As filed with the Securities and Exchange Commission on August 25, 1997
Registration No. 333-____
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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Deltic Timber Corporation
(Exact name of registrant as specified in its charter)
Delaware 0811, 2421 71-0795870
(State or other (Primary Standard Industrial (I.R.S. Employer
jurisdiction of Classification Code Number) Identification No.)
incorporation or
organization)
210 East Elm Street
P.O. Box 7200
El Dorado, AR 71731-7200
(501) 881-9400
(Address of principal executive offices)
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DELTIC TIMBER CORPORATION
1996 STOCK INCENTIVE PLAN
(Full title of the plan)
W. Bayless Rowe
General Counsel
210 East Elm Street
Post Office Box 7200
El Dorado, AR 71731-7200
(Name and address of agent for service)
Telephone number, including area code, of agent for service: (501) 881-6409
Copy to:
Barbara Nims
Davis Polk & Wardwell
450 Lexington Avenue
New York, NY 10017
(212) 450-4000
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
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<S> <C> <C> <C> <C>
Proposed Maximum Proposed Maximum
Amount to be Offering Price Per Aggregate Offering Amount of
Title of Securities to be Registered Registered Share(1) Price(1) Registration Fee
- --------------------------------------- ------------ ------------------ ------------------ ----------------
Deltic Timber Corporation Common Stock 600,000 $15,885,562.79 $15,885,562.79 $4,813.81
par value $.01 per share
================================================================================================================================
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(1) As of the date hereof, options to purchase 97,353 shares of Common Stock
were outstanding under the Deltic Timber Corporation 1996 Stock
Incentive Plan (the "Plan") at an aggregate exercise price of
$1,967,267.(36). The registration fee for the foregoing shares is
based upon the exercise price. Pursuant to Rule 457(c) under the
Securities Act of 1933 the registration fee for the remaining 502,647
shares available under the Plan is based on the average of the high and
low prices of the securities being registered hereby on the New York
Stock Exchange Composite Transaction Tape on August 22, 1997.
</TABLE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents previously filed with the Securities
and Exchange Commission (the "Commission") by Deltic Timber Corporation (the
"Registrant") pursuant to the Securities Exchange Act of 1934, as amended
(the "1934 Act") (Commission 1934 Act File Number 1-12147) are incorporated by
reference herein:
(1) The Registrant's Annual Report on Form 10-K for the fiscal
year ended December 31, 1996 and the Registrant's Quarterly Reports on Form
10-Q for each of the fiscal quarters ended March 31, 1997 and June 30, 1997.
(2) All documents subsequently filed with the Commission by
the Registrant pursuant to Sections 13(a), 13(c), 14 and 15(d) of the 1934 Act
prior to the filing of a post-effective amendment (i) which indicates that all
securities offered herein have been sold or (ii) which deregisters all
securities then remaining unsold.
(3) The description of the Registrant's common stock $0.01 par
value ("Common Stock" or "Shares") contained in the Registrant's registration
statement on Form 10 as declared effective on December 5, 1996, filed under
the 1934 Act, including any amendment thereto or report filed for the purpose
of updating such description ("Form 10").
Any statement contained herein or in a document incorporated or
deemed to be incorporated by reference herein shall be deemed to be modified
or superseded for purposes hereof or of the related prospectus to the extent
that a statement contained herein or in any other subsequently filed document
which is also incorporated or deemed to be incorporated herein modifies or
supersedes such statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute a part of
this Registration Statement.
Item 4. DESCRIPTION OF SECURITIES
Not applicable, see Item 3(3) above.
Item 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Certain legal matters in connection with this registration
statement, including the validity of the Shares to be registered hereby, will
be passed upon for the Registrant by Davis Polk & Wardwell, 450 Lexington
Avenue, New York, New York 10017. William L. Rosoff, a director of the
Company, is a partner of the law firm Davis Polk & Wardwell.
Item 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Reference is made to section 102(b)(7) of the Delaware
General Corporation Law (the "DGCL"), which enables a corporation in its
certificate of incorporation to eliminate or limit the personal liability
of a director for violations of the director's fiduciary duty, except (i)
for breach of the director's duty of loyalty to the corporation or its
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) pursuant to
section 174 of the DGCL (providing for liability of directors for unlawful
payment of dividends or unlawful stock purchases or redemptions) or (iv)
for any transaction from which a director derived an improper personal
benefit. The Registrant's certificate of incorporation eliminates the
liability of directors to the fullest extent permitted by Delaware law.
Reference is made to section 145 of the DGCL which provides
that a corporation may indemnify directors and officers against expenses
(including attorneys fees), judgments, fines and amounts paid in settlement in
connection with specified actions, suits or proceedings, whether civil,
criminal, administrative or investigative (other than an action by or in the
right of the corporation (a "derivative action")) if they act in good faith
and in a manner they 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 their conduct was unlawful. A
similar standard is applicable in the case of derivative actions, except that
indemnification only extends to expenses (including attorneys fees) incurred
in connection with defense or settlement of such action, and the statute
requires court approval before there can be indemnification that may be
granted by a corporation's charter, by-laws, disinterested director vote,
stockholder vote, agreement or otherwise. The Registrant's certificate of
incorporation provides for indemnification of its directors and officers, to
the fullest extent permitted by Delaware law.
In addition, the Registrant has purchased and maintains
directors' and officers' liability insurance.
Item 7. EXEMPTION FROM REGISTRATION CLAIMED
Not Applicable.
Item 8. EXHIBITS
4.01 Amended and Restated Certificate of Incorporation of the
Registrant. (Incorporated herein by reference to Exhibit 3.1
to the Form 10).*
4.02 Amended and Restated By-Laws of the Company.
(Incorporated herein by reference to Exhibit 3.2 to the Form
10).*
5.01 Opinion of Davis Polk & Wardwell.
23.01 Consent of KPMG Peat Marwick LLP.
24.01 Power of attorney (included on the signature page of this
registration statement).
99.01 Deltic Timber Corporation 1996 Stock Incentive Plan.
- ----------
* Incorporated by reference.
Item 9. UNDERTAKINGS
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933 (the "1933 Act")
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent post-
effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high and of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than 20 percent change in the maximum aggregate
offering price set forth in the "Calculation of Registration Fee" table in
this 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 (a)(1)(i) and (a)(1)(ii) do not apply if
the registration statement is on Form S-3, Form S-8 or Form F-3, and the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the registrant pursuant to Section 13 or Section 15(d) of the
1934 Act that are incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the 1933 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.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the 1933 Act, each filing of the registrant's
annual report pursuant to Section 13(a) or Section 15(d) of the 1934 Act (and,
where applicable, each filing of an employee benefit plan's Annual Report
pursuant to Section 15(d) of the 1934 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.
(c) Insofar as indemnification for liabilities arising under the 1933
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 Commission such indemnification is
against public policy as expressed in the 1933 Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the registrant of expenses incurred or
paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities
being registered, the registrant will, unless in the opinion of its counsel
the matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the
final adjudication of such issue.
SIGNATURES
The Registrant. Pursuant to the requirements of the Securities Act of 1933,
the Registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of El Dorado, State of Arkansas, on
August 25, 1997.
DELTIC TIMBER CORPORATION
By: /s/ W. Bayless Rowe
----------------------
Name: W. Bayless Rowe
Title: General Counsel and
Secretary
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below, constitutes and appoints W. Bayless Rowe, Ron L. Pearce, and Clefton D.
Vaughan, and each of them, our true and lawful attorneys-in-fact and agents,
with full power of substitution and resubstitution, to do any and all acts and
things and execute, in the name of the undersigned, any and all instruments
which said attorneys-in-fact and agents may deem necessary or advisable in
order to enable Deltic Timber Corporation to comply with the Securities Act of
1933 and any requirements of the Securities and Exchange Commission in respect
thereof, in connection with the filing with the Securities and Exchange
Commission of the registration statement on Form S-8 under the Securities Act
of 1933, including specifically but without limitation, power and authority to
sign the name of the undersigned to such registration statement, and any
amendments to such registration statement (including post-effective
amendments), and to file the same with all exhibits thereto and other
documents in connection therewith, with the Securities and Exchange
Commission, to sign any and all applications, registration statements, notices
or other documents necessary or advisable to comply with applicable state
securities laws, and to file the same, together with other documents in
connection therewith with the appropriate state securities authorities,
granting unto said attorneys-in-fact and agents, and each of them, full power
and authority to do and to perform each and every act and thing requisite or
necessary to be done in and about the premises, as fully and to all intents
and purposes as the undersigned might or could do in person, hereby ratifying
and confirming all that said attorneys-in-fact and agents, and any of them, or
their 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 by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
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<S> <C> <C>
/s/ Robert C. Nolan
- --------------------------------
Robert C. Nolan Chairman of the Board of
Directors August 25, 1997
/s/ O.H. Darling, Jr.
- --------------------------------
O.H. Darling, Jr. Director August 25, 1997
/s/ Eric M. Heiner
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Eric M. Heiner Director August 25, 1997
/s/ Rev. Christopher Keller, III
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Rev. Christopher Keller, III Director August 25, 1997
/s/ Alex R. Lieblong
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Alex R. Lieblong Director August 25, 1997
/s/ R. Madison Murphy
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R. Madison Murphy Director August 25, 1997
/s/ William L. Rosoff
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William L. Rosoff Director August 25, 1997
/s/ John C. Shealy
- --------------------------------
John C. Shealy Director August 25, 1997
/s/ Ron L. Pearce
- --------------------------------
Ron L. Pearce President, Chief Executive
Officer and Director August 25, 1997
/s/ Emily R. Evers
- --------------------------------
Emily R. Evers Controller August 25, 1997
/s/ W. Bayless Rowe
- --------------------------------
W. Bayless Rowe General Counsel and
Secretary August 25, 1997
/s/ Clefton D. Vaughan
- --------------------------------
Clefton D. Vaughan Vice President, Finance
and Administration August 25, 1997
</TABLE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit Sequentially
Number Exhibit Numbered Page
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<S> <C> <C>
4.01 Amended and Restated Certificate of Incorporation *
of the Registrant. (Incorporated herein by
reference to Exhibit 3.1 to the Form 10).
4.02 Amended and Restated By-Laws of the Company. *
(Incorporated herein by reference to
Exhibit 3.2 to the Form 10).
5.01 Opinion of Davis Polk & Wardwell.
23.01 Consent of KPMG Peat Marwick LLP.
24.01 Power of attorney (included on the signature
page of this registration statement).
99.01 Form of the Deltic Timber Corporation 1996 Stock
Incentive Plan.
- ----------
* Incorporated by reference.
</TABLE>
Exhibit 5.01
Davis Polk & Wardwell Letterhead
August 25, 1997
Deltic Timber Corporation
200 Peach Street
P.O. Box 7000
El Dorado, AR 71731-7200
Dear Sirs:
We are acting as counsel for Deltic Timber Corporation (the "Company")
in connection with its Registration Statement on Form S-8 (the "Registration
Statement") to register under the Securities Act of 1933, as amended, 600,000
shares (the "Shares") of Common Stock ($.01 par value) of the Company issuable
pursuant to the 1996 Stock Incentive Plan (the "Plan") of the Company. In
connection therewith, we have examined originals or copies, certified or
otherwise identified to our satisfaction, of such documents, corporate
records, certificates of public officials and other instruments as we have
deemed necessary for the purpose of this opinion.
Upon the basis of the foregoing, we are of the opinion that the Shares
deliverable pursuant to the Plan have been duly authorized and, when and to
the extent issued pursuant to the Plan upon receipt by the Company of adequate
consideration therefor, will be validly issued, fully paid and nonassessable.
We consent to the filing of this opinion as Exhibit 5.01 to the
Registration Statement.
Very truly yours,
/s/ Barbara Nims
-----------------
Barbara Nims
Exhibit 23.01
Consent of Independent Auditors
INDEPENDENT AUDITORS' CONSENT
-----------------------------
The Board of Directors
Deltic Timber Corporation:
We consent to the use of our report dated February 28, 1997, related to the
consolidated balance sheets of Deltic Timber Corporation and Consolidated
Subsidiaries as of December 31, 1996 and 1995, and the related consolidated
statements of income, stockholders' equity, and cash flows for each of the
years in the three-year period ended December 31, 1996, which report is
included in the December 31, 1996, annual report on Form 10-K of Deltic Timber
Corporation, incorporated by reference on Form S-8 of Deltic Timber
Corporation filed on or about August 25, 1997.
/s/ KPMG Peat Marwick LLP
KPMG Peat Marwick LLP
Shreveport, Louisiana
August 25, 1997
EXHIBIT 99.01
Form of 1996 Stock Incentive Plan
DELTIC TIMBER CORPORATION
1996 Stock Incentive Plan
Section 1. Purpose.
The purpose of the Deltic Timber Corporation Stock Incentive
Plan is to foster and promote the long-term financial success of the Company
and materially increase shareholder value by (a) motivating superior
performance by means of performance-related incentives, (b) encouraging and
providing for the acquisition of an ownership interest in the Company by
Employees, and (c) enabling the Company to attract and retain the services of
an outstanding management team upon whose judgment, interest, and special
effort the successful conduct of its operations is largely dependent.
Section 2. Definitions.
Unless the context otherwise indicates, the following
definitions shall be applicable for the purpose of the 1996 Stock Incentive
Plan:
"Agreement" shall mean a written agreement setting forth the
terms of an Award.
"Award" shall mean any Option (which may be designated as a
Nonqualified or incentive Stock Option), a Stock Appreciation Right or a
Restricted Stock Award, in each case granted under this Plan.
"Beneficiary" shall mean the person, persons, trust or trusts
designated by an Employee or if no designation has been made, the person,
persons, trust or trusts entitled by will or the laws of descent and
distribution to receive the benefits specified under this Plan in the event of
an Employee's death.
"Board" shall mean the Board of Directors of the Company.
"Code" means the Internal Revenue Code of 1986, as amended.
"Committee" shall mean the Executive Compensation Committee of
the Board, as from time to time constituted, or any successor committee of the
Board with similar functions. The Committee shall be constituted to comply
with the requirements of Rule 16b-3 promulgated by the Securities and Exchange
Commission under the Securities Exchange Act of 1934, or such rule or any
successor rule thereto which is in effect from time to time.
"Common Stock" shall mean the Common Stock of the Company,
$0.01 par value, subject to adjustment pursuant to Section 11.
"Company" shall mean Deltic Timber Corporation, a Delaware
corporation.
"Employee" shall mean any person employed by the Company on a
full-time salaried basis or by a subsidiary that does not have in effect for
its personnel any plan similar to the Plan, including officers and employee
directors thereof.
"Incentive Stock Option" or "ISO" shall mean an Option that is
intended by the Committee to meet the requirements of Section 422 of the Code
or any successor provision.
"Nonqualified Stock Option" or "NQSO" shall mean an Epson
granted pursuant to this Plan which does not qualify as an Incentive Stock
Option.
"Normal Termination" shall mean a termination of employment (i)
at normal retirement time, (ii) for permanent and total disability, or (iii)
with Company approval, and without being terminated for cause.
"Option" shall mean the right to purchase Common Stock at a
price to be specified and upon terms to be designated by the Committee
pursuant to this Plan. An Option shall be designated by the Committee as a
Nonqualified Stock Option or an Incentive Stock Option at the time of grant.
"Opportunity Shares" shall mean additional shares of Common
Stock which may be earned by an Employee pursuant to Section 8 hereof.
"Option Holder" or "Holder" shall mean an Employee to whom an
option has been granted
"Personal Representative" shall mean the person or persons who,
upon the disability or incompetence of an Employee, shall have acquired on
behalf of the Employee by legal proceeding or otherwise the right to receive
the benefits specified in this Plan.
"Plan" shall mean this 1996 Stock Incentive Plan.
"Replacement Shares" shall mean shares which may be awarded to
Employees as Option(s) or as Restrictive Stock in such amount and at such
value as may be determined by the Committee to be sufficient to replace
similar awards from Murphy Oil Corporation which were forfeited by Employees
by virtue of their employment by the Company.
"Restricted Period" shall mean the period designated by the
Committee during which Restricted Stock may not be sold, assigned,
transferred, pledged, or otherwise encumbered and during which such stock is
subject to forfeiture.
"Restricted Stock" shall mean those shares of Common Stock
issued pursuant to a Restricted Stock Award which are subject to the
restrictions, terms, and conditions specified by the Committee pursuant to
Section 8 hereof.
"Restricted Stock Award" shall mean an award of Restricted
Stock pursuant to Section 8 hereof.
"Stock Appreciation Right" or "SAR" shall mean the right of the
holder to receive, upon exercise thereof, payment of an amount determined by
multiplying: (a) any increase in the Fair Market Value of a share of Common
Stock at the date of exercise over the price fixed by the Committee at the
date of grant, by (b) the number of shares with respect to which the SAR is
exercised; provided, however, that at the time of grant, the Committee may
establish, in its sole discretion, a maximum amount per share which will be
payable upon exercise of a SAR. The amount payable upon exercise may be paid
in cash or other property, including without limitation shares of Common
Stock, or any combination thereof as determined by the Committee.
Section 3. Administration.
The Plan shall be administered by the Committee. In addition to
any implied powers and duties that may be needed to carry out the provisions
of the Plan, the Committee shall have all of the powers vested in it by the
terms of the Plan, including exclusive authority to select the Employees to be
granted Awards under the Plan, to determine the type, size and terms of the
Awards to be made to each Employee selected, to determine the time when Awards
will be granted, and to prescribe the form of the Agreements embodying Awards
made under the Plan. No member of the Committee. while he serves on the
Committee, may be granted Awards under the Plan. The Committee shall be
authorized to interpret the Plan and the Awards granted under the Plan, to
establish, amend and rescind any rules and regulations relating to the Plan,
to make any other determinations which it believes necessary or advisable for
the administration of the Plan, and to correct any defect or supply any
omission or reconcile any inconsistency in the Plan or in any Award in the
manner and to the extent the Committee deems desirable to carry it into
effect. Any decision of the Committee in the administration of the Plan, as
described herein, shall be final and conclusive.
The Board may from time to time remove members from the
Committee or add members thereto, and vacancies in the Committee, however
caused, shall be filled by action of the Board. The Committee shall select one
of its members as chairman and shall hold its meetings at such time and places
as it may determine. The Committee may act only by a majority of its members.
The members of the Committee may receive such compensation for their services
as the Board may determine. Any determination of the Committee may be made,
without notice, by the written consent of the majority of the members of the
Committee. In addition, the Committee may authorize any one or more of their
number or any officer of the Company to execute and deliver documents on
behalf of the Committee.
Section 4. Stock Subject to the Plan.
The aggregate maximum number of shares which may be issued
under the Plan shall be 1.2 million. Subject to the aggregate maximum limit,
the maximum number of shares available for Awards under the Plan in each
calendar year during any part of which the Plan shall be in effect shall be
one-half of one percent (0.5%) of the total issued and outstanding shares as
of the date of issuance of the shares, excluding any Replacement Shares issued
due to the spin-off from Murphy Oil Corporation. In subsequent years, the
Committee may award up to one-half of one percent of the total issued and
outstanding shares as of December 31 of the immediately preceding year for
long-term Awards. Any and all such shares may be issued in respect of any of
the types of Awards; provided, however no more than fifty percent (50%) of the
shares available shall be available for Awards under the Plan shall be issued
in respect of Restricted Stock. Unless otherwise determined by the Committee,
all shares available in any year that are not granted under the Plan will not
be available for grant for subsequent years
If any shares of Common Stock subject to an Award hereunder are
forfeited or any such Award otherwise terminates without the issuance of
shares of Common Stock or other consideration to an Employee, such shares,
shall not increase the number of shares available for grant in such year.
Section 5. Eligibility.
Any Employee who is a director or an officer or who serves in
any other key administration, professional or technical capacity shall be
eligible to participate in the Plan. In addition the Committee may in any year
include any other Employee who the Committee has determined has made some
unusual contribution which would not be expected of such Employee in the
ordinary course of his work.
Section 6. Stock Options.
A. Grant of Options and Price.
Any Option granted under the Plan may be granted as an Incentive Stock
Option or as a Nonqualified Stock Option, as shall be designated by the
Committee at the time of the grant of such Option. Each Option shall be
evidenced by an Agreement between the recipient and the Company, which
Agreement shall specify the designation of the Option as an ISO or a NQSO, as
the case may be, and shall contain such terms and conditions not inconsistent
with the Plan as the Committee, in its sole discretion, may determine in
accordance with the Plan. The maximum Option that an Employee may receive in a
calendar year is 50,000 shares; and in addition, as to Incentive Stock
Options, the aggregate fair market value (determined on the date the option is
granted) any Employee may receive in any calendar year shall not exceed
$100,000.
The exercise price for the purchase of Common Stock to be issued
pursuant to each Option shall be fixed by the Committee at the time of the
granting of the Option provided, however, that except with respect to the
exercise price for Replacement Shares, such exercise price shall in no event
be less than the fair market value of the Common Stock on the date such Option
is granted. With respect to the exercise price for Replacement Shares, the
Committee may fix an exercise price at any value as it may determine.
B. Exercise.
The period during which an Option may be exercised shall be
determined by the Committee; provided, that such period will not be longer
than ten years from the date on which the Option is granted. The date or dates
on which portions of an Option may be exercised during the term of an Option
shall be determined by the Committee. In no case may an Option be exercised at
any time for fewer than 50 shares (or the total remaining shares covered by
the Option if fewer than 50 shares) during the term of the Option. An Option
which is granted in tandem with a SAR may only be exercised upon the surrender
of the right to exercise such SAR for an equivalent number of shares.
C. Payment for Shares.
The exercise price for the Common Stock shall be paid in full
when the Option is exercised. Subject to such rules as the Committee may
impose, the exercise price may be paid in whole or in part in (i) cash, (ii)
whole shares of Common Stock evidenced by negotiable certificates, valued at
their fair market value on the date of exercise, (iii) by a combination of
such methods of payment, or (iv) such other consideration as shall be approved
by the Committee.
Section 7. Stock Appreciation Rights.
Stock Appreciation Rights may be granted to participants at
such time or times as shall be determined by the Committee and shall be
subject to such terms and conditions as the Committee may impose. A grant of a
SAR shall be made pursuant to a written agreement containing such provisions
not inconsistent with the Plan as the Committee shall approve.
SARs may be exercised at such times or subject to such
conditions as the Committee shall impose, either at or after the time of
grant. SARs which are granted in tandem with an Option may only be exercised
upon the surrender of the right to exercise such Option for an equivalent
number of shares and may be exercised only with respect to the shares of Stock
for which the related Option is then exercisable. Option shares with respect
to which a tandem SAR shall have been exercised for cash shall not again be
available for an Award under this Plan. Notwithstanding any other provision of
the Plan, the Committee may impose such conditions on the exercise of a SAR
(including, without limitation, the right of the Committee to limit the time
of exercise to specified periods) as may be required to satisfy the applicable
provisions of Rule 16b-3 as promulgated under the Securities Exchange Act of
1934, as amended (the "Exchange Act").
Section 8. Restricted Stock Awards.
The Committee may make an award of Restricted Stock to selected
Employees, evidenced by an Agreement which shall contain such terms and
conditions, including without limitation, forfeiture provisions, as the
Committee, in its sole discretion, may determine The amount of each Restricted
Stock Award and the respective terms and conditions of each Award (which terms
and conditions need not be the same in each case) shall be determined by the
Committee in its sole discretion. The maximum Award that an Employee may
receive in a calendar year is 50,000 shares.
The Committee shall establish performance measures for each
Restricted Period on the basis of such criteria and to accomplish such
objectives as the Committee may from time to time, in its sole discretion,
determine. Such measures may include, but shall not be limited to, total
shareholder return, growth in cash flow per share, growth in earnings per
share, return on assets, or return on stockholder equity. The Committee may
from time to time establish different performance objectives for certain
operating subsidiaries or sectors of the business.
Shares of Restricted Stock will be subject to forfeiture and
may not be sold, transferred, pledged, assigned, or otherwise alienated or
hypothecated until such time or until the satisfaction of such conditions or
the occurrence of such events as shall be determined by the Committee either
at or after the time of grant. Unless otherwise determined by the Committee at
the time of grant, participants holding shares of Restricted Stock granted
hereunder may exercise full voting rights with respect to those shares during
the Restricted Period.
Unless otherwise determined by the Committee at the time of
grant, participants holding shares of Restricted Stock shall be entitled to
receive all dividends and other distributions paid with respect to those
shares, provided that if any such dividends or distributions are paid in
shares of Stock or other securities, such shares or securities shall be
subject to the same forfeiture restrictions and restrictions on
transferability as apply to the Restricted Stock with respect to which they
were paid.
Each Employee, who has received shares of Common Stock pursuant
to a Restricted Stock Award with respect to which all of the restrictions set
forth in Section 8 shall have lapsed or pursuant to an award of Opportunity
Shares related to such Restricted Stock Award, shall also receive from the
Company a cash payment in the year following the close of the Restricted
Period in an amount determined by the Committee, which amount is intended to
allow such Employee to pay such Employee's tax liability (assuming the highest
rates of tax applicable to any individual taxpayer in the year in which such
payment is made) with respect to (i) such shares and (ii) such cash payment.
Provided, however, unless otherwise determined by the Committee, the cash
payment shall in no event exceed 50% of the fair market value of such shares
as of the date that all of the restrictions set forth in Section 8 shall have
lapsed or as to an award of Opportunity Shares as of the date of grant thereof.
Section 9. Termination of Employment.
Unless otherwise determined by the Committee, in the event a
participant's employment terminates by reason of Normal Termination, any
Options granted to such participant which are then outstanding may be
exercised at the earlier of any time prior to the expiration of the term of
the Options or within two (2) years after termination and any shares of
Restricted Stock then outstanding shall be prorated for all restricted periods
then in effect based on the number of months of actual participation.
Unless otherwise determined by the Committee, in the event a
participant's employment is terminated by reason of death, any Options granted
to such participant which are then outstanding may be exercised by the
participant's beneficiary or the participant's legal representative at any
time prior to the expiration date of the term of the Options or within two (2)
years following the participant's termination of employment, whichever period
is shorter, and any shares of Restricted Stock then outstanding shall be
prorated for all restricted periods then in effect based on the number of
months of actual participation.
Unless otherwise determined by the Committee, in the event the
employment of the participant shall terminate for any reason other than the
ones described in this Section, any Options granted to such participant which
are then outstanding shall be cancelled and any shares of Restricted Stock
then outstanding as to which the Restricted Period has not lapsed shall be
forfeited.
A change in employment from the Company or one Subsidiary to
another Subsidiary of the Company shall not be considered a termination.
Section 10. Change in Control.
Notwithstanding any other provision of this Plan or an
Agreement to the contrary, upon a Change in Control, as defined below, all
outstanding Awards shall vest, become immediately exercisable or payable or
have all restrictions lifted as may apply to the type of Award.
A "Change in Control" shall be deemed to have occurred if (i)
any "person", including a "group" (as such terms are used in Sections 13(d)
and 14(d)(2) of the Exchange Act, but excluding the Company, any of its
subsidiaries or any employee benefit plan of the Company or any of its
subsidiaries or Charles H. Murphy, Jr. and affiliates of Charles H. Murphy,
Jr.) is or becomes the "beneficial owner" (as defined in Rule 13(d)(3) under
the Exchange Act), directly or indirectly, of securities of the Company
representing 25% or more of the combined voting power of the Company's then
outstanding securities; or (ii) the stockholders or the Board of the Company
shall approve a definitive agreement (1) for the merger or other business
combination of the Company with or into another corporation a majority of the
directors of which were not directors of the Company immediately prior to the
merger or in which the stockholders of the Company immediately prior to the
effective date of such merger own less than 50% of the voting power in such
corporation or (2) for the sale or other disposition of all or substantially
all of the assets of the Company.
Section 11. Adjustments upon Changes in Capitalization.
In the event of any change in the Common Stock by reason of any
stock split, stock dividend, recapitalization, merger, consolidation,
reorganization, combination, or exchange of shares, split-up, spin-off, share
purchase, liquidation or other similar change in capitalization affecting or
involving the Common Stock, or any distribution to common stockholders other
than regular cash dividends, the Committee shall make such substitution or
adjustment, if any, as it deems equitable, as to the number or kind of shares
that may be issued under the Plan pursuant to Section 4 and the number or kind
of shares subject to, or the price per share under or terms of any outstanding
Award. The amount and form of the substitution or adjustment shall be
determined by the Committee and any such substitution or adjustment shall be
conclusive and binding on all parties for all purposes of the Plan.
Section 12. Miscellaneous Provisions.
No Employee or other person shall have any claim or right to be granted
an Award under the Plan and no Award shall confer any right to continued
employment.
An Employee's rights and interest under the Plan or any Award may not
be assigned or transferred in whole or in part, either directly or by
operation of law or otherwise (except in the event of an Employee's death, to
the Employee's Beneficiaries or by will or the laws of descent and
distribution), including, but not by way of limitation, execution, levy,
garnishment, attachment, pledge, bankruptcy or in any other manner, and no
such right or interest of any Employee in the Plan or in any Award shall be
subject to any obligation or liability of such individual. An Award shall be
exercisable, during an Employee's lifetime, only by him or her or his or her
Personal Representative. Except as specified in the applicable Award
agreement, the holder of an Award shall have none of the rights of a
shareholder until the shares subject thereto shall have been registered on the
transfer books of the Company.
Any provision of the Plan or any Agreement to the contrary
notwithstanding, no Common Stock shall be issued hereunder unless course' for
the Company shall be satisfied that such issuance will be in compliance with
applicable Federal, state, or other securities laws.
The Company shall have the power to withhold, or require a participant
to remit to the Company, an amount sufficient to satisfy Federal, state, and
local withholding tax requirements in respect of any Award, or any exercise or
vesting thereof under the Plan, and the Company may defer payment of cash or
issuance of Stock until such requirements are satisfied. The Committee may, in
its discretion, permit an Employee to elect, subject to such conditions as the
Committee shall impose, (i) to have shares of Stock otherwise issuable under
the Plan withheld by the Company or (ii) to deliver to the Company previously
acquired shares of Stock, in either case having a fair market value sufficient
to satisfy all or part of the participant's estimated total Federal, state,
and local tax obligation associated with the transaction.
The expenses of the Plan shall be borne by the Company, except as set
forth above in subsection (d) of this Section.
Awards granted under the Plan shall be binding upon the Company, its
successors and assigns.
Nothing contained in this Plan shall prevent the Board of Directors
from adopting other or additional compensation arrangements, subject to
shareholder approval if such approval of any such additional arrangement is
required.
Section 13. Amendment, Modification, and Termination of Plan.
The Board may from time to time amend the Plan or any provision
thereof without the consent of the stockholders except in the case of any
amendments that require stockholder approval in order to comply with
applicable law or provisions of stock exchange listing agreements.
The Board may terminate the Plan in whole or in part at any
time provided that no such termination shall impair the terms of Awards then
outstanding under which the obligations of the Company have not been fully
discharged.
Section 14. Governing Law.
The provisions of this Plan shall be interpreted and construed
in accordance with the laws of the State of Delaware.
