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As filed with the Securities and Exchange Commission on June 19, 1997.
Registration No. 333-_____
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
WHG RESORTS & CASINOS INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 36-3277019
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
6063 EAST ISLA VERDE AVENUE
CAROLINA, PUERTO RICO 00979
(787) 791-2222
(Address, including zip code, and telephone number,
including area code, of Registrant's principal executive offices)
---------------
1997 STOCK OPTION PLAN
(Full title of the plan)
---------------
PAMELA E. FLAHERTY, ESQ.
SHACK & SIEGEL, P.C.
530 FIFTH AVENUE
NEW YORK, NEW YORK 10036
(212) 782-0700
(Name and address, including zip code, and
telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
===================================================================================================================================
TITLE OF SECURITIES AMOUNT TO BE PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TO BE REGISTERED REGISTERED(1) OFFERING PRICE PER SHARE AGGREGATE OFFERING PRICE REGISTRATION FEE
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Voting Common Stock, 900,000 shares 857,000 shares at $8.375(2) $7,651,500(4) $2,318.64
par value $.01 per share 40,000 shares at $11.00(2)
3,000 shares at $11.375(3)
===================================================================================================================================
</TABLE>
(1) Pursuant to Rule 416 under the Securities Act of 1933, as amended, the
number of shares of the issuer's Voting Common Stock registered hereunder
will be adjusted in the event of stock splits, stock dividends or similar
transactions.
(2) Based on the price at which outstanding options to purchase Voting Common
Stock may be exercised.
(3) Based on the average of the high and low prices of the Registrant's Voting
Common Stock reported on the New York Stock Exchange on June 13, 1997.
(4) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) and 457(h) on the basis of the price at which
outstanding options to purchase Voting Common Stock may be exercised under
the plan and the average of the high and low prices of the Registrant's
Voting Common Stock reported on the New York Stock Exchange on June 13,
1997 for options to purchase Voting Common Stock not yet granted under the
plan.
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PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The documents containing the information specified by this Part I will
be sent or given to eligible participants as specified by Rule 428(b)(1)
promulgated under the Securities Act of 1933, as amended (the "Securities Act"),
and are not being filed with the Securities and Exchange Commission (the
"Commission") either as part of this Registration Statement or as prospectuses
or prospectus supplements pursuant to Rule 424. These documents and the
documents incorporated by reference in this Registration Statement pursuant to
Item 3 of Part II herein, taken together, constitute a prospectus that meets the
requirements of Section 10(a) of the Securities Act.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The Registrant's Quarterly Report on From 10-Q for the fiscal quarter
ending March 31, 1997, the Information Statement dated April 15, 1997 contained
in the Registration Statement on Form 10 (the "Form 10") (File No. 1-12783), as
filed with the Commission pursuant to the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and the information under the caption "Description
of the Company's Capital Stock" with respect to the Registrant's voting common
stock, par value $.01 per share (the "Common Stock"), contained in the Form 10,
are incorporated herein by reference and made a part of this Registration
Statement as of the date hereof.
All reports subsequently filed by the Registrant pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act after the effective date of this
Registration Statement and prior to the termination of the offering of the
Common Stock offered hereby shall be deemed to be incorporated by reference into
this Registration Statement and to be a part hereof from the date of filing of
such reports. Any statement contained herein or in a document incorporated or
deemed to be incorporated by reference herein shall be deemed to be modified or
superseded for purposes of this Registration Statement to the extent that a
statement contained herein or in any document which is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Registration Statement.
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ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The legality of the issuance of the shares of Common Stock offered
hereby will be passed upon for the Registrant by Shack & Siegel, P.C., 530 Fifth
Avenue, New York, New York 10036. Shareholders of Shack & Siegel, P.C., hold
options to purchase 20,000 shares of the Registrant's Common Stock at an
exercise price of $8.375 per share.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Registrant's authority to indemnify its officers and directors is
governed by the provisions of Section 145 of the General Corporation Law of the
State of Delaware (the "DGCL"), by the Amended and Restated Bylaws of the
Registrant (the "Bylaws") and by the Amended and Restated Certificate of
Incorporation of the Registrant (the "Certificate of Incorporation").
Article Eleventh of the Certificate of Incorporation of the Registrant
protects directors against monetary damages for breaches of their fiduciary duty
of care, except as set forth below. Under the DGCL, absent Article Eleventh,
directors could generally be held liable for gross negligence for decisions made
in the performance of their duty of care but not for simple negligence. Article
Eleventh eliminates director liability for negligence in the performance of
their duties. Directors remain liable for breaches of their duty of loyalty to
the Registrant and its stockholders, as well as for acts or omissions not in
good faith or which involve intentional misconduct or a knowing violation of law
and transactions from which a director derives improper personal benefit.
Article Eleventh does not eliminate director liability under Section 174 of the
DGCL, which makes directors personal liable for unlawful dividends or unlawful
stock repurchases or redemptions and expressly sets forth a negligence standard
with respect to such liability.
While Article Eleventh provides directors with protection from awards
of monetary damages for breaches of the duty of care, it does not eliminate a
director's duty of care. Accordingly, Article Eleventh will have no effect on
the availability of equitable remedies such as an injunction or rescission based
upon a director's breach of the duty of care. The provisions of Article Eleventh
which eliminate liability as described above will apply to officers of the
Registrant only if they are directors of the Registrant and are acting in their
capacity as directors, and will not apply to officers of the Registrant who are
not directors. The elimination of liability of directors for monetary damages in
the circumstances described above may deter persons from bringing third-party or
derivative actions against directors to the extent such actions seek monetary
damages.
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Under Section 145 of the DGCL, directors and officers as well as other
employees and individuals may be indemnified against expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement in connection
with specified actions, suits or proceedings, whether civil, criminal,
administrative or investigative (other than an action by or in the right of the
corporation (a "derivative action")) if they acted in good faith and in a manner
they reasonably believed to be in or not opposed to the best interests of the
Registrant, and with respect to any criminal action or proceeding, had no
reasonable cause to believe their conduct was unlawful. A similar standard of
care is applicable in the case of derivative actions, except that
indemnification only extends to expenses (including attorneys' fees) incurred in
connection with defense or settlement of such an action and the DGCL requires
court approval before there can be any indemnification where the person seeking
indemnification has been found liable to the Registrant.
Section 4 of Article V of the Bylaws provides that the Registrant shall
indemnify any person to whom, and to the extent, indemnification may be granted
pursuant to Section 145 of the DGCL.
Article Twelfth of the Certificate of Incorporation provides that each
person who was or is made a party to, or is involved in any action, suit or
proceeding by reason of the fact that he is or was a director, officer or
employee of the Registrant will be indemnified by the Registrant against all
expenses and liabilities (including attorneys' fees) reasonably incurred by or
imposed upon him, except in such case where the director, officer or employee is
adjudged guilty of willful misfeasance or malfeasance in the performance of his
duties. Article Twelfth also provides that the right of indemnification shall be
in addition to and not exclusive of all other rights to which such director,
officer or employee may be granted.
The Registrant has entered into indemnity agreements with each of its
directors and executive officers whereby the Registrant will, in general,
indemnify such directors and executive officers, to the extent permitted by the
DGCL, against any expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement incurred in connection with any actual or threatened
action or proceeding to which such director or officer is made or threatened to
be made a party by reason of the fact that such person is or was a director or
officer of the Registrant.
The Registrant also maintains directors' and officers' liability
insurance providing for $10 million in coverage.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
3
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ITEM 8. EXHIBITS.
Exhibit Number Decription
- -------------- ----------
4.1 1997 Stock Option Plan.
4.2 Form of Option Agreement under the 1997 Stock Option Plan.
5 Opinion of Shack & Siegel, P.C., counsel for Registrant.
23.1 Consent of Shack & Siegel, P.C. (contained in the Opinion
filed as Exhibit 5 hereto).
23.2 Consent of Ernst & Young LLP.
24 Power of Attorney (contained on the signature page hereof).
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. Notwithstanding the foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of securities offered would not
exceed that which was registered) and any deviation from the low or high and of
the estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration Fee"
table in the effective registration statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
registration statement is on Form S-3, Form S-8 or Form F-3, and the information
required to be included
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in a post-effective amendment by those paragraphs is contained in periodic
reports filed with or furnished to the Commission by the registrant pursuant to
Section l3 or 15(d) of the Securities Exchange Act of 1934 that are incorporated
by reference in the registration statement.
(2) That, for the purpose of determining 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 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
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 foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the 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.
5
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SIGNATURES
Pursuant to the requirements of the Securities Act, 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 Palm Beach, State of Florida on this 19th day of
June, 1997.
WHG RESORTS & CASINOS INC.
(Registrant)
By: /s/ Louis J. Nicastro
-------------------------------------------------
Louis J. Nicastro
Chairman of the Board and Chief Executive Officer
POWER OF ATTORNEY
Each person whose signature to this Registration Statement appears
below hereby appoints Louis J. Nicastro and Richard F. Johnson, and each of them
acting singly, as his attorney-in-fact, to sign in his behalf individually and
in the capacity stated below and to file all amendments and post-effective
amendments to this Registration Statement, which amendment or amendments may
make such changes and additions to this Registration Statement as such
attorney-in-fact may deem necessary or appropriate.
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed by the following persons in the capacity and on the
dates indicated.
SIGNATURE DATE CAPACITY IN WHICH SIGNED
--------- ---- ------------------------
/s/ Louis J. Nicastro June 19, 1997 Chairman of the Board, Chief
- --------------------------- Executive Officer and Director
Louis J. Nicastro (Principal Executive Officer)
/s/ George R. Baker June 19, 1997 Vice Chairman and Director
- ---------------------------
George R. Baker
/s/ Brian R. Gamache June 19, 1997 President and Chief Operating
- --------------------------- Officer and Director
Brian R. Gamache
/s/ Richard F. Johnson June 19, 1997 Treasurer and Chief Financial
- --------------------------- Officer (Principal Financial and
Richard F. Johnson Accounting Officer)
/s/ Barbara M. Norman June 19, 1997 Vice President, Secretary
- --------------------------- General Counsel and Director
Barbara M. Norman
/s/ David M. Satz, Jr. June 19, 1997 Director
- ---------------------------
David M. Satz, Jr.
/s/ Joseph A. Lamendella June 19, 1997 Director
- ---------------------------
Joseph A. Lamendella
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EXHIBIT INDEX
Exhibit Number Description
- -------------- -----------
4.1 1997 Stock Option Plan.
4.2 Form of Option Agreement under the 1997 Stock Option Plan.
5 Opinion of Shack & Siegel, P.C., counsel for Registrant.
23.1 Consent of Shack & Siegel, P.C. (contained in the Opinion
filed as Exhibit 5 hereto).
23.2 Consent of Ernst & Young LLP.
24 Power of Attorney (contained on the signature page hereof).
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WHG RESORTS & CASINOS INC.
1997 STOCK OPTION PLAN
ARTICLE I
PURPOSE OF THE PLAN
The 1997 Stock Option Plan (the 'Plan') is intended to provide a method
whereby 'Employees,' 'Directors' and 'Consultants and Advisers' of WHG Resorts &
Casinos Inc. (the 'Company') and its 'Subsidiaries' (as such quoted terms are
hereinafter defined) may be encouraged to acquire a proprietary interest in the
Company and whereby such individuals may realize benefits from an increase in
the value of the shares of Voting Common Stock, $0.01 par value per share (the
'Common Stock'), of the Company; to encourage and provide such Employees,
Directors and Consultants and Advisers with greater incentive and to encourage
their continued provision of services to the Company; and, generally, to promote
the interests of the Company and all of its stockholders. Under the Plan, from
time to time on or before March 19, 2007, options to purchase shares of Common
Stock and related Stock Appreciation Rights may be granted to such persons as
may be selected in the manner hereinafter provided on the terms and subject to
the conditions hereinafter set forth. Capitalized terms are defined in Article
XV hereof.
ARTICLE II
ADMINISTRATION OF THE PLAN
SECTION 1. Subject to the authority as described herein of the Board of
Directors (the 'Board') of the Company, the Plan shall be administered by the
Compensation Committee of the Company's Board of Directors (the 'Committee')
which is composed of at least two members of the Board who are Non-Employee
Directors. The Committee is authorized to interpret the Plan and may from time
to time adopt such rules and regulations for carrying out the Plan as it may
deem best. All determinations by the Committee shall be made by the affirmative
vote of a majority of its members but any determination reduced to writing and
signed by a majority of its members shall be fully enforceable and effective as
if it had been made by a majority vote at a meeting duly called and held.
Subject to any applicable provisions of the Plan, all determinations by the
Committee or by the Board pursuant to the provisions of the Plan, and all
related orders or resolutions of the Committee or the Board, shall be final,
conclusive and binding on all Persons, including the Company and its
stockholders, employees, directors and optionees.
SECTION 2. All authority delegated to the Committee pursuant to the Plan,
may also be exercised by the Board except with respect to matters which under
Rule 16b-3 and Section 16 of the 1934 Act or Section 162(m) of the Code are
required to be determined in the absolute discretion of the Committee. Subject
to the foregoing, in the event of any conflict or inconsistency between
determinations, orders, resolutions or other actions of the Committee and the
Board, the actions of the Board shall control.
SECTION 3. With respect to Section 16 of the 1934 Act, transactions under
the Plan are intended to comply with all applicable conditions of Rule 16b-3 or
its successors under the 1934 Act. To the extent any provision of the Plan or
action by the Committee fails to so comply, it shall be deemed null and void to
the extent permitted by law and deemed advisable by the Committee.
ARTICLE III
STOCK SUBJECT TO THE PLAN
SECTION 1. The shares to be issued or delivered upon exercise of options or
rights granted under the Plan shall be made available, at the discretion of the
Board, either from the authorized but unissued shares of Common Stock of the
Company or from shares of Common Stock reacquired by the Company, including
shares purchased by the Company in the open market or otherwise obtained.
SECTION 2. Subject to the provisions of Article X, the aggregate number of
shares of Common Stock which may be purchased pursuant to options granted at any
time under the Plan shall not exceed
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900,000. Such number shall be reduced by the aggregate number of shares covered
by options in respect of which Stock Appreciation Rights are exercised. The
maximum number of shares with respect to which options may be granted in any
calendar year to any one employee shall be 500,000 as such number may be
adjusted by the Committee in accordance with Article X hereof. The Committee
shall calculate such limit in a manner consistent with Section 162(m) of the
Code. Shares subject to any options which are canceled, lapse or are otherwise
terminated shall be immediately available for reissuance under the Plan.
ARTICLE IV
PURCHASE PRICE OF OPTIONED SHARES
Unless the Committee shall fix a greater or lesser purchase price, the
purchase price per share of Common Stock under each option granted to Employees,
Directors, Consultants and Advisers shall not be less than one hundred percent
(100%) of the Fair Market Value (as hereinafter defined) of the Common Stock at
the time such option is granted, but in no case shall such price be less than
the par value of the Common Stock or 85% of the Fair Market Value of the Common
Stock as of the time of grant; provided, however, that in the case of an
Incentive Stock Option granted to an Employee who, at the time of the grant,
owns stock possessing more than ten percent (10%) of the total combined voting
power of all classes of stock of the Company (a 'Ten Percent Stockholder'), such
purchase price per share shall be at least one hundred and ten percent (110%) of
the Fair Market Value.
ARTICLE V
ELIGIBILITY OF RECIPIENTS
Options will be granted only to Persons who are Employees, Directors,
Consultants or Advisers of the Company or a Subsidiary.
ARTICLE VI
DURATION OF THE PLAN
Unless previously terminated by the Committee or the Board, the Plan will
terminate on March 19, 2007. Such termination will not terminate any option or
Stock Appreciation Right then outstanding.
ARTICLE VII
GRANT OF OPTIONS TO EMPLOYEES,
DIRECTORS, CONSULTANTS AND ADVISERS
SECTION 1. Each option granted under the Plan to Employees shall constitute
either an Incentive Stock Option or a Non-Qualified Stock Option, as determined
in each case by the Committee and each option granted under the Plan to
Directors, Consultants and Advisers shall constitute a Non-Qualified Stock
Option. With respect to Incentive Stock Options granted to Employees, to the
extent that the aggregate Fair Market Value (determined at the time an option is
granted) of Common Stock of the Company with respect to which such Incentive
Stock Options are exercisable for the first time by any individual during any
calendar year (under the Plan and any other stock option plan of the Company)
exceeds $100,000, such Incentive Stock Options shall be treated as Non-Qualified
Stock Options to the extent of such excess. The foregoing rule shall be applied
by taking Incentive Stock Options into account in the order in which they were
granted. In the event outstanding Incentive Stock Options become immediately
exercisable under the terms hereof, such Incentive Stock Options will, to the
extent the aggregate Fair Market Value thereof exceeds $100,000, be treated as
Non-Qualified Stock Options.
SECTION 2. The Committee shall from time to time determine the Employees,
Directors, Consultants and Advisers to be granted options, it being understood
that options may be granted at different times to the same person, provided,
however, that no one person may receive an option or options under the Plan
covering more than fifty percent (50%) of the total number of shares subject to
the Plan. In addition, the Committee shall determine subject to the terms of the
Plan (a) the number of
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shares subject to each option, (b) the time or times when the options will be
granted, (c) whether such options shall be Incentive Stock Options,
Non-Qualified Stock Options or both, (d) whether Stock Appreciation Rights will
be granted in connection with the grant of options, (e) the purchase price of
the shares subject to each option, which price shall be not less than that
specified in Article IV, (f) the time or times when each option and any related
Stock Appreciation Rights may be exercised and (g) any other matters which the
Committee shall deem appropriate.
SECTION 3. All instruments evidencing options granted to Employees,
Directors, Consultants and Advisers under the Plan shall be in such form, which
shall be consistent with the Plan and any applicable determinations, orders,
resolutions or other actions of the Committee or the Board.
SECTION 4. The Committee, in its sole discretion, on the granting of an
option to an Employee, Director, Consultant or Adviser under the Plan may also
grant Stock Appreciation Rights relating to any number of shares but, except as
hereinafter provided, not more than fifty percent (50%) of the number of shares
covered by such option shall include Stock Appreciation Rights. Such options
shall be subject to such terms and conditions, not inconsistent with the Plan,
that the Committee shall impose, including the following:
(i) Stock Appreciation Rights may be granted only in writing and only
attached to an underlying option at the time of the grant of the option;
(ii) Stock Appreciation Rights may be exercised only at the time when
the option to which it is attached is exercisable;
(iii) Stock Appreciation Rights shall entitle the optionee (or any
person entitled to act under the provisions of the Plan) to surrender
unexercised all or part of the then exercisable portion of the option to
which the Stock Appreciation Rights are attached to the Company and to
receive from the Company in exchange therefor a payment in cash equal to
the excess, if any, of the then value of one share covered by such portion
over the option price per share specified in such option, multiplied by the
number of shares covered by the portion of the option so surrendered (which
excess is herein called the 'Appreciated Value'). For purposes of
computation of the Appreciated Value, the value of one share shall be
deemed to be the average Fair Market Value of such share during the
four-week period immediately preceding the date of notice of exercise of
the Stock Appreciation Rights;
(iv) if Stock Appreciation Rights attached to an option are exercised,
such option shall be deemed to have been canceled to the extent of the
number of shares surrendered on exercise of the Stock Appreciation Rights
and no further options may be granted covering such shares; and
(v) if an option to which Stock Appreciation Rights are attached is
exercised, such Stock Appreciation Rights shall be canceled to the extent
necessary to cause the number of shares to which such Stock Appreciation
Rights relate not to exceed the number of remaining shares subject to such
option.
ARTICLE VIII
NON-TRANSFERABILITY OF OPTIONS
No Incentive Stock Option or any related Stock Appreciation Rights granted
under the Plan shall be transferable by the optionee otherwise than by will or
by the laws of descent and distribution, and any such Incentive Stock Option or
any related Stock Appreciation Rights shall be exercised during the lifetime of
the optionee solely by him or her. Any Non-Qualified Stock Option granted under
the Plan may be transferable by the optionee to the extent specifically
permitted by the Committee as specified in the instrument evidencing the option
as the same may be amended from time to time. Except to the extent permitted by
such instrument, no Non-Qualified Stock Option shall be transferable except by
will or by the laws of descent and distribution.
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ARTICLE IX
EXERCISE OF OPTIONS
SECTION 1. Each option (and any related Stock Appreciation Rights) granted
under the Plan shall terminate on the date specified by the Committee which date
shall be not later than the expiration of ten years from the date on which it
was granted; provided, however, that in the case of an Incentive Stock Option
granted to an Employee who, at the time of the grant is a Ten Percent
Stockholder, such period shall not exceed five (5) years from the date of grant.
SECTION 2. Except to the extent otherwise provided in any instruments
evidencing an option and, if so specified in such instrument, in the cases
provided for in Article XII hereof, each option (and any related Stock
Appreciation Rights) granted under the Plan may be exercised only while the
optionee is an Employee or Director of the Company.
SECTION 3. A person electing to exercise an option or Stock Appreciation
Rights then exercisable shall give written notice to the Company of such
election and, if electing to exercise an option, of the number of shares of
Common Stock such person has elected to purchase. A person exercising an option
shall at the time of purchase tender the full purchase price of such shares,
which tender, except as provided in Section 4 of this Article IX, shall be made
in cash or cash equivalent (which may be such person's personal check) or, to
the extent permitted by applicable law, in shares of Common Stock already owned
by such person (which shares shall be valued for such purpose on the basis of
their Fair Market Value on the date of exercise), or in any combination thereof.
In the event of payment in shares of Common Stock already owned, such shares
shall be appropriately endorsed for transfer to the Company. The Company shall
have no obligation to deliver shares of Common Stock pursuant to the exercise of
any option, in whole or in part, until such payment in full of the purchase
price therefor is received by the Company. No optionee, or legal representative,
legatee, distributee or transferee of such optionee, shall be or be deemed to be
a holder of any shares of Common Stock subject to such option or entitled to any
rights of a stockholder of the Company in respect of any shares of Common Stock
covered by such option until such shares have been paid for in full and issued
or delivered by the Company.
SECTION 4. In order to assist an optionee in the exercise of an option
granted under the Plan, the Committee or Board may, in its discretion,
authorize, either at the time of the grant of the option or thereafter (a) the
extension of a loan to the optionee by the Company, (b) the payment by the
optionee of the purchase price of the Common Stock in installments, (c) the
guarantee by the Company of a loan obtained by the optionee from a third party
or (d) make such other reasonable arrangements to facilitate the exercise of
options in accordance with applicable law. The Committee or Board shall
authorize the terms of any such loan, installment payment arrangement or
guarantee, including the interest rate (which, in the case of incentive stock
options, shall be not less than the higher of (i) the 'prime rate' as from time
to time in effect at a commercial bank of recognized standing, and (ii) the rate
of interest from time to time imputed under Section 483 of the Code and terms of
repayment thereof, and shall cause the instrument evidencing any such option to
be amended, if required, to provide for any such extension of credit. Loans,
installment payment arrangements and guarantees may be authorized without
security, and the maximum amount of any such loan or guarantee shall be the
purchase price of the Common Stock being acquired, plus related interest
payments.
SECTION 5. Each option shall be subject to the requirement that if at any
time the Board shall in its discretion determine that the listing, registration
or qualification of the shares of Common Stock subject to such option upon any
securities exchange or under any state or Federal law, or the consent or
approval of any governmental regulatory body, is necessary or desirable as a
condition of or in connection with, the granting of such option or the issuance
or purchase of shares thereunder, such option may not be exercised in whole or
in part unless such listing, registration, qualification, consent or approval
shall have been effected or obtained free from any conditions not reasonably
acceptable to the Board. Unless at the time of exercise of an option and the
issuance of Common Stock so purchased, there shall be in effect as to such
Common Stock a registration statement under the Act, the holder of such option
shall deliver a certification (a) acknowledging that such shares of Common Stock
may be 'restricted securities' as defined in Rule 144 promulgated under the Act;
and (b) containing such optionee's agreement that such Common Stock may not be
sold or otherwise disposed of except in
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compliance with applicable provisions of the Act. In the event that the Common
Stock is then listed on a national securities exchange, the Company shall use
its best efforts to cause the listing of the shares of Common Stock subject to
options upon such exchange.
SECTION 6. All payments made by the Company pursuant to Section 4 of this
Article IX shall be subject to withholding in respect of such income or other
taxes as may be required by law to be paid or withheld. The Company may
establish appropriate procedures to provide for payment or withholding of such
income or other taxes as may be required by law to be paid or withheld in
connection with the exercise of options under the Plan, and to ensure that the
Company receives prompt advice concerning the occurrence of any event which may
create, or affect the timing or amount of, any obligation to pay or withhold any
such taxes or which may make available to the Company any tax deduction
resulting from the occurrence of such event.
ARTICLE X
ADJUSTMENTS
SECTION 1. New option rights may be substituted for the options granted
under the Plan, or the Company's duties as to options outstanding under the Plan
may be assumed, by a corporation other than the Company, or by a parent or
subsidiary of the Company or such corporation, in connection with any merger,
consolidation, acquisition, separation, reorganization, liquidation or other
similar corporate transaction in which the Company is involved. Notwithstanding
the foregoing or the provisions of this Article X, in the event such
corporation, or parent or subsidiary of the Company or such corporation, does
not substitute new option rights for, and substantially equivalent to, the
options granted hereunder, or assume the options granted hereunder, the options
granted hereunder shall terminate and thereupon become null and void (i) upon
dissolution or liquidation of the Company, or similar occurrence, (ii) upon any
merger, consolidation, acquisition, separation, reorganization, or similar
occurrence, where the Company will not be a surviving entity or (iii) upon a
transfer of substantially all of the assets of the Company or more than 80% of
the outstanding Common Stock in a single transaction; provided, however, that
each optionee shall have the right immediately prior to or concurrently with
such dissolution, liquidation, merger, consolidation, acquisition, separation,
reorganization or other similar corporate transaction, to exercise any unexpired
option granted hereunder whether or not then exercisable.
SECTION 2. In the event that the Committee determines that any dividend or
other distribution (whether in the form of cash, shares, other securities, or
other property), recapitalization, stock split, reverse stock split,
reorganization, merger, consolidation, split-up, spin-off, combination,
repurchase, or exchange of shares or other securities of the Company, issuance
of warrants or other rights to purchase shares or other securities of the
Company, or other corporate transaction or event affects the shares such that an
adjustment is determined by the Committee to be appropriate in order to prevent
dilution or enlargement of the benefits or potential benefits intended to be
made available under the Plan, then, the Committee shall, in such manner as it
may deem equitable, adjust any or all of (i) the number of shares of Common
Stock or other securities of the Company (or number and kind of other securities
or property) with respect to which options may be granted and any limitations
set forth in the Plan, (ii) the number of shares of Common Stock or other
securities of the Company (or number and kind of other securities or property)
subject to outstanding options and (iii) the grant or exercise or target price
with respect to any option or, if deemed appropriate, make provision for a cash
payment to the holder of an outstanding option including, if necessary, the
termination of such an option; provided, in each case, that with respect to
Incentive Stock Options no such adjustment shall be authorized to the extent
that such authority would cause the Plan to violate Section 422 of the Code.
Without limiting the generality of the foregoing, any such adjustment shall be
deemed to have prevented any dilution and enlargement of an optionee's rights if
such optionee receives in any such adjustment rights which are substantially
similar (after taking into account the fact that the optionee has not paid the
applicable exercise price) to the rights the optionee would have received had he
exercised his outstanding options and become a stockholder of the Company
immediately prior to the event giving rise to such adjustment.
SECTION 3. Adjustments and elections under this Article X shall be made by
the Committee whose determination as to what adjustments, if any, shall be made
and the extent thereof shall be final, binding
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and conclusive. Adjustments required under this Article X shall also be deemed
to increase by a like number the aggregate number of shares authorized for
purchase pursuant to options granted under the Plan as set forth in Section 2 of
Article III hereof.
ARTICLE XI
PRIVILEGES OF STOCK OWNERSHIP
No optionee shall be entitled to the privileges of stock ownership as to
any shares of Common Stock not actually issued and delivered to him or her.
ARTICLE XII
TERMINATION OF SERVICE OR EMPLOYMENT
SECTION 1. In the event that an optionee shall cease his or her
relationship with the Company or a Subsidiary by voluntarily terminating such
relationship without the written consent of the Company or a Subsidiary, or if
the Company or a Subsidiary shall terminate for cause such relationship, unless
otherwise provided in the instrument evidencing such option, the option and any
associated Stock Appreciation Rights held by such optionee shall terminate
forthwith.
SECTION 2. If the holder of an option shall voluntarily terminate his or
her relationship with the Company or a Subsidiary with the written consent of
the Company, which written consent expressly sets forth a statement to the
effect that options which are exercisable on the date of such termination shall
remain exercisable, or if the optionee's relationship with the Company or a
Subsidiary shall have terminated by the Company or a Subsidiary for reasons
other than cause, unless otherwise provided in the instrument evidencing such
option, such optionee may exercise his or her option to the extent exercisable
at the time of such termination, at any time prior to the expiration of three
months after such termination or the date of expiration of the option as fixed
at the time of grant, whichever shall first occur. Options granted under the
Plan to Employees shall not be affected by any change in the position of
employment so long as the holder thereof continues to be an Employee or a
Director.
SECTION 3. Should an optionee die during the existence of his or her
relationship with the Company, unless otherwise provided in the instrument
evidencing such option, all of the optionee's options shall be terminated except
that any option (and any related Stock Appreciation Rights) to the extent
exercisable by the optionee at the time of such death, may be exercised within
one year after the date of such death but not later than the expiration date of
the option solely in accordance with all of the terms and conditions of the Plan
by the optionee's personal representatives or by the person or persons to whom
the optionee's rights under the option shall pass by will or by the applicable
laws of descent and distribution.
SECTION 4. Should an optionee die after cessation of the optionee's
relationship with the Company or a Subsidiary, unless otherwise provided in the
instrument evidencing such option, all of the optionee's options shall be
terminated except that any option (and any related Stock Appreciation Rights) to
the extent exercisable by the optionee at the time of such death may be
exercised within one year after the date of such death but not later than the
expiration of the option solely in accordance with all of the terms and
conditions of the Plan by the optionee's personal representatives or by the
person or persons to whom the optionee's rights under the option shall pass by
will or by the applicable laws of descent and distribution.
ARTICLE XIII
AMENDMENTS TO PLAN
The Board may at any time terminate or from time to time amend, modify or
suspend the Plan; provided, however, that no such amendment or modification
without the approval of the stockholders of the Company shall:
(i) materially increase the benefits accruing to participants under
the Plan;
(ii) materially increase the maximum number (determined as provided in
the Plan) of shares of Common Stock which may be purchased pursuant to
options granted under the Plan; or
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(iii) materially modify the requirements as to eligibility for
participation in the Plan.
The amendment or termination of the Plan shall not, without the written consent
of an optionee, adversely affect any rights or obligations under any option
theretofore granted to such optionee under the Plan.
ARTICLE XIV
EFFECTIVE DATE OF PLAN
The Plan shall be effective on March 20, 1997.
ARTICLE XV
DEFINITIONS
For the purposes of this Plan, the following terms shall have the meanings
indicated:
Act: Shall mean the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.
Code: Shall mean the Internal Revenue Code of 1986, as amended and the
regulations promulgated thereunder.
Committee: Such term is defined in Article II, Section 1.
Common Stock: Such term is defined in Article I.
Consultants and Advisers: Such term shall include any third party retained
or engaged by the Company or any Subsidiary to provide services to the Company
or such Subsidiary, including any employee of such third party providing such
services.
Director: Such term shall include any director of the Company.
Employee: Such term shall include (i) any officer as well as any full-time
salaried key executive, managerial, professional, administrative, or key
employee of the Company or a Subsidiary. Such term shall also include an
employee on approved leave of absence provided such employee's right to continue
employment with the Company or a Subsidiary upon expiration of such employee's
leave of absence is guaranteed either by statute or by contract with or by a
policy of the Company or a Subsidiary and any consultant, independent
contractor, professional advisor or other person who is paid by the Company or a
Subsidiary for rendering services or furnishing materials or goods to the
Company or a Subsidiary.
Fair Market Value: The fair market value as of any date shall be determined
by the Committee or Board after giving consideration to the price of the Common
Stock in the public market and shall be determined otherwise in a manner
consistent with the provisions of the Code.
Incentive Stock Option: Such term means an option intended to qualify under
Section 422 of the Code.
1934 Act: Shall mean the Securities Exchange Act of 1934, as amended and
the rules and regulations promulgated thereunder.
Non-Employee Director: Such term shall mean any director of the Company who
is a Non-Employee Director as that term is defined in Rule 16b-3 promulgated
under the 1934 Act.
Non-Qualified Stock Option: Such term means an option which does not
qualify under Section 422 of the Code.
Person: Such term shall have the meaning ascribed to it under the 1934 Act.
Plan: Such term is defined in Article I and shall include all amendments
thereof.
Stock Appreciation Rights: Means the rights granted by the Committee
pursuant to Section 4 of Article VI hereof.
Subsidiary: Means and includes a 'Subsidiary Corporation' of the Company as
defined in Section 424 of the Code.
Ten Percent Stockholder: Such term is defined in Article IV.
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FORM OF WHG RESORTS & CASINOS INC.
OPTION AGREEMENT
----------------
TO: __________________
Re: [Non-Qualified Stock Option] [Incentive Stock Option]
WHG Resorts & Casinos Inc. 1997 Stock Option Plan
This letter will evidence the grant to you on ______ ("Grant Date") by
the Compensation Committee of the Board of Directors of WHG Resorts & Casinos
(the "Company") of an option pursuant to the Company's 1997 Stock Option Plan
(the "Plan") to purchase ________________ (_________) shares of the common
stock, par value $.01 per share ("Common Stock"), of the Company at a price of
$____ per share (the "Option"). Under applicable provisions of the Internal
Revenue Code of 1986, as amended, the Option is treated as [a non-qualified
stock option] [an incentive stock option].
This Option is issued in accordance with and is subject to and
conditioned upon all of the terms and conditions of this Agreement and of the
Plan as from time to time amended, provided, however, that no future amendment
or termination of the Plan shall, without your consent, alter or impair any of
your rights or obligations under the Plan, all of which are incorporated by
reference in this Agreement as if fully set forth herein.
The Company shall not be obligated to issue any shares pursuant to this
Option if, in the opinion of counsel to the Company, the shares to be so issued
are required to be registered or otherwise qualified under the Securities Act of
1933, as amended, or under any other applicable statute, regulation or ordinance
affecting the sale of securities, unless and until such shares have been so
registered or otherwise qualified.
It is understood that the Company may establish, from time to time,
appropriate procedures to provide for payment or withholding of such income or
other taxes as may be required by law to be paid or withheld in connection with
the exercise of this Option. By the execution hereof, you hereby agree to pay to
the Company or your Employer all such amounts requested by the Company to permit
the Company to take any tax deduction available to it resulting from the
exercise of this Option. You also agree to comply with any procedures
established, from time to time, by the Company to ensure that the Company
receives prompt advice concerning the occurrence of any event which may create,
or affect the timing or amount of, any obligation to pay or withhold any such
taxes or which may make available to the Company any tax deduction resulting
from the occurrence of such event.
This Option may be exercised as follows: [up to ___% of the total
number of shares granted to you ("Total Grant") shall be exercisable commencing
on the first anniversary of the Grant Date; up to ___% of the Total Grant shall
be exercisable commencing on the second anniversary of the Grant Date; up to __%
of the Total Grant shall be exercisable commencing on the third anniversary of
the Grant Date; and up to 100% of the Total Grant shall be
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exercisable commencing on the fourth anniversary of the Grant Date] [100% of the
total number of shares granted to you shall be exercisable on the Grant Date].
This Option, to the extent not previously exercised, shall expire on the day
preceding the tenth anniversary of the Grant Date.
[This option is transferrable by you during your lifetime to members of
your family or trusts created for the benefit of yourself or your family and
similar transfers for estate planning and other proper purposes, subject in each
case, however, to the prior consent of the Company, which consent shall not be
unreasonably withheld.]
This Option is to be exercised by delivering to the Company a written
notice of exercise in the form attached hereto as Exhibit A, together with
payment as provided in the Plan.
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Would you kindly evidence your acceptance of this Option and your
agreement to comply with the provisions of this Agreement and of the Plan by
executing the enclosed copy of the Agreement under the words "ACCEPTED AND
AGREED TO" and returning a copy to Brian R. Gamache, President of the Company.
Very truly yours,
WHG RESORTS & CASINOS INC.
By:
------------------------------------
Name:
Title:
Attachments
ACCEPTED AND AGREED TO
this ____ day of ____, 199__.
- -----------------------------
Name:
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EXHIBIT A
---------
Dated: ________
President
WHG Resorts & Casinos Inc.
6063 East Isla Verde Avenue
Carolina, Puerto Rico 00979
Gentlemen:
Notice is hereby given of my election to purchase ____ shares of common
stock, par value $.01 per share (the "Common Stock"), of WHG Resorts & Casinos
Inc. (the "Company") at a price of $____ per share pursuant to the provisions of
the stock option ("Option") granted to me on ______ under the terms of the
Company's 1997 Stock Option Plan.
Enclosed is my check made payable to the Company in the amount of $_______
in payment of the exercise price of the Option and my check in the amount of
$_______ made payable to the subsidiary of the Company which is my employer (or
to the Company as my employer) in payment of the tax due on exercise of the
Option.
The following information is supplied for use in issuing and registering
the shares purchased hereby:
Number of certificates: _________________
Denomination of
each certificate: _________________
Name: _________________
Address: _________________
_________________
Social Security Number: _________________
Very truly yours,
---------------------------
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SHACK & SIEGEL, P.C.
530 Fifth Avenue
New York, New York 10036
(212) 782-0700
June 19, 1997
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Form S-8 Registration Statement 900,000 shares of
voting common stock of WHG Resorts & Casinos Inc.
-------------------------------------------------
Ladies and Gentlemen:
We have acted as counsel to WHG Resorts & Casinos Inc., a Delaware
corporation (the "Company"), in connection with the filing with the Securities
and Exchange Commission of a registration statement on Form S-8 (the
"Registration Statement") under the Securities Act of 1933, as amended (the
"Securities Act"), relating to 900,000 shares of the Company's voting common
stock, par value $.01 per share ("Common Stock"), which may be issued and sold
pursuant to the Company's 1997 Stock Option Plan (the "1997 Plan").
In connection with this opinion, we have examined and are familiar with
originals or copies, certified or otherwise identified to our satisfaction, of
(i) the 1997 Plan; (ii) the Registration Statement; (iii) the Amended and
Restated Certificate of Incorporation of the Company; (iv) the Amended and
Restated By-Laws of the Company; and (v) such other documents as we have deemed
necessary or appropriate as a basis for the opinion set forth below. In our
examination, we have assumed the genuineness of all signatures, the legal
capacity of all natural persons, the authenticity of all documents submitted to
us as originals, the conformity to the original documents of all documents
submitted to us as certified or photostatic copies and the authenticity of the
originals of such latter documents. As to any facts material to this opinion
that we did not independently establish or verify, we have relied upon
statements and representations of officers and other representatives of the
Company and others.
Based upon and subject to the foregoing, we are of the opinion that the
shares of Common Stock reserved for issuance upon the exercise of options have
been duly authorized and that such shares of Common Stock, when issued and
delivered upon exercise of options granted in accordance with the terms of the
1997 Plan, and assuming full payment for the shares of Common Stock thereby
issued, will be validly issued, fully paid and nonassessable.
We consent to the filing of this opinion as Exhibit 5 to the
Registration Statement.
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The law covered by the opinion expressed herein is limited to the
corporate laws of the State of Delaware.
Very truly yours,
SHACK & SIEGEL, P.C.
By: /s/ Pamela E. Flaherty
-------------------------------------
Pamela E. Flaherty
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CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration
Statement (Form S-8) pertaining to the 1997 Stock Option Plan of WHG Resorts &
Casinos Inc. of our reports with respect to the consolidated financial
statements of WHG Resorts & Casinos Inc., formerly known as Williams Hotel
Corporation, and the financial statements of Posadas de San Juan Associates, WKA
El Con Associates and El Conquistador Partnership L.P., included in the
Registration Statement No. 1-12783 (Form 10), filed with the Securities and
Exchange Commission.
Chicago, Illinois ERNST & YOUNG LLP
June 17, 1997
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