ss.15.11.1 PROXY/ANNUAL MEETING - Cover
Sheet - Proxy Statement
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
[(Amendment No. ___)]
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[ X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss. 240.14a-11(c) or ss. 240.14a-12
GEOWASTE INCORPORATED
(Name of Registrant as Specified in Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[ X ] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
(1) Title of each class of securities to which transaction
applies:
(2) Aggregate number of securities to which transaction
applies:
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (set
forth the amount on which the filing fee is calculated and
state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee previously paid with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which
the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the Form or
Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE>
GEOWASTE INCORPORATED
SUITE 700
100 WEST BAY STREET
JACKSONVILLE, FLORIDA 32202
-------------------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To be held June 5, 1997
-------------------------------------
To the Stockholders of GeoWaste Incorporated:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders (the
"Meeting") of GeoWaste Incorporated (the "Company") will be held at 1101 Hawkins
Street, Valdosta, Georgia, on June 5, 1997 at 10:00 a.m., local time, for the
following purposes:
1. To elect five (5) Directors.
2. To authorize and approve the 1996 Stock Option Plan.
3. To approve the appointment of Coopers & Lybrand L.L.P. as
independent auditors of the Company for the fiscal year
ending December 31, 1997.
4. To transact such other business as may properly come before
the Meeting or any postponement thereof.
Stockholders of record at the close of business on April 17, 1997,
shall be entitled to notice of, and to vote at, the Meeting or any postponements
or adjournments thereof.
By order of the Board of Directors
Amy C. MacF. Burbott
Chief Executive Officer
and President
Dated: Jacksonville, Florida
May 6, 1997
<PAGE>
IMPORTANT: WHETHER OR NOT YOU INTEND TO BE PRESENT AT THE MEETING, PLEASE FILL
IN, DATE, SIGN AND MAIL PROMPTLY THE ENCLOSED PROXY IN THE POSTAGE-PAID ENVELOPE
PROVIDED TO ASSURE THAT YOUR SHARES ARE REPRESENTED AT THE MEETING.
<PAGE>
GEOWASTE INCORPORATED
SUITE 700
100 WEST BAY STREET
JACKSONVILLE, FLORIDA 32202
-----------------------------
PROXY STATEMENT
-----------------------------
ANNUAL MEETING OF STOCKHOLDERS
The accompanying Proxy is solicited by the Board of Directors of
GeoWaste Incorporated, a Delaware corporation (the "Company"), for use at the
Annual Meeting of Stockholders to be held on June 5, 1997, at 10:00 a.m., local
time, or any adjournment or postponement thereof (the "Meeting"), at which
stockholders of record at the close of business on April 17, 1997 shall be
entitled to vote. The cost of solicitation of proxies will be borne by the
Company. The Company may use the services of its Directors, officers, employees
and others to solicit proxies, personally or by telephone; arrangements may also
be made with brokerage houses and other custodians, nominees, fiduciaries and
stockholders of record to forward solicitation material to the beneficial owners
of stock held of record by such persons. The Company may reimburse such
solicitors for reasonable out-of-pocket expenses incurred by them in soliciting,
but no compensation will be paid for their services.
Each proxy executed and returned by a stockholder may be revoked at
any time before it is voted by timely submission of written notice of revocation
or by submission of a duly executed proxy bearing a later date (in either case
directed to the Secretary of the Company) or, if a stockholder is present at the
Meeting, he may elect to revoke his proxy and vote his shares personally.
This proxy statement, the Notice of Annual Meeting of Stockholders
and the accompanying form of proxy are first being sent to stockholders of the
Company on or about May 6, 1997. Enclosed herewith is a copy of the Company's
Annual Report on Form 10-K for the year ended December 31, 1996. Additional
copies may be obtained by providing written requests for such Form 10-K to
Raymond F. Chase, Vice President & Controller, Geowaste Incorporated, Suite 700,
100 West Bay Street, Jacksonville, Florida 32202.
On April 17, 1997, the Company had outstanding and entitled to vote
with respect to all matters to be acted upon at the Meeting 21,265,829 shares of
Common Stock. Each holder of Common Stock is entitled to one vote for each share
of stock held by such holder. The presence of holders representing a majority of
all the votes entitled to be cast at the Meeting will constitute a quorum at the
Meeting. In accordance with Delaware law, abstentions and broker non-votes are
counted for purposes of determining the presence or absence of a quorum for the
transaction of business. Each proposal on the agenda must receive the
affirmative vote of a majority of the shares voted at the Meeting in order to
pass. Abstentions are counted in the calculation of the votes cast with respect
to any of the matters submitted to a vote of stockholders, whereas broker
non-votes are not counted for purposes of determining votes cast with respect to
any of such matters.
It is expected that the following business will be considered at the
Meeting and action taken thereon:
1. ELECTION OF DIRECTORS
It is proposed to elect five (5) Directors at the Meeting to hold
office until the next annual meeting of stockholders and until their successors
are duly elected and qualified. It is intended that the accompanying form of
Proxy will be voted for the nominees set forth below. If any of the nominees
should be unable to serve, which is not now anticipated, the proxies solicited
hereby will be voted for such other person or persons as shall be designated by
the present Board of Directors. The Board of Directors is not aware that any
nominee may be unable or unwilling to serve as a Director.
NOMINEES FOR ELECTION AS DIRECTORS
Certain information with respect to each nominee is set forth below.
WALTER H. BARANDIARAN, Age 44. Mr. Barandiaran is a General Partner and
co-founder of The Argentum Group, a position he has held since 1987. The
Argentum Group is a New York based private investment firm. Mr. Barandiaran is a
director of Conner Industries, Inc. and Lanxide Precision, Inc..
AMY C. MACF. BURBOTT, Age 46. Ms. Burbott has served as President and Chief
Executive Officer of the Company since May 1996 and has served as Director since
July 1991 (including having served as Chairman of the Board from February 1995
to May 1996). Ms. Burbott also served as President and Chief Executive Officer
of the Company from July 1991 until February 1995.
STEVEN M. ENGEL, Age 44. Mr. Engel is a co-owner of Engel Brothers Media, a
documentary film and television production company, where he has served as Chief
Executive Officer since 1996. From 1991 to 1996, Mr. Engel served as President
of Hambro Resource Development, Inc. an investment banking firm. Mr. Engel has
been a Director of the Company since 1991.
HARVE A. FERRILL, Age 64. Mr. Ferrill serves as Chairman of the Board of the
Company. From 1990, until its sale to CUC International in 1996, Mr. Ferrill was
the Chairman and Chief Executive Officer of Advance Ross Corporation, a value
added consumer purchase company, where he continues as Chief Executive Officer.
Mr. Ferrill has been a Director of the Company since 1991.
MICHAEL D. PAGLIA, Age 33. Mr. Paglia joined the Company as a Vice President and
Director in August 1996 upon the Company's acquisition of Spectrum Group, Inc.
("United Sanitation"). From July 1993 to August 1996 Mr. Paglia had served as an
officer and owner of United Sanitation. From 1989 to July 1993, he was the
general manager for the Northern Florida operations of Commercial Metals
Company. Mr. Paglia has been a Director of the Company since 1996.
BOARD MEETINGS AND COMMITTEES
In the fiscal year ended December 31, 1996, there were three meetings
of the Board of Directors and two actions by unanimous consent. The Stock Option
Committee acted through unanimous consent on two occasions. Each Director of the
Company attended in excess of 75% of the total number of meetings of the Board
of Directors and committees thereof. The Company does not have a standing audit,
compensation or nominating committee, but such functions are performed by the
full Board of Directors. The Company's Board of Directors has maintained a Stock
Option Committee comprised of two outside Directors who administer the Company's
1992 Stock Option Plan.
COMPENSATION OF DIRECTORS
Directors of the Company are not paid for their services as such but
are reimbursed reasonable expenses incurred for Company business or attendance
at Board of Directors meetings. Directors are also eligible to receive grants
under the Company's 1996 Stock Option Plan. See Item 2 below.
EXECUTIVE COMPENSATION
The following table sets forth certain information regarding
compensation paid to the Company's Chief Executive Officer and to each of the
most highly compensated executive officers of the Company whose salary and bonus
for 1996 exceeded $100,000 (collectively, the "Named Executive Officers").
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
- ----------------------------------------------------------------------------------------------------------------------
Long Term
Annual Compensation Compensation
Name and Principal Salary Bonus Other Annual Stock Options
Position Year ($) ($) Comp. (#)
($)
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Amy C. MacF. Burbott 1996 $ 105,833 $ $ 40,083 (1) 400,000
Chief Executive Officer 1995 10,833 -0- 121,129 (1) -0-
and President 1994 130,000 -0- 22,083 (2) -0-
Kevin R. Kohn 1996 $ 102,785 $ 12,000 $ 221,337 (3)
President 1995 90,102 -0- 20,000
1994 79,894 45,439 (4) 125,000
- ------------------------------------------------------------------------------------------------------------------------
- ---------------------
(1) Consulting payments made to Ms. Burbott when she was not employed by the Company.
(2) Compensation earned in 1992 and 1993 but paid in 1994.
(3) Exercised Stock Options.
(4) Relocation expense reimbursement.
</TABLE>
AGREEMENTS RELATING TO EMPLOYMENT
Amy C. MacF. Burbott and Raymond F. Chase, the Company's Chief
Executive Officer and Vice President, respectively, have severance agreements
which provide that their employment may be terminated with or without cause, but
if the employment is terminated without cause, they are to receive severance
payments equal to six (6) months of their respective current annual salary. The
agreements also specify certain continuation of health and insurance benefits
during the period severance payments are being made.
STOCKHOLDER RETURN PERFORMANCE PRESENTATION
The following line graph sets forth a comparison of the percentage
change in the cumulative total stockholder return on the Company's Common Stock
compared to the cumulative total return of the S&P SmallCap 600 Index and a peer
group, for the period January 1, 1992 through December 31, 1996.
The graph assumes that the shares of the Company's Common Stock were
bought at a price of $100 per share and that the value of the investment in each
of the Company's Common Stock and the indices was $100 at the beginning of the
period. As required by the Securities and Exchange Commission (the
"Commission"), the values shown assume the investment of all dividends (where
applicable) and, in the case of the peer group are weighted to reflect the
market capitalization of the component companies. The peer group is comprised of
the following companies: Allied Waste Industries, Inc., American Waste Services,
Inc., Browning-Ferris Industries, Inc., Eastern Environmental Services, Inc.,
Superior Services, Inc., Transamerican Waste Industries, Inc., Transcor Waste
Services, Inc., United Waste Systems, Inc., USA Waste Services, Inc. and WMX
Technologies, Inc.
The stock price performance shown on the graph below is not
necessarily indicative of future price performance.
PERFORMANCE GRAPH
<TABLE>
<CAPTION>
TOTAL SHAREHOLDER RETURNS
--------------------------
Dividends Reinvested
ANNUAL RETURN PERCENTAGE
Years Ending
Company Name/Index Dec 92 Dec 93 Dec 94 Dec 95 Dec 96
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
GEOWASTE INC 31.20 -47.64 -27.22 150.00 70.00
S&P SMALL CAP 600 INDEX 21.04 18.79 - 4.77 29.96 21.32
PEER GROUP -0.63 -26.17 4.03 14.70 11.75
INDEXED RETURNS
Years Ending
Base Period
Company Name/Index Dec 91 Dec 92 Dec 93 Dec 94 Dec 95 Dec 96
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
GEOWASTE INC 100 131.20 68.70 50.00 125.00 212.50
S&P SMALL CAP 600 INDEX 100 121.04 143.78 136.92 177.94 215.88
PEER GROUP 100 99.37 73.37 76.33 87.55 97.84
Peer Group Companies
- ---------------------------------------------------------------------------------------------------------
ALLIED WASTE INDS INC
AMERICAN WASTE SVCS -CLA
BROWNING-FERRIS INDS
EASTN ENVIRONMENT SVC
SUPERIOR SERVICES INC
TRANSAMERICAN WASTE INDS INC
TRANSCOR WASTE SVCS INC
UNITED WASTE SYS INC
USA WASTE SERVICES INC
WMX TECHNOLOGIES INC
</TABLE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information with respect to
beneficial ownership of the Company's Common Stock as of April 17, 1997, (i) by
each person who is known by the Company to own beneficially more than five
percent of the Common Stock, (ii) by each of the Company's current directors,
(iii) by each of the Named Executive Officers and (iv) by all current directors
and executive officers as a group.
- -----------------------------------------------------------------------------
SHARES BENEFICIALLY OWNED
NAME NUMBER PERCENT
- -----------------------------------------------------------------------------
Walter H. Barandiaran 100,400 *
Amy C. MacF. Burbott 600,000(1) 2%
Robert J. Cresci 2,584,475(2) 10%
Steven M. Engel 40,000 *
Harve A. Ferrill 1,196,856(3) 5%
Kevin R. Kohn 2000 *
Michael D. Paglia 1,000,000 4%
All directors and executive officers as
group (9 persons) 5,981,501 24%
Allen Holding Inc.
711 Fifth Avenue 6,260,000(4) 25%
New York, New York 10022
Emvest & Co.
c/o Morrissey & Hawkins
One International Place 2,000,000 8%
Boston, Massachusetts 02110
- ------------------------------------------------------------------------------
- -----------------------------
* Less than 1%
(1) Includes 600,000 shares which Ms. Burbott has an option to acquire and
which are immediately exercisable.
(2) Includes 10,000 shares which are held directly by Mr. Cresci and 2,574,475
shares which are subject to issuance upon the conversion of the Company's
Convertible Subordinated Debenutures, for which Mr. Cresci has sole investment
power but disclaims any beneficial ownership.
(3) Includes 100,000 shares which Mr. Ferrill has an option to acquire and
which are immediately exercisable and 26,080 shares beneficially owned by
Mr. Ferrill, 18,080 of which he has sole voting and investment power and 8,000
shares of which he shares voting and investment power. Also includes 1,070,776
shares held by Advance Ross Corporation (of which Mr. Ferrill is Chief Executive
Officer), for which Mr. Ferrill disclaims any beneficial ownership.
(4) Includes 3,573,200 shares held by Allen Value Partners L.P., 760,000
shares held by Allen & Company Incorporated and 426,800 shares issued to Allen
Value Limited Incorporated. Allen Holding Inc. may be deemed to beneficially
own the shares of Common Stock held by Allen Value Partners L.P. and Allen
Value Limited Incorporated. However, Allen Holding Inc. disclaims beneficial
ownership except to the extent represented by Allen Holding Inc.'s equity
interest and profit participation in such entities. Also includes warrants
held by Allen & Company Incorporated to purchase 1,500,000 shares which are
immediately exercisable. The amount in the table excludes 709,425 shares and
warrants to purchase 500,000 shares held by officers and directors of
Allen & Company for which Allen & Company disclaims beneficial ownership.
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On March 5, 1992 the Company completed the private placement of $3
million in Convertible Subordinated Debentures (the "Debentures"). The
Debentures had a term of five years and bear interest at the rate of 8.5% per
annum. The Debentures are convertible into the Company's Common Stock at $1.40
per share. In March 1997 the Company and the holder of the Debentures agreed to
extend the due date of the Debentures to September 30, 1997. Mr. Robert Cresci,
who has served as a Director of the Company since the placement of the
Debentures and who is not standing for reelection to the Board, is the
investment advisor to the holders of the Debentures.
The Company, through its wholly owned subsidiary United Sanitation,
leases approximately 155,000 square feet of land and buildings in Ocala, Florida
which is used for the operations of United Sanitation's collection, transfer,
recycling and portable toilet business. The property is leased from a real
estate company which is controlled by Michael and John Paglia, who serve as the
Company's Director and Vice President and Vice President, respectively. The
lease has a term of 20 years, grants the Company an option to purchase the
property at any time after the fifth year of the lease at fair market value, and
has annual rent of $204,000 with yearly escalators tied to changes in the
Florida Consumers Price Index. The Company believes the lease to be reasonable,
fair and on terms and conditions typical for commercial leases in the Ocala,
Florida area.
During 1996 the Company incurred investment banking fees to Allen & Company
Incorporated in the amount of $640,000 for advisory services performed in
connection with the acquisitions made by the Company in 1996. A portion of these
fees ($240,000) represents the value assigned by the Company to the extension of
Allen & Company Incorporated's warrants to February 28, 1998 and has been
recorded as purchase price for the particular acquisition for which the services
were rendered.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), requires the Company's directors, certain of its officers and
persons who own more than 10 percent of a registered class of the Company's
equity securities to file reports of ownership and changes in ownership with the
Commission. Such officers, directors and greater than 10 percent stockholders
are required by the Commission regulation to furnish the Company with copies of
all Section 16(a) form filed by such reporting persons.
Based solely upon review of the copies of such forms received and
regular correspondence with such parties, the Company believes that during 1996,
except for a Form 4 filing required to be filed by Kevin Kohn, a former officer
and director of the Company, all of its officers, directors and greater than ten
percent stockholders complied with all filing requirements under Section 16(a)
of the Exchange Act.
OPTIONS GRANTED
The table below shows information regarding the grant of stock options
made to the Named Executive Officers during the fiscal year ended December 31,
1996. The amount shown for each officer as grant date present value is based on
the assumptions set forth below. Actual gains, if any, on stock option exercises
are dependent on the future performance of the Company's Common Stock.
<TABLE>
<CAPTION>
OPTION GRANTS DURING 1996
- ------------------------------------------------------------------------------
Potential Potential
Realizable Realizable
% Value At Value At
Number Total Assumed Assumed
of Of Exercise Annual Annual
Shares Options Price Per Vesting Expiration Rate Rate
Granted Granted Share Date Date Of Stock Of Stock
To Employees Appreciation Appreciation
Name In 1996 At 5% At 10%
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Amy C. MacF. Burbott 100,000 * $2.00 4-23-96 4-23-06 $ 125,000 $ 317,000
100,000 * 2.00 4-23-97 4-23-06 $ 125,000 $ 317,000
100,000 * $2.75 4-23-98 4-23-06 $ 50,000 $ 242,000
100,000 * 3.50 4-23-99 4-23-06 $ 0 $ 167,000
- --------------------------------------------------------------------------------------------------------------------------
- ------------------
* The aggregate grant of options to purchase 400,000 shares of Common Stock to
Ms. Burbott on April 23, 1996 represented 86% of the total number of option
granted to all employees in 1996.
</TABLE>
The table below sets forth information for the named Executive
Officers concerning option exercises during 1996 and outstanding options at
December 31, 1996.
<TABLE>
<CAPTION>
AGGREGATED OPTION EXERCISES DURING 1996
AND YEAR END OPTION VALUES
- -------------------------------------------------------------------------------------------------------------------
NUMBER OF SECURITIES VALUE OF UNEXERCISED
SHARES UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
ACQUIRED OPTIONS AT END AT END OF 1996 ($)
ON VALUE OF 1996 EXERCISABLE/
EXERCISE REALIZED (#) UNEXERCISABLE (1)
NAME (#) ($) EXERCISABLE/UNEXERCISABLE
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Amy C. MacF. Burbott -0- -0- 500,000 $662,500(2)
Chief Executive 300,000 $ 12,500
Officer and President
Kevin R. Kohn President 100,416 221,337 37,916 $ 61,614
6,668 6,235
- -------------------------------------------------------------------------------------------------------------------
- -----------------
(1) Calculated using $2.125 per share, the last sale price of the Company's
Common Stock on December 31, 1996.
(2) Includes 400,000 shares at an exercise price of $ .50 per share for which
the Company must reimburse the exercise price.
</TABLE>
2. STOCK OPTION PLAN
GENERAL
Effective November 18, 1996, the Board of Directors of the Company
adopted the 1996 Stock Option Plan (the "Plan") under which stock option grants
may be made to members of the Board of Directors and key employees of the
Company. As of April 17, 1997, no options have been granted under the Plan and
any such grant prior to the approval of the Plan by the Company's stockholders
would be conditioned upon such approval. On April 17, 1997, the fair market
value of a share of Common Stock was $2.75. The following summary of the Plan is
qualified in its entirety by reference to the full text of the Plan. The
Company will provide, without charge to each of its stockholders, on the written
request of such stockholders a copy of the 1996 Stock Option Plan.
PURPOSE
The purpose of the Plan is to enable the Company to attract and retain
key employees and directors, provide an additional incentive to each key
employee and director and provide each key employee and director with a stake in
the future of the Company which corresponds to the stake of each of the
Company's stockholders.
PLAN ADMINISTRATION
The Plan is currently administered by a committee of the Board of
Directors (the "Committee"). The Committee determines the key employees and
directors who will be eligible for grants and the amount and type of the grants,
establishes rules and guidelines relating to the Plan, establishes and modifies
the terms of grants and is entitled to take such other action as may be
necessary for the proper administration of the Plan.
MAJOR PROVISIONS OF THE PLAN
The major provisions of the Plan are as follows:
TYPES OF OPTIONS TO BE GRANTED. It is intended that either "Incentive
Stock Options," within the meaning of Section 422 of the Internal Revenue Code
of 1986, as amended (the "Code"), or options which do not satisfy Section 422 of
the Code ("Non- Qualified Stock Options"), or both, may be granted under the
Plan (collectively, the "Options"). At the time an Option is granted, the
Committee determines, in its sole discretion, whether such Option (a) is to be
considered as an Incentive Stock Option or (b) is not to be treated as an
Incentive Stock Option for purposes of the Plan and the Code. No Option which is
intended to qualify as an Incentive Stock Option shall be granted under the Plan
to any individual who, at the time of such grant, is not an employee of the
Company or a subsidiary of the Company (a "Subsidiary").
The aggregate fair market value (determined as of the date an Option
is granted) of the shares of Common Stock with respect to which Options which
are designated as Incentive Stock Options, and any other Incentive Stock
Options, granted to an employee (under the Plan, or any other Incentive Stock
Option plan maintained by the Company or any Subsidiary that meets the
requirements of Section 422 of the Code) first become exercisable in any
calendar year shall not exceed $100,000. Furthermore, no Option may be granted
in any calendar year to any key employee for more than 250,000 shares of Common
Stock.
PLAN PARTICIPANTS. The class of persons who are potential recipients
of Options granted under the Plan consist of key employees of the Company or any
Subsidiary and members of the Company's Board of Directors. The key employees
and directors to whom Options are granted under the Plan, and the number of
shares subject to each such Option, shall be determined by the Committee in its
sole discretion, subject, however, to the terms and conditions of the Plan. As
of April 17, 1997, 150 key employees and 3 directors who are not key employees
were eligible to participate in the Plan.
SHARES AVAILABLE UNDER THE PLAN. A maximum of 1,000,000 authorized and
unissued or treasury shares of the Company's Common Stock may be issued or
delivered under the Plan. Shares of Common Stock which remain unissued after the
cancellation or expiration of an Option are available for future grants under
the Plan
OPTION EXERCISE PRICE AND DURATION. Generally, the price per share of
the shares of Common Stock to be purchased pursuant to the exercise of any
Incentive Stock Option shall be no less than the fair market value of a share on
the day on which the Option is granted. However, if the Incentive Stock Option
is granted to a key employee who is a Ten Percent Shareholder (as defined in the
Plan), the price per share of the shares of Common Stock to be purchased
pursuant to the exercise of any Incentive Stock Option shall be no less than
110% of the fair market value of a share on the day on which such Option is
granted. The price per share of the shares of Common Stock to be purchased
pursuant to the exercise of any Non-Qualified Stock Option may be less than the
fair market value of a share on the day on which such Option is granted but in
no event may the exercise price be less than adequate consideration. The
duration of any Option granted under the Plan shall be ten years from the date
upon which the Option is granted unless the holder of the Option is a Ten
Percent Shareholder on the date the option is granted, in which case, the
duration of any Incentive Stock Option granted to such individual shall be five
years from the date the Incentive Stock Option is granted.
EXERCISE OF OPTIONS. An Option, after the grant thereof, shall be
exercisable by the holder of the Option (the "Participant"), in whole or in
part, at such time or times as set forth in the related Option Certificate;
provided, however, that all Options shall become fully and immediately vested on
a change in control.
For purposes of the Plan, a "change in control" shall mean (a) the
acquisition of the power to direct, or to cause the direction, of the management
and policies of the Company by a person (not previously possessing such power),
acting alone or in conjunction with others, whether through the ownership of
Common Stock, by contract or otherwise, or (b) the acquisition, directly or
indirectly, of the power to vote 20% or more of the outstanding Common Stock by
a person or persons (other than a person possessing such power on the date this
Plan becomes effective or the Company or an employee benefit plan established
and maintained by the Company). For purposes of this definition, (i) the term
"person" means a natural person, corporation, partnership, joint venture, trust,
government or instrumentality of a government and (ii) customary agreements with
or between underwriters and selling group members with respect to a bona fide
public offering of Common Stock shall be disregarded.
In the event that the Company agrees to sell all or substantially all
of its assets or agrees to any merger, consolidation, reorganization, division
or other corporate transaction in which Common Stock is converted into another
security or into the right to receive securities or property and such agreement
does not provide for the assumption or substitution of the Options granted under
the Plan, each unexercised Option at the Committee's direction and discretion
may be canceled and, if the fair market value of the shares exceeds the exercise
price, the cancellation will be in exchange for shares of Common Stock equal in
value to the difference between the exercise price and fair market value as of
the date before the effective date of the transaction.
TERMINATION OF THE OPTIONS. A certificate representing an Option may
provide for the exercise of an Option after the employment of a Participant has
terminated for any reason whatsoever, including death or disability. If any
Option shall expire, be canceled or terminate for any reason without having been
exercised in full, the unpurchased shares of Common Stock subject thereto may
again be made subject to Options under the Plan.
PAYMENT FOR AND ISSUANCE OF SHARES. Payment of the shares purchased
pursuant to the exercise of an Option shall be made in full at the time of the
exercise of the Option, in cash or by delivery of previously-owned shares of
Common Stock of the Company. The Committee may also, in its discretion, allow a
Participant exercising an Option to pay the exercise price, in whole or in part,
by electing that the Company withhold shares of Common Stock from the shares of
Common Stock that otherwise would be transferred to such Participant as a result
of exercising such Option (a "Cashless Exercise"). With the approval of the
Committee, the Company may loan, or guarantee a loan by a third party, to a
Participant of 100% of the purchase price of the shares to be purchased. The
Plan contains standard provisions to assure that any exercise of an Option or
the issuance of shares pursuant thereto will not violate applicable securities
and income tax withholding laws.
ADJUSTMENT OF SHARES. The Plan contains usual anti-dilution provisions
in the event of certain corporate transactions.
AMENDMENT AND DISCONTINUANCE OF THE PLAN. The Plan may be amended,
modified or terminated by the Committee, except that the Committee may not,
without requisite approval of the stockholders, increase the maximum number of
shares as to which Options may be granted under the Plan, change the minimum
exercise price, change the class of eligible persons or extend the period for
which Options may be granted or exercised. No amendment, modification, or
termination of the Plan may, without the written consent of a Participant,
affect the rights of such Participant under an outstanding Option unless there
is a dissolution or liquidation of the Company, change in capitalization of the
Company, sale or merger of the Company, or change in control of the Company. No
Option may be granted more than ten years after the effective date of the Plan.
NON-TRANSFERABILITY OF OPTIONS. Options shall be non-transferrable and
non- assignable by Participants, except to the extent that the estate or other
devisee of a deceased Participant may be permitted to exercise them.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
INCENTIVE STOCK OPTIONS. An employee will not recognize income upon
the grant or exercise of an Incentive Stock Option. If an employee disposes of
the shares acquired upon exercise of an Incentive Stock Option at least two
years after the date the Option was granted and at least one year after the date
the shares are transferred to him upon the exercise of an Option, the employee
will realize long-term capital gain in an amount equal to the excess, if any, of
the amount realized on the disposition of the shares over the exercise price. In
such case, the Company will not be entitled to any tax deduction. If an employee
disposes of the shares acquired upon the exercise of an Incentive Stock Option
prior to the expiration of two years from the date the Option was granted, or
one year from the date the shares are transferred to him, any gain realized will
be taxable at such time as follows: (1) as ordinary income to the extent of the
difference between the Option exercise price and the lesser of (a) the fair
market value of the shares on the date the shares were transferred to him or (b)
the amount realized on such disposition, and (2) as capital gain to the extent
of any excess, which gain shall be treated as short-term or long-term capital
gain depending upon the employee's holding period. In such case, the Company may
claim an income tax deduction for the amount taxable to the employee as ordinary
income. The difference between the fair market value of the shares at the time
the Incentive Stock Option is exercised and the exercise price will constitute
an item of adjustment, for purposes of determining alternative minimum taxable
income, and may under certain circumstances be subject, in the year in which the
Option is exercised, to the alternative minimum tax.
If an individual uses shares of Common Stock of the Company that he
owns to pay, in whole or in part, the exercise price of an Incentive Stock
Option, (a) the individual's holding period for the newly-issued shares equal in
number to the surrendered shares (the "exchanged shares") shall include the
period during which the surrendered shares were held, (b) the employee's basis
in such exchanged shares will be the same as his basis in the surrendered
shares, and (c) no gain or loss will be recognized by the employee on the
exchange of the surrendered shares for the exchanged shares. Further, the
employee will have a zero basis in any additional shares received over and above
the exchanged shares. However, if an employee tenders shares acquired pursuant
to the exercise of an Incentive Stock Option, such tender will constitute a
disposition of such shares for purposes of the one-year (or two- year) holding
period requirement applicable to Incentive Stock Options and such tender will be
treated as a taxable exchange if such holding period has not been met. If an
individual pays for the exercise price of an Incentive Stock Option through a
Cashless Exercise, such individual will be considered to have received and
disposed of the shares withheld to pay the exercise price on the date of
exercise of the Option. Therefore, the disposition of the withheld shares will
not meet the one-year (or two- year) holding period requirement applicable to
Incentive Stock Options.
NON-QUALIFIED STOCK OPTIONS. A holder will not recognize any income at
the time a Non-Qualified Stock Option is granted, but he will recognize ordinary
income at the time he exercises a Non-Qualified Stock Option in a total amount
equal to: (1) in the case of Options exercised with cash, the excess of the then
fair market value of the shares acquired over the exercise price, (2) in the
case of Options which an employee exercises by tendering previously owned
shares, the then fair market value of the shares issued in excess of the fair
market value of the shares surrendered upon such exercise, and (3) in the case
of a Cashless Exercise, the excess of the then fair market value of the
aggregate shares acquired by the holder and withheld by the Company to pay the
exercise price over the exercise price. Section 83 of the Code generally
provides that if a Director, officer, or principal stockholder receives shares
pursuant to the exercise of a Non-Qualified Stock Option, he is not required to
recognize income until the date on which he can sell such shares at a profit
without being subject to liability under Section 16(b) of the Exchange Act.
Regulations under Section 83 of the Code provide that if the sale of shares at a
profit within six months after purchasing the shares could subject a person to
suit under Section 16(b) of the Exchange Act, the person is taxed at the earlier
of (i) the expiration of such six month period or (ii) the first day on which
the sale of the shares at a profit will not subject the person to suit under
Section 16(b) of the Exchange Act. Alternatively, a Director, officer or
principal stockholder who would not otherwise be subject to tax on the value of
his shares as of the date they were acquired can file a written election, within
30 days after the shares are transferred to him, pursuant to Section 83(b) of
the Code, to be taxed as of the date of transfer. In either case, the Director,
officer, or principal stockholder would realize income equal to the amount by
which the fair market value, at the time the income is recognized, of the shares
acquired pursuant to the exercise of such option exceeds the price paid for such
shares.
All income realized upon the exercise of any Non-Qualified Stock
Option will be taxed as ordinary income. The Company may claim an income tax
deduction for the amount taxable to a holder in the same year as those amounts
are taxable to a holder. Shares issued upon the exercise of a Non-Qualified
Stock Option are generally eligible for capital gain or loss treatment upon any
subsequent disposition. Generally, a holder's holding period will commence from
the date such shares are issued to him, and his basis in such shares will equal
their fair market value as of that date. If an individual uses shares of Common
Stock that he owns to exercise a Non-Qualified Stock Option, (a) the
individual's holding period for the newly-issued shares equal in number to the
surrendered shares (the "exchanged shares") shall include the period during
which the surrendered shares were held, (b) the holder's basis in such exchanged
shares will be the same as his basis in the surrendered shares, and (c) no gain
or loss will be recognized by the holder on the exchange of the surrendered
shares for the exchanged shares.
SECTION 280G OF THE CODE. In addition to Federal income tax
consequences discussed above, Section 280G of the Code provides that if an
officer, stockholder or highly compensated individual receives a payment which
is in the nature of compensation and which is contingent upon a change in
control of the employer, and such payment equals or exceeds three times his Base
Salary (as hereinafter defined), then any amount received in excess of Base
Salary shall be considered an "excess parachute payment." An individual's Base
Salary is equal to his average annual compensation over the five-year period (or
period of employment, if shorter) ending with the close of the individual's
taxable year immediately preceding the taxable year in which the change in
control occurs. In addition to any income tax which would otherwise be owed on
such payment, the individual will be subject to an excise tax equal to 20% of
such excess payment (and the Company will not be allowed any deduction which
might otherwise have been allowed for such excess payment). If the taxpayer
establishes, by clear and convincing evidence, that the amount received is
reasonable compensation for past or future services, all or a portion of such
amount shall be deemed not to be an excess parachute payment.
Section 280G provides that payments made pursuant to a contract
entered into within one year of the change in control are presumed to be
parachute payments unless the individual establishes, by clear and convincing
evidence, that such contract was not entered into in contemplation of a change
in control. In addition, the General Explanation of the Tax Reform Act of 1984
prepared by the Staff of the Joint Committee on Taxation indicates that the
grant of an Option within one year of the change in control or the acceleration
of an Option because of a change in control may be considered a parachute
payment, in an amount equal to the value of the Option or the value of the
accelerated portion of the Option, as the case may be. Pursuant to proposed
regulations, the acceleration of a Non-Qualified Stock Option because of a
change in control will be considered a parachute payment. Even if the grant of
an Option, if any, within one year of the change in control or the acceleration
of an Option, if any, is not a parachute payment for purposes of Section 280G,
the exercise of an Option granted within one year of the change in control or
the exercise of the accelerated portion of an Option may result in a parachute
payment. Payments received for the cancellation of an Option, if any, because of
a change in control may also result in parachute payments.
The foregoing summarizes all material Federal income tax consequences;
however, reference is made to the applicable provisions of the Code. In
addition, there may be tax considerations under state and local laws applicable
to participants.
EFFECTIVE DATE. The Plan was adopted by the Board of Directors to be
effective as of November 18, 1996 subject to approval by the holders of a
majority of the shares of stock of the Company which vote on the subject at a
meeting of stockholders of the Company duly convened and held within twelve
months of the Board of Directors' adoption of the Plan. In the event the Plan is
not approved by stockholders of the Company, the Plan shall be void and of no
further force and effect.
VOTE REQUIRED
Under the Code, the affirmative vote of the holders of a majority of
the shares of stock of the Company voting on the subject at this Annual Meeting
is required to approve the amendment to the Plan.
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS A VOTE FOR THE
AUTHORIZATION AND APPROVAL OF THE PLAN.
3. APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors of the Company has selected Coopers & Lybrand
L.L.P. as independent auditors of the Company for the fiscal year ending
December 31, 1997. A representative of Coopers & Lybrand L.L.P. is expected to
be present at the meeting with the opportunity to make a statement if such
representative so desires and to respond to appropriate questions.
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS A VOTE FOR APPROVAL
OF THE APPOINTMENT OF COOPERS & LYBRAND L.L.P. AS THE COMPANY'S AUDITORS.
4. OTHER MATTERS
STOCKHOLDER PROPOSALS
Proposals of stockholders intended to be presented at the Company's
1998 Annual Meeting of Stockholders must be received by the Company on or prior
to November 7, 1997 to be eligible for inclusion in the Company's Proxy
Statement and form of Proxy to be used in connection with such meeting.
OTHER BUSINESS
At the date of this Proxy Statement, the only business which the Board
of Directors intends to present or knows that others will present at the Meeting
is that hereinabove set forth. If any other matter or matters are properly
brought before the Meeting, or any adjournment thereof, it is the intention of
the persons named in the accompanying form of Proxy to vote the Proxy on such
matters in accordance with their judgment.
Amy C. MacF. Burbott
Chief Executive Officer and
President
Dated: May 6, 1997
<PAGE>
GEOWASTE INCORPORATED
PROXY
PROXY SELECTED BY THE BOARD OF DIRECTORS FOR
ANNUAL MEETING OF STOCKHOLDERS
JUNE 5, 1997
The undersigned hereby appoints Raymond F. chase and Michelle Mikell,
and each of them, proxies with full power of substitution and resubstitution,
for and in the names of the undersigned, to vote all shares of stock of GeoWaste
Incorporated which the undersigned would be entitled to vote if personally
present at the Annual Meeting of stockholders to be held on Thursday, June 5,
1997 at 10:00 a.m., local time, 1101 Hawkins street, Valdosta,\ Georgia 31601,
and at any adjournments or adjournments thereof, upon the matters described in
the accompanying Notice of Annual Meeting of Stockholders and Proxy statement,
receipt of which is hereby acknowledged, and upon any other business that may
properly come before the meeting at any adjournment or adjournments thereof.
Said proxies are directed to vote on the matters described in the Notice of
Annual Meeting and Proxy Statement as follows, and otherwise in their discretion
upon such other business as may properly come before the meeting and any
adjournment or adjournments thereof.
<PAGE>
1. ELECTION OF DIRECTORS- 2. APPROVAL OF THE COMPANY'S
IF PROPOSAL 1 IS APPROVED 1996 STOCK OPTION PLAN ("ITEM 2")
For all nominees WITHHOLD (INSTRUCTION:
listed to the right AUTHORITY To withhold FOR AGAINST ABSTAIN
(except as marked to vote for authority / / / / / /
to the contrary) all nominees to vote for any
listed to the individual nominee(s)
right strike a line through the
nominee's name in the
list below.)
/ / / / Walter H. Barandiaran, Amy MacF. Burbott,
Steven M. Engel, Harve A. Ferrill and
Michael D. Paglia
3. RATIFICATION OF THE APPOINTMENT, THIS PROXY WILL BE VOTED AS DIRECTED
by the Board of Directors, of BUT IF NO DIRECTION IS INDICATED,
Coopers & Lybrand independent THIS PROXY WILL BE VOTED "FOR"
public accountants as auditors EACH OF THE ABOVE-STATED PROVISIONS.
of the Company for the year ending
December 31, 1997 ("ITEM 3"). Please sign and date below and return
the proxy immediately in the
enclosed evnelope, whether or not you
plan to attend the annual meeting.
FOR AGAINST ABSTAIN
/ / / / / / Please date this proxy and sign
exactly as your name or names appear
hereon. When more than one owner is
shown, each should sign. When
signing in fiduciary or
representative capacity, please give
full title. If this proxy is
submitted by a corporation, it should
be executed in the full corporate
name by a duly authorized officer.
If this proxy is submitted by a
partnership, it should be executed
in full partnership name by a duly
authorized person.
Date: ,1997
--------------------------
Signature
--------------------------
Signature
<PAGE>
Exhibit A
GEOWASTE INCORPORATED
1996 STOCK OPTION PLAN
<PAGE>
TABLE OF CONTENTS
Page
SECTION 1. PURPOSE...........................................................2
SECTION 2. DEFINITIONS.......................................................2
2.1. Board............................................................ 2
2.2. Change in Control.................................................2
2.3. Code..............................................................3
2.4. Committee.........................................................3
2.5. Director..........................................................3
2.6. Fair Market Value.................................................3
2.7. ISO...............................................................3
2.8. Key Employee......................................................3
2.9. 1933 Act..........................................................4
2.10. Non-ISO...........................................................4
2.11. Option............................................................4
2.12. Option Certificate................................................4
2.13. Option Holder.....................................................4
2.14. Option Price......................................................4
2.15. Parent Corporation................................................4
2.16. Plan..............................................................4
2.17. Rule 16b-3........................................................4
2.18. Stock.............................................................4
2.19. Subsidiary........................................................4
2.20. Ten Percent Shareholder...........................................4
SECTION 3. SHARES SUBJECT TO OPTIONS.........................................5
SECTION 4. EFFECTIVE DATE....................................................5
SECTION 5. COMMITTEE.........................................................6
SECTION 6. ELIGIBILITY.......................................................6
SECTION 7. GRANT OF OPTIONS..................................................6
7.1. Committee Action..................................................6
7.2. $100,000 Limit....................................................7
SECTION 8. OPTION PRICE......................................................7
SECTION 9. EXERCISE PERIOD...................................................8
SECTION 10. NONTRANSFERABILITY................................................9
SECTION 11. SECURITIES REGISTRATION AND RESTRICTIONS..........................9
SECTION 12. LIFE OF PLAN.....................................................10
SECTION 13. ADJUSTMENT.......................................................11
SECTION 14. SALE OR MERGER OF GEOWASTE; CHANGE IN CONTROL....................12
14.1. Sale or Merger...................................................12
14.2. Change in Control................................................12
SECTION 15. AMENDMENT OR TERMINATION.........................................12
SECTION 16. MISCELLANEOUS....................................................13
16.1. No Shareholder Rights............................................13
16.2. No Contract of Employment........................................13
16.3. Withholding......................................................14
16.4. Construction.....................................................14
16.5. Loans............................................................14
<PAGE>
SECTION 1.
PURPOSE
The purpose of this Plan is to promote the interests of GeoWaste and
its related companies by granting Options to purchase Stock to Key Employees and
Directors in order (1) to attract and retain Key Employees and Directors, (2) to
provide an additional incentive to each Key Employee and Director to work to
increase the value of Stock and (3) to provide each Key Employee and Director
with a stake in the future of GeoWaste which corresponds to the stake of each of
GeoWaste's shareholders.
SECTION 2.
DEFINITIONS
Each term set forth in this Section 2 shall have the meaning set forth
opposite such term for purposes of this Plan and, for purposes of such
definitions, the singular shall include the plural and the plural shall include
the singular.
2.1. Board -- means the Board of Directors of GeoWaste.
2.2. Change in Control -- means (a) the acquisition of the power to
direct, or to cause the direction, of the management and policies of GeoWaste by
a person (not previously possessing such power), acting alone or in conjunction
with others, whether through the ownership of Stock, by contract or otherwise,
or (b) the acquisition, directly or indirectly, of the power to vote 20% or more
of the outstanding Stock by a person or persons (other than a person possessing
such power on the date this Plan becomes effective or GeoWaste or an employee
benefit plan established and maintained by GeoWaste). For purposes of this
definition, (i) the term "person" means a natural person, corporation,
partnership, joint venture, trust, government or instrumentality of a government
and (ii) customary agreements with or between underwriters and selling group
members with respect to a bona fide public offering of Stock shall be
disregarded.
2.3. Code -- means the Internal Revenue Code of 1986, as amended.
2.4. Committee -- means a committee which shall have at least 2
members, each of whom shall be appointed by and shall serve at the pleasure of
the Board and shall come within the definition of a "Non-Employee Director"
under Rule 16b-3 and an "outside director" under Section 162(m) of the Code.
2.5. Director -- means a member of GeoWaste's Board.
2.6. Fair Market Value -- means (a) if the Stock is listed on a
national securities exchange or quoted in an automated interdealer quotation
system, the last sales price or, if unavailable, the average of the closing bid
and asked prices per share of the Stock on such date (or, if there was no
trading or quotation in the Stock on such date, on the next preceding date on
which there was trading or quotation) as provided by one of such organizations;
or (b) if the Stock is not listed on a national securities exchange or quoted in
an automated interdealer quotation system, as determined by the Board in good
faith in its sole discretion.
2.7. ISO -- means an option granted under this Plan to purchase Stock
which is intended to satisfy the requirements of Section 422 of the Code.
2.8. Key Employee -- means an employee of GeoWaste or any Subsidiary
of GeoWaste who, in the judgment of the Committee acting in its absolute
discretion, is key to the success of GeoWaste, or a Subsidiary of GeoWaste.
2.9. 1933 Act -- means the Securities Act of 1933, as amended.
2.10. Non-ISO -- means an option granted under this Plan to purchase
stock which is intended to fail to satisfy the requirements of Section 422 of
the Code.
2.11. Option -- means an ISO or a Non-ISO.
2.12. Option Certificate -- means the written agreement or instrument
which sets forth the terms of an Option granted to a Key Employee or Director
under this Plan.
2.13. Option Holder -- means a Director or Key Employee who has been
granted an Option under this Plan.
2.14. Option Price -- means the price to purchase one share of Stock
upon the exercise of an Option granted under this Plan.
2.15. Parent Corporation -- means any corporation which is a parent
corporation (within the meaning of Section 424(e) of the Code) of GeoWaste.
2.16. Plan -- means this GeoWaste Incorporated 1996 Stock Option Plan
effective as of November 18, 1996 and as amended from time to time thereafter.
2.17. Rule 16b-3 -- means the exemption under Rule 16b-3 to Section
16b of the Securities Exchange Act of 1934, as amended, or any successor to such
rule.
2.18. Stock -- means the $0.10 par value Common Stock of GeoWaste.
2.19. Subsidiary -- means any corporation which is a subsidiary
corporation (within the meaning of Section 424(f) of the Code) of GeoWaste.
2.20. Ten Percent Shareholder -- means a person who owns (after taking
into account the attribution rules of Section 424(d) of the Code) more than ten
percent (10%) of the total combined voting power of all classes of stock of
either GeoWaste, a Subsidiary or a Parent Corporation.
SECTION 3.
Shares Subject To Options
There shall be 1,000,000 shares of Stock reserved for use under this
Plan. Such shares of Stock shall be reserved to the extent that GeoWaste deems
appropriate from authorized but unissued shares of Stock and from shares of
Stock which have been reacquired by GeoWaste. Any shares of Stock subject to an
Option which remain unissued after the cancellation or expiration of such Option
thereafter shall again become available for use under this Plan, but any shares
of Stock used to exercise an Option under Section 7 or to satisfy a withholding
obligation under Section 16.3 shall not again be available for use under this
Plan.
SECTION 4.
Effective Date
The effective date of this Plan shall be November 18, 1996, provided
GeoWaste's shareholders (acting at a duly called meeting of such shareholders)
approve this Plan within twelve (12) months after the date the Board adopts this
Plan and such approval satisfies the requirements for shareholder approval under
Section 422 of the Code and any other applicable law. Any Option granted before
such shareholder approval automatically shall be granted subject to such
approval.
SECTION 5.
COMMITTEE
This Plan shall be administered by the Committee. The Committee acting
in its absolute discretion shall exercise such powers and take such action as
expressly called for under this Plan and, further, the Committee shall have the
power to interpret this Plan and to take such other action in the administration
and operation of this Plan as the Committee deems equitable under the
circumstances, which action shall be binding on GeoWaste, on each affected Key
Employee and Director and on each other person directly or indirectly affected
by such action.
SECTION 6.
ELIGIBILITY
Only Key Employees and Directors shall be eligible for the grant of
Options under this Plan.
SECTION 7.
GRANT OF OPTIONS
7.1. Committee Action. The Committee acting in its absolute discretion
shall grant Options to Key Employees and Directors under this Plan from time to
time to purchase shares of Stock and, further, shall have the right to grant new
Options in exchange for the cancellation of outstanding Options which have a
higher or lower Option Price; provided, however, no ISO shall be granted to a
Director or Key Employee unless he or she is employed by GeoWaste or a
Subsidiary and no Option shall be granted in any calendar year to any Key
Employee for more than 250,000 shares of Stock. Each grant of an Option shall be
evidenced by an Option Certificate, and each Option Certificate shall
(a) specify whether the Option is an ISO or Non-ISO, and
(b) incorporate such other terms and conditions as the Committee
acting in its absolute discretion deems consistent with the terms
of this Plan, including (without limitation) a limitation on the
number of shares subject to the Option which first become
exercisable during any particular period.
If the Committee grants an ISO and a Non-ISO to a Key Employee on the
same date, the right of the Key Employee to exercise the ISO shall not be
conditioned on his or her failure to exercise the Non-ISO.
7.2. $100,000 Limit. The aggregate Fair Market Value of the shares of
Stock subject to ISOs granted to a Key Employee and other incentive stock
options (which satisfy the requirements under Section 422 of the Code) granted
to such Key Employee under any other stock option plan adopted by GeoWaste, a
Subsidiary or a Parent Corporation which first become exercisable in any
calendar year shall not exceed $100,000. Such Fair Market Value figure shall be
determined by the Committee on the date the ISO or other incentive stock option
is granted. The Committee shall interpret and administer the limitation set
forth in this Section 7.2 in accordance with Section 422(d) of the Code, and the
Committee shall treat this Section 7.2 as in effect only for those periods for
which Section 422(d) of the Code is in effect.
SECTION 8.
OPTION PRICE
The Option Price for each share of Stock subject to an ISO shall be no
less than the Fair Market Value of a share of Stock on the date the ISO is
granted or, if the ISO is granted to a Key Employee who is a Ten Percent
Shareholder, the Option Price for each share of Stock subject to such ISO shall
be no less than 110% of the Fair Market Value of a share of Stock on the date
the ISO is granted. On the other hand, the Option Price for a Non-ISO may be
less than the Fair Market Value of a share of Stock on the date the Non-ISO is
granted but shall under no circumstances be less than adequate consideration (as
determined by the Board) for such a share. The Option Price shall be payable in
full upon the exercise of any Option, and an Option Certificate at the
discretion of the Committee may provide for the payment of the Option Price
either in cash or in Stock or in any combination of cash and such Stock. If an
Option Certificate allows the payment of the Option Price in whole or in part in
Stock, such payment shall be made in Stock acceptable to the Committee. The
Committee may also (in its discretion) allow an Option Holder or Director to pay
such Option Price (in whole or in part) by electing that GeoWaste withhold
shares of Stock (that otherwise would be transferred to such Option Holder as a
result of the exercise of such Option) to the extent that he or she elects to
pay such Option Price through such withheld shares of Stock. Any payment made in
Stock shall be treated as equal to the Fair Market Value of such Stock on the
date the properly endorsed certificate for such Stock is delivered to the
Committee or the date the Stock is treated by the Committee as withheld from the
exercise of the Option.
SECTION 9.
EXERCISE PERIOD
Each Option granted under this Plan shall be exercisable in whole or
in part at such time or times as set forth in the related Option Certificate,
but no Option Certificate shall make an Option exercisable on or after the
earliest of the
(1) the date which is the fifth anniversary of the date the
Option is granted, if the Option is an ISO and the Option Holder
is a Ten Percent Shareholder on the date the Option is granted,
or
(2) the date which is the tenth anniversary of the date such Option
is granted, if such Option is granted to a Option Holder who is
not a Ten Percent Shareholder on the date the Option is granted.
An Option Certificate may provide for the exercise of an Option after the
employment of an Option Holder has terminated for any reason whatsoever,
including death or disability.
SECTION 10.
NONTRANSFERABILITY
An Option granted under this Plan shall not be transferable by an
Option Holder other than by will or by the laws of descent and distribution, and
such Option shall be exercisable during an Option Holder's lifetime only by the
Option Holder. The person or persons to whom an Option is transferred by will or
by the laws of descent and distribution thereafter shall be treated as the
Option Holder.
SECTION 11.
SECURITIES REGISTRATION AND RESTRICTIONS
Each Option Certificate shall provide that, upon the receipt of shares
of Stock as a result of the exercise of an Option, the Option Holder shall, if
so requested by GeoWaste, agree to hold such shares of Stock for investment and
not with a view of resale or distribution to the public and, if so requested by
GeoWaste, shall deliver to GeoWaste a written statement satisfactory to GeoWaste
to that effect. Each Option Certificate also shall provide that, if so requested
by GeoWaste, the Option Holder shall make a written representation to GeoWaste
that he or she will not sell or offer for sale any of such Stock unless a
registration statement shall be in effect with respect to such Stock under the
1933 Act and any applicable state securities law or he or she shall have
furnished to GeoWaste an opinion in form and substance satisfactory to GeoWaste
of legal counsel satisfactory to GeoWaste that such registration is not
required. Certificates representing the Stock transferred upon the exercise or
surrender of an Option may at the discretion of GeoWaste bear a legend to the
effect that such Stock has not been registered under the 1933 Act or any
applicable state securities law and that such Stock cannot be sold or offered
for sale in the absence of an effective registration statement as to such Stock
under the 1933 Act and any applicable state securities law or an opinion in form
and substance satisfactory to GeoWaste of legal counsel satisfactory to GeoWaste
that such registration is not required.
SECTION 12.
LIFE OF PLAN
No Option shall be granted under this Plan on or after the earlier of
(a) the tenth anniversary of the effective date of this Plan, in which
event this Plan shall continue in effect thereafter until all
outstanding Options have been surrendered or exercised in full or
no longer are exercisable, or
(b) the date on which all of the Stock reserved under Section 3 of
this Plan has (as a result of the exercise of Options) been
issued or no longer is available for use under this Plan, in
which event this Plan also shall terminate on such date.
SECTION 13.
ADJUSTMENT
The number of shares of Stock reserved under Section 3 of this Plan
and the number of shares of Stock subject to Options granted under this Plan and
the Option Price of such Options shall be adjusted by the Committee in an
equitable manner to reflect any change in the capitalization of GeoWaste,
including, but not limited to, such changes as stock dividends or stock splits.
Furthermore, the Committee shall have the right to adjust (in a manner which
satisfies the requirements of Section 424(a) of the Code) the number of shares
of Stock reserved under Section 3 of this Plan and the number of shares subject
to Options and the Option Price of such Options in the event of any corporate
transaction described in Section 424(a) of the Code which provides for the
substitution or assumption of such Options. If any adjustment under this Section
13 would create a fractional share of Stock or a right to acquire a fractional
share of Stock, such fractional share shall be disregarded and the number of
shares of Stock reserved under this Plan and the number subject to any Options
granted under this Plan shall be the next lower number of shares of Stock,
rounding all fractions downward. An adjustment made under this Section 13 by the
Committee shall be conclusive and binding on all affected persons and, further,
shall not constitute an increase in "the number of shares reserved under Section
3" within the meaning of Section 15(a) of this Plan.
SECTION 14.
SALE OR MERGER OF GEOWASTE; CHANGE IN CONTROL
14.1 Sale or Merger. If GeoWaste agrees to sell all or substantially
all of its assets for cash or property or for a combination of cash and property
or agrees to any merger, consolidation, reorganization, division or other
corporate transaction in which Stock is converted into another security or into
the right to receive securities or property and such agreement does not provide
for the assumption or substitution of the Options granted under this Plan, each
then unexercised Option at the direction and discretion of the Committee (a) may
be cancelled unilaterally by the Committee as of the date before the effective
date of such transaction in exchange the number of whole shares of Stock (and
cash in lieu of fractional shares), if any, equal to the difference between the
Option Price for the unexercised shares and Fair Market Value of such shares or
(b) may be cancelled if the Option Price equals or exceeds the Fair Market Value
of a share of Stock on such date.
14.2. Change in Control. If a Change in Control of GeoWaste occurs,
then all Options that are outstanding and unexercised as of the date of such
Change in Control shall be fully vested as of such date.
SECTION 15.
AMENDMENT OR TERMINATION
This Plan may be amended by the Committee from time to time to the
extent that the Committee deems necessary or appropriate; provided, however, no
such amendment shall be made absent the proper approval of the shareholders of
GeoWaste (a) to increase the number of shares reserved under Section 3, (b) to
extend the maximum life of the Plan under Section 12 or the maximum exercise
period under Section 9, (c) to decrease the minimum option price under Section 8
or (d) to change the class of employees eligible for Options under Section 6.
The Committee also may suspend the granting of Options under this Plan at any
time and may terminate this Plan at any time; provided, however, the Committee
shall not have the right unilaterally to modify, amend or cancel any Option or
granted before such suspension or termination unless (1) the Option Holder
consents in writing to such modification, amendment or cancellation or (2) there
is a dissolution or liquidation of GeoWaste or a transaction described in
Section 13 or Section 14 of this Plan.
SECTION 16.
MISCELLANEOUS
16.1. No Shareholder Rights. No Option Holder shall have any rights as
a shareholder of GeoWaste as a result of the grant of an Option to him or to her
under this Plan or his or her exercise or surrender of such Option pending the
actual delivery of Stock subject to such Option to such Option Holder.
16.2. No Contract of Employment. The grant of an Option to a Key
Employee or Director under this Plan shall not constitute a contract of
employment and if the Option Holder is an Employee, shall not confer on such
Option Holder any rights upon his or her termination of employment with GeoWaste
in addition to those rights, if any, expressly set forth in the Option
Certificate which evidences his or her Option.
16.3. Withholding. Each Option grant shall be made subject to the
condition that the Option Holder consents to whatever action the Committee
directs to satisfy the federal and state tax withholding requirements, if any,
which the Committee in its discretion deems applicable to the exercise of any
Option granted to him or her. The Committee also shall have the right to provide
in an Option Certificate that an Option Holder may elect to satisfy federal and
state tax withholding requirements through a reduction in the number of shares
of Stock actually transferred to him or to her under this Plan.
16.4. Construction. This Plan shall be construed under the laws of the
State of Delaware.
16.5. Loans. If approved by the Committee, GeoWaste may lend money or
guarantee loans by third parties to any Option Holder to finance the exercise of
any Option granted under this Plan.
IN WITNESS WHEREOF, GeoWaste Incorporated has caused its duly
authorized officer to execute this Plan this ______ day of _______________, 1996
to evidence its adoption of this Plan.
GEOWASTE INCORPORATED
By:___________________________
Title:________________________
