
Corporation or the Holder. The Committee may invalidate an Award at any time
before the Award Agreement is signed by the Holder (if signature is required) or
is delivered to the Holder (if signature is not required), and such Award shall
be treated as never having been granted.
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4.4 AWARD AGREEMENTS. Each Award granted under the Plan shall be
evidenced by an Award Agreement that incorporates those terms that the Committee
shall deem necessary or desirable. More than one Award may be granted under the
Plan to the same Eligible Individual and be outstanding concurrently.
4.5 NO RIGHT TO AWARD. The adoption of the Plan shall not be deemed to
give any Person a right to be granted an Award.
SECTION 5. TERMS AND CONDITIONS OF OPTIONS
All Options granted under the Plan shall comply with, and the related
Option Agreements shall be deemed to include and be subject to, the terms and
conditions set forth in this Section 5 (to the extent each term and condition
applies to the form of Option) and also to the terms and conditions set forth in
Sections 6 and 7.
5.1 NUMBER OF SHARES. Each Option Agreement shall state the total
number of shares of Stock to which it relates.
5.2 VESTING; EXERCISABILITY. Each Option Agreement shall state the
time, periods or other conditions on which the right to exercise the Option or a
portion thereof shall vest, the time, periods or other conditions on which
vested Options shall be exercisable and the number (or method of determining the
number) of shares of Stock for which the right to exercise the Option shall
vest, or such vested Option shall become exercisable, at each such time, period
or satisfaction of condition.
5.3 EXPIRATION OF OPTIONS. Options may be exercised during the term
determined by the Committee and set forth in the Option Agreement; PROVIDED that
no Option shall be exercised after the expiration of a period of ten years
commencing on the Date of Grant of such Option.
5.4 EXERCISE PRICE. Each Option Agreement shall state the exercise
price per share of Stock (the "EXERCISE PRICE"). The Exercise Price shall not
be less than the greater of (a) the par value per share of the Stock or (b) 100%
of the Fair Market Value per share of the Stock on the Date of Grant of the
Option.
5.5 METHOD OF EXERCISE. Each Option shall be exercisable only by
written, recorded electronic or other notice of exercise in the manner specified
by the Committee from time to time (the "EXERCISE NOTICE") delivered to the
Corporation or to the Person designated by the Committee during the term of the
Option, which notice shall (a) state the number of shares of Stock with respect
to which the Option is being exercised, (b) be signed or otherwise given by the
Holder of the Option or by the person authorized to exercise the Option in the
event of the Holder's death or disability, (c) be accompanied by the Exercise
Price for all shares of Stock for which the Option is exercised, unless
provision for the payment of the Exercise Price has been made pursuant to
Paragraph 5.6 or 5.7 or in another manner permitted by law and approved in
advance by the Committee, and (d) include such other information, instruments,
and documents as may be required to satisfy any other condition to exercise
contained in the Option Agreement. The Option shall not be deemed to have been
exercised unless all of the requirements of the preceding provisions of this
Paragraph 5.5 have been satisfied.
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5.6 MEDIUM AND TIME OF PAYMENT. The Exercise Price of an Option
shall be payable in full upon the exercise of the Option (a) in cash or by an
equivalent means (such as that specified in Paragraph 5.7) acceptable to the
Committee, (b) on the Committee's prior consent, with shares of Stock owned
by the Holder (including shares received upon exercise of the Option) and
having a Fair Market Value at least equal to the aggregate Exercise Price
payable in connection with such exercise, or (c) by any combination of
clauses (a) and (b). If the Committee chooses to accept shares of Stock in
payment of all or any portion of the Exercise Price, then (for purposes of
payment of the Exercise Price) those shares of Stock shall be deemed to have
a cash value equal to their aggregate Fair Market Value determined as of the
date of the delivery of the Exercise Notice.
5.7 PAYMENT WITH SALE PROCEEDS. In addition, at the request of the
Holder and to the extent permitted by applicable law, the Committee may (but
shall not be required to) approve arrangements with a brokerage firm under which
that brokerage firm, on behalf of the Holder, shall pay to the Corporation the
Exercise Price of the Option being exercised (either as a loan to the Holder or
from the proceeds of the sale of Stock issued pursuant to that exercise of the
Option), and the Corporation shall promptly cause the exercised shares to be
delivered to the brokerage firm. Such transactions shall be effected in
accordance with the procedures that the Committee may establish from time to
time.
5.8 PAYMENT OF TAXES. The Committee may, in its discretion, require a
Holder to pay to the Corporation (or the Corporation's Subsidiary if the Holder
is an employee of a Subsidiary of the Corporation), at the time of the exercise
of an Option, the amount that the Committee deems necessary to satisfy the
Corporation's or its Subsidiary's current or future obligation to withhold
federal, state or local income or other taxes that the Holder incurs by
exercising an Option. Upon the exercise of an Option requiring tax withholding,
a Holder may (a) direct the Corporation to withhold from the shares of Stock to
be issued to the Holder the number of shares necessary to satisfy the
Corporation's obligation to withhold taxes, that determination to be based on
the shares' Fair Market Value as of the date on which tax withholding is to be
made; (b) deliver to the Corporation sufficient shares of Stock (based upon the
Fair Market Value at date of withholding) to satisfy the Corporation's tax
withholding obligations, based on the shares' Fair Market Value as of the date
of exercise; or (c) deliver sufficient cash to the Corporation to satisfy its
tax withholding obligations. Holders who elect to use such a stock withholding
feature must make the election at the time and in the manner that the Committee
prescribes. The Committee may, at its sole option, deny any Holder's request to
satisfy withholding obligations through Stock instead of cash. In the event the
Committee subsequently determines that the aggregate Fair Market Value (as
determined above) of any shares of Stock withheld as payment of any tax
withholding obligation is insufficient to discharge that tax withholding
obligation, then the Holder shall pay to the Corporation, immediately upon the
Committee's request, the amount of that deficiency.
5.9 NO FRACTIONAL SHARES. The Corporation shall not in any case be
required to sell, issue, or deliver a fractional share with respect to any
Option. In lieu of the issuance of any fractional share of Stock, the
Corporation shall pay to the Holder an amount in cash equal to the same fraction
(as the fractional Stock) of the Fair Market Value of a share of Stock
determined as of the date of the applicable Exercise Notice.
5.10 MODIFICATION, EXTENSION AND RENEWAL OF OPTIONS. Subject to the
terms and conditions of and within the limitations of the Plan and any
applicable law, and any consent required by the last sentence of this Paragraph
5.10, the Committee may (a) modify, extend or renew outstanding Options granted
under the Plan and (b) accept the surrender of Options outstanding hereunder (to
the extent not previously exercised)
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and authorize the granting of new Options in substitution for outstanding
Options (to the extent not previously exercised). Nevertheless, without the
consent of the Holder, the Committee may not modify any outstanding Option so as
to materially increase the obligations of a Holder under any Option theretofore
granted hereunder to that Holder thereunder.
5.11 OTHER AGREEMENT PROVISIONS. The Option Agreements authorized under
the Plan shall contain such provisions in addition to those required by the Plan
(including, without limitation, restrictions or the removal of restrictions upon
the exercise of the Option and the retention or transfer of shares thereby
acquired) as the Committee may deem advisable. Each Option Agreement shall
identify the Option evidenced thereby as a Nonstatutory Option.
SECTION 6. ADJUSTMENT PROVISIONS
6.1 ADJUSTMENT OF AWARDS AND AUTHORIZED STOCK. The terms of an Award,
the number of shares of Stock authorized pursuant to Paragraph 2.1 for issuance
under the Plan shall be subject to adjustment, from time to time, in accordance
with the following provisions:
(a) If at any time or from time to time, the Corporation shall
subdivide as a whole (by reclassification, by a Stock split, by the
issuance of a distribution on Stock payable in Stock or otherwise) the
number of shares of Stock then outstanding into a greater number of shares
of Stock, then (i) the maximum number of shares of Stock available for the
Plan as provided in Paragraph 2.1 shall be increased proportionately, and
the kind of shares or other securities available for the Plan shall be
appropriately adjusted, (ii) the number of shares of Stock (or other kind
of shares or securities) that may be acquired under any Award shall be
increased proportionately, and (iii) the price (including Exercise Price)
for each share of Stock (or other kind of shares or unit of other
securities) subject to then outstanding Awards shall be reduced
proportionately, without changing the aggregate purchase price as to which
outstanding Awards remain exercisable.
(b) If at any time or from time to time the Corporation shall
consolidate as a whole (by reclassification, reverse Stock split, or
otherwise) the number of shares of Stock then outstanding into a lesser
number of shares of Stock, (i) the maximum number of shares of Stock
available for the Plan as provided in Paragraph 2.1 shall be decreased
proportionately, and the kind of shares or other securities available for
the Plan shall be appropriately adjusted, (ii) the number of shares of
Stock (or other kind of shares or securities) that may be acquired under
any Award shall be decreased proportionately, and (iii) the price
(including Exercise Price) for each share of Stock (or other kind of shares
or unit of other securities) subject to then outstanding Awards shall be
increased proportionately, without changing the aggregate purchase price as
to which outstanding Awards remain exercisable.
(c) Whenever the number of shares of Stock subject to
outstanding Awards and the price for each share of Stock subject to
outstanding Awards are required to be adjusted as provided in this
Paragraph 6.1, the Committee shall promptly prepare a notice setting forth,
in reasonable detail, the event requiring adjustment, the amount of the
adjustment, the method by which such adjustment was calculated, and the
change in price and the number of shares of Stock, other
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securities, cash or property purchasable subject to each Award after giving
effect to the adjustments. The Committee shall promptly give each Holder
such a notice.
(d) Adjustments under Paragraph 6.1(a) and (b) shall be made by
the Committee, and its determination as to what adjustments shall be made
and the extent thereof shall be final, binding and conclusive. No
fractional interest shall be issued under the Plan on account of any such
adjustments.
6.2 CHANGES IN CONTROL. Upon the occurrence of a Change in Control,
all outstanding Options shall immediately become fully vested and exercisable in
full, including that portion of any Option that pursuant to the terms and
provisions of the applicable Award Agreement had not yet become exercisable (the
total number of shares of Stock as to which an Option is exercisable upon the
occurrence of a Change in Control is referred to herein as the "TOTAL SHARES").
If a Change in Control involves a Restructure or occurs in connection with a
series of related transactions involving a Restructure and if such Restructure
is in the form of a Non-Surviving Event and as a part of such Restructure shares
of stock, other securities, cash or property shall be issuable or deliverable in
exchange for Stock, then the Holder of an Award shall be entitled to purchase or
receive (in lieu of the Total Shares that the Holder would otherwise be entitled
to purchase or receive) the number of shares of stock, other securities, cash or
property to which that number of Total Shares would have been entitled in
connection with such Restructure at an aggregate exercise price equal to the
Exercise Price that would have been payable if that number of Total Shares had
been purchased on the exercise of the Option immediately before the consummation
of the Restructure. Nothing in this Paragraph 6.2 shall impose on a Holder the
obligation to exercise any Award immediately before or upon the Change of
Control, nor shall the Holder forfeit the right to exercise the Award during the
remainder of the original term of the Award because of a Change in Control or
because the Holder's employment is terminated for any reason following a Change
in Control.
6.3 RESTRUCTURE AND NO CHANGE IN CONTROL. In the event a Restructure
should occur at any time while there is any outstanding Award hereunder and that
Restructure does not occur in connection with a Change in Control or in
connection with a series of related transactions involving a Change in Control,
then:
(a) no outstanding Options shall immediately become fully vested
and exercisable in full merely because of the occurrence of the
Restructure;
(b) at the option of the Committee, the Corporation may (but
shall not be required to) take any one or more of the following actions:
(i) accelerate in whole or in part the time of the vesting
and exercisability of any one or more of the outstanding Options so
as to provide that those Options shall be exercisable before, upon,
or after the consummation of the Restructure;
(ii) if the Restructure is in the form of a Non-Surviving
Event, cause the surviving entity to assume in whole or in part any
one or more of the outstanding Awards upon such terms and
provisions as the Committee deems desirable; or
(iii) redeem in whole or in part any one or more of the
outstanding Awards (whether or not then exercisable) in
consideration of a cash payment, as such payment may
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be reduced for tax withholding obligations as contemplated in the
Section governing the particular form of Award, in an amount equal
to, for Options, the excess of (1) the Fair Market Value,
determined as of a date immediately preceding the consummation of
the Restructure, of the aggregate number of shares of Stock subject
to the Award and as to which the Award is being redeemed over (2)
the Exercise Price for that number of shares of Stock;
The Corporation shall promptly notify each Holder of any election or action
taken by the Corporation under this Paragraph 6.3. In the event of any election
or action taken by the Corporation pursuant to this Paragraph 6.3 that requires
the amendment or cancellation of any Award Agreement as may be specified in any
notice to the Holder thereof, that Holder shall promptly deliver that Award
Agreement to the Corporation in order for that amendment or cancellation to be
implemented by the Corporation and the Committee. The failure of the Holder to
deliver any such Award Agreement to the Corporation as provided in the preceding
sentence shall not in any manner effect the validity or enforceability of any
action taken by the Corporation and the Committee under this Paragraph 6.3,
including, without limitation, any redemption of an Award as of the consummation
of a Restructure. Any cash payment to be made by the Corporation pursuant to
this Paragraph 6.3 in connection with the redemption of any outstanding Awards
shall be paid to the Holder thereof currently with the delivery to the
Corporation of the Award Agreement evidencing that Award; provided, however,
that any such redemption shall be effective upon the consummation of the
Restructure notwithstanding that the payment of the redemption price may occur
subsequent to the consummation. If all or any portion of an outstanding Award
is to be exercised or accelerated upon or after the consummation of a
Restructure that is in the form of a Non-Surviving Event and as a part of that
Restructure shares of stock, other securities, cash or property shall be
issuable or deliverable in exchange for Stock, then the Holder of the Award
shall thereafter be entitled to purchase or receive (in lieu of the number of
shares of Stock that the Holder would otherwise be entitled to purchase or
receive) the number of shares of stock, other securities, cash or property to
which such number of shares of Stock would have been entitled in connection with
the Restructure at an aggregate exercise price equal to the Exercise Price that
would have been payable if that number of Total Shares had been purchased on the
exercise of the Option immediately before the consummation of the Restructure.
6.4 NOTICE OF CHANGE IN CONTROL OR RESTRUCTURE. The Corporation shall
attempt to keep all Holders informed with respect to any Change in Control or
Restructure or of any potential Change in Control or Restructure to the same
extent that the Corporation's stockholders are informed by the Corporation of
any such event or potential event.
SECTION 7. ADDITIONAL PROVISIONS
7.1 TERMINATION OF EMPLOYMENT. Subject to the last sentence of
Paragraph 6.2 and unless the Board of Directors otherwise elects, if a Holder's
employment relationship is terminated for any reason, whether voluntary or
involuntary (including termination of employment as a result of death,
disability or retirement), and without regard to the circumstances giving rise
to or the legality of the termination, then all Awards held by that Holder that
have not yet vested shall be forfeited and all Awards that have vested shall
continue to be exercisable (by the Holder or, in the case of his death or, if
appropriate, his disability, by the Holder's legatees, distributees, guardian or
other legal representative) during the period(s) described in the relevant Award
Agreement.
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7.2 TRANSFERABILITY OF AWARDS. In addition to such other terms and
conditions as may be included in a particular Award Agreement, an Award
requiring exercise shall be exercisable during a Holder's lifetime only by that
Holder or by that Holder's guardian or legal representative. An Award requiring
exercise shall not be transferrable other than by will or the laws of descent
and distribution, except as permitted in accordance with Paragraph 3.5.
7.3 FORFEITURE AND RESTRICTIONS ON TRANSFER. Each Award Agreement may
contain or otherwise provide for conditions giving rise to the forfeiture of the
Stock acquired pursuant to an Award or otherwise and may also provide for those
restrictions on the transferability of shares of the Stock acquired pursuant to
an Award or otherwise that the Committee in its sole and absolute discretion may
deem proper or advisable. The conditions giving rise to forfeiture may include,
but need not be limited to, the requirement that the Holder render substantial
services to the Corporation or its Subsidiaries for a specified period of time.
The restrictions on transferability may include, but need not be limited to,
options and rights of first refusal in favor of the Corporation and stockholders
of the Corporation other than the Holder of such shares of Stock who is a party
to the particular Award Agreement or a subsequent holder of the shares of Stock
who is bound by that Award Agreement.
7.4 DELIVERY OF CERTIFICATES OF STOCK. Subject to Paragraph 7.5, the
Corporation shall promptly issue and deliver a certificate representing the
number of shares of Stock as to which an Option has been exercised after the
Corporation receives an Exercise Notice and upon receipt by the Corporation of
the Exercise Price and any tax withholding as may be requested. The value of
the shares of Stock issuable or transferable because of an Award under the Plan
shall not bear any interest owing to the passage of time, except as may be
otherwise provided in an Award Agreement.
7.5 CONDITIONS TO DELIVERY OF STOCK. Nothing herein or in any Award
granted hereunder or any Award Agreement shall require the Corporation to issue
any shares with respect to any Award if that issuance would, in the opinion of
counsel for the Corporation, constitute a violation of the Securities Act or any
similar or superseding statute or statutes, any other applicable statute or
regulation, or the rules of any applicable securities exchange or securities
association, as then in effect. At the time of any exercise of an Option, the
Corporation may, as a condition precedent to the exercise of such Option,
require from the Holder of the Award (or in the event of his death, his legal
representatives, heirs, legatees, or distributees) such written representations,
if any, concerning the Holder's intentions with regard to the retention or
disposition of the shares of Stock being acquired pursuant to the Award and such
written covenants and agreements, if any, as to the manner of disposal of such
shares as, in the opinion of counsel to the Corporation, may be necessary to
ensure that any disposition by that Holder (or in the event of the Holder's
death, his legal representatives, heirs, legatees, or distributees) will not
involve a violation of the Securities Act or any similar or superseding statute
or statutes, any other applicable state or federal statute or regulation, or any
rule of any applicable securities exchange or securities association, as then in
effect.
7.6 SECURITIES ACT LEGEND. Certificates for shares of Stock, when
issued, may have the following legend or statements of other applicable
restrictions endorsed thereon and may not be immediately transferable:
THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE
SECURITIES LAWS. THE SHARES MAY NOT BE OFFERED FOR SALE,
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SOLD, PLEDGED, TRANSFERRED, OR OTHERWISE DISPOSED OF UNTIL THE HOLDER
HEREOF PROVIDES EVIDENCE SATISFACTORY TO THE ISSUER (WHICH, IN THE
DISCRETION OF THE ISSUER, MAY INCLUDE AN OPINION OF COUNSEL SATISFACTORY TO
THE ISSUER) THAT SUCH OFFER, SALE, PLEDGE, TRANSFER, OR OTHER DISPOSITION
WILL NOT VIOLATE APPLICABLE FEDERAL OR STATE LAWS.
This legend shall not be required for shares of Stock issued pursuant to an
effective registration statement under the Securities Act.
7.7 LEGEND FOR RESTRICTIONS ON TRANSFER. Each certificate representing
shares issued to a Holder pursuant to an Award granted under the Plan shall, if
such shares are subject to any transfer restriction, including a right of first
refusal, provided for under this Plan, an Award Agreement or other agreement,
such as a shareholders' agreement among the Corporation and its shareholders,
bear a legend that complies with applicable law with respect to the restrictions
on transferability, such as:
THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
RESTRICTIONS ON TRANSFERABILITY IMPOSED BY _____________________________,
AND MAY NOT BE TRANSFERRED, SOLD, OR OTHERWISE DISPOSED OF EXCEPT AS
THEREIN PROVIDED. THE CORPORATION WILL FURNISH A COPY OF SUCH INSTRUMENT
AND AGREEMENT TO THE RECORD HOLDER OF THIS CERTIFICATE WITHOUT CHARGE ON
REQUEST TO THE CORPORATION AT ITS PRINCIPAL PLACE OF BUSINESS OR REGISTERED
OFFICE.
7.8 NO RIGHTS AS STOCKHOLDER. A Holder shall have no right as a
stockholder with respect to any shares covered by his Award until a certificate
representing those shares is issued in his name. No adjustment shall be made
for dividends (ordinary or extraordinary, whether in cash or other property) or
distributions or other rights for which the record date is before the date that
certificate is issued, except as contemplated by Section 6.
7.9 FURNISH INFORMATION. Each Holder shall furnish to the Corporation
all information requested by the Corporation to enable it to comply with any
reporting or other requirement imposed upon the Corporation by or under any
applicable statute or regulation.
7.10 OBLIGATION TO EXERCISE. The granting of an Award hereunder shall
impose no obligation upon the Holder to exercise the same or any part thereof.
7.11 ADJUSTMENTS TO AWARDS. Subject to the general limitations set
forth in Sections 5 and 6 and the provisions of Paragraph 8.1, the Committee
may make any adjustment in the exercise price of, the number of shares
subject to or the terms of an Option by canceling an outstanding Option and
regranting an Option. Such adjustment shall be made by amending, substituting
or regranting an outstanding Option. Such amendment, substitution or regrant
may result in terms and conditions that differ from the terms and conditions
of the original Option. The Committee may not, however, impair the rights of
any Holder to previously granted Options without that Holder's consent. If
such action is effected by amendment, the effective date of such amendment
shall be the date of the original grant.
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7.12 REMEDIES. The Corporation shall be entitled to recover from a
Holder reasonable attorneys' fees incurred in connection with the enforcement of
the terms and provisions of the Plan and any Award Agreement whether by an
action to enforce specific performance or for damages for its breach or
otherwise.
7.13 CONSIDERATION. No Option shall be exercisable unless and until the
Holder shall have paid cash or property to, or performed services for, the
Corporation or any of its Subsidiaries that the Committee believes is equal to
or greater in value that the par value of the Stock subject to such Award.
SECTION 8. DURATION AND AMENDMENT OF PLAN
8.1 DURATION. No Awards may be granted hereunder after September 15,
1997.
8.2 AMENDMENT. The Board of Directors may, insofar as permitted by
law, with respect to any shares which, at the time, are not subject to Awards,
suspend or discontinue the Plan or revise or amend it in any respect whatsoever,
and may amend any provision of the Plan or any Award Agreement to make the Plan
or the Award Agreement, or both, comply with Section 16(b) of the Exchange Act
and the exemptions therefrom, the Code, the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"), the regulations promulgated under the Code or
ERISA, or any other law, rule or regulation that may affect the Plan. The Board
of Directors may also amend, modify, suspend or terminate the Plan for the
purpose of meeting or addressing any changes in other legal requirements
applicable to the Corporation or the Plan or for any other purpose permitted by
law. The Plan may not be amended without the consent of the holders of a
majority of the shares of Stock then outstanding to increase materially the
aggregate number of shares of Stock that may be issued under the Plan (except
for adjustments pursuant to Section 6 of the Plan).
SECTION 9. GENERAL
9.1 APPLICATION OF FUNDS. The proceeds received by the Corporation
from the sale of shares pursuant to Awards shall be used for general corporate
purposes.
9.2 RIGHT OF THE CORPORATION AND SUBSIDIARIES TO TERMINATE EMPLOYMENT.
Nothing contained in the Plan, or in any Award Agreement, shall confer upon any
Holder the right to continue in the employ of the Corporation or any Subsidiary,
or interfere in any way with the rights of the Corporation or any Subsidiary to
terminate his or her employment at any time.
9.3 NO LIABILITY FOR GOOD FAITH DETERMINATIONS. Neither the members of
the Board of Directors nor any member of the Committee shall be liable for any
act, omission, or determination taken or made in good faith with respect to the
Plan or any Award granted under it, and members of the Board of Directors and
the Committee shall be entitled to indemnification and reimbursement by the
Corporation in respect of any claim, loss, damage, or expense (including
attorneys' fees, the costs of settling any suit, provided such settlement is
approved by independent legal counsel selected by the Corporation, and amounts
paid in satisfaction of a judgment, except a judgment based on a finding of bad
faith) arising therefrom to the full extent permitted by law and under any
directors and officers liability or similar insurance coverage that may
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from time to time be in effect. This right to indemnification shall be in
addition to, and not a limitation on, any other indemnification rights any
member of the Board of Directors or the Committee may have.
9.4 OTHER BENEFITS. Participation in the Plan shall not preclude the
Holder from eligibility in any other stock or stock option plan of the
Corporation or any Subsidiary or any old age benefit, insurance, pension, profit
sharing retirement, bonus, or other extra compensation plans that the
Corporation or any Subsidiary has adopted, or may, at any time, adopt for the
benefit of its Employees. The adoption of the Plan by the Board of Directors
shall not be construed as creating any limitations on the power of the Board of
Directors to adopt such other incentive arrangements as it may deem desirable,
including, without limitation, the granting of stock options and the awarding of
stock and cash otherwise than under the Plan, and such arrangements may be
either generally applicable or applicable only in specific cases.
9.5 EXCLUSION FROM PENSION AND PROFIT-SHARING COMPENSATION. By
acceptance of an Award, each Holder shall be deemed to have agreed that the
Award is special incentive compensation that will not be taken into account in
any manner as salary, compensation or bonus in determining the amount of any
payment under any pension, retirement or other employee benefit plan of the
Corporation or any Subsidiary. In addition, each beneficiary of a deceased
Holder shall be deemed to have agreed that the Award will not affect the amount
of any life insurance coverage, if any, provided by the Corporation or a
Subsidiary on the life of the Holder that is payable to the beneficiary under
any life insurance plan covering employees of the Corporation or any Subsidiary.
9.6 EXECUTION OF RECEIPTS AND RELEASES. Any payment of cash or any
issuance or transfer of shares of Stock to the Holder, or to his legal
representative, heir, legatee, or distributee, in accordance with the provisions
hereof, shall, to the extent thereof, be in full satisfaction of all claims of
such persons hereunder. The Committee may require any Holder, legal
representative, heir, legatee, or distributee, as a condition precedent to such
payment, to execute a release and receipt therefor in such form as it shall
determine.
9.7 NO GUARANTEE OF INTERESTS. Neither the Committee nor the
Corporation guarantees the Stock of the Corporation from loss or depreciation.
9.8 PAYMENT OF EXPENSES. All expenses incident to the administration,
termination, or protection of the Plan, including, but not limited to, legal and
accounting fees, shall be paid by the Corporation or its Subsidiaries; provided,
however, the Corporation or a Subsidiary may recover any and all damages, fees,
expenses, and costs arising out of any actions taken by the Corporation to
enforce its right to purchase Stock under this Plan.
9.9 CORPORATION RECORDS. Records of the Corporation or its
Subsidiaries regarding the Holder's period of employment, termination of
employment and the reason therefor, leaves of absence, reemployment, and other
matters shall be conclusive for all purposes hereunder, unless determined by the
Committee to be incorrect.
9.10 INFORMATION. The Corporation and its Subsidiaries shall, upon
request or as may be specifically required hereunder, furnish or cause to be
furnished, all of the information or documentation which is necessary or
required by the Committee to perform its duties and functions under the Plan.
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9.11 NO LIABILITY OF CORPORATION. The Corporation assumes no
obligation or responsibility to the Holder or his legal representatives,
heirs, legatees, or distributees for any act of, or failure to act on the
part of, the Committee.
9.12 CORPORATION ACTION. Any action required of the Corporation shall
be by resolution of its Board of Directors or by a person authorized to act by
resolution of the Board of Directors.
9.13 SEVERABILITY. If any provision of this Plan is held to be illegal
or invalid for any reason, the illegality or invalidity shall not affect the
remaining provisions hereof, but such provision shall be fully severable and the
Plan shall be construed and enforced as if the illegal or invalid provision had
never been included herein.
9.14 NOTICES. Whenever any notice is required or permitted hereunder
other than any Exercise Notice, such notice must be in writing and personally
delivered or sent by mail. Any such notice required or permitted to be
delivered hereunder shall be deemed to be delivered on the date on which it is
personally delivered, or, whether actually received or not, on the third
Business Day after it is deposited in the United States mail, certified or
registered, postage prepaid, addressed to the person who is to receive it at the
address which such person has theretofore specified by written notice delivered
in accordance herewith. The Corporation or a Holder may change, at any time and
from time to time, by written notice to the other, the address which it or he
had previously specified for receiving notices. Until changed in accordance
herewith, the Corporation and each Holder shall specify as its and his address
for receiving notices the address set forth in the Agreement pertaining to the
shares to which such notice relates. Any Exercise Notice shall be valid only
when it is in fact received by the Corporation or the Person it designates in
accordance with procedures that the Committee may adopt from time to time.
9.15 WAIVER OF NOTICE. Any person entitled to notice hereunder may
waive such notice.
9.16 SUCCESSORS. The Plan shall be binding upon the Holder, his legal
representatives, heirs, legatees, and distributees, upon the Corporation, its
successors, and assigns, and upon the Committee, and its successors.
9.17 HEADINGS. The titles and headings of Sections and Paragraphs are
included for convenience of reference only and are not to be considered in
construction of the provisions hereof.
9.18 GOVERNING LAW. All questions arising with respect to the
provisions of the Plan shall be determined by application of the laws of the
State of Texas except to the extent Texas law is preempted by federal law.
Questions arising with respect to the provisions of an Agreement that are
matters of contract law shall be governed by the laws of the state specified in
the Agreement, except to the extent the corporate law of the Corporation's (or
its successor's) jurisdiction of incorporation conflicts with the contract law
of such state, in which event such corporate law shall govern. The obligation
of the Corporation to sell and deliver Stock hereunder is subject to applicable
laws and to the approval of any governmental authority required in connection
with the authorization, issuance, sale, or delivery of such Stock.
9.19 WORD USAGE. Words used in the masculine shall apply to the
feminine where applicable, and wherever the context of this Plan dictates, the
plural shall be read as the singular and the singular as the plural.
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IN WITNESS WHEREOF, Trammell Crow Company, acting by and through its
officer hereunto duly authorized, has executed this Trammell Crow Company 1997
Stock Option Plan this 31st day of July, 1997.
TRAMMELL CROW COMPANY
By: /s/ William P. Leiser
----------------------------
Name: William P. Leiser
----------------------------
Title: Executive Vice President
----------------------------
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Exhibit 5.1
[LETTERHEAD OF VINSON & ELKINS L.L.P.]
April 21, 1998
Trammell Crow Company
3400 Trammell Crow Center
2001 Ross Avenue
Dallas, Texas 75201
Ladies and Gentlemen:
We have acted as counsel for Trammell Crow Company, a Delaware corporation
(the "Company"), in connection with the Company's registration under the
Securities Act of 1933, as amended (the "Act"), of 2,423,801 shares of common
stock, par value $0.01 per share (the "Shares"), of the Company pursuant to the
Company's Registration Statement on Form S-8 (the "Registration Statement")
filed with the Securities and Exchange Commission (the "Commission") on April
21, 1998.
In reaching the opinions set forth herein, we have examined and are
familiar with originals or copies, certified or otherwise identified to our
satisfaction, of such documents and records of the Company and such statutes,
regulations and other instruments as we deemed necessary or advisable for
purposes of this opinion, including (i) the Registration Statement, (ii) the
Certificate of Incorporation of the Company, as filed with the Secretary of
State of the State of Delaware, (iii) the Bylaws of the Company, and (iv)
certain minutes of meetings of, and resolutions adopted by, the Board of
Directors of the Company.
We have assumed that (i) all information contained in all documents we
reviewed is true, correct and complete, (ii) all signatures on all documents we
reviewed are genuine, (iii) all documents submitted to us as originals are true
and complete, (iv) all documents submitted to us as copies are true and complete
copies of the originals thereof, and (v) all persons executing and delivering
the documents we examined were competent to execute and deliver such documents.
In addition, we have assumed that, upon exercise of the stock options pursuant
to which the Shares will be issued (the "Options"), (i) the Shares will be
issued in accordance with the Trammell Crow Company 1997 Stock Option Plan (the
"Plan"), (ii) the full consideration for each Share shall be paid to the Company
and in no event will be less than the par value for each Share, and (iii)
certificates evidencing the Shares will be properly executed and delivered by
the Company in accordance with the Delaware General Corporation Law (the
"DGCL").
<PAGE>
Exhibit 5.1
[LETTERHEAD OF VINSON & ELKINS L.L.P.]
Based on the foregoing, and having due regard for the legal considerations
we deem relevant, we are of the opinion that the Shares, when issued by the
Company upon exercise of the Options in accordance with the Plan, will be
legally issued, fully paid and non-assessable.
This opinion is limited in all respects to the laws of the State of Texas,
the DGCL and the federal laws of the United States of America. You should be
aware that we are not admitted to the practice of law in the State of Delaware.
This opinion letter may be filed as an exhibit to the Registration
Statement. In giving this consent, we do not thereby admit that we come within
the category of persons whose consent is required under Section 7 of the Act or
the rules and regulations of the Commission promulgated thereunder.
Very truly yours,
/s/ Vinson & Elkins L.L.P.
<PAGE>
EXHIBIT 23.1
CONSENT OF ERNST & YOUNG LLP
We consent to the reference to our firm in the Registration Statement on
Form S-8 pertaining to the 1997 Stock Option Plan of Trammell Crow Company and
to the incorporation by reference therein of our report dated March 4, 1998,
with respect to the consolidated financial statements of Trammell Crow Company
and Subsidiaries included in its Annual Report (Form 10-K) for the year ended
December 31, 1997, filed with the Securities and Exchange Commission.
Ernst & Young LLP
Dallas, Texas
April 14, 1998
