<PAGE> 1
As filed with the Securities and Exchange Commission on June 13, 1997
Registration No. 333-______________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------------------
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
---------------------------------
Core Materials Corporation
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 31-1481870
- ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
800 Manor Park Drive, P.O. Box 28183,
- -------------------------------------
Columbus, Ohio 43238-0183
- ------------------------------------- ----------
(Address of Principal (Zip Code)
Executive Offices)
Core Materials Corporation Long-Term Equity Incentive Plan
----------------------------------------------------------
(Full title of the plan)
Kevin Barnett Copy to:
c/o Core Materials Corporation Philip C. Johnston, Esq.
800 Manor Park Drive Vorys, Sater, Seymour and Pease
P.O. Box 28183 52 East Gay Street, P.O. Box 1008
Columbus, Ohio 43228-0183 Columbus, Ohio 43216-1008
- --------------------------
(Name and address of agent)
(614) 870-5000
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(Telephone number, including area code, of agent for service)
---------------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Title of Amount Proposed maximum Proposed maximum Amount of
securities to to be offering price aggregate offering registration
be registered registered per share(1) price(1) fee
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares of 1,500,000 $2.75 for $4,296,280 $1,302.00
Common Stock, 696,000 shares
par value of Common Stock;
$.01 per share $2.81 for
("Common Stock") 35,000 shares of
Common Stock;
$2.97 for
769,000 shares
of Common Stock
</TABLE>
- ------------------
(1) Estimated solely for the purpose of calculating the aggregate offering
price and the registration fee pursuant to Rules 457(c) and 457(h)
promulgated under the Securities Act of 1933, as amended, and computed
on the basis of: (a) $2.75 per share for 696,000 shares of Common
Stock to be registered, which is the price at which options to
purchase such shares of Common Stock may be exercised; (b) $2.81 for
35,000 shares of Common Stock to be registered, which is the price at
which options to purchase such shares of Common Stock may be
exercised; and (c) $2.97 for 769,000 shares of Common Stock which is
the average of the high and low sales prices of the shares of Common
Stock as reported on the American Stock Exchange on June 9, 1997.
Page 1 of 94; Index to Exhibits at Page 15
<PAGE> 2
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
- -------------------------------------------------
The Annual Report on Form 10-K for the fiscal year ended December 31,
1996 of Core Materials Corporation (the "Registrant"), and all other reports
filed with the Securities and Exchange Commission (the "Commission") pursuant
to the requirements of Section 13(a) or Section 15(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), since that date are
hereby incorporated by reference.
The description of the Registrant's shares of Common Stock contained
in the Registrant's Registration Statement No. 333-15809 on Form S-4, as filed
with the Commission on November 8, 1996, and all amendments thereto or reports
filed for the purpose of updating such description heretofore filed by the
Registrant with the Commission, are hereby incorporated by reference.
Any definitive Proxy Statement or Information Statement filed pursuant
to Section 14 of the Exchange Act and all documents which may be filed with the
Commission pursuant to Sections 13, 14 or 15(d) of the Exchange Act subsequent
to the date hereof and prior to the completion of the offering contemplated
hereby, shall also be deemed to be incorporated herein by reference and to be
made a part hereof from the date of filing of such documents; provided,
however, that no report of the Compensation Committee of the Board of Directors
of the Registrant on executive compensation and no performance graph included
in any Proxy Statement or Information Statement filed pursuant to Section 14 of
the Exchange Act shall be deemed to be incorporated herein by reference.
Item 4. Description of Securities.
- -----------------------------------
Not Applicable.
Item 5. Interests of Named Experts and Counsel.
- ------------------------------------------------
Not Applicable.
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<PAGE> 3
Item 6. Indemnification of Directors and Officers.
- ---------------------------------------------------
Section 102(b)(7) of the Delaware General Corporation Law permits a
Delaware corporation to limit the liability of its directors through a
provision in its certificate of incorporation, and provides, in pertinent part,
as follows:
(b) In addition to the matters required to be set forth in the
certificate of incorporation by subsection (a) of this section, the
certificate of incorporation may also contain any or all of the
following matters:
* * *
(7) A provision eliminating or limiting the personal liability of a
director to the corporation or its stockholders for monetary damages
for breach of fiduciary duty as a director, provided that such
provision shall not eliminate or limit the liability of a director:
(i) for any 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) under section 174 of this title; or (iv) for
any transaction from which the director derived an improper personal
benefit. No such provision shall eliminate or limit the liability of a
director for any act or omission occurring prior to the date when such
provision becomes effective. . . .
Article XI of the Certificate of Incorporation of the Company, as
amended, limits the personal liability of the directors of the Company and
provides as follows:
SECTION 1. Limitation of Directors' Liability.
-----------------------------------
A. No director of the corporation shall be personally liable
to the Corporation or its stockholders for monetary damages for breach
of fiduciary duty as a director, except, to the extent provided by
applicable law, for liability (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
Delaware General Corporation Law or (iv) for any transaction from
which the director derived an improper personal benefit. If the
Delaware General Corporation Law is hereafter amended to authorize
corporate action further limiting or eliminating the personal
liability of directors, then the liability of each director of the
Corporation shall be limited or eliminated to the full extent
permitted by the Delaware General Corporation Law as so amended from
time to time.
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B. Neither the amendment nor repeal of this Section 1, nor
the adoption of any provision of the Certificate of Incorporation
inconsistent with this Section 1, shall eliminate or reduce the effect
of this Section 1, in respect of any matter occurring, or any cause of
action, suit or claim that, but for this Section 1, would accrue or
arise, prior to such amendment, repeal or adoption of an inconsistent
provision.
Section 145 of the Delaware General Corporation Law governs
indemnification by a Delaware corporation and provides as follows:
(a) A corporation shall have power to indemnify any person
who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative (other than an action
by or in the right of the corporation) by reason of the fact that the
person is or was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the corporation as
a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against
expenses (including attorneys' fees), judgments, fines and amounts
paid in settlement actually and reasonably incurred by the person in
connection with such action, suit or proceeding if the person acted in
good faith and in a manner the person reasonably believed to be in or
not opposed to the best interests of the corporation, and, with
respect to any criminal action or proceeding, had no reasonable cause
to believe the person's conduct was unlawful. The termination of any
action, suit or proceeding by judgment, order, settlement, conviction,
or upon a plea of nolo contendere or its equivalent, shall not, of
itself, create a presumption that the person did not act in good faith
and in a manner which the person reasonably believed to be in or not
opposed to the best interests of the corporation, and, with respect to
any criminal action or proceeding, had reasonable cause to believe
that the person's conduct was unlawful.
(b) A corporation shall have power to indemnify any person
who was or is a party or is threatened to be made a party to any
threatened, pending or completed action or suit by or in the right of
the corporation to procure a judgment in its favor by reason of the
fact that the person is or was a director, officer, employee or agent
of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise
against expenses (including attorneys' fees) actually and reasonably
4
<PAGE> 5
incurred by the person in connection with the defense or settlement of
such action or suit if the person acted in good faith and in a manner
the person reasonably believed to be in or not opposed to the best
interests of the corporation and except that no indemnification shall
be made in respect of any claim, issue or matter as to which such
person shall have been adjudged to be liable to the corporation unless
and only to the extent that the Court of Chancery or the court in
which such action or suit was brought shall determine upon application
that, despite the adjudication of liability but in view of all the
circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses which the Court of Chancery or
such other court shall deem proper.
(c) To the extent that a director, officer, employee or agent
of a corporation has been successful on the merits or otherwise in
defense of any action, suit or proceeding referred to in subsections
(a) and (b) of this section, or in defense of any claim, issue or
matter therein, he shall be indemnified against expenses (including
attorneys' fees) actually and reasonably incurred by him in connection
therewith.
(d) Any indemnification under subsections (a) and (b) of this
section (unless ordered by a court) shall be made by the corporation
only as authorized in the specific case upon a determination that
indemnification of the director, officer, employee or agent is proper
in the circumstances because the person has met the applicable
standard of conduct set forth in subsections (a) and (b) of this
section. Such determination shall be made (1) by a majority vote of
the directors who are not parties to such action, suit or proceeding,
even though less than a quorum, or (2) if there are no such directors,
or if such directors so direct, by independent legal counsel in a
written opinion, or (3) by the stockholders.
(e) Expenses (including attorneys' fees) incurred by an
officer or director in defending any civil, criminal, administrative
or investigative action, suit or proceeding may be paid by the
corporation in advance of the final disposition of such action, suit
or proceeding upon receipt of an undertaking by or on behalf of such
director or officer to repay such amount if it shall ultimately be
determined that he is not entitled to be indemnified by the
corporation as authorized in this section. Such expenses (including
attorneys' fees) incurred by other employees and agents may be so paid
upon such terms and conditions, if any, as the board of directors
deems appropriate.
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<PAGE> 6
(f) The indemnification and advancement of expenses provided
by, or granted pursuant to, the other subsections of this section
shall not be deemed exclusive of any other rights to which those
seeking indemnification or advancement of expenses may be entitled
under any bylaw, agreement, vote of stockholders or disinterested
directors or otherwise, both as to action in his official capacity and
as to action in another capacity while holding such office.
(g) A corporation shall have power to purchase and maintain
insurance on behalf of any person who is or was a director, officer,
employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent
of another corporation, partnership, joint venture, trust or other
enterprise against any liability asserted against him and incurred by
him in any such capacity, or arising out of his status as such,
whether or not the corporation would have the power to indemnify him
against such liability under this section.
(h) For purposes of this section, references to "the
corporation" shall include, in addition to the resulting corporation,
any constituent corporation (including any constituent of a
constituent) absorbed in a consolidation or merger which, if its
separate existence had continued, would have had power and authority
to indemnify its directors, officers, and employees or agents, so that
any person who is or was a director, officer, employee or agent of
such constituent corporation, or is or was serving at the request of
such constituent corporation as a director, officer, employee or agent
of another corporation, partnership, joint venture, trust or other
enterprise, shall stand in the same position under this section with
respect to the resulting or surviving corporation as he would have
with respect to such constituent corporation if its separate existence
had continued.
(i) For purposes of this section, references to "other
enterprises" shall include employee benefit plans; references to
"fines" shall include any excise taxes assessed on a person with
respect to any employee benefit plan; and references to "serving at
the request of the corporation" shall include any service as a
director, officer, employee or agent of the corporation which imposes
duties on, or involves services by, such director, officer, employee
or agent with respect to an employee benefit plan, its participants or
beneficiaries; and a person who acted in good faith and in a manner he
reasonably believed to be in the interest of the participants and
beneficiaries of an employee benefit plan shall be deemed to
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<PAGE> 7
have acted in a manner "not opposed to the best interests of the
corporation" as referred to in this section.
(j) The indemnification and advancement of expenses provided
by, or granted pursuant to, this section shall, unless otherwise
provided when authorized or ratified, continue as to a person who has
ceased to be a director, officer, employee or agent and shall inure to
the benefit of the heirs, executors and administrators of such a
person.
(k) The Court of Chancery is hereby vested with exclusive
jurisdiction to hear and determine all actions for advancement of
expenses or indemnification brought under this section or under any
bylaw, agreement, vote of stockholders or disinterested directors, or
otherwise. The Court of Chancery may summarily determine a
corporation's obligation to advance expenses (including attorneys'
fees).
Article VIII of the By-laws of the Company governs indemnification by
the Company and provides as follows:
ARTICLE VIII.
INDEMNIFICATION
Section 1. The Corporation shall indemnify any person who was
or is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (other than an action by or
in the right of the Corporation) by reason of the fact that such
person is or was a director or officer of the Corporation, or is or
was serving at the request of the Corporation as a director, officer,
member, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by such person in connection with
such action, suit or proceeding if such person acted in good faith and
in a manner such person reasonably believed to be in or not opposed to
the best interests of the Corporation, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe such
person's conduct was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction, or upon a plea
of nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner
which such person reasonably believed to be in or not opposed to the
best interest of the Corporation, and, with respect to
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<PAGE> 8
any criminal action or proceeding, had reasonable cause to believe
that such person's conduct was unlawful.
Section 2. The Corporation shall indemnify any person who was
or is a party or is threatened to be made a party to any threatened,
pending or completed action or suit by or in the right of the
Corporation to procure a judgment in its favor by reason of the fact
that such person is or was a director or officer of the Corporation,
or is or was serving at the request of the Corporation as a director,
officer or member of another corporation, partnership, joint venture,
trust or other enterprise, against expenses (including attorneys'
fees) actually and reasonably incurred by such person in connection
with the defense or settlement of such action or suit if such person
acted in good faith and in a manner such person reasonably believed to
be in or not opposed to the best interests of the Corporation, except
that no such indemnification shall be made in respect of any claim,
issue or matter as to which such person shall have been adjudged to be
liable to the Corporation unless and only to the extent that the Court
of Chancery of Delaware or the court in which such suit or action was
brought shall determine upon application that, despite the
adjudication of liability but in consideration of all the
circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses which such court shall deem
proper.
Section 3. The Corporation may, to the extent deemed
advisable by the Board of Directors, indemnify any person who is or
was an employee or agent (other than a director or officer) of the
Corporation if such person would be entitled to such indemnity under
the provisions of Section 1 or 2 if such person had been a director or
office of the Corporation.
Section 4. To the extent that a person shall be successful on
the merits or otherwise in defense of any action, suit or proceeding
referred to in Sections 1, 2 or 3 or in defense of any claim, issue or
matter therein, such person shall be indemnified against expenses
(including attorneys' fees) actually and reasonably incurred by such
person in connection therewith.
Section 5. Any indemnification under Sections 1, 2 and 3
(unless ordered by a court) shall be made by the Corporation only as
authorized in the specific case upon a determination that
indemnification of the director, officer, member, employee or agent is
proper in the circumstances because such person has met the applicable
standard of conduct set forth in Sections 1 and 2. Such determination
shall be made (1) by a majority vote of the directors who are not
parties to such
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action, suit or proceeding, even though less than a quorum, or (2) if
there are no such directors, or if such directors so direct, by
independent legal counsel in a written opinion, or (3) by the
stockholders.
Section 6. Expenses (including attorneys' fees) incurred by
an officer or director in defending any civil, criminal,
administrative or investigative action, suit or proceeding shall be
paid by the Corporation in advance of the final disposition of such
action, suit or proceeding upon receipt of an undertaking by or on
behalf of the director or officer to repay such amount if it shall
ultimately be determined that such person is not entitled to be
indemnified by the Corporation as authorized in this Article VIII.
Such expenses (including attorneys' fees) incurred by other employees
and agents may be so paid upon such terms and conditions, if any, as
the Board of Directors deems appropriate.
Section 7. The indemnification and advancement of expenses
provided by, or granted pursuant to, this Article VIII shall not be
deemed exclusive of any other rights to which those seeking
indemnification or advancement of expenses may be entitled under any
statute, By-Law, agreement, vote of stockholders or disinterested
directors or otherwise, both as to action in such person's official
capacity and as to action in another capacity while holding such
office, and shall, unless otherwise provided when authorized or
ratified, continue as to a person who has ceased to be a director,
officer, member, employee or agent and shall inure to the benefit of
the heirs, executors, and administrators of such person.
Section 8. The Corporation shall have the power to purchase
and maintain insurance on behalf of any person who was or is a
director, officer, employee or agent of the Corporation, or is or was
serving at the request of the Corporation as a director, officer,
member, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against any liability asserted
against such person and incurred by such person in any such capacity,
or arising out of such person's status as such, whether or not the
Corporation would have the power to indemnify such person against such
liability under the provisions of this Article VIII or of the General
Corporation Law of the State of Delaware.
Section 10. For the purposes of this Article VIII, references
to "the Corporation" shall include, in addition to the resulting
corporation, any constituent corporation
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(including any constituent of a constituent) absorbed in a
consolidation or merger and the Corporation which, if its separate
existence had continued, would have had power and authority to (or in
fact did) indemnify its directors, officers, employees or agents, so
that any person who is or was a director, officer, employee or agent
of such constituent corporation, or is or was serving at the request
of such constituent corporation as a director, officer, member,
employee or agent of another corporation, partnership, joint venture,
trust or other enterprise, shall stand in the same position under the
provisions of this Article with respect to the resulting or surviving
corporation as such person would have with respect to such constituent
corporation if its separate existence had continued.
Section 11. For purposes of this Article VIII, references to
"other enterprises" shall include employee benefit plans, references
to "fines" shall include any excise taxes assessed on a person with
respect to any employee benefit plan, and references to "serving at
the request of the Corporation" shall include any service as a
director, officer, employee or agent of the Corporation which imposes
duties on, or involves services by, such director, officer, employee,
or agent with respect to any employee benefit plan, its participants
and beneficiaries, and a person who acted in good faith and in a
manner such person reasonably believed to be in the interest of the
participants and beneficiaries of an employee benefit plan shall be
deemed to have acted in a manner "not opposed to the best interest of
the Corporation" as referred to in this Article VIII.
Article 18 of the Company's Long-Term Equity Incentive Plan
provides for indemnification by the Company, as follows:
Each person who is or shall have been a member of the
Committee, or of the Board, shall be indemnified by the Company
against and from any loss, cost, liability, or expense that may be
imposed upon or reasonably incurred by him or her in connection with
or resulting from any claim, action, suit, or proceeding to which he
or she may be a party or in which he or she may be involved by reason
of any action taken or failure to act under the Plan. Such person
shall be indemnified by the Company for all amounts paid by him or her
in settlement thereof, with the Company's approval, or paid by him or
her in satisfaction of any
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<PAGE> 11
judgment in any such action, suit, or proceeding against him or her,
provided he or she shall give the Company an opportunity, at its own
expense, to handle and defend the same before he or she undertakes to
handle and defend it on his or her own behalf. The foregoing right of
indemnification shall not be exclusive of any other rights of
indemnification to which such persons may be entitled under the
Company's Articles of Incorporation or Bylaws, as a matter of law, or
otherwise, or any power that the Company may have to indemnify them or
hold them harmless.
The Registrant has purchased insurance coverage under a
policy which insures directors and officers against certain
liabilities which might be incurred by them in such capacities.
Item 7. Exemption from Registration Claimed.
- ---------------------------------------------
Not Applicable.
Item 8. Exhibits.
- ------------------
See the Index to Exhibits attached hereto at page 15.
Item 9. Undertakings.
- ----------------------
A. The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement
(or the most recent post-effective amendment thereof)
which, individually or in the aggregate, represent a
fundamental change in the information set forth in the
registration statement; 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 information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports
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<PAGE> 12
filed with or furnished to the Commission by the Registrant pursuant
to Section 13 or Section 15(d) of the Securities Exchange Act of 1934
that are incorporated by reference in this registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona
fide offering thereof.
(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 Securities Act of 1933, each
filing of the Registrant's annual report pursuant to Section 13(a) or
Section 15(d) of the Securities Exchange Act of 1934 that is
incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
C. Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the provisions
described in Item 6 of this Part II, or otherwise, the Registrant has
been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed
in the 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.
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<PAGE> 13
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the Registrant certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-8 and has
duly caused this Registration Statement to be signed on its behalf by
the undersigned, thereunto duly authorized, in the City of Columbus,
State of Ohio, on the 13th day of June, 1997.
Core Materials Corporation
By:/s/ KEVIN L. BARNETT
-------------------------------------------------
Kevin L. Barnett, Vice President, Chief Financial
Officer, Secretary and Treasurer
Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons
in the capacities indicated, on the 13th day of June, 1997.
<TABLE>
<CAPTION>
Signature Capacities
- --------- ----------
<S> <C>
*/s/ KENNETH M. SCHMELL General Manager and
- ----------------------- Acting Chief Executive
Kenneth M. Schmell Officer
*/s/ KEVIN L. BARNETT Vice President,
- ---------------------- Chief Financial Officer,
Kevin L. Barnett Secretary and Treasurer
*/s/ GERALD L. VOIROL Controller and
- ---------------------- Assistant Secretary
Gerald L. Voirol
*/s/ RICHARD R. CONTE Director
- ----------------------
Richard R. Conte
*/s/ RALPH O. HELLMOLD Director
- ----------------------
Ralph O. Hellmold
*/s/ THOMAS M. HOUGH Director
- ----------------------
Thomas M. Hough
*/s/ MALCOLM M. PRINE Director
- ----------------------
Malcolm M. Prine
</TABLE>
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<PAGE> 14
<TABLE>
<S> <C>
*/s/ THOMAS E. RIGSBY Director
- ------------------------
Thomas E. Rigsby
*By:/s/ KEVIN L. BARNETT Attorney-in-Fact
--------------------
Kevin L. Barnett
</TABLE>
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<PAGE> 15
INDEX TO EXHIBITS
-----------------
<TABLE>
<CAPTION>
Exhibit No. Description Page No.
- ----------- ----------- --------
<S> <C> <C>
4(a) Certificate of Incorporation Pages 16 through 34
of Core Materials
Corporation as filed with
the Secretary of State
of Delaware on October 8, 1996
4(b) Certificate of Amendment of Pages 35 through 38
Certificate of Incorporation
of Core Materials Corporation as
filed with the Secretary of State
of Delaware on November 6, 1996
4(c) Certificate of Incorporation Pages 39 through 57
of Core Materials Corporation,
reflecting amendments through
November 6, 1996 [for purposes of
compliance with Securities and
Exchange Commission filing
requirements only]
4(d) By-Laws of Core Materials Incorporated by reference
Corporation to Exhibit 3-C
to Registrant's Registration Statement on
Form S-4 (filed November 8, 1996, SEC
Registration No. 333-15809)
4(e) Core Materials Corporation Pages 58 through 80
Long-Term Equity Incentive Plan
5 Opinion of Vorys, Sater, Seymour and Pease, Pages 81 through 83
Counsel to Registrant
23(a) Consent of Deloitte & Touche LLP, Independent Pages 84 and 85
Auditors to Registrant
23(b) Consent of Vorys, Sater, Seymour and Pease, Filed as part of Exhibit 5 hereof
Counsel to Registrant
24 Powers of Attorney Pages 86 through 94
</TABLE>
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<PAGE> 1
Exhibit 4(a)
Certificate of Incorporation
of Core Materials Corporation as filed with the
Secretary of State of Delaware
on October 8, 1996
16
<PAGE> 2
CERTIFICATE OF INCORPORATION
OF
CORE MATERIALS CORPORATION
ARTICLE I
NAME
The name of the Corporation is Core Materials Corporation.
ARTICLE II
REGISTERED OFFICE AND REGISTERED AGENT
The registered office of the Corporation in the State of Delaware is
located at Corporation Trust Center, 1209 Orange Street, in the City of
Wilmington, County of New Castle. The name and address of the Corporation's
registered agent is The Corporation Trust Company, Corporation Trust Center,
1209 Orange Street, Wilmington, Delaware 19801.
ARTICLE III
CORPORATE PURPOSES
The purpose of the Corporation is to engage in any lawful act or
activity for which corporations may be organized under the General Corporation
Law of the State of Delaware.
ARTICLE IV
CAPITAL STOCK
The total number of shares of all classes of capital stock which the
Corporation shall have authority to issue is sixty million (60,000,000) shares,
of which fifty million (50,000,000) shares shall be Common Stock of the par
value of one cent ($0.01) each (hereinafter called "Common Stock") and ten
million (10,000,000) shares shall be Preferred Stock of the par value of one
cent ($0.01) each (hereinafter called "Preferred Stock").
A. RIGHTS AND RESTRICTIONS OF PREFERRED STOCK. The Preferred Stock is
hereby authorized to be issued from time to time in one or more series, the
shares of each series to have such voting powers, full or limited, or no voting
powers, and such designations, preferences and relative, participating,
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optional or other special rights and qualifications, limitations or
restrictions thereof as shall be stated and expressed in the Certificate of
Incorporation or in any amendment thereto or in the resolution or resolutions
adopted by the Board of Directors providing for the issue thereof.
B. RIGHTS AND RESTRICTIONS OF COMMON STOCK. The powers, preferences,
rights, qualifications, limitations or restrictions thereof in respect to the
Common Stock are as follows:
(a) The Common Stock is junior to the Preferred Stock and is subject
to all the powers, rights, privileges, preferences and priorities of
the Preferred Stock as herein or in any resolution or resolutions
adopted by the Board of Directors pursuant to authority expressly
vested in it by the provisions of this Article.
(b) The Common Stock shall have voting rights for the election of
directors and for all other purposes, each holder of Common Stock being
entitled to one vote for each share thereof held by such holder, except
as otherwise required by law.
C. INCREASE OR DECREASE IN AMOUNT OF AUTHORIZED SHARES. The number of
authorized shares of any class or classes of capital stock of the Corporation
may be increased or decreased by an amendment to this Certificate of
Incorporation authorized by the affirmative vote of the holders of a majority
of the shares of the Common Stock outstanding and entitled to vote thereon and,
except as expressly provided in the Certificate of Incorporation or in any
resolution or resolutions adopted by the Board of Directors pursuant to
authority expressly vested in it by the provisions of this Article with respect
to the Preferred Stock, no vote by holders of capital stock of the Corporation
other than the Common Stock shall be required to approve such action.
D. SHARES ENTITLED TO MORE OR LESS THAN ONE VOTE. If any class or
series of the Corporation's capital stock shall be entitled to more or less
than one vote for any share, on any matter, every reference in this Certificate
of Incorporation, the By-laws and in any relevant provision of law to a
majority or other proportion of stock shall refer to such majority or other
proportion of the votes of such stock.
E. ISSUANCES OF STOCK. All issuances of capital stock of the
Corporation must be authorized by the affirmative vote of two-thirds (2/3) of
the entire Board of Directors.
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ARTICLE V
DENIAL OF PREEMPTIVE RIGHTS
No holder of any class of capital stock of the Corporation, whether
now or hereafter authorized, shall be entitled, as such, as a matter of right,
to subscribe for or purchase any part of any new or additional issue of capital
stock of the Corporation of any class whatsoever, or of securities convertible
into or exchangeable for capital stock of the Corporation of any class
whatsoever, whether now or hereafter authorized, or whether issued for cash,
property or services.
ARTICLE VI
STOCKHOLDER VOTE REQUIRED IN CONNECTION
WITH CERTAIN BUSINESS COMBINATIONS
SECTION 1. Vote Generally Required. Notwithstanding anything contained
herein or in the General Corporation Law of the State of Delaware, and subject
to the provisions of Section 3 of this Article VI, the Corporation shall not
(a) merge or consolidate with any one or more corporations, joint-stock
associations or non-stock corporations (other than in a merger not requiring
any vote of stockholders of the Corporation under the General Corporation Law
of the State of Delaware), (b) sell, lease or exchange all or substantially all
of its property and assets, or (c) adopt any plan or proposal for the
liquidation or dissolution of the Corporation, unless (1) the Board of
Directors shall, at a meeting duly called, adopt a resolution, by the
affirmative vote of at least two-thirds (2/3) of the entire Board of Directors,
approving such action and (2) such action shall be approved at a meeting by the
affirmative vote of the holders of 66 2/3% of the shares of capital stock of
the Corporation then entitled to vote generally in the election of directors
("Voting Stock"), voting together as a single class and, except as expressly
provided in this Certificate of Incorporation or in any resolution or
resolutions adopted by the Board of Directors pursuant to authority expressly
vested in it by the provisions of Article IV with respect to the Preferred
Stock and except as otherwise provided by law, no vote by holders of capital
stock of the Corporation other than the Voting Stock shall be required to
approve such action.
SECTION 2. Amendment or Repeal. Notwithstanding the fact that a lesser
percentage may be specified by the General Corporation Law of Delaware, the
affirmative vote of the holders of record of at least eighty percent (80%) of
the shares of the Voting Stock present in person or by proxy at a meeting of
stockholders of the Corporation, voting together as a single
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class, shall be required to amend, alter or repeal any provision of, or to adopt
any provision or provisions inconsistent with, any provision of this Article.
ARTICLE VII
CORPORATE EXISTENCE
The Corporation is to have perpetual existence.
ARTICLE VIII
TRANSFER OF CAPITAL STOCK
SECTION 1. Certain Restrictions on the Transfer of Stock. In order to
preserve the Tax Benefits, the restrictions set forth below shall apply for the
period beginning on the Article VIII Effective Date and ending on the
Expiration Date, unless the Board of Directors shall fix an earlier or later
date in accordance with Section 6 of this Article VIII.
A. Definitions.
(1) Article VIII Effective Date. The time and date of
the legal effectiveness of the merger of RYMAC Mortgage Investment
Corporation with and into the Corporation.
(2) Control. The possession, direct or indirect, of the power
to direct or cause the direction of the management and policies of a
Person, whether through the ownership of voting securities, by
contract, or otherwise. Such definition shall also apply to the terms
"controlling," "controlled by" and "under common control with."
(3) Effective Date Tier Entity. Any Person that, as of the
Article VIII Effective Date or the date that shares of Common Stock
are issued pursuant to the Asset Purchase Agreement (as defined in B.5
below) after giving effect to such issuance, was a First Tier Entity
or a Higher Tier Entity, for so long as such person continues to have
a Prohibited Ownership Percentage.
(4) Expiration Date. The last day of the fifteen-year period
commencing on the Article VIII Effective Date.
(5) First Tier Entity. A "first tier entity" with respect to
the Corporation, as that term is defined in Treasury Regulations
Section l.382-2T(f)(9).
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(6) 47 Percentage Point Increase. An increase of 47
percentage points or more of the Stock owned by "5-percent
shareholders" of the Corporation (as defined in A(13) below) over the
lowest percentage of Stock owned by such 5-percent shareholders at any
time during the three-year period preceding any determination date,
such determination to be made in accordance with Treasury Regulations
Section 1.382-2T(c) as if the determination date were a "testing
date."
(7) Higher Tier Entity. A "higher tier entity" with respect
to the Corporation, as that term is defined in Treasury Regulations
Section l.382-2T(f)(14).
(8) Internal Revenue Code. The Internal Revenue Code of 1986,
as amended. Any reference to a particular Section or provision of the
Internal Revenue Code shall be deemed to also refer to any successor
Section or provision having similar effect.
(9) Ownership Change. An "ownership change" with respect to
the Corporation, as that term is used in Section 382(g) of the Internal
Revenue Code and Treasury Regulations Section 1.382-2T(a)(1), except
that for purposes of determining whether 5-percent shareholders have
increased their percentage interests by more than 50 percentage points,
there shall be added to the increase in their percentage interests an
amount equal to 2.5% of the total value of the Stock of the
Corporation.
(10) Other Permitted Holders. Any Person, other than an
Effective Date Tier Entity or a Permitted Transferee, which has a
Prohibited Ownership Percentage permitted under Section 1, whether
pursuant to a waiver under Paragraph D of Section 1 or otherwise.
(11) Permitted Transferee. Any transferee with a Prohibited
Ownership Percentage as to which the Board of Directors has consented
pursuant to Subparagraph C(2) or C(3) of Section 1.
(12) Person. Any individual, corporation, estate, trust,
association, company, partnership, joint venture, or similar
organization, or any other entity described in Treasury Regulations
Section 1.382-3(a)(1)(i).
(13) Prohibited Ownership Percentage. Any ownership in
the Corporation that would cause a Person or Public Group to be a
"5-percent shareholder" of the Corporation within the meaning of
Treasury Regulations Section 1.382-2T(g)(1)(i) or (ii). For this
purpose, whether a Person or Public Group
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would be a "5-percent shareholder" shall be determined (u) by
substituting "4.5 percent" for "5 percent" each place it appears in
such provisions, (v) without giving effect to the following provisions:
Treasury Regulations Sections 1.382-2T(g)(2), 1.382-2T(g)(3),
1.382-2T(h)(2)(iii) and 1.382-2T(h)(6)(iii), (w) by treating every
Person or Public Group which owns Stock, whether directly or by
attribution, as directly owning such Stock notwithstanding any further
attribution of such Stock to other Persons and notwithstanding Treasury
Regulations Section 1.382-2T(h)(2)(i)(A), (x) by substituting the term
"Person" in place of individual" in Treasury Regulations Section
l.382-2T(g)(1)(i), (y) by taking into account ownership of Stock at any
time during the "testing period" as defined in Treasury Regulations
Section 1.382-2T(d)(1), and (z) by treating each day during the testing
period as if it were a "testing date" as defined in Treasury
Regulations Section 1.382-2T(a)(2)(i). In addition, for the purpose of
determining whether any Person or Public Group has a Prohibited
Ownership Percentage as of any date, the definition of Stock set forth
in Subparagraph A(15) of Section 1 shall be applied in lieu of the
definition in Treasury Regulations Section 1.382-2T(f)(18), except that
any option shall be treated as Stock only to the extent treating it as
Stock would cause an increase in ownership of such Person and such
option would be deemed exercised pursuant to Treasury Regulations in
effect from time to time (disregarding whether treating such option as
exercised would cause an ownership change).
(14) Public Group. A "public group" with respect to the
Corporation, as that term is used in Treasury Regulations Section
1.382-2T(f)(13), excluding any "direct public group" with respect to
the Corporation, as that term is used in Treasury Regulations Section
1.382-2T(j)(2)(ii).
(15) Stock. All classes of stock of the Corporation, all
options to acquire stock of the Corporation and all other interests
that would be treated as stock in the Corporation pursuant to Treasury
Regulations Section 1.382-2T(f)(18)(iii), other than (x) stock
described in Section 1504(a)(4) of the Internal Revenue Code and (y)
stock that would be described in such Section 1504(a)(4) but is not so
described solely because it is entitled to vote as a result of
dividend arrearages. As used in this Article VIII, the term "option"
shall have the meaning set forth in Treasury Regulations Section
1.382-2T(h)(4).
(16) Tax Benefits. The net operating loss carryovers and
capital loss carryovers to which the Corporation is
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entitled under the Internal Revenue Code, free of restrictions under
Section 382 of the Internal Revenue Code.
(17) Testing Date Action. Any Transfer or acquisition of
Stock or any other action (including the acquisition or issuance of an
option to Transfer or acquire Stock), if the effect of such Transfer,
acquisition or other action would be to cause a "testing date" with
respect to the Corporation within the meaning of Treasury Regulations
Section l.382-2T(a)(2)(i), determined by treating every Person and
Public Group which has a Prohibited Ownership percentage as a
5-percent shareholder as used in such Section.
(18) Transfer. Any means of conveyance of legal or beneficial
ownership of Stock, whether such ownership is direct or indirect,
voluntary or involuntary, including, without limitation, an indirect
transfer of ownership through the transfer of any ownership interest
of any entity that owns Stock.
(19) Transferee Undertaking. A duly executed written
undertaking for the benefit of the Corporation by any transferee
pursuant to which the transferee agrees that (i) it will not take any
of the following actions without the prior consent of the Board of
Directors (x) acquire any additional Stock, (y) Transfer any Stock in
violation of Paragraph B of Section 1, or (z) take or cause to be
taken any Testing Date Action, (ii) upon request by the Corporation,
it will furnish or cause to be furnished to the Corporation all
certificates representing Stock held of record or beneficially,
directly or indirectly, by it or by any Person controlling, controlled
by or under common control with it for the purpose of placing a legend
on such certificates to reflect the undertakings described in clause
(i) above, (iii) it acknowledges that stop transfer orders may be
entered with the transfer agent (or agents) and the registrar (or
registrars) of Stock against the transfer of Stock subject to the
undertakings described in clause (i) above except in compliance with
the requirements of such undertakings, and (iv) it will agree to such
other actions and remedies as the Corporation may reasonably request
in order to preserve the Tax Benefits.
(20) Treasury Regulations. The regulations promulgated by the
Secretary of the Treasury under the Internal Revenue Code. Any
reference to a particular Treasury Regulation or Section or provision
thereof shall be deemed to also refer to any successor Regulation or
Section or provision having similar effect.
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B. Transfer Restrictions.
Unless otherwise consented to or waived by the Board of Directors, the
following Transfers and actions shall be prohibited:
(1) General. No Person shall Transfer any Stock to any other
Person to the extent that such Transfer, if effected, (i) would cause
the transferee or any person or Public Group to have a Prohibited
Ownership Percentage, or (ii) would increase the ownership percentage
of any transferee or any Person or Public Group having a Prohibited
Ownership Percentage.
(2) Additional Restrictions on Transfers Involving Effective
Date Tier Entities. In addition to the restrictions under Subparagraph
B(1), (i) no Effective Date Tier Entity or individual that owns a
direct ownership interest in the Corporation of five percent or more
shall Transfer any Stock, and no other Person shall Transfer any Stock
to an Effective Date Tier Entity, if, in either case, after such
Transfer, there would be a 47 Percentage Point Increase, and (ii) no
Effective Date Tier Entity or individual that owns a direct ownership
interest in the Corporation of five percent or more shall take any
other action (including the acquisition or issuance of an option to
Transfer or acquire Stock) if, after such action, there would be a 47
Percentage Point Increase.
(3) Additional Restrictions on Transfers Involving Other
Permitted Holders. In addition to the restrictions under Subparagraph
B(1), (i) no Other Permitted Holder shall Transfer any Stock, and no
other Person shall Transfer any Stock to an Other Permitted Holder,
if, in either case, such Transfer would constitute a Testing Date
Action, and (ii) no Other Permitted Holder shall take any other action
that would constitute a Testing Date Action.
(4) Additional Restrictions under Transferee Undertakings. In
addition to the restrictions under Subparagraph B(1), (i) no Person
who has delivered a Transferee Undertaking shall Transfer any Stock,
and no Person shall Transfer any Stock to any Person who has delivered
a Transferee Undertaking, if, in either case, such Transfer would
result in a violation of such Transferee Undertaking, and (ii) no
Person who has delivered a Transferee Undertaking shall take or cause
to be taken any other action that would constitute a Testing Date
Action.
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(5) Exception. Notwithstanding anything herein to the
contrary, the issuance of shares of Common Stock of the Corporation to
Navistar International Transportation Corp. ("Navistar") or its
designees pursuant to the terms of an Asset Purchase Agreement, dated
September 12, 1996 (the "Asset Purchase Agreement"), between Navistar
and RYMAC Mortgage Investment Corporation shall not be deemed to be a
violation of the transfer restrictions set forth in this Paragraph B.
C. Permitted Transfers.
(1) General. Unless otherwise restricted under Paragraph B of
Section 1 or under a Transferee Undertaking or other agreement,
Transfers of Stock may be made without the consent of the Board of
Directors.
(2) Transfers by Effective Date Tier Entities. Upon petition
by any Effective Date Tier Entity or individual that owns a direct
ownership interest in the Corporation of five percent or more, the
Board of Directors shall consent to a proposed Transfer of Stock that
complies with Subparagraph B(2) of Section l but would otherwise be
prohibited pursuant to Subparagraph B(1) of Section 1 if it determines
that (i) after giving effect to such Transfer, the percentage of Stock
owned by all Persons and Public Groups with a Prohibited Ownership
percentage will not have increased by more than 47 percentage points
over the lowest percentage of Stock owned by such Persons and Public
Groups at any time during the three-year period preceding the proposed
date of such Transfer (such determination to be made in accordance
with the provisions of Treasury Regulations Section l.382-2T(c)) and
(ii) the proposed transferee shall have delivered a Transferee
Undertaking.
(3) Transfers by Permitted Transferees. Upon petition by any
Permitted Transferee, the Board of Directors shall consent to a
proposed Transfer of Stock or Testing Date Action that would otherwise
be prohibited pursuant to Subparagraph B(1) or B(4) of Section 1 or
pursuant to any Transferee Undertaking if it determines that (i) after
such proposed Transfer or Testing Date Action there would not be an
Ownership Change and (ii) in the case of any such proposed Transfer
that, if effected, would otherwise be prohibited under Subparagraph
B(1) of Section l, such Transfer would otherwise be permitted under
Subparagraph C(2) if such Transfer were proposed to be made by an
Effective Date Tier Entity.
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(4) Certain Additional Transfers to Permitted Transferees.
Upon petition by any Permitted Transferee, the Board of Directors
shall consent to a proposed Transfer of additional Stock to such
Permitted Transferee from a Person constituting an Effective Date Tier
Entity or another Permitted Transferee if it determines that such
proposed Transfer would otherwise be permitted under Subparagraph C(2)
or C(3) of Section 1, as the case may be.
(5) Transfers by Other Permitted Holders. Upon petition by
any Other Permitted Holder, the Board of Directors shall consent to a
proposed Transfer of Stock or Testing Date Action that would otherwise
be prohibited pursuant to Subparagraph B(1), B(3) or B(4) of Section 1
or pursuant to any Transferee Undertaking if it determines that (i)
after such proposed Transfer or Testing Date Action there would not be
an Ownership Change and (ii) in the case of any such proposed Transfer
that, if effected, would otherwise be prohibited under Subparagraph
(B)(1) of Section l, such Transfer would not cause a 47 Percentage
Point Increase and the proposed transferee shall have delivered a
Transferee Undertaking.
D. Waivers. Notwithstanding anything herein to the contrary, the Board
of Directors may waive any of the restrictions contained in Paragraph B of
Section 1 of this Article VIII: (a) in the case of any issuance of Stock by the
Corporation which would otherwise be prohibited under Subparagraph B(1) of
Section 1, if the transferee agrees to be bound to the restrictions applicable
to Permitted Transferees; (b) in the event of a tender or exchange offer within
the meaning of the Securities Exchange Act of 1934, as amended, to acquire
Stock constituting more than fifty percent in value of the outstanding Common
Stock of the Corporation, so long as such waiver shall apply to all Transfers
pursuant to such tender or exchange offer; (c) in connection with any Transfers
of Stock in connection with underwritten offerings of such Stock; (d) in
connection with any investment in or acquisition of a business or any business
combination involving the Corporation or any subsidiary of the Corporation; and
(e) in any other instance in which the Board of Directors reasonably and in
good faith determines that a waiver would be in the best interests of the
Corporation.
SECTION 2. Attempted Transfer in Violation of Transfer Restrictions.
Unless the consent or waiver of the Board of Directors is obtained as provided
in Paragraph C or D of Section l, and except as provided in Paragraph C of
Section 2 below, any attempted Transfer of shares of Stock of the Corporation
in excess of the shares that could be Transferred to the transferee
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without restriction under Paragraph B of Section l is not effective to transfer
ownership of such excess shares (the "Prohibited Shares") to the purported
acquiror thereof (the "Purported Acquiror"), and the Purported Acquiror shall
not be entitled to any rights as a shareholder of the Corporation with respect
to the Prohibited Shares, including, without limitation, the right to vote or
to receive dividends with respect thereto. Nothing contained in this Article
VIII shall preclude the settlement of any transaction involving Stock entered
into through the facilities of any national securities exchange on which the
shares of Stock of the Corporation are listed. The application of the
provisions and remedies described in the first sentence of this Section 2 and
in Paragraphs A, B and C of Section 2 below shall be deemed not to so preclude
any such settlement. Paragraphs A, B and C below shall apply only in the case
of violations of the restrictions contained in Subparagraph B(1) of Section l.
A. Transfer of Certificates; Sale of Stock. Upon demand by the
Corporation, the Purported Acquiror shall transfer any certificate or other
evidence of purported ownership of the Prohibited Shares within the Purported
Acquiror's possession or control, together with any dividends or other
distributions paid by the Corporation with respect to the Prohibited Shares
that were received by the Purported Acquiror (the "Prohibited Distributions"),
to an agent to be designated by the Corporation (the "Agent"). If the Purported
Acquiror has sold the Prohibited Shares to an unrelated party in an arms-length
transaction after purportedly acquiring them, the Purported Acquiror shall be
deemed to have sold the Prohibited Shares for the Agent, and in lieu of
transferring the Prohibited Shares and Prohibited Distributions to the Agent
shall transfer to the Agent the Prohibited Distributions and the proceeds of
such sale (the "Resale Proceeds") except to the extent that the Agent grants
written permission to the Purported Acquiror to retain a portion of the Resale
Proceeds not exceeding the amount that would have been payable by the Agent to
the Purported Acquiror pursuant to Paragraph B of Section 2 if the Prohibited
Shares had been sold by the Agent rather than by the Purported Acquiror. Any
purported Transfer of the Prohibited Shares by the Purported Acquiror, other
than a transfer described in one of the two preceding sentences (unless such
transfer itself violated the provisions of Article VIII), shall not be
effective to transfer any ownership of the Prohibited Shares.
B. Allocation and Distribution of Proceeds. The Agent shall sell in an
arms-length transaction (through the American Stock Exchange, if possible) any
Prohibited Shares transferred to the Agent by the Purported Acquiror, and the
proceeds of such sale (the "Sales Proceeds"), or the Resale Proceeds, if
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applicable, shall be allocated to the Purported Acquiror up to the
following amount: (1) where applicable, the purported purchase price paid or
value of consideration surrendered by the Purported Acquiror for the Prohibited
Shares and (2) where the purported Transfer of the Prohibited Shares to the
Purported Acquiror was by gift, inheritance, or any similar purported transfer,
the fair market value of the Prohibited Shares at the time of such purported
Transfer. Any Resale Proceeds or Sales Proceeds in excess of the amount
allocable to the Purported Acquiror pursuant to the preceding sentence,
together with any Prohibited Distributions (such excess amount and Prohibited
Distributions are collectively the "Subject Amounts"), shall be transferred to
an entity designated by the Corporation that is described in Section 501(c)(3)
of the Internal Revenue Code (the "Designated Charity"). In no event shall any
such Prohibited Shares or Subject Amounts inure to the benefit of the
Corporation or the Agent, but such Subject Amounts may be used to cover
expenses incurred by the Agent in performing its duties.
C. Limitation on Enforceability. Notwithstanding anything herein to
the contrary, with respect to any Transfer of Stock which would cause a Person
or Public Group (the "Prohibited Party") to violate a restriction provided for
in Subparagraph B(1) of Section 1 only on account of the attribution to the
Prohibited Party of the ownership of Stock by a Person or Public Group which is
not controlling, controlled by or under common control with the Prohibited
Party, which ownership is nevertheless attributed to the Prohibited Party,
Subparagraph B(1) of Section 1 shall not apply in a manner that would
invalidate such Transfer. In such case, the Prohibited Party and any Persons
controlling, controlled by or under common control with the Prohibited Party
(collectively, the "Prohibited Party Group") shall automatically be deemed to
have disposed of, and shall be required to dispose of, sufficient shares of
Stock (which shares shall consist only of shares held legally or beneficially,
whether directly or indirectly, by any member of the Prohibited Party Group,
but not shares held through another Person, other than shares held through a
Person acting as agent or fiduciary for any member of the Prohibited Party
Group, and which shares shall be disposed of in the inverse order in which they
were acquired by members of the Prohibited Party Group) to cause the Prohibited
Party, following such disposition, not to be in violation of Subparagraph B(1)
of Section 1; provided that in the event no member of the Prohibited Party
Group (i) is an Effective Date Tier Entity, Permitted Transferee or Other
Permitted Holder and (ii) had any actual knowledge that such Transfer was
prohibited under Subparagraph B(1) of Section 1, such disposition shall only be
effected to the extent necessary in order to prevent an Ownership Change. Such
disposition shall be deemed to occur simultaneously with the Transfer giving
rise
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to the application of this provision, and such number of shares which are
deemed to be disposed of shall be considered Prohibited Shares and shall be
disposed of through the Agent as provided in Paragraph B of Section 2, except
that the maximum amount payable to the Prohibited Party in connection with such
sale shall be the fair market value of the prohibited Shares at the time of the
Prohibited Transfer.
D. Other Remedies. In the event that the Board of Directors determines
that a Person proposes to take any action in violation of Paragraph B of
Section 1, or in the event that the Board of Directors determines after the
fact that an action has been taken in violation of Paragraph B of Section 1,
the Board of Directors, subject to the second and third sentences of the
introductory paragraph of Section 2, may take such action as it deems advisable
to prevent or to refuse to give effect to any Transfer or other action which
would result, or has resulted, in such violation, including, but not limited
to, refusing to give effect to such Transfer or other action on the books of
the Corporation or instituting proceedings to enjoin such Transfer or other
action. If any Person shall knowingly violate Paragraph B of Section 1, then
that Person and all other Persons controlling, controlled by or under common
control with such Person shall be jointly and severally liable for, and shall
pay to the Corporation, such amount as will, after taking account of all taxes
imposed with respect to the receipt or accrual of such amount and all costs
incurred by the Corporation as a result of such loss, put the Corporation in
the same financial position as it would have been in had such violation not
occurred.
SECTION 3. Prompt Enforcement Against Purported Acquiror. Within 30
business days of learning of a purported Transfer of Prohibited Shares to a
Purported Acquiror or a Transfer of Stock to a Prohibited Party, the
Corporation through its Secretary or any Assistant Secretary shall demand that
the Purported Acquiror or Prohibited Party surrender to the Agent the
certificates representing the Prohibited Shares, or any Resale Proceeds, and
any Prohibited Distributions, and if such surrender is not made by the
Purported Acquiror or Prohibited Party within 30 business days from the date of
such demand, the Corporation shall institute legal proceedings to compel such
surrender; provided, however, that nothing in this Section 3 shall preclude the
Corporation in its discretion from immediately bringing legal proceedings
without a prior demand, and also provided that failure of the Corporation to
act within the time periods set out in this Section 3 shall not constitute a
waiver of any right of the Corporation to compel any transfer required by
Section 2. Upon a determination by the Board of Directors that there has been
or is threatened a purported Transfer of Prohibited Shares to a Purported
Acquiror or a Transfer of Stock to a Prohibited
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Party or any other violation of Paragraph B of Section 1, the Board of
Directors may authorize such additional action as it deems advisable to give
effect to the provisions of this Article VIII, including, without limitation,
refusing to give effect on the books of the Corporation to any such purported
Transfer or instituting proceedings to enjoin any such purported Transfer.
SECTION 4. Obligation to Provide Information. The Corporation may
require as a condition to the registration of the Transfer of any Stock that
the proposed transferee furnish to the Corporation all information reasonably
requested by the Corporation with respect to all the direct or indirect
ownership of Stock by the proposed transferee and by Persons controlling,
controlled by or under common control with the proposed transferee.
SECTION 5. Legends. All certificates evidencing Stock that is subject
to the restrictions on transfer set forth in this Article VIII shall bear a
conspicuous legend referencing such restrictions.
SECTION 6. Further Actions. Subject to the second and third sentences
of the introductory paragraph of Section 2, nothing contained in this Article
VIII shall limit the authority of the Board of Directors to take such other
action to the extent permitted by law as it deems necessary or advisable to
protect the Corporation and the interests of the holders of its securities in
preserving the Tax Benefits. Without limiting the generality of the foregoing,
in the event of a change in law (including applicable regulations) making one
or more of the following actions necessary, in the case of actions described in
clauses (B), (C) and (D) below, or desirable, in the case of actions described
in clause (A) below, the Board of Directors may (A) accelerate the Expiration
Date, (B) extend the Expiration Date, (C) conform any terms or numbers set
forth in the transfer restrictions in Section 1 to make such terms consistent
with the Internal Revenue Code and the Treasury Regulations following any
changes therein to the extent necessary to preserve the Tax Benefits, or (D)
conform the definitions of any terms set forth in this Article VIII to the
definitions in effect following such change in law; provided that the Board of
Directors shall determine in writing that such acceleration, extension, change
or modification is reasonably necessary to preserve the Tax Benefits or that
the continuation of these restrictions is no longer reasonably necessary for
the preservation of the Tax Benefits, which determination shall be based upon
an opinion of legal counsel to the Corporation and which determination shall be
filed with the Secretary of the Corporation and mailed by the Secretary to all
stockholders of the Corporation within ten days after the date of any such
determination.
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<PAGE> 16
SECTION 7. Severability. If any provision of this Article VIII or the
application of any such provision to any Person or under any circumstance shall
be held invalid, illegal, or unenforceable in any respect by a court of
competent jurisdiction, such invalidity, illegality or unenforceability shall
not affect any other provision of this Article VIII.
ARTICLE IX
BOARD OF DIRECTORS
SECTION l. Powers of Board of Directors. In furtherance and not in
limitation of the powers conferred by statute, the Board of Directors of the
Corporation is expressly authorized:
A. To make, alter, amend or repeal the By-Laws. Any By-Law
may be altered, amended or repealed by the holders of the capital
stock of the Corporation entitled to vote thereon at any annual
meeting or at any special meeting called for that purpose.
B. To authorize and cause to be executed mortgages and liens
upon the real and personal property of the Corporation.
C. To exercise, in addition to the powers and authorities
hereinbefore or by law conferred upon it, any such powers and
authorities and do all such acts and things as may be exercised or
done by the Corporation, subject, nevertheless, to the provisions of
the laws of the State of Delaware and of the Certificate of
Incorporation and of the By-Laws of the Corporation.
SECTION 2. Removal of Directors. Subject to the rights of the holders
of any series of Preferred Stock or any other class of capital stock of the
Corporation (other than the Common Stock) then outstanding, any director, or
the entire Board of Directors, may be removed from office at any time, with or
without cause, by the affirmative vote of the holders of record of outstanding
shares representing at least 80% of the Voting Stock, voting together as a
single class.
SECTION 3. Vacancies. Subject to the rights of the holders of any
series of Preferred Stock or any other class of capital stock of the
Corporation (other than the Common Stock) then outstanding, any vacancies in
the Board of Directors for any reason, including by reason of any increase in
the number of directors, shall be filled only by the Board of Directors, acting
by the affirmative vote of a majority of the remaining directors
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<PAGE> 17
then in office, although less than a quorum, and any directors so elected shall
hold office until their successors are elected and qualify; provided, however,
notwithstanding anything herein to the contrary, any vacancies on the Board of
Directors prior to the first annual meeting of stockholders of the Corporation
after the Closing Date (as defined in the Asset Purchase Agreement referred to
in Section 1(B)(5) of Article VIII hereof, a copy of which shall be sent to any
stockholder, upon request, without charge) shall be filled as provided in the
Asset Purchase Agreement.
SECTION 4. Preferred Stock. Whenever the holders of any one or more
series of Preferred Stock issued by the Corporation shall have the right,
voting separately by class or series, to elect directors at an annual or a
special meeting of holders of capital stock of the Corporation, the nomination,
election, term of office, filling of vacancies and other features of such
directorships shall be governed by this Article IX unless expressly otherwise
provided by law or by the resolution or resolutions providing for the creation
of such series.
ARTICLE X
ACTION BY STOCKHOLDERS
Any action required or permitted to be taken by the holders of the
issued and outstanding capital stock of the Corporation may be effected solely
at an annual or special meeting of stockholders duly called and held in
accordance with law, this Certificate of Incorporation and the By-laws of the
Corporation, and the power of stockholders, or any of them, to consent in
writing, without a meeting, to the taking of any such action is hereby
specifically denied.
ARTICLE XI
LIMITATION OF DIRECTORS' LIABILITY
SECTION 1. Limitation of Directors' Liability.
-----------------------------------
A. No director of the corporation shall be personally liable to the
Corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, except, to the extent provided by applicable law, for
liability (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 Delaware General Corporation Law or (iv) for any transaction
from which the director derived an improper personal benefit. If the Delaware
32
<PAGE> 18
General Corporation Law is hereafter amended to authorize corporate action
further limiting or eliminating the personal liability of directors, then the
liability of each director of the Corporation shall be limited or eliminated to
the full extent permitted by the Delaware General Corporation Law as so amended
from time to time.
B. Neither the amendment nor repeal of this Section 1, nor the adoption
of any provision of the Certificate of Incorporation inconsistent with this
Section 1, shall eliminate or reduce the effect of this Section 1, in respect
of any matter occurring, or any cause of action, suit or claim that, but for
this Section 1, would accrue or arise, prior to such amendment, repeal or
adoption of an inconsistent provision.
ARTICLE XII
The name and mailing address of the sole incorporator is as follows:
NAME MAILING ADDRESS
- ---- ---------------
RYMAC MORTGAGE INVESTMENT CORPORATION Penn Central West II
Suite 311
Pittsburgh, PA 15276
ARTICLE XIII
RESERVATION OF RIGHT TO AMEND CERTIFICATE OF INCORPORATION
The Corporation reserves the right to amend, alter, change or repeal
any provisions contained in this Certificate of Incorporation in the manner now
or hereafter prescribed by law, and all the provisions of this Certificate of
Incorporation and all rights and powers conferred in this Certificate of
Incorporation on stockholders, directors and officers are subject to this
reserved power, provided that the affirmative vote of the holders of record of
at least 80% of the shares of Voting Stock present in person or by proxy at a
meeting of stockholders, voting together as a single class, shall be required
to amend, alter, change, or repeal any provision of, or to adopt any provision
or provisions inconsistent with Article VI, Article XI or this Article XIII of
this Certificate of Incorporation, notwithstanding the fact that a lesser
percentage may be specified by the General Corporation Law of Delaware.
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<PAGE> 19
The undersigned, being the sole incorporator of the Corporation, for
the purpose of forming a corporation pursuant to the General Corporation Law of
the State of Delaware, does make this certificate, hereby declaring and
certifying that this is the act and deed of the undersigned and the facts
stated herein are true, and accordingly, the undersigned has hereunto set his
hand this 8th day of October, 1996.
RYMAC MORTGAGE INVESTMENT CORPORATION,
as Incorporator
By:/s/ RICHARD R. CONTE
---------------------------
Title: Chief Executive Officer
Richard R. Conte
34
<PAGE> 1
Exhibit 4(b)
Certificate of Amendment of
Certificate of Incorporation of
Core Materials Corporation
as filed with the Secretary of State of Delaware
on November 6, 1996
35
<PAGE> 2
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
Core Materials Corporation, a corporation organized and existing under
and by virtue of the General Corporation Law of the State of Delaware,
DOES HEREBY CERTIFY:
FIRST: That pursuant to the unanimous written consent of the Board of
Directors of Core Materials Corporation, resolutions were duly adopted setting
forth a proposed amendment of the Certificate of Incorporation of said
corporation, declaring said amendment to be advisable and calling a meeting of
the stockholders of said corporation for consideration thereof. The resolutions
setting forth the proposed amendments are as follows:
RESOLVED, that the Certificate of Incorporation of this corporation be
amended by changing the first paragraph of the Article numbered "IV"
so that, as amended said paragraph of such Article shall be and read
as follows:
"The total number of shares of all classes of capital stock which the
Corporation shall have authority to issue is thirty million
(30,000,000) shares, of which twenty million (20,000,000) shares shall
be Common Stock of the par value of one cent ($0.01) each (hereinafter
called "Common Stock") and ten million (10,000,000) shares shall be
Preferred Stock of the par value of one cent ($0.01) each (hereinafter
called "Preferred Stock")."
FURTHER RESOLVED, that the Certificate of Incorporation of this
corporation be amended by changing the Article thereof numbered "VI"
so that, as amended said Article shall be and read as follows:
"SECTION l. Vote Generally Required. Notwithstanding anything
contained herein or in the General Corporation Law of the State of
Delaware, the Corporation shall not (a) merge or consolidate with any
one or more corporations, joint-stock associations or non-stock
corporations (other than in a merger not requiring any vote of
stockholders of the Corporation under the General Corporation Law of
Delaware), (b) sell, lease or exchange all or substantially all of its
property and assets or (c) adopt any plan or proposal for the
liquidation or dissolution of the Corporation, unless (1) the Board of
Directors shall, at a meeting duly called, adopt a resolution, by the
affirmative
36
<PAGE> 3
vote of at least two-thirds (2/3) of the entire Board of Directors,
approving such action and (2) such action shall be approved at a
meeting by the affirmative vote of the holders of 66-2/3% of the shares
of capital stock of the Corporation then outstanding and entitled to
vote generally in the election of directors ("Voting Stock"), voting
together as a single class and, except as expressly provided in this
Certificate of Incorporation or in any resolution or resolutions
adopted by the Board of Directors pursuant to authority expressly
vested in it by the provisions of Article IV with respect to the
Preferred Stock and except as otherwise provided by law, no vote by
holders of capital stock of the Corporation other than Voting Stock
shall be required to approve such action.
SECTION 2: Amendment or Repeal. Notwithstanding the fact that a lesser
percentage may be specified by the General Corporation Law of
Delaware, the affirmative vote of the holders of record of at least
66-2/3% of the shares of the Voting Stock, voting together as a single
class, shall be required to amend, alter or repeal any provision of,
or to adopt any provision or provisions inconsistent with, any
provision of this Article."
FURTHER RESOLVED, that the Certificate of Incorporation of the
corporation be amended by changing the Article thereof numbered "XIII"
so that, as amended said Article shall be and read as follows:
"The Corporation reserves the right to amend, alter, change or repeal
any provisions contained in this Certificate of Incorporation in the
manner now or hereafter prescribed by law, and all the provisions of
this Certificate of Incorporation and all rights and powers conferred
in this Certificate of Incorporation on stockholders, directors and
officers are subject to this reserved power; provided that (a) the
affirmative vote of the holders of record of at least 66-2/3% of the
shares of Voting Stock, voting together as a single class, shall be
required to amend, alter, change, or repeal any provision of, or to
adopt any provision or provisions inconsistent with Article VI or this
subsection (a) of Article XIII of this Certificate of Incorporation;
(b) the affirmative vote of the holders of record of at least 80% of
the shares of Voting Stock, voting together as a single class, shall be
required to amend, alter, change, or repeal any provision of, or adopt
any provision or provisions inconsistent with Section 2 of Article IX
or this subsection (b) of Article XIII of this Certificate of
Incorporation; and (c) the affirmative vote of the holders of record of
at least 80% of the shares of
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<PAGE> 4
Voting Stock present in person or by proxy at a meeting of
stockholders, voting together as a single class, shall be required to
amend, alter, change, or repeal any provision of, or to adopt any
provision or provisions inconsistent with Article XI or this subsection
(c) of Article XIII of this Certificate of Incorporation,
notwithstanding the fact that a lesser percentage may be specified by
the General Corporation Law of Delaware."
SECOND: That thereafter, pursuant to resolution of its Board of
Directors, a special meeting of the Stockholders of said corporation was duly
called and held, upon notice in accordance with Section 222 of the General
Corporation law of the State of Delaware at which meeting the necessary number
of shares as required by statute were voted in favor of the amendments.
THIRD: That said amendment was duly adopted in accordance with the
provisions of Section 242 of the General Corporation Law of the State of
Delaware.
38
<PAGE> 1
Exhibit 4(c)
Certificate of Incorporation
of Core Materials Corporation,
reflecting amendments through November 6, 1996
[for purposes of compliance
with Securities and Exchange Commission
filing requirements only]
39
<PAGE> 2
CERTIFICATE OF INCORPORATION
OF
CORE MATERIALS CORPORATION
ARTICLE I
NAME
The name of the Corporation is Core Materials Corporation.
ARTICLE II
REGISTERED OFFICE AND REGISTERED AGENT
The registered office of the Corporation in the State of Delaware is
located at Corporation Trust Center, 1209 Orange Street, in the City of
Wilmington, County of New Castle. The name and address of the Corporation's
registered agent is The Corporation Trust Company, Corporation Trust Center,
1209 Orange Street, Wilmington, Delaware 19801.
ARTICLE III
CORPORATE PURPOSES
The purpose of the Corporation is to engage in any lawful act or
activity for which corporations may be organized under the General Corporation
Law of the State of Delaware.
ARTICLE IV
CAPITAL STOCK
The total number of shares of all classes of capital stock which the
Corporation shall have authority to issue is thirty million (30,000,000)
shares, of which twenty million (20,000,000) shares shall be Common Stock of
the par value of one cent ($0.01) each (hereinafter called "Common Stock") and
ten million (10,000,000) shares shall be Preferred Stock of the par value of
one cent ($0.01) each (hereinafter called "Preferred Stock").
A. RIGHTS AND RESTRICTIONS OF PREFERRED STOCK. The Preferred Stock is
hereby authorized to be issued from time to time in one or more series, the
shares of each series to have such voting powers, full or limited, or no voting
powers, and such designations, preferences and relative, participating,
40
<PAGE> 3
optional or other special rights and qualifications, limitations or
restrictions thereof as shall be stated and expressed in the Certificate of
Incorporation or in any amendment thereto or in the resolution or resolutions
adopted by the Board of Directors providing for the issue thereof.
B. RIGHTS AND RESTRICTIONS OF COMMON STOCK. The powers, preferences,
rights, qualifications, limitations or restrictions thereof in respect to the
Common Stock are as follows:
(a) The Common Stock is junior to the Preferred Stock and is
subject to all the powers, rights, privileges, preferences and
priorities of the Preferred Stock as herein or in any resolution or
resolutions adopted by the Board of Directors pursuant to authority
expressly vested in it by the provisions of this Article.
(b) The Common Stock shall have voting rights for the
election of directors and for all other purposes, each holder of
Common Stock being entitled to one vote for each share thereof held by
such holder, except as otherwise required by law.
C. INCREASE OR DECREASE IN AMOUNT OF AUTHORIZED SHARES. The number of
authorized shares of any class or classes of capital stock of the Corporation
may be increased or decreased by an amendment to this Certificate of
Incorporation authorized by the affirmative vote of the holders of a majority
of the shares of the Common Stock outstanding and entitled to vote thereon and,
except as expressly provided in the Certificate of Incorporation or in any
resolution or resolutions adopted by the Board of Directors pursuant to
authority expressly vested in it by the provisions of this Article with respect
to the Preferred Stock, no vote by holders of capital stock of the Corporation
other than the Common Stock shall be required to approve such action.
D. SHARES ENTITLED TO MORE OR LESS THAN ONE VOTE. If any class or
series of the Corporation's capital stock shall be entitled to more or less
than one vote for any share, on any matter, every reference in this Certificate
of Incorporation, the By-laws and in any relevant provision of law to a
majority or other proportion of stock shall refer to such majority or other
proportion of the votes of such stock.
E. ISSUANCES OF STOCK. All issuances of capital stock of the
Corporation must be authorized by the affirmative vote of two-thirds (2/3) of
the entire Board of Directors.
41
<PAGE> 4
ARTICLE V
DENIAL OF PREEMPTIVE RIGHTS
No holder of any class of capital stock of the Corporation, whether
now or hereafter authorized, shall be entitled, as such, as a matter of right,
to subscribe for or purchase any part of any new or additional issue of capital
stock of the Corporation of any class whatsoever, or of securities convertible
into or exchangeable for capital stock of the Corporation of any class
whatsoever, whether now or hereafter authorized, or whether issued for cash,
property or services.
ARTICLE VI
STOCKHOLDER VOTE REQUIRED IN CONNECTION
WITH CERTAIN BUSINESS COMBINATIONS
SECTION l. Vote Generally Required. Notwithstanding anything contained
herein or in the General Corporation Law of the State of Delaware, the
Corporation shall not (a) merge or consolidate with any one or more
corporations, joint-stock associations or non-stock corporations (other than in
a merger not requiring any vote of stockholders of the Corporation under the
General Corporation Law of Delaware), (b) sell, lease or exchange all or
substantially all of its property and assets or (c) adopt any plan or proposal
for the liquidation or dissolution of the Corporation, unless (1) the Board of
Directors shall, at a meeting duly called, adopt a resolution, by the
affirmative vote of at least two-thirds (2/3) of the entire Board of Directors,
approving such action and (2) such action shall be approved at a meeting by the
affirmative vote of the holders of 66-2/3% of the shares of capital stock of
the Corporation then outstanding and entitled to vote generally in the election
of directors ("Voting Stock"), voting together as a single class and, except as
expressly provided in this Certificate of Incorporation or in any resolution or
resolutions adopted by the Board of Directors pursuant to authority expressly
vested in it by the provisions of Article IV with respect to the Preferred
Stock and except as otherwise provided by law, no vote by holders of capital
stock of the Corporation other than Voting Stock shall be required to approve
such action.
SECTION 2: Amendment or Repeal. Notwithstanding the fact that a lesser
percentage may be specified by the General Corporation Law of Delaware, the
affirmative vote of the holders of record of at least 66-2/3% of the shares of
the Voting Stock, voting together as a single class, shall be required to
amend, alter or repeal any provision of, or to adopt any provision or
provisions inconsistent with, any provision of this Article."
42
<PAGE> 5
ARTICLE VII
CORPORATE EXISTENCE
The Corporation is to have perpetual existence.
ARTICLE VIII
TRANSFER OF CAPITAL STOCK
SECTION 1. Certain Restrictions on the Transfer of Stock. In order to
preserve the Tax Benefits, the restrictions set forth below shall apply for the
period beginning on the Article VIII Effective Date and ending on the
Expiration Date, unless the Board of Directors shall fix an earlier or later
date in accordance with Section 6 of this Article VIII.
A. Definitions.
(1) Article VIII Effective Date. The time and date of the
legal effectiveness of the merger of RYMAC Mortgage Investment
Corporation with and into the Corporation.
(2) Control. The possession, direct or indirect, of the power
to direct or cause the direction of the management and policies of a
Person, whether through the ownership of voting securities, by
contract, or otherwise. Such definition shall also apply to the terms
"controlling," "controlled by" and "under common control with."
(3) Effective Date Tier Entity. Any Person that, as of the
Article VIII Effective Date or the date that shares of Common Stock
are issued pursuant to the Asset Purchase Agreement (as defined in B.5
below) after giving effect to such issuance, was a First Tier Entity
or a Higher Tier Entity, for so long as such person continues to have
a Prohibited Ownership Percentage.
(4) Expiration Date. The last day of the fifteen-year period
commencing on the Article VIII Effective Date.
(5) First Tier Entity. A "first tier entity" with respect to
the Corporation, as that term is defined in Treasury Regulations
Section l.382-2T(f)(9).
(6) 47 Percentage Point Increase. An increase of 47
percentage points or more of the Stock owned by "5-percent
shareholders" of the Corporation (as defined in A(13) below) over the
lowest percentage of Stock owned by such 5-percent
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<PAGE> 6
shareholders at any time during the three-year period preceding any
determination date, such determination to be made in accordance with
Treasury Regulations Section 1.382-2T(c) as if the determination date
were a "testing date."
(7) Higher Tier Entity. A "higher tier entity" with respect
to the Corporation, as that term is defined in Treasury Regulations
Section l.382-2T(f)(14).
(8) Internal Revenue Code. The Internal Revenue Code of 1986,
as amended. Any reference to a particular Section or provision of the
Internal Revenue Code shall be deemed to also refer to any successor
Section or provision having similar effect.
(9) Ownership Change. An "ownership change" with respect to
the Corporation, as that term is used in Section 382(g) of the
Internal Revenue Code and Treasury Regulations Section 1.382-2T(a)(1),
except that for purposes of determining whether 5-percent shareholders
have increased their percentage interests by more than 50 percentage
points, there shall be added to the increase in their percentage
interests an amount equal to 2.5% of the total value of the Stock of
the Corporation.
(10) Other Permitted Holders. Any Person, other than an
Effective Date Tier Entity or a Permitted Transferee, which has a
Prohibited Ownership Percentage permitted under Section 1, whether
pursuant to a waiver under Paragraph D of Section 1 or otherwise.
(11) Permitted Transferee. Any transferee with a Prohibited
Ownership Percentage as to which the Board of Directors has consented
pursuant to Subparagraph C(2) or C(3) of Section 1.
(12) Person. Any individual, corporation, estate, trust,
association, company, partnership, joint venture, or similar
organization, or any other entity described in Treasury Regulations
Section 1.382-3(a)(1)(i).
(13) Prohibited Ownership Percentage. Any ownership in the
Corporation that would cause a Person or Public Group to be a
"5-percent shareholder" of the Corporation within the meaning of
Treasury Regulations Section 1.382-2T(g)(1)(i) or (ii). For this
purpose, whether a Person or Public Group would be a "5-percent
shareholder" shall be determined (u) by substituting "4.5 percent" for
"5 percent" each place it appears in such provisions, (v) without
giving effect to the following provisions: Treasury Regulations
Sections 1.382-
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<PAGE> 7
2T(g)(2), 1.382-2T(g)(3), 1.382-2T(h)(2)(iii) and 1.382-2T(h)(6)(iii),
(w) by treating every Person or Public Group which owns Stock, whether
directly or by attribution, as directly owning such Stock
notwithstanding any further attribution of such Stock to other Persons
and notwithstanding Treasury Regulations Section 1.382-2T(h)(2)(i)(A),
(x) by substituting the term "Person" in place of "individual" in
Treasury Regulations Section l.382-2T(g)(1)(i), (y) by taking into
account ownership of Stock at any time during the "testing period" as
defined in Treasury Regulations Section 1.382-2T(d)(1), and (z) by
treating each day during the testing period as if it were a "testing
date" as defined in Treasury Regulations Section 1.382-2T(a)(2)(i). In
addition, for the purpose of determining whether any Person or Public
Group has a Prohibited Ownership Percentage as of any date, the
definition of Stock set forth in Subparagraph A(15) of Section 1 shall
be applied in lieu of the definition in Treasury Regulations Section
1.382-2T(f)(18), except that any option shall be treated as Stock only
to the extent treating it as Stock would cause an increase in
ownership of such Person and such option would be deemed exercised
pursuant to Treasury Regulations in effect from time to time
(disregarding whether treating such option as exercised would cause an
ownership change).
(14) Public Group. A "public group" with respect to the
Corporation, as that term is used in Treasury Regulations Section
1.382-2T(f)(13), excluding any "direct public group" with respect to
the Corporation, as that term is used in Treasury Regulations Section
1.382-2T(j)(2)(ii).
(15) Stock. All classes of stock of the Corporation, all
options to acquire stock of the Corporation and all other interests
that would be treated as stock in the Corporation pursuant to Treasury
Regulations Section 1.382-2T(f)(18)(iii), other than (x) stock
described in Section 1504(a)(4) of the Internal Revenue Code and (y)
stock that would be described in such Section 1504(a)(4) but is not so
described solely because it is entitled to vote as a result of
dividend arrearages. As used in this Article VIII, the term "option"
shall have the meaning set forth in Treasury Regulations Section
1.382-2T(h)(4).
(16) Tax Benefits. The net operating loss carryovers and
capital loss carryovers to which the Corporation is entitled under the
Internal Revenue Code, free of restrictions under Section 382 of the
Internal Revenue Code.
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<PAGE> 8
(17) Testing Date Action. Any Transfer or acquisition of
Stock or any other action (including the acquisition or issuance of an
option to Transfer or acquire Stock), if the effect of such Transfer,
acquisition or other action would be to cause a "testing date" with
respect to the Corporation within the meaning of Treasury Regulations
Section l.382-2T(a)(2)(i), determined by treating every Person and
Public Group which has a Prohibited Ownership percentage as a
5-percent shareholder as used in such Section.
(18) Transfer. Any means of conveyance of legal or beneficial
ownership of Stock, whether such ownership is direct or indirect,
voluntary or involuntary, including, without limitation, an indirect
transfer of ownership through the transfer of any ownership interest
of any entity that owns Stock.
(19) Transferee Undertaking. A duly executed written
undertaking for the benefit of the Corporation by any transferee
pursuant to which the transferee agrees that (i) it will not take any
of the following actions without the prior consent of the Board of
Directors (x) acquire any additional Stock, (y) Transfer any Stock in
violation of Paragraph B of Section 1, or (z) take or cause to be
taken any Testing Date Action, (ii) upon request by the Corporation,
it will furnish or cause to be furnished to the Corporation all
certificates representing Stock held of record or beneficially,
directly or indirectly, by it or by any Person controlling, controlled
by or under common control with it for the purpose of placing a legend
on such certificates to reflect the undertakings described in clause
(i) above, (iii) it acknowledges that stop transfer orders may be
entered with the transfer agent (or agents) and the registrar (or
registrars) of Stock against the transfer of Stock subject to the
undertakings described in clause (i) above except in compliance with
the requirements of such undertakings, and (iv) it will agree to such
other actions and remedies as the Corporation may reasonably request
in order to preserve the Tax Benefits.
(20) Treasury Regulations. The regulations promulgated by the
Secretary of the Treasury under the Internal Revenue Code. Any
reference to a particular Treasury Regulation or Section or provision
thereof shall be deemed to also refer to any successor Regulation or
Section or provision having similar effect.
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<PAGE> 9
B. Transfer Restrictions.
Unless otherwise consented to or waived by the Board of Directors, the
following Transfers and actions shall be prohibited:
(1) General. No Person shall Transfer any Stock to any other
Person to the extent that such Transfer, if effected, (i) would cause
the transferee or any person or Public Group to have a Prohibited
Ownership Percentage, or (ii) would increase the ownership percentage
of any transferee or any Person or Public Group having a Prohibited
Ownership Percentage.
(2) Additional Restrictions on Transfers Involving Effective
Date Tier Entities. In addition to the restrictions under Subparagraph
B(1), (i) no Effective Date Tier Entity or individual that owns a
direct ownership interest in the Corporation of five percent or more
shall Transfer any Stock, and no other Person shall Transfer any Stock
to an Effective Date Tier Entity, if, in either case, after such
Transfer, there would be a 47 Percentage Point Increase, and (ii) no
Effective Date Tier Entity or individual that owns a direct ownership
interest in the Corporation of five percent or more shall take any
other action (including the acquisition or issuance of an option to
Transfer or acquire Stock) if, after such action, there would be a 47
Percentage Point Increase.
(3) Additional Restrictions on Transfers Involving Other
Permitted Holders. In addition to the restrictions under Subparagraph
B(1), (i) no Other Permitted Holder shall Transfer any Stock, and no
other Person shall Transfer any Stock to an Other Permitted Holder,
if, in either case, such Transfer would constitute a Testing Date
Action, and (ii) no Other Permitted Holder shall take any other action
that would constitute a Testing Date Action.
(4) Additional Restrictions under Transferee Undertakings. In
addition to the restrictions under Subparagraph B(1), (i) no Person
who has delivered a Transferee Undertaking shall Transfer any Stock,
and no Person shall Transfer any Stock to any Person who has delivered
a Transferee Undertaking, if, in either case, such Transfer would
result in a violation of such Transferee Undertaking, and (ii) no
Person who has delivered a Transferee Undertaking shall take or cause
to be taken any other action that would constitute a Testing Date
Action.
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<PAGE> 10
(5) Exception. Notwithstanding anything herein to the
contrary, the issuance of shares of Common Stock of the Corporation to
Navistar International Transportation Corp. ("Navistar") or its
designees pursuant to the terms of an Asset Purchase Agreement, dated
September 12, 1996 (the "Asset Purchase Agreement"), between Navistar
and RYMAC Mortgage Investment Corporation shall not be deemed to be a
violation of the transfer restrictions set forth in this Paragraph B.
C. Permitted Transfers.
(1) General. Unless otherwise restricted under Paragraph B of
Section 1 or under a Transferee Undertaking or other agreement,
Transfers of Stock may be made without the consent of the Board of
Directors.
(2) Transfers by Effective Date Tier Entities. Upon petition
by any Effective Date Tier Entity or individual that owns a direct
ownership interest in the Corporation of five percent or more, the
Board of Directors shall consent to a proposed Transfer of Stock that
complies with Subparagraph B(2) of Section l but would otherwise be
prohibited pursuant to Subparagraph B(1) of Section 1 if it determines
that (i) after giving effect to such Transfer, the percentage of Stock
owned by all Persons and Public Groups with a Prohibited Ownership
percentage will not have increased by more than 47 percentage points
over the lowest percentage of Stock owned by such Persons and Public
Groups at any time during the three-year period preceding the proposed
date of such Transfer (such determination to be made in accordance
with the provisions of Treasury Regulations Section l.382-2T(c)) and
(ii) the proposed transferee shall have delivered a Transferee
Undertaking.
(3) Transfers by Permitted Transferees. Upon petition by any
Permitted Transferee, the Board of Directors shall consent to a
proposed Transfer of Stock or Testing Date Action that would otherwise
be prohibited pursuant to Subparagraph B(1) or B(4) of Section 1 or
pursuant to any Transferee Undertaking if it determines that (i) after
such proposed Transfer or Testing Date Action there would not be an
Ownership Change and (ii) in the case of any such proposed Transfer
that, if effected, would otherwise be prohibited under Subparagraph
B(1) of Section l, such Transfer would otherwise be permitted under
Subparagraph C(2) if such Transfer were proposed to be made by an
Effective Date Tier Entity.
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(4) Certain Additional Transfers to Permitted Transferees.
Upon petition by any Permitted Transferee, the Board of Directors
shall consent to a proposed Transfer of additional Stock to such
Permitted Transferee from a Person constituting an Effective Date Tier
Entity or another Permitted Transferee if it determines that such
proposed Transfer would otherwise be permitted under Subparagraph C(2)
or C(3) of Section 1, as the case may be.
(5) Transfers by Other Permitted Holders. Upon petition by
any Other Permitted Holder, the Board of Directors shall consent to a
proposed Transfer of Stock or Testing Date Action that would otherwise
be prohibited pursuant to Subparagraph B(1), B(3) or B(4) of Section 1
or pursuant to any Transferee Undertaking if it determines that (i)
after such proposed Transfer or Testing Date Action there would not be
an Ownership Change and (ii) in the case of any such proposed Transfer
that, if effected, would otherwise be prohibited under Subparagraph
(B)(1) of Section l, such Transfer would not cause a 47 Percentage
Point Increase and the proposed transferee shall have delivered a
Transferee Undertaking.
D. Waivers. Notwithstanding anything herein to the contrary, the Board
of Directors may waive any of the restrictions contained in Paragraph B of
Section 1 of this Article VIII: (a) in the case of any issuance of Stock by the
Corporation which would otherwise be prohibited under Subparagraph B(1) of
Section 1, if the transferee agrees to be bound to the restrictions applicable
to Permitted Transferees; (b) in the event of a tender or exchange offer within
the meaning of the Securities Exchange Act of 1934, as amended, to acquire
Stock constituting more than fifty percent in value of the outstanding Common
Stock of the Corporation, so long as such waiver shall apply to all Transfers
pursuant to such tender or exchange offer; (c) in connection with any Transfers
of Stock in connection with underwritten offerings of such Stock; (d) in
connection with any investment in or acquisition of a business or any business
combination involving the Corporation or any subsidiary of the Corporation; and
(e) in any other instance in which the Board of Directors reasonably and in
good faith determines that a waiver would be in the best interests of the
Corporation.
SECTION 2. Attempted Transfer in Violation of Transfer Restrictions.
Unless the consent or waiver of the Board of Directors is obtained as provided
in Paragraph C or D of Section l, and except as provided in Paragraph C of
Section 2 below, any attempted Transfer of shares of Stock of the Corporation
in excess of the shares that could be Transferred to the transferee
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<PAGE> 12
without restriction under Paragraph B of Section l is not effective to transfer
ownership of such excess shares (the "Prohibited Shares") to the purported
acquiror thereof (the "Purported Acquiror"), and the Purported Acquiror shall
not be entitled to any rights as a shareholder of the Corporation with respect
to the Prohibited Shares, including, without limitation, the right to vote or
to receive dividends with respect thereto. Nothing contained in this Article
VIII shall preclude the settlement of any transaction involving Stock entered
into through the facilities of any national securities exchange on which the
shares of Stock of the Corporation are listed. The application of the
provisions and remedies described in the first sentence of this Section 2 and
in Paragraphs A, B and C of Section 2 below shall be deemed not to so preclude
any such settlement. Paragraphs A, B and C below shall apply only in the case
of violations of the restrictions contained in Subparagraph B(1) of Section l.
A. Transfer of Certificates; Sale of Stock. Upon demand by the
Corporation, the Purported Acquiror shall transfer any certificate or other
evidence of purported ownership of the Prohibited Shares within the Purported
Acquiror's possession or control, together with any dividends or other
distributions paid by the Corporation with respect to the Prohibited Shares
that were received by the Purported Acquiror (the "Prohibited Distributions"),
to an agent to be designated by the Corporation (the "Agent"). If the Purported
Acquiror has sold the Prohibited Shares to an unrelated party in an arms-length
transaction after purportedly acquiring them, the Purported Acquiror shall be
deemed to have sold the Prohibited Shares for the Agent, and in lieu of
transferring the Prohibited Shares and Prohibited Distributions to the Agent
shall transfer to the Agent the Prohibited Distributions and the proceeds of
such sale (the "Resale Proceeds") except to the extent that the Agent grants
written permission to the Purported Acquiror to retain a portion of the Resale
Proceeds not exceeding the amount that would have been payable by the Agent to
the Purported Acquiror pursuant to Paragraph B of Section 2 if the Prohibited
Shares had been sold by the Agent rather than by the Purported Acquiror. Any
purported Transfer of the Prohibited Shares by the Purported Acquiror, other
than a transfer described in one of the two preceding sentences (unless such
transfer itself violated the provisions of Article VIII), shall not be
effective to transfer any ownership of the Prohibited Shares.
B. Allocation and Distribution of Proceeds. The Agent shall sell in an
arms-length transaction (through the American Stock Exchange, if possible) any
Prohibited Shares transferred to the Agent by the Purported Acquiror, and the
proceeds of such sale (the "Sales Proceeds"), or the Resale Proceeds, if
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applicable, shall be allocated to the Purported Acquiror up to the following
amount: (1) where applicable, the purported purchase price paid or value of
consideration surrendered by the Purported Acquiror for the Prohibited Shares
and (2) where the purported Transfer of the Prohibited Shares to the Purported
Acquiror was by gift, inheritance, or any similar purported transfer, the fair
market value of the Prohibited Shares at the time of such purported Transfer.
Any Resale Proceeds or Sales Proceeds in excess of the amount allocable to the
Purported Acquiror pursuant to the preceding sentence, together with any
Prohibited Distributions (such excess amount and Prohibited Distributions are
collectively the "Subject Amounts"), shall be transferred to an entity
designated by the Corporation that is described in Section 501(c)(3) of the
Internal Revenue Code (the "Designated Charity"). In no event shall any such
Prohibited Shares or Subject Amounts inure to the benefit of the Corporation or
the Agent, but such Subject Amounts may be used to cover expenses incurred by
the Agent in performing its duties.
C. Limitation on Enforceability. Notwithstanding anything herein to
the contrary, with respect to any Transfer of Stock which would cause a Person
or Public Group (the "Prohibited Party") to violate a restriction provided for
in Subparagraph B(1) of Section 1 only on account of the attribution to the
Prohibited Party of the ownership of Stock by a Person or Public Group which is
not controlling, controlled by or under common control with the Prohibited
Party, which ownership is nevertheless attributed to the Prohibited Party,
Subparagraph B(1) of Section 1 shall not apply in a manner that would
invalidate such Transfer. In such case, the Prohibited Party and any Persons
controlling, controlled by or under common control with the Prohibited Party
(collectively, the "Prohibited Party Group") shall automatically be deemed to
have disposed of, and shall be required to dispose of, sufficient shares of
Stock (which shares shall consist only of shares held legally or beneficially,
whether directly or indirectly, by any member of the Prohibited Party Group,
but not shares held through another Person, other than shares held through a
Person acting as agent or fiduciary for any member of the Prohibited Party
Group, and which shares shall be disposed of in the inverse order in which they
were acquired by members of the Prohibited Party Group) to cause the Prohibited
Party, following such disposition, not to be in violation of Subparagraph B(1)
of Section 1; provided that in the event no member of the Prohibited Party
Group (i) is an Effective Date Tier Entity, Permitted Transferee or Other
Permitted Holder and (ii) had any actual knowledge that such Transfer was
prohibited under Subparagraph B(1) of Section 1, such disposition shall only be
effected to the extent necessary in order to prevent an Ownership Change. Such
disposition shall be deemed to occur simultaneously with the Transfer giving
rise
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to the application of this provision, and such number of shares which are
deemed to be disposed of shall be considered Prohibited Shares and shall be
disposed of through the Agent as provided in Paragraph B of Section 2, except
that the maximum amount payable to the Prohibited Party in connection with such
sale shall be the fair market value of the prohibited Shares at the time of the
Prohibited Transfer.
D. Other Remedies. In the event that the Board of Directors determines
that a Person proposes to take any action in violation of Paragraph B of
Section 1, or in the event that the Board of Directors determines after the
fact that an action has been taken in violation of Paragraph B of Section 1,
the Board of Directors, subject to the second and third sentences of the
introductory paragraph of Section 2, may take such action as it deems advisable
to prevent or to refuse to give effect to any Transfer or other action which
would result, or has resulted, in such violation, including, but not limited
to, refusing to give effect to such Transfer or other action on the books of
the Corporation or instituting proceedings to enjoin such Transfer or other
action. If any Person shall knowingly violate Paragraph B of Section 1, then
that Person and all other Persons controlling, controlled by or under common
control with such Person shall be jointly and severally liable for, and shall
pay to the Corporation, such amount as will, after taking account of all taxes
imposed with respect to the receipt or accrual of such amount and all costs
incurred by the Corporation as a result of such loss, put the Corporation in
the same financial position as it would have been in had such violation not
occurred.
SECTION 3. Prompt Enforcement Against Purported Acquiror. Within 30
business days of learning of a purported Transfer of Prohibited Shares to a
Purported Acquiror or a Transfer of Stock to a Prohibited Party, the
Corporation through its Secretary or any Assistant Secretary shall demand that
the Purported Acquiror or Prohibited Party surrender to the Agent the
certificates representing the Prohibited Shares, or any Resale Proceeds, and
any Prohibited Distributions, and if such surrender is not made by the
Purported Acquiror or Prohibited Party within 30 business days from the date of
such demand, the Corporation shall institute legal proceedings to compel such
surrender; provided, however, that nothing in this Section 3 shall preclude the
Corporation in its discretion from immediately bringing legal proceedings
without a prior demand, and also provided that failure of the Corporation to
act within the time periods set out in this Section 3 shall not constitute a
waiver of any right of the Corporation to compel any transfer required by
Section 2. Upon a determination by the Board of Directors that there has been
or is threatened a purported Transfer of Prohibited Shares to a Purported
Acquiror or a Transfer of Stock to a Prohibited
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Party or any other violation of Paragraph B of Section 1, the Board of Directors
may authorize such additional action as it deems advisable to give effect to the
provisions of this Article VIII, including, without limitation, refusing to give
effect on the books of the Corporation to any such purported Transfer or
instituting proceedings to enjoin any such purported Transfer.
SECTION 4. Obligation to Provide Information. The Corporation may
require as a condition to the registration of the Transfer of any Stock that
the proposed transferee furnish to the Corporation all information reasonably
requested by the Corporation with respect to all the direct or indirect
ownership of Stock by the proposed transferee and by Persons controlling,
controlled by or under common control with the proposed transferee.
SECTION 5. Legends. All certificates evidencing Stock that is subject
to the restrictions on transfer set forth in this Article VIII shall bear a
conspicuous legend referencing such restrictions.
SECTION 6. Further Actions. Subject to the second and third sentences
of the introductory paragraph of Section 2, nothing contained in this Article
VIII shall limit the authority of the Board of Directors to take such other
action to the extent permitted by law as it deems necessary or advisable to
protect the Corporation and the interests of the holders of its securities in
preserving the Tax Benefits. Without limiting the generality of the foregoing,
in the event of a change in law (including applicable regulations) making one
or more of the following actions necessary, in the case of actions described in
clauses (B), (C) and (D) below, or desirable, in the case of actions described
in clause (A) below, the Board of Directors may (A) accelerate the Expiration
Date, (B) extend the Expiration Date, (C) conform any terms or numbers set
forth in the transfer restrictions in Section 1 to make such terms consistent
with the Internal Revenue Code and the Treasury Regulations following any
changes therein to the extent necessary to preserve the Tax Benefits, or (D)
conform the definitions of any terms set forth in this Article VIII to the
definitions in effect following such change in law; provided that the Board of
Directors shall determine in writing that such acceleration, extension, change
or modification is reasonably necessary to preserve the Tax Benefits or that
the continuation of these restrictions is no longer reasonably necessary for
the preservation of the Tax Benefits, which determination shall be based upon
an opinion of legal counsel to the Corporation and which determination shall be
filed with the Secretary of the Corporation and mailed by the Secretary to all
stockholders of the Corporation within ten days after the date of any such
determination.
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SECTION 7. Severability. If any provision of this Article VIII or the
application of any such provision to any Person or under any circumstance shall
be held invalid, illegal, or unenforceable in any respect by a court of
competent jurisdiction, such invalidity, illegality or unenforceability shall
not affect any other provision of this Article VIII.
ARTICLE IX
BOARD OF DIRECTORS
SECTION l. Powers of Board of Directors. In furtherance and not in
limitation of the powers conferred by statute, the Board of Directors of the
Corporation is expressly authorized:
A. To make, alter, amend or repeal the By-Laws. Any By-Law
may be altered, amended or repealed by the holders of the capital
stock of the Corporation entitled to vote thereon at any annual
meeting or at any special meeting called for that purpose.
B. To authorize and cause to be executed mortgages and liens
upon the real and personal property of the Corporation.
C. To exercise, in addition to the powers and authorities
hereinbefore or by law conferred upon it, any such powers and
authorities and do all such acts and things as may be exercised or
done by the Corporation, subject, nevertheless, to the provisions of
the laws of the State of Delaware and of the Certificate of
Incorporation and of the By-Laws of the Corporation.
SECTION 2. Removal of Directors. Subject to the rights of the holders
of any series of Preferred Stock or any other class of capital stock of the
Corporation (other than the Common Stock) then outstanding, any director, or
the entire Board of Directors, may be removed from office at any time, with or
without cause, by the affirmative vote of the holders of record of outstanding
shares representing at least 80% of the Voting Stock, voting together as a
single class.
SECTION 3. Vacancies. Subject to the rights of the holders of any
series of Preferred Stock or any other class of capital stock of the
Corporation (other than the Common Stock) then outstanding, any vacancies in
the Board of Directors for any reason, including by reason of any increase in
the number of directors, shall be filled only by the Board of Directors, acting
by the affirmative vote of a majority of the remaining directors
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then in office, although less than a quorum, and any directors so elected shall
hold office until their successors are elected and qualify; provided, however,
notwithstanding anything herein to the contrary, any vacancies on the Board of
Directors prior to the first annual meeting of stockholders of the Corporation
after the Closing Date (as defined in the Asset Purchase Agreement referred to
in Section 1(B)(5) of Article VIII hereof, a copy of which shall be sent to any
stockholder, upon request, without charge) shall be filled as provided in the
Asset Purchase Agreement.
SECTION 4. Preferred Stock. Whenever the holders of any one or more
series of Preferred Stock issued by the Corporation shall have the right,
voting separately by class or series, to elect directors at an annual or a
special meeting of holders of capital stock of the Corporation, the nomination,
election, term of office, filling of vacancies and other features of such
directorships shall be governed by this Article IX unless expressly otherwise
provided by law or by the resolution or resolutions providing for the creation
of such series.
ARTICLE X
ACTION BY STOCKHOLDERS
Any action required or permitted to be taken by the holders of the
issued and outstanding capital stock of the Corporation may be effected solely
at an annual or special meeting of stockholders duly called and held in
accordance with law, this Certificate of Incorporation and the By-laws of the
Corporation, and the power of stockholders, or any of them, to consent in
writing, without a meeting, to the taking of any such action is hereby
specifically denied.
ARTICLE XI
LIMITATION OF DIRECTORS' LIABILITY
SECTION 1. Limitation of Directors' Liability.
A. No director of the corporation shall be personally liable to the
Corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, except, to the extent provided by applicable law, for
liability (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 Delaware General Corporation Law or (iv) for any transaction
from which the director derived an improper personal benefit. If the Delaware
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General Corporation Law is hereafter amended to authorize corporate action
further limiting or eliminating the personal liability of directors, then the
liability of each director of the Corporation shall be limited or eliminated to
the full extent permitted by the Delaware General Corporation Law as so amended
from time to time.
B. Neither the amendment nor repeal of this Section 1, nor the
adoption of any provision of the Certificate of Incorporation inconsistent with
this Section 1, shall eliminate or reduce the effect of this Section 1, in
respect of any matter occurring, or any cause of action, suit or claim that,
but for this Section 1, would accrue or arise, prior to such amendment, repeal
or adoption of an inconsistent provision.
ARTICLE XII
The name and mailing address of the sole incorporator is as follows:
NAME MAILING ADDRESS
- ---- ---------------
RYMAC MORTGAGE Penn Central West II
INVESTMENT CORPORATION Suite 311
Pittsburgh, PA 15276
ARTICLE XIII
RESERVATION OF RIGHT TO AMEND CERTIFICATE OF INCORPORATION
The Corporation reserves the right to amend, alter, change or repeal
any provisions contained in this Certificate of Incorporation in the manner now
or hereafter prescribed by law, and all the provisions of this Certificate of
Incorporation and all rights and powers conferred in this Certificate of
Incorporation on stockholders, directors and officers are subject to this
reserved power; provided that (a) the affirmative vote of the holders of record
of at least 66-2/3% of the shares of Voting Stock, voting together as a single
class, shall be required to amend, alter, change, or repeal any provision of,
or to adopt any provision or provisions inconsistent with Article VI or this
subsection (a) of Article XIII of this Certificate of Incorporation; (b) the
affirmative vote of the holders of record of at least 80% of the shares of
Voting Stock, voting together as a single class, shall be required to amend,
alter, change, or repeal any provision of, or adopt any provision or provisions
inconsistent with Section 2 of Article IX or this subsection (b) of Article
XIII of this Certificate of Incorporation; and (c) the affirmative vote of the
holders of record of at least 80% of the shares of Voting Stock present in
person or by proxy at a meeting of stockholders, voting together as a single
class, shall be
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required to amend, alter, change, or repeal any provision of, or
to adopt any provision or provisions inconsistent with Article XI or this
subsection (c) of Article XIII of this Certificate of Incorporation,
notwithstanding the fact that a lesser percentage may be specified by the
General Corporation Law of Delaware.
The undersigned, being the sole incorporator of the Corporation, for
the purpose of forming a corporation pursuant to the General Corporation Law of
the State of Delaware, does make this certificate, hereby declaring and
certifying that this is the act and deed of the undersigned and the facts
stated herein are true, and accordingly, the undersigned has hereunto set his
hand this 8th day of October, 1996.
RYMAC MORTGAGE INVESTMENT CORPORATION,
as Incorporator
By: /s/ RICHARD R. CONTE
---------------------------
Title: Chief Executive Officer
Richard R. Conte
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Exhibit 4(e)
Core Materials Corporation
Long-Term Equity Incentive Plan
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<PAGE> 2
CORE MATERIALS CORPORATION
LONG-TERM EQUITY INCENTIVE PLAN
ARTICLE 1. ESTABLISHMENT, OBJECTIVES, AND DURATION
1.1 ESTABLISHMENT OF THE PLAN. Core Materials Corporation, a Delaware
corporation (hereinafter referred to as the "Company"), hereby establishes an
incentive compensation plan to be known as the "Core Materials Corporation
Long-Term Equity Incentive Plan" (hereinafter referred to as the "Plan"), as
set forth in this document. The Plan permits the grant of Nonqualified Stock
Options, Incentive Stock Options, Director Options, Stock Appreciation Rights,
Restricted Stock, Performance Shares and Performance Units, and Other Incentive
Awards.
Subject to approval by the Company's stockholders within twelve (12)
months of the Effective date (as herein defined), the Plan shall become
effective as of January 1, 1997 (the "Effective Date") and shall remain in
effect as provided in Section 1.3 hereof.
1.2 OBJECTIVES OF THE PLAN. The objectives of the Plan are to optimize
the profitability and growth of the Company through incentives which are
consistent with the Company's goals and which link and align the personal
interests of Participants and Eligible Directors to those of the Company's
stockholders; to provide Participants and Eligible Directors with an incentive
for excellence in individual performance; and to promote teamwork.
The Plan is further intended to provide flexibility to the Company in
its ability to motivate, attract, and retain the services of Participants and
Eligible Directors who make significant contributions to the Company's success
and to allow Participants and Eligible Directors to share in the success of the
Company.
1.3 DURATION OF THE PLAN. The Plan shall commence on the Effective
Date, as described in Section 1.1 hereof, and shall remain in effect, subject
to the right of the Board of Directors to amend or terminate the Plan at any
time pursuant to Article 16 hereof, until all Shares subject to it shall have
been purchased or acquired according to the Plan's provisions. However, in no
event may an Award or Director Option be granted under the Plan on or after
December 31, 2006.
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<PAGE> 3
ARTICLE 2. DEFINITIONS
Whenever used in the Plan, the following terms shall have the meanings
set forth below, and when the meaning is intended, the initial letter of the
word shall be capitalized:
2.1 "AWARD" means, individually or collectively, a grant under this
Plan of Nonqualified Stock Options, Incentive Stock Options, Stock Appreciation
Rights, Restricted Stock, Performance Shares or Performance Units, or Other
Incentive Awards, but shall not include any Director Option.
2.2 "AWARD AGREEMENT" means an agreement entered into by the Company
and each Participant setting forth the terms and provisions applicable to
Awards granted under this Plan.
2.3 "BENEFICIAL OWNER" or "BENEFICIAL OWNERSHIP" shall have the
meaning ascribed to such term in Rule 13d-3 of the General Rules and
Regulations under the Exchange Act.
2.4 "BOARD" or "BOARD OF DIRECTORS" means the Board of Directors of
the Company.
2.5 "CHANGE IN CONTROL" of the Company means the Company or its
shareholders entering into one or more agreements to dispose of all or
substantially all of the assets or fifty percent (50%) or more of the
outstanding capital stock of the Company by means of sale (whether as a result
of a tender offer or otherwise), merger, reorganization or liquidation in one
or a series of related transactions; provided, however, that a "Change in
Control" shall not occur in the event that (a) the primary purpose of the
transaction is to change the Company's domicile solely within the United
States; or (b) the transaction is approved by a majority of the members of the
Board of Directors who had either been in office for more than twelve months
prior to such transaction or had been elected, or nominated for election by the
Company's shareholders, by the vote of three-fourths of the directors then
still in office who were directors at the beginning of such twelve-month
period.
2.6 "CODE" means the Internal Revenue Code of 1986, as amended from
time to time.
2.7 "COMMITTEE" means the Compensation Committee of the Board, as
specified in Article 3 herein, or such other Committee appointed by the Board
to administer the Plan with respect to grants of Awards.
2.8 "COMPANY" means Core Materials Corporation, a Delaware
corporation, and the Company's Subsidiaries, as well as any
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successor to any of such entities as provided in Article 19 herein.
2.9 "DIRECTOR" means any individual who is a member of the Board of
Directors of the Company.
2.10 "DIRECTOR OPTION" means a Nonqualified Stock Option granted to
each Eligible Director pursuant to Section 6.9 without any action by the Board
or the Committee.
2.11 "DISABILITY" shall have the meaning ascribed to such term in the
Participant's governing long-term disability plan. To the extent that a
Participant is not covered under a long-term disability plan, the term
"Disability" shall have the meaning ascribed to the term "permanent and total
disability" under Section 22(e)(3) of the Code, or any successor provision
thereto.
2.12 "EFFECTIVE DATE" shall have the meaning ascribed to such term in
Section 1.1 hereof.
2.13 "ELIGIBLE DIRECTOR" means, on any date, a person who is serving
as a member of the Board who is a Nonemployee Director.
2.14 "EMPLOYEE" means any employee of the Company. Nonemployee
Directors shall not be considered Employees under this Plan unless specifically
designated otherwise.
2.15 "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended from time to time, or any successor act thereto.
2.16 "FAIR MARKET VALUE" shall be determined on the basis of the
average of the high and low sale prices on the principal securities exchange on
which the Shares are publicly traded or, if there is no such sale on the
relevant date, then on the last previous day on which a sale was reported.
2.17 "FREESTANDING SAR" means an SAR that is granted independently of
any Options, as described in Article 7 herein.
2.18 "INCENTIVE STOCK OPTION" or "ISO" means an option to purchase
Shares granted under Article 6 herein and which is designated as an Incentive
Stock Option and which is intended to meet the requirements of Code Section
422.
2.19 "INSIDER" shall mean an individual who is, on the relevant date,
an officer, director, or ten percent (10%) beneficial owner of any class of the
Company's equity securities that is registered pursuant to Section 12 of the
Exchange Act, all as defined under Section 16 of the Exchange Act.
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2.20 "NAMED EXECUTIVE OFFICER" means a Participant who, as of the date
of vesting and/or payout of an Award, as applicable, is one of the group of
"covered employees," as defined in the regulations promulgated under Code
Section 162(m), or any successor statute.
2.21 "NONEMPLOYEE DIRECTOR" means an individual who is a member of the
Board of Directors of the Company but who is not an Employee of the Company or
a Subsidiary.
2.22 "NONQUALIFIED STOCK OPTION" or "NQSO" means an option to purchase
Shares granted under Article 6 herein and which is not intended to meet the
requirements of Code Section 422.
2.23 "OPTION" means an Incentive Stock Option or a Nonqualified Stock
Option, as described in Article 6 herein, but shall not include a Director
Option.
2.24 "OPTION PRICE" means the price at which a Share may be purchased
by a Participant pursuant to an Option.
2.25 "OTHER INCENTIVE AWARD" means an award granted pursuant to
Article 10 hereof.
2.26 "PARTICIPANT" means an Employee who has outstanding an Award
granted under the Plan.
2.27 "PERFORMANCE-BASED EXCEPTION" means the performance-based
exception from the tax deductibility limitations of Code Section 162(m).
2.28 "PERFORMANCE PERIOD" means the time period during which
performance goals must be achieved with respect to an Award, as determined by
the Committee.
2.29 "PERFORMANCE SHARE" means an Award granted to a Participant, as
described in Article 9 herein.
2.30 "PERFORMANCE UNIT" means an Award granted to a Participant, as
described in Article 9 herein.
2.31 "PERIOD OF RESTRICTION" means the period during which the
transfer of Shares of Restricted Stock is limited in some way (based on the
passage of time, the achievement of performance goals, and/or upon the
occurrence of other events as determined by the Committee at its discretion),
and the Shares are subject to a substantial risk of forfeiture, as provided in
Article 8 herein.
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2.32 "PERSON" shall have the meaning ascribed to such term in Section
3(a)(9) of the Exchange Act and used in Sections 13(d) and 14(d) thereof,
including a "group" as defined in Section 13(d) thereof.
2.33 "RESTRICTED STOCK" means an Award granted to a Participant
pursuant to Article 8 herein.
2.34 "RETIREMENT" means the normal retirement date on which a
Participant qualifies for full retirement benefits under the Company's
qualified retirement plan, as identified by the Committee. In the event that a
Participant is not covered under any qualified retirement plan maintained by
the Company, the term "Retirement" shall mean the date on which such
Participant attains age 65.
2.35 "SHARES" means the shares of common stock of the Company.
2.36 "SHARE POOL" means the number of shares authorized for issuance
under paragraph 4.1, as adjusted for awards and payouts under paragraph 4.2 and
as adjusted for changes in corporate capitalization under paragraph 4.3.
2.37 "STOCK APPRECIATION RIGHT" or "SARA" means an Award, granted
alone or in connection with a related Option, designated as an SAR, pursuant to
the terms of Article 7 herein.
2.38 "SUBSIDIARY" means any corporation, partnership, joint venture,
affiliate, or other entity in which the Company has a majority voting interest,
and which the Committee designates as a participating entity in the Plan.
2.39 "TANDEM SAR" means an SAR that is granted in connection with a
related Option pursuant to Article 7 herein, the exercise of which shall
require forfeiture of the right to purchase a Share under the related Option
(and when a Share is purchased under the Option, the Tandem SAR shall similarly
be canceled).
ARTICLE 3. ADMINISTRATION
3.1 THE COMMITTEE. The Plan shall be administered by the Compensation
Committee of the Board, or by any other Committee appointed by the Board. The
members of the Committee shall be appointed from time to time by, and shall
serve at the discretion of, the Board of Directors. Notwithstanding any
provision contained herein, to the extent that any Award is designed to comply
with the Performance-Based Exception, the Committee shall
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satisfy the requirements contained in Section 1.162-27(c)(4) of the
final regulations promulgated by the Internal Revenue Service under Section
162(m) of the Code. For purposes of granting Awards under the Plan, the
Committee shall be composed of not less than the minimum number of persons from
time to time required by Rule 16b-3 under the Exchange Act, each of whom shall
be a "non-employee director" within the meaning of Rule 16b-3 under the
Exchange Act, or any successor rule or regulation.
3.2 AUTHORITY OF THE COMMITTEE. Except as limited by law or by the
Certificate of Incorporation or Bylaws of the Company, and subject to the
provisions herein, the Committee shall have full power to select Employees who
shall participate in the Plan; determine the sizes and types of Awards;
determine the terms and conditions of Awards in a manner consistent with the
Plan; construe and interpret the Plan and any agreement or instrument entered
into under the Plan; establish, amend, or waive rules and regulations for the
Plan's administration; and (subject to the provisions of Article 16 herein)
amend the terms and conditions of any outstanding Award to the extent such
terms and conditions are within the discretion of the Committee as provided in
the Plan. Further, the Committee shall make all other determinations which may
be necessary or advisable for the administration of the Plan. As permitted by
law, the Committee may delegate its authority as identified herein.
Notwithstanding anything else contained in the Plan to the contrary, neither
the Committee nor the Board shall have any discretion regarding whether an
Eligible Director shall receive a Director Option pursuant to Section 6.9 or
regarding the terms of any Director Option, including, without limitation, the
number of Shares subject to such Director Option, the timing of the grant or
the exercisability of such Director Option or the exercise price per Share of
such Director Option.
3.3 DECISIONS BINDING. All determinations and decisions made by the
Committee pursuant to the provisions of the Plan and all related orders and
resolutions of the Board shall be final, conclusive and binding on all persons,
including the Company, its stockholders, Employees, Participants, and their
estates and beneficiaries.
ARTICLE 4. SHARES SUBJECT TO THE PLAN AND MAXIMUM AWARDS
4.1 NUMBER OF SHARES AVAILABLE FOR GRANTS. Subject to adjustment as
provided in Section 4.3 herein, the number of Shares hereby reserved for
issuance under the Plan shall be One Million Five Hundred Thousand
(1,500,000.00). The Committee shall determine the appropriate methodology for
calculating the number of Shares issued pursuant to the Plan.
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Unless and until the Committee determines that an Award to a Named
Executive Officer shall not be designed to comply with the Performance-Based
Exception, the following rules shall apply to grants of such Awards under the
Plan:
(a) The maximum aggregate number of Shares (including Options, SARs,
Restricted Stock, Performance Units and Performance Shares paid
out in Shares, or Other Incentive Awards paid out in Shares) that
may be granted or that may vest, as applicable, pursuant to any
Award held by any Named Executive Officer shall be One Hundred
Twenty-five Thousand (125,000). For this purpose, to the extent
that any Option is canceled (as described in Section
1.162-27(e)(2)(vi)(B) of the final regulations under Section
162(m) of the Code, such canceled Option shall continue to be
counted against the maximum number of Shares for which Options may
be granted to a Named Executive Officer under the Plan; and
(b) The maximum aggregate cash payout (including Performance Units and
Performance Shares paid out in cash, or Other Incentive Awards
paid out in cash) with respect to Awards granted in any fiscal
year which may be made to any Named Executive Officer shall be One
Hundred Twenty-five Thousand Dollars ($125,000).
4.2 LAPSED AWARDS. If any Award or Director Option granted under this
Plan is canceled, terminates, expires, or lapses for any reason (with the
exception of the termination of a Tandem SAR upon exercise of the related
Option, or the termination of a related Option upon exercise of the
corresponding Tandem SAR), any Shares subject to such Award or Director Option
again shall be available for the grant of an Award or Director Option under the
Plan.
4.3 ADJUSTMENTS IN AUTHORIZED SHARES. In the event of any change in
corporate capitalization, such as a stock split, or a corporate transaction,
such as any merger, consolidation, separation, including a spin-off, or other
distribution of stock or property of the Company, any reorganization (whether
or not such reorganization comes within the definition of such term in Code
Section 368), or any partial or complete liquidation of the Company, such
adjustment shall be made in the number and class of Shares available in the
Share Pool and in the number and class of and/or price of Shares subject to
outstanding Awards granted under the Plan, as may be determined to be
appropriate and equitable by the Committee, in its sole discretion, to prevent
dilution or enlargement of rights; provided, however, that the number of Shares
subject to any Award shall always be a whole
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number. If, pursuant to the preceding sentence, an adjustment is made to
outstanding Options held by Participants, a corresponding adjustment shall be
made to outstanding Director Options and if, pursuant to the preceding
sentence, an adjustment is made to the number of Shares authorized for issuance
under the Plan, a corresponding adjustment shall be made to the number of
Shares subject to each Director Option thereafter granted pursuant to Section
6.9.
ARTICLE 5. ELIGIBILITY AND PARTICIPATION
5.1 ELIGIBILITY. Persons eligible to participate in this Plan include
all officers and key employees of the Company, as determined by the Committee,
including Employees who are members of the Board and Employees who reside in
countries other than the United States of America.
5.2 ACTUAL PARTICIPATION. Subject to the provisions of the Plan, the
Committee may, from time to time, select from all eligible Employees, those to
whom Awards shall be granted and shall determine the nature and amount of each
Award. Each Eligible Director shall receive nondiscretionary Director Options
in accordance with, and only in accordance with, Section 6.9 hereof.
ARTICLE 6. STOCK OPTIONS
6.1 GRANT OF OPTIONS. Subject to the terms and provisions of the Plan,
Options may be granted, either by the Committee or the Board, to one or more
Participants in such number, and upon such terms, and at any time and from time
to time as shall be determined by the Committee. The Committee or the Board
shall have the authority to grant Incentive Stock Options or to grant
Nonqualified Stock Options or to grant both types of Options. In the case of
Incentive Stock Options, the terms and conditions of such grants shall be
subject to, and comply with, such rules as may be prescribed by Section 422 of
the Code, as from time to time amended, and any regulations implementing such
statute, including, without limitation, the requirements of Code Section 422(d)
which limit the aggregate Fair Market Value of Shares (determined at the time
that such Option is granted) for which Incentive Stock Options are exercisable
for the first time to $100,000 per calendar year. Each provision of the Plan
and of each written Award Agreement relating to an Option designated as an
Incentive Stock Option shall be construed so that such Option qualifies as an
Incentive Stock Option, and any provision that cannot be so construed shall be
disregarded.
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6.2 AWARD AGREEMENT. Each Option grant shall be evidenced by an Award
Agreement that shall specify the Option Price, the duration of the Option, the
number of Shares to which the Option pertains, and such other provisions as the
Committee shall determine. The Award Agreement also shall specify whether the
Option is intended to be an ISO or an NQSO.
6.3 OPTION PRICE. Unless otherwise designated by the Committee at the
time of grant, the Option Price for each grant of an Option under this Plan
shall be at least equal to one hundred percent (100%) of the Fair Market Value
of a Share on the date the Option is granted. Notwithstanding any provision
contained herein, in the case of an Incentive Stock Option, the exercise price
at the time such Incentive Stock Option is granted to any Employee who, at the
time of such grant, owns (within the meaning of Section 425(d) of the Code)
more than ten percent of the voting power of all classes of stock of the
Company or a subsidiary, shall not be less than 110% of the per Share Fair
Market Value on the date of grant.
6.4 DURATION OF OPTIONS. Each Option granted to an Employee shall
expire at such time as the Committee shall determine at the time of grant;
provided, however, that in the case of an Incentive Stock Option, an Employee
may not exercise such Incentive Stock Option after (a) the date which is ten
years (five years in the case of a Participant who owns more than ten percent
of the voting power of the Company or a subsidiary) after the date on which
such Incentive Stock Option is granted; or (b) the date which is three months
(twelve months in the case of a Participant who becomes disabled, as defined in
Section 22(e)(3) of the Code, or who dies) after the date on which he ceases to
be an Employee of the Company or a subsidiary.
6.5 EXERCISE OF OPTIONS. Options granted under this Article 6 shall be
exercisable at such times and be subject to such restrictions and conditions as
the Committee shall in each instance approve, which need not be the same for
each grant or for each Participant.
6.6 PAYMENT. Options granted under this Article 6 shall be exercised
by the delivery of a written notice of exercise to the Company, setting forth
the number of Shares with respect to which the Option is to be exercised,
accompanied by full payment for the Shares.
The Option Price upon exercise of any Option shall be payable to the
Company in full either: (a) in cash or its equivalent, or (b) by tendering
previously acquired Shares having an aggregate Fair Market Value at the time of
exercise equal to the total Option Price (provided that the Shares which are
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tendered must have been held by the Participant for at least six (6) months
prior to their tender to satisfy the Option Price), or (c) by a combination of
(a) and(b).
As soon as practicable after receipt of a written notification of
exercise and full payment, the Company shall deliver to the Participant, in the
Participant's name, Share certificates in an appropriate amount based upon the
number of Shares purchased under the Option(s).
6.7 RESTRICTIONS ON SHARE TRANSFERABILITY. The Committee may impose
such restrictions on any Shares acquired pursuant to the exercise of an Option
granted under this Article 6 as it may deem advisable, including, without
limitation, restrictions under applicable federal securities laws, under the
requirements of any stock exchange or market upon which such Shares are then
listed and/or traded, and under any blue sky or state securities laws
applicable to such Shares.
6.8 TERMINATION OF EMPLOYMENT. Each Option Award Agreement shall set
forth the extent to which the Participant shall have the right to exercise the
Option following termination of the Participant's employment with the Company
and/or its Subsidiaries. Such provisions shall be determined in the sole
discretion of the Committee, shall be included in the Award Agreement entered
into with each Participant, need not be uniform among all Options issued
pursuant to the Plan, and may reflect distinctions based on the reasons for
termination of employment.
6.9 DIRECTOR OPTIONS. Notwithstanding anything else contained herein
to the contrary, each Eligible Director shall receive, on April 16, 1997,
provided that the Eligible Director is serving as a member of the Board on such
date, a grant of a Director Option to purchase 35,000 Shares at an exercise
price per Share equal to the Fair Market Value on the date of grant. Each
Eligible Director who is first elected to the Board after April 16, 1997 shall
receive, on the day following such election, a grant of a Director Option to
purchase 35,000 Shares at an exercise price per Share equal to the Fair Market
Value on the date of grant. A Director Option shall be exercisable until the
earlier to occur of the following two dates: (a) the tenth anniversary of the
date of grant of such Director Option; or (b) twelve months after the date the
Eligible Director ceases to be a member of the Board, except that if the
Eligible Director ceases to be a member of the Board after having been
convicted of, or pled guilty or nolo contendere to, a felony, his Director
Option shall be canceled on the date he ceases to be a member of the Board.
Each Director Option shall vest twenty percent (20%) on the annual anniversary
date after the date of grant; and any unvested Director Options shall be
forfeited by the Eligible
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Director if he terminates his service on the Board prior to satisfaction of
such vesting requirement. An Eligible Director may pay the exercise price of a
Director Option in the manner described in Section 6.6. Each Director Option
shall be evidenced by an agreement between the Company and the Eligible
Director.
6.10 NONTRANSFERABILITY OF OPTIONS AND DIRECTOR OPTIONS.
(a) INCENTIVE STOCK OPTIONS AND DIRECTOR OPTIONS. No ISO or Director
Option granted under the Plan may be sold, transferred, pledged,
assigned, or otherwise alienated or hypothecated, other than by
will or by the laws of descent and distribution. Further, all
ISOs and Director Options granted to a Participant or Eligible
Director under the Plan shall be exercisable during his or her
lifetime only by such Participant or Eligible Director
(b) NONQUALIFIED STOCK OPTIONS. Except as otherwise provided in a
Participant's Award Agreement, no NQSO granted under this
Article 6 may be sold, transferred, pledged, assigned, or
otherwise alienated or hypothecated, other than by will or by
the laws of descent and distribution. Further, except as
otherwise provided in a Participant's Award Agreement, all NQSOs
granted to a Participant under this Article 6 shall be
exercisable during his or her lifetime only by such Participant
ARTICLE 7. STOCK APPRECIATION RIGHTS
7.1 GRANT OF SARS. Subject to the terms and conditions of the Plan,
SARs may be granted to Participants at any time and from time to time as shall
be determined by the Committee. The Committee may grant Freestanding SARs,
Tandem SARs, or any combination of these forms of SAR.
The Committee shall have complete discretion in determining the number
of SARs granted to each Participant (subject to Article 4 herein) and,
consistent with the provisions of the Plan, in determining the terms and
conditions pertaining to such SARs.
Unless otherwise designated by the Committee at the time of grant, the
grant price of a Freestanding SAR shall equal the Fair Market Value of a Share
on the date of grant of the SAR. The grant price of Tandem SARs shall equal the
Option Price of the related Option.
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7.2 EXERCISE OF TANDEM SARS. Tandem SARs may be exercised for all or
part of the Shares subject to the related Option upon the surrender of the
right to exercise the equivalent portion of the related Option. A Tandem SAR
may be exercised only with respect to the Shares for which its related Option
is then exercisable.
Notwithstanding any other provision of this Plan to the contrary, with
respect to a Tandem SAR granted in connection with an ISO: (i) the Tandem SAR
will expire no later than the expiration of the underlying ISO; (ii) the value
of the payout with respect to the Tandem SAR may be for no more than one
hundred percent (100%) of the difference between the Option Price of the
underlying ISO and the Fair Market Value of the Shares subject to the
underlying ISO at the time the Tandem SAR is exercised; and (iii) the Tandem
SAR may be exercised only when the Fair Market Value of the Shares subject to
the ISO exceeds the Option Price of the ISO.
7.3 EXERCISE OF FREESTANDING SARS. Freestanding SARs may be exercised
upon whatever terms and conditions the Committee, in its sole discretion,
imposes upon them.
7.4 SAR AGREEMENT. Each SAR grant shall be evidenced by an Award
Agreement that shall specify the grant price, the term of the SAR, and such
other provisions as the Committee shall determine.
7.5 TERM OF SARS. The term of an SAR granted under the Plan shall be
determined by the Committee, in its sole discretion; provided, however, that
unless otherwise designated by the Committee, such term shall not exceed ten
(10) years.
7.6 PAYMENT OF SAR AMOUNT. Upon exercise of an SAR, a Participant
shall be entitled to receive payment from the Company in an amount determined
by multiplying:
(a) The difference between the Fair Market Value of a Share on the
date of exercise over the grant price; by
(b) The number of Shares with respect to which the SAR is exercised.
At the discretion of the Committee, the payment upon SAR exercise may
be in cash, in Shares of equivalent value, in Restricted Shares of equivalent
value, or in some combination thereof.
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7.7 TERMINATION OF EMPLOYMENT. Each SAR Award Agreement shall set
forth the extent to which the Participant shall have the right to exercise the
SAR following termination of the Participant's employment with the Company
and/or its Subsidiaries. Such provisions shall be determined in the sole
discretion of the Committee, shall be included in the Award Agreement entered
into with Participants, need not be uniform among all SARs issued pursuant to
the Plan, and may reflect distinctions based on the reasons for termination of
employment.
7.8 NONTRANSFERABILITY OF SARS. Except as otherwise provided in a
Participant's Award Agreement, no SAR granted under the Plan may be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated, other
than by will or by the laws of descent and distribution. Further, except as
otherwise provided in a Participant's Award Agreement, all SARs granted to a
Participant under the Plan shall be exercisable during his or her lifetime only
by such Participant.
ARTICLE 8. RESTRICTED STOCK
8.1 GRANT OF RESTRICTED STOCK. Subject to the terms and provisions of
the Plan, the Committee, at any time and from time to time, may grant Shares of
Restricted Stock to Participants in such amounts as the Committee shall
determine.
8.2 RESTRICTED STOCK AGREEMENT. Each Restricted Stock grant shall be
evidenced by an Award Agreement that shall specify the Period(s) of
Restriction, the number of Shares of Restricted Stock granted, and such other
provisions as the Committee shall determine.
8.3 TRANSFERABILITY. Except as provided in this Article 8, the Shares
of Restricted Stock granted herein may not be sold, transferred, pledged,
assigned, or otherwise alienated or hypothecated until the end of the
applicable Period of Restriction established by the Committee and specified in
the Restricted Stock Award Agreement, or upon earlier satisfaction of any other
conditions, as specified by the Committee in its sole discretion and set forth
in the Restricted Stock Agreement. All rights with respect to the Restricted
Stock granted to a Participant under the Plan shall be available during his or
her lifetime only to such Participant.
8.4 OTHER RESTRICTIONS. Subject to Article 11 herein, the Committee
may impose such other conditions and/or restrictions on any Shares of
Restricted Stock granted pursuant to the Plan as it may deem advisable
including, without limitation, a requirement that Participants pay a stipulated
purchase price for each Share
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of Restricted Stock, restrictions based upon the achievement of specific
performance goals (Company-wide, divisional, and/or individual), time-based
restrictions on vesting following the attainment of the performance goals,
and/or restrictions under applicable federal or state securities laws.
The Company shall retain the certificates representing Shares of
Restricted Stock in the Company's possession until such time as all conditions
and/or restrictions applicable to such Shares have been satisfied.
Except as otherwise provided in this Article 8, Shares of Restricted
Stock covered by each Restricted Stock grant made under the Plan shall become
freely transferable by the Participant after the last day of the applicable
Period of Restriction.
8.5 VOTING RIGHTS. Unless otherwise designated 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 Period of Restriction.
8.6 DIVIDENDS AND OTHER DISTRIBUTIONS. Unless otherwise designated by
the Committee at the time of grant, Participants holding Shares of Restricted
Stock granted hereunder may be credited with regular cash dividends paid with
respect to the underlying Shares while they are so held during the Period of
Restriction. The Committee may apply any restrictions to the dividends that the
Committee deems appropriate. Without limiting the generality of the preceding
sentence, if the grant or vesting of Restricted Shares granted to a Named
Executive Officer is designed to comply with the requirements of the
Performance-Based Exception, the Committee may apply any restrictions it deems
appropriate to the payment of dividends declared with respect to such
Restricted Shares, such that the dividends and/or the Restricted Shares
maintain eligibility for the Performance-Based Exception.
8.7 TERMINATION OF EMPLOYMENT. Each Restricted Stock Award Agreement
shall set forth the extent to which the Participant shall have the right to
receive unvested Restricted Shares following termination of the Participant's
employment with the Company and/or its Subsidiaries. Such provisions shall be
determined in the sole discretion of the Committee, shall be included in the
Award Agreement entered into with each Participant, need not be uniform among
all Shares of Restricted Stock issued pursuant to the Plan, and may reflect
distinctions based on the reasons for termination of employment; provided,
however that, except in the cases of terminations connected with
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a Change in Control, terminations by reason of death or Disability, and except
for Restricted Shares paid to Participants upon SAR exercise, the vesting of
Shares of Restricted Stock which qualify for the Performance-Based Exception
and which are held by Named Executive Officers shall not occur prior to the
time they otherwise would have, but for the employment termination.
ARTICLE 9. PERFORMANCE UNITS AND PERFORMANCE SHARES
9.1 GRANT OF PERFORMANCE UNITS/SHARES. Subject to the terms of the
Plan, Performance Units and/or Performance Shares may be granted to
Participants in such amounts and upon such terms, and at any time and from time
to time, as shall be determined by the Committee.
9.2 VALUE OF PERFORMANCE UNITS/SHARES. Each Performance Unit shall
have an initial value that is established by the Committee at the time of
grant. Each Performance Share shall have an initial value equal to the Fair
Market Value of a Share on the date of grant. The Committee shall set
performance goals in its discretion which, depending on the extent to which
they are met, will determine the number and/or value of Performance
Units/Shares that will be paid out to the Participant. For purposes of this
Article 9, the time period during which the performance goals must be met shall
be called a "Performance Period."
9.3 EARNING OF PERFORMANCE UNITS/SHARES. Subject to the terms of this
Plan, after the applicable Performance Period has ended, the holder of
Performance Units/Shares shall be entitled to receive payout on the number and
value of Performance Units/Shares earned by the Participant over the
Performance Period, to be determined as a function of the extent to which the
corresponding performance goals have been achieved, as established by the
Committee.
9.4 FORM AND TIMING OF PAYMENT OF PERFORMANCE UNITS/SHARES. Payment of
earned Performance Units/Shares shall be made in a single lump sum within
seventy-five (75) calendar days following the close of the applicable
Performance Period. Subject to the terms of this Plan, the Committee, in its
sole discretion, may pay earned Performance Units/Shares in the form of cash or
in Shares (or in a combination thereof) which have an aggregate Fair Market
Value equal to the value of the earned Performance Units/Shares at the close of
the applicable Performance Period. Such Shares may be granted subject to any
restrictions deemed appropriate by the Committee.
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At the discretion of the Committee, Participants may be entitled to
receive any dividends declared with respect to Shares which have been earned in
connection with grants of Performance Units and/or Performance Shares which
have been earned, but not yet distributed to Participants (such dividends shall
be subject to the same accrual, forfeiture, and payout restrictions as apply to
dividends earned with respect to Shares of Restricted Stock, as set forth in
Section 8.6 herein). In addition, Participants may, at the discretion of the
Committee, be entitled to exercise their voting rights with respect to such
Shares.
9.5 TERMINATION OF EMPLOYMENT DUE TO DEATH, DISABILITY, OR RETIREMENT.
Unless otherwise designated by the Committee, and set forth in the
Participant's Award Agreement, in the event the employment of a Participant is
terminated due to death, Disability, or Retirement during a Performance Period,
the Participant shall receive a prorated payout of the Performance
Units/Shares. The prorated payout shall be determined by the Committee, shall
be based upon the length of time that the Participant held the Performance
Units/Shares during the Performance Period, and shall further be adjusted based
on the achievement of the preestablished performance goals.
Payment of earned Performance Units/Shares shall be made at a time
specified by the Committee in its sole discretion and set forth in the
Participant's Award Agreement. Notwithstanding the foregoing, with respect to
Named Executive Officers who retire during a Performance Period, payments shall
be made at the same time as payments are made to Participants who did not
terminate employment during the applicable Performance Period.
9.6 TERMINATION OF EMPLOYMENT FOR OTHER REASONS. In the event that a
Participant's employment terminates for any reason other than those reasons set
forth in Section 9.5 herein, all Performance Units/Shares shall be forfeited by
the Participant to the Company unless determined otherwise by the Committee, as
set forth in the Participant's Award Agreement.
9.7 NONTRANSFERABILITY. Except as otherwise provided in a
Participant's Award Agreement, Performance Units/Shares may not be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated, other
than by will or by the laws of descent and distribution. Further, except as
otherwise provided in a Participant's Award Agreement, a Participant's rights
under the Plan shall be exercisable during the Participant's lifetime only by
the Participant or the Participant's legal representative.
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ARTICLE 10. OTHER INCENTIVE AWARDS
10.1 GRANT OF OTHER INCENTIVE AWARDS. Subject to the terms and
provisions of the Plan, Other Incentive Awards may be granted to Participants
in such amount, upon such terms, and at any time and from time to time as shall
be determined by the Committee.
10.2 OTHER INCENTIVE AWARD AGREEMENT. Each Other Incentive Award grant
shall be evidenced by an Award Agreement that shall specify the amount of the
Other Incentive Award granted, the terms and conditions applicable to such
grant, the applicable Performance Period and performance goals, and such other
provisions as the Committee shall determine, subject to the terms and
provisions of the Plan.
10.3 NONTRANSFERABILITY. Except as otherwise provided in a
Participant's Award Agreement, Other Incentive Awards may not be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated, other
than by will or by the laws of descent and distribution.
10.4 FORM AND TIMING OF PAYMENT OF OTHER INCENTIVE AWARDS. Payment of
Other Incentive Awards shall be made at such times and in such form, in cash,
in Shares, or in Restricted Shares (or a combination thereof), as established
by the Committee subject to the terms of the Plan. Such Shares may be granted
subject to any restrictions deemed appropriate by the Committee. Without
limiting the generality of the foregoing, annual incentive awards may be paid
in the form of Shares and/or Other Incentive Awards (which may or may not be
subject to restrictions, at the discretion of the Committee).
ARTICLE 11. PERFORMANCE MEASURES
Unless and until the Committee proposes for shareholder vote and
shareholders approve a change in the general performance measures set forth in
this Article 11, the attainment of which may determine the degree of payout
and/or vesting with respect to Awards to Named Executive Officers which are
designed to qualify for the Performance-Based Exception, the performance
measure(s) to be used for purposes of such grants shall be chosen from among
the following alternatives, as reported on the Company's annual 10-k report:
(a) Return on Assets ("ROA") which equals net income divided by total
assets.
(b) Return on Sales ("ROS") which equals net income divided by net
sales.
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(c) Return on Equity ("ROE") which equals net income divided by total
equity.
(d) Cash Flow Return on Investment ("CFROI") which equals net cash
flows divided by owners equity.
(e) Operating Income.
(f) Earnings Before Income Taxes ("EBIT") which equals net income plus
taxes.
(g) Net Earnings which equals net earnings as reported.
(h) Earnings Per Share.
The Committee shall have the discretion to adjust the determinations
of the degree of attainment of the preestablished performance goals; provided,
however, that Awards which are designed to qualify for the Performance-Based
Exception, and which are held by Named Executive Officers, may not be adjusted
upward (the Committee shall retain the discretion to adjust such Awards
downward).
In the event that applicable tax and/or securities laws change to
permit Committee discretion to alter the governing performance measures without
obtaining shareholder approval of such changes, the Committee shall have sole
discretion to make such changes without obtaining shareholder approval. In
addition, in the event that the Committee determines that it is advisable to
grant Awards which shall not qualify for the Performance-Based Exception, the
Committee may make such grants without satisfying the requirements of Code
Section 162(m) and, thus, which use performance measures other than those
specified above. To the extent that the Committee determines that it is
advisable to grant Awards in compliance with the Performance-Based Exception,
the Committee must certify, in writing, prior to the payment of any
compensation under the Award, that the performance goals and any other material
terms were in fact satisfied.
ARTICLE 12. BENEFICIARY DESIGNATION
Each Participant under the Plan may, from time to time, name any
beneficiary or beneficiaries (who may be named contingently or successively) to
whom any benefit under the Plan is to be paid in case of his or her death
before he or she receives any or all of such benefit. Each such designation
shall revoke all prior designations by the same Participant, shall be in a form
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prescribed by the Company, and will be effective only when filed by the
Participant in writing with the Company during the Participant's lifetime. In
the absence of any such designation, benefits remaining unpaid at the
Participant's death shall be paid to the Participant's estate.
ARTICLE 13. DEFERRALS
The Committee may permit a Participant to defer such Participant's
receipt of the payment of cash or the delivery of Shares that would otherwise
be due to such Participant by virtue of the exercise of an Option or SAR, the
lapse or waiver of restrictions with respect to Restricted Stock, or the
satisfaction of any requirements or goals with respect to Performance
Units/Shares or Other Incentive Awards. If any such deferral election is
required or permitted, the Committee shall, in its sole discretion, establish
rules and procedures for such payment deferrals.
ARTICLE 14. RIGHTS OF EMPLOYEES
14.1 EMPLOYMENT. Nothing in the Plan shall interfere with or limit in
any way the right of the Company to terminate any Participant's employment at
any time, nor confer upon any Participant any right to continue in the employ
of the Company.
14.2 PARTICIPATION. No Employee shall have the right to be selected to
receive an Award under this Plan, or, having been so selected, to be selected
to receive a future Award.
ARTICLE 15. CHANGE IN CONTROL
15.1 TREATMENT OF OUTSTANDING AWARDS. Upon the occurrence of a Change
in Control, unless otherwise specifically prohibited under applicable laws, or
by the rules and regulations of any governing governmental agencies or national
securities exchanges:
(a) Any and all Options, Director Options and SARs granted hereunder
shall become immediately exercisable, and shall remain exercisable
throughout their entire term, and any cash or property received
upon exercise of any Option or SAR shall be free from further
restriction;
(b) Any restriction periods and restrictions imposed on Restricted
Shares shall lapse; and
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(c) Unless otherwise specified in Participant's Award Agreement at
time of grant, the target payout opportunities attainable under
all outstanding Awards of Performance Units and Performance Shares
and Other Incentive Awards shall be deemed to have been fully
earned for the entire Performance Period(s) as of the effective
date of the Change in Control. The vesting of all such Awards
shall be accelerated as of the effective date of the Change in
Control, and in full settlement of such Awards, there shall be
paid out to Participants (in Shares for Awards normally paid in
Shares and in cash for Awards normally paid in cash) within thirty
(30) days following the effective date of the Change in Control a
pro rata portion of all targeted Award opportunities associated
with such outstanding Awards, based on the number of complete and
partial calendar months within the Performance Period which had
elapsed as of such effective date.
15.2 TERMINATION, AMENDMENT, AND MODIFICATIONS OF CHANGE-IN-CONTROL
PROVISIONS. Notwithstanding any other provision of this Plan or any Award
Agreement provision, the provisions of this Article 15 may not be terminated,
amended, or modified to affect adversely any Award or Director Option
theretofore granted under the Plan without the prior written consent of the
Participant or Eligible Director with respect to said Participant's or Eligible
Director's outstanding Awards or Director Options.
ARTICLE 16. AMENDMENT, MODIFICATION, AND TERMINATION
16.1 AMENDMENT, MODIFICATION, AND TERMINATION. The Board may at any
time and from time to time alter, amend, suspend or terminate the Plan in whole
or in part, provided that no amendment may be made to Section 6.9 or any other
provision of the Plan relating to Director Options within six months of the
last date on which any such provision was amended, other than to comport with
changes in the Code or the rules thereunder. The Committee shall not have the
authority to cancel outstanding Awards and issue substitute Awards in
replacement thereof.
16.2 AWARDS PREVIOUSLY GRANTED. No termination, amendment, or
modification of the Plan shall adversely affect in any material way any Award
previously granted under the Plan, without the written consent of the
Participant holding such Award.
16.3 COMPLIANCE WITH CODE SECTION 162(m). At all times when Code
Section 162(m) is applicable, all Awards granted under this Plan shall comply
with the requirements of Code Section
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<PAGE> 22
162(m); provided, however, that in the event the Committee determines that such
compliance is not desired with respect to any Award or Awards available for
grant under the Plan, then compliance with Code Section 162(m) will not be
required. In addition, in the event that changes are made to Code Section
162(m) to permit greater flexibility with respect to any Award or Awards
available under the Plan, the Committee may, subject to this Article 16, make
any adjustments it deems appropriate.
ARTICLE 17. WITHHOLDING
17.1 TAX WITHHOLDING. The Company shall have the power and the right
to deduct or withhold, or require a Participant or Eligible Director to remit
to the Company, an amount sufficient to satisfy federal, state, and local
taxes, domestic or foreign, required by law or regulation to be withheld with
respect to any taxable event arising as a result of this Plan.
17.2 SHARE WITHHOLDING. With respect to withholding required upon the
exercise of Options, Director Options or SARs, upon the lapse of restrictions
on Restricted Stock, or upon any other taxable event arising as a result of
Awards granted hereunder, Participants or Eligible Directors may elect, subject
to the approval of the Committee, to satisfy the withholding requirement, in
whole or in part, by having the Company withhold Shares having a Fair Market
Value on the date the tax is to be determined equal to the minimum statutory
total tax which could be imposed on the transaction. All such elections shall
be irrevocable, made in writing, signed by the Participant or Eligible
Director, and shall be subject to any restrictions or limitations that the
Committee, in its sole discretion, deems appropriate.
ARTICLE 18. INDEMNIFICATION
Each person who is or shall have been a member of the Committee, or of
the Board, shall be indemnified by the Company against and from any loss, cost,
liability, or expense that may be imposed upon or reasonably incurred by him or
her in connection with or resulting from any claim, action, suit, or proceeding
to which he or she may be a party or in which he or she may be involved by
reason of any action taken or failure to act under the Plan. Such person shall
be indemnified by the Company for all amounts paid by him or her in settlement
thereof, with the Company's approval, or paid by him or her in satisfaction of
any judgment in any such action, suit, or proceeding against him or her,
provided he or she shall give the Company an opportunity, at its own expense,
to handle and defend
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<PAGE> 23
the same before he or she undertakes to handle and defend it on his or her own
behalf. The foregoing right of indemnification shall not be exclusive of any
other rights of indemnification to which such persons may be entitled under the
Company's Articles of Incorporation or Bylaws, as a matter of law, or otherwise,
or any power that the Company may have to indemnify them or hold them harmless.
ARTICLE 19. SUCCESSORS
All obligations of the Company under the Plan with respect to Awards
or Director Options granted hereunder shall be binding on any successor to the
Company, whether the existence of such successor is the result of a direct or
indirect purchase, merger, consolidation, or otherwise, of all or substantially
all of the business and/or assets of the Company.
ARTICLE 20. LEGAL CONSTRUCTION
20.1 GENDER AND NUMBER. Except where otherwise indicated by the
context, any masculine term used herein also shall include the feminine, the
plural shall include the singular, and the singular shall include the plural.
20.2 SEVERABILITY. In the event any provision of the Plan shall be
held illegal or invalid for any reason, the illegality or invalidity shall not
affect the remaining parts of the Plan, and the Plan shall be construed and
enforced as if the illegal or invalid provision had not been included.
20.3 REQUIREMENTS OF LAW. The granting of Awards or Director Options
and the issuance of Shares under the Plan shall be subject to all applicable
laws, rules, and regulations, and to such approvals by any governmental
agencies or national securities exchanges as may be required.
20.4 GOVERNING LAW. To the extent not preempted by federal law, the
Plan, and all agreements hereunder, shall be construed in accordance with and
governed by the laws of the State of Delaware.
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<PAGE> 1
Exhibit 5
Opinion of Vorys, Sater, Seymour and Pease,
Counsel to Registrant
81
<PAGE> 2
(614) 464-6400
June 13, 1997
Board of Directors
Core Materials Corporation
800 Manor Park Drive
P.O. Box 28183
Columbus, Ohio 43228-0183
Gentlemen:
We are familiar with the proceedings taken and proposed to be
taken by Core Materials Corporation (the "Company") in connection with the
registration for issuance and sale of shares of common stock of the Company,
par value $.01 per share, (the "Common Stock") under the Company's Long-Term
Equity Incentive Plan (the "Plan"), as described in the Registration Statement
on Form S-8 (the "Registration Statement") to be filed with the Securities and
Exchange Commission on or about June 13, 1997. The purpose of the Registration
Statement is to register an additional 1,500,000 shares of Common Stock
reserved for issuance under the Plan pursuant to the provisions of the
Securities Act of 1933, as amended, and the rules and regulations promulgated
thereunder.
In connection with this opinion, we have examined an original
or copy of, and have relied upon the accuracy of, without independent
verification or investigation: (a) the Registration Statement; (b) the Plan;
(c) the Certificate of Incorporation of the Company, as amended through
November 6, 1996; (d) the By-Laws of the Company; and (e) certain proceedings
of the directors and of the stockholders of the Company. We have also relied
upon such representations of the Company and officers of the Company and such
authorities of law as we have deemed relevant as a basis for this opinion.
We have relied solely upon the examinations and inquiries
recited herein, and we have not undertaken any independent investigation to
determine the existence or absence
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<PAGE> 3
of any facts, and no inference as to our knowledge concerning such facts
should be drawn.
Based upon and subject to the foregoing and the further
qualifications and limitations set forth below, as of the date hereof, we are
of the opinion that after the 1,500,000 shares of Common Stock of the Company
to be registered under the Registration Statement have been issued and
delivered by the Company upon the exercise of options under the Plan against
payment of the purchase price therefor, against settlement of Performance
Awards granted under the Plan, upon the exercise of Stock Appreciation Rights
under the Plan, and upon grant of Restricted Stock under the Plan, in each case
in accordance with the terms of the Plan, said shares of Common Stock will be
validly issued, fully paid and non-assessable, assuming compliance with
applicable federal and state securities laws and with the transfer restrictions
contained in the Company's Certificate of Incorporation, as amended through
November 6, 1996.
Our opinion is limited to the General Corporation Law of
Delaware in effect as of the date hereof. This opinion is furnished by us
solely for the benefit of the Company in connection with the offering of the
shares of Common Stock pursuant to the Plan and the filing of the Registration
Statement and any amendments thereto. This opinion may not be relied upon by
any other person or assigned, quoted or otherwise used without our specific
written consent.
Notwithstanding the foregoing, we consent to the filing of
this opinion as an exhibit to the Registration Statement and to the reference
to us therein.
Very truly yours,
/s/ Vorys, Sater, Seymour and Pease
-----------------------------------
VORYS, SATER, SEYMOUR AND PEASE
83
<PAGE> 1
Exhibit 23(a)
Consent of Deloitte & Touche LLP,
Independent Auditors to Registrant
84
<PAGE> 2
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Core Materials Corporation on Form S-8 of our report dated March 21, 1997,
appearing in the Annual Report on Form 10-K of Core Materials Corporation for
the year ended December 31, 1996.
/s/ Deloitte & Touche LLP
- -------------------------
Deloitte & Touche LLP
Chicago, Illinois
May 29, 1997
85
<PAGE> 1
Exhibit 24
Powers of Attorney
86
<PAGE> 2
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned officer
and/or director of Core Materials Corporation (the "Company"), a Delaware
corporation, which is about to file with the Securities and Exchange Commission,
Washington, D.C., under the provisions of the Securities Act of 1933, as
amended, a Registration Statement on Form S-8 for the registration of certain of
its common shares for offering and sale pursuant to the Core Materials
Corporation Long-Term Equity Incentive Plan, hereby constitutes and appoints
Kevin L. Barnett and Kenneth M. Schmell, and each of them, as his true and
lawful attorneys-in-fact and agents with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign such Registration Statement and any and all amendments
thereto, and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission and the
American Stock Exchange, granting unto each of said attorneys-in-fact, and
substitute or substitutes, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all things that each of said
attorneys-in-fact and agents, or his or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
this 19th day of May, 1997.
/s/ KEVIN L. BARNETT
---------------------
Kevin L. Barnett
87
<PAGE> 3
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned officer
and/or director of Core Materials Corporation (the "Company"), a Delaware
corporation, which is about to file with the Securities and Exchange
Commission, Washington, D.C., under the provisions of the Securities Act of
1933, as amended, a Registration Statement on Form S-8 for the registration of
certain of its common shares for offering and sale pursuant to the Core
Materials Corporation Long-Term Equity Incentive Plan, hereby constitutes and
appoints Kevin L. Barnett and Kenneth M. Schmell, and each of them, as his true
and lawful attorneys-in-fact and agents with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign such Registration Statement and any and all amendments
thereto, and to file the same, with all exhibits thereto, and other documents
in connection therewith, with the Securities and Exchange Commission and the
American Stock Exchange, granting unto each of said attorneys-in-fact, and
substitute or substitutes, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all things that each of said
attorneys-in-fact and agents, or his or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
this 20th day of May, 1997.
/s/ KENNETH M. SCHMELL
----------------------
Kenneth M. Schmell
88
<PAGE> 4
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned officer
and/or director of Core Materials Corporation (the "Company"), a Delaware
corporation, which is about to file with the Securities and Exchange
Commission, Washington, D.C., under the provisions of the Securities Act of
1933, as amended, a Registration Statement on Form S-8 for the registration of
certain of its common shares for offering and sale pursuant to the Core
Materials Corporation Long-Term Equity Incentive Plan, hereby constitutes and
appoints Kevin L. Barnett and Kenneth M. Schmell, and each of them, as his true
and lawful attorneys-in-fact and agents with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign such Registration Statement and any and all amendments
thereto, and to file the same, with all exhibits thereto, and other documents
in connection therewith, with the Securities and Exchange Commission and the
American Stock Exchange, granting unto each of said attorneys-in-fact, and
substitute or substitutes, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all things that each of said
attorneys-in-fact and agents, or his or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
this 19th day of May, 1997.
/s/ GERALD L. VOIROL
--------------------
Gerald L. Voirol
89
<PAGE> 5
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned officer
and/or director of Core Materials Corporation (the "Company"), a Delaware
corporation, which is about to file with the Securities and Exchange
Commission, Washington, D.C., under the provisions of the Securities Act of
1933, as amended, a Registration Statement on Form S-8 for the registration of
certain of its common shares for offering and sale pursuant to the Core
Materials Corporation Long-Term Equity Incentive Plan, hereby constitutes and
appoints Kevin L. Barnett and Kenneth M. Schmell, and each of them, as his true
and lawful attorneys-in-fact and agents with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign such Registration Statement and any and all amendments
thereto, and to file the same, with all exhibits thereto, and other documents
in connection therewith, with the Securities and Exchange Commission and the
American Stock Exchange, granting unto each of said attorneys-in-fact, and
substitute or substitutes, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all things that each of said
attorneys-in-fact and agents, or his or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
this 16th day of May, 1997.
/s/ RICHARD R. CONTE
--------------------
Richard R. Conte
90
<PAGE> 6
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned officer
and/or director of Core Materials Corporation (the "Company"), a Delaware
corporation, which is about to file with the Securities and Exchange
Commission, Washington, D.C., under the provisions of the Securities Act of
1933, as amended, a Registration Statement on Form S-8 for the registration of
certain of its common shares for offering and sale pursuant to the Core
Materials Corporation Long-Term Equity Incentive Plan, hereby constitutes and
appoints Kevin L. Barnett and Kenneth M. Schmell, and each of them, as his true
and lawful attorneys-in-fact and agents with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign such Registration Statement and any and all amendments
thereto, and to file the same, with all exhibits thereto, and other documents
in connection therewith, with the Securities and Exchange Commission and the
American Stock Exchange, granting unto each of said attorneys-in-fact, and
substitute or substitutes, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all things that each of said
attorneys-in-fact and agents, or his or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
this 16th day of May, 1997.
/s/ RALPH O. HELLMOLD
----------------------
Ralph O. Hellmold
91
<PAGE> 7
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned officer
and/or director of Core Materials Corporation (the "Company"), a Delaware
corporation, which is about to file with the Securities and Exchange
Commission, Washington, D.C., under the provisions of the Securities Act of
1933, as amended, a Registration Statement on Form S-8 for the registration of
certain of its common shares for offering and sale pursuant to the Core
Materials Corporation Long-Term Equity Incentive Plan, hereby constitutes and
appoints Kevin L. Barnett and Kenneth M. Schmell, and each of them, as his true
and lawful attorneys-in-fact and agents with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign such Registration Statement and any and all amendments
thereto, and to file the same, with all exhibits thereto, and other documents
in connection therewith, with the Securities and Exchange Commission and the
American Stock Exchange, granting unto each of said attorneys-in-fact, and
substitute or substitutes, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all things that each of said
attorneys-in-fact and agents, or his or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
this 16th day of May, 1997.
/s/ THOMAS M. HOUGH
-------------------
Thomas M. Hough
92
<PAGE> 8
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned officer
and/or director of Core Materials Corporation (the "Company"), a Delaware
corporation, which is about to file with the Securities and Exchange
Commission, Washington, D.C., under the provisions of the Securities Act of
1933, as amended, a Registration Statement on Form S-8 for the registration of
certain of its common shares for offering and sale pursuant to the Core
Materials Corporation Long-Term Equity Incentive Plan, hereby constitutes and
appoints Kevin L. Barnett and Kenneth M. Schmell, and each of them, as his true
and lawful attorneys-in-fact and agents with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign such Registration Statement and any and all amendments
thereto, and to file the same, with all exhibits thereto, and other documents
in connection therewith, with the Securities and Exchange Commission and the
American Stock Exchange, granting unto each of said attorneys-in-fact, and
substitute or substitutes, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all things that each of said
attorneys-in-fact and agents, or his or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
this 16th day of May, 1997.
/s/ MALCOLM M. PRINE
--------------------
Malcolm M. Prine
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<PAGE> 9
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned officer
and/or director of Core Materials Corporation (the "Company"), a Delaware
corporation, which is about to file with the Securities and Exchange
Commission, Washington, D.C., under the provisions of the Securities Act of
1933, as amended, a Registration Statement on Form S-8 for the registration of
certain of its common shares for offering and sale pursuant to the Core
Materials Corporation Long-Term Equity Incentive Plan, hereby constitutes and
appoints Kevin L. Barnett and Kenneth M. Schmell, and each of them, as his true
and lawful attorneys-in-fact and agents with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign such Registration Statement and any and all amendments
thereto, and to file the same, with all exhibits thereto, and other documents
in connection therewith, with the Securities and Exchange Commission and the
American Stock Exchange, granting unto each of said attorneys-in-fact, and
substitute or substitutes, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all things that each of said
attorneys-in-fact and agents, or his or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand
this 16th day of May, 1997.
/s/ THOMAS E. RIGSBY
---------------------
Thomas E. Rigsby
94
