<PAGE> 1
As filed with the Securities and Exchange Commission on December 15, 1998
Registration No. 333- _______________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
STAFF LEASING, INC.
(Exact name of issuer as specified in its charter)
<TABLE>
<CAPTION>
FLORIDA 65-0735612
<S> <C>
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
</TABLE>
600 301 Boulevard West, Suite 202
Bradenton, Florida 34205
(Address of principal executive offices)
---------------------------------
STAFF LEASING, INC.
1997 STOCK INCENTIVE PLAN
---------------------------------
Michael D. Craig
Vice President and General Counsel
Staff Leasing, Inc.
600 301 Boulevard West, Suite 202
Bradenton, Florida 34205
(941)748-4540
(Name, address and telephone number of agent for service)
---------------------------------
<PAGE> 2
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------
Proposed Proposed
Maximum Maximum
Amount Offering Aggregate Amount of
Title of Securities Being Price Per Offering Registration
Being Registered Registered(1) Share(2) Price Fee
- -------------------------------------------------------------------------------------
<S> <C>
Common Stock
$.01 par value 2,500,000 $11.75 $29,375,000 $8,166.25
- -------------------------------------------------------------------------------------
</TABLE>
(1) This registration statement also covers such indeterminable number of
additional shares as may become issuable to prevent dilution in the event
of a stock split, stock dividend, reclassification or other similar
transaction pursuant to the terms of the Plan.
(2) This calculation is made pursuant to Rule 457(h) under the Securities Act
1933, as amended, solely for the purpose of determining the amount of the
registration fee and is based upon the average of the high and low prices
of the registrant's Common Stock on December 14, 1998.
<PAGE> 3
PART I
INFORMATION REQUIRED IN SECTION 10(a) PROSPECTUS
The document(s) containing the information specified in Part I of Form
S-8 will be sent or given to participants as specified by Rule 428(b)(1) of the
Securities Act of 1933, as amended (the "Securities Act"). These documents and
the items incorporated by reference into this Registration Statement pursuant
to Item 3 of Part II of this Registration Statement, taken together, constitute
a prospectus that meets the requirements of Section 10(a) of the Securities
Act.
-1-
<PAGE> 4
PART II
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents which have been filed with the Securities and
Exchange Commission are incorporated herein by reference as of their respective
dates and are a part hereof:
(a) The Annual Report on Form 10-K of Staff Leasing, Inc. (the
"Company") for the year ended December 31, 1997;
(b) The Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1998;
(c) The Company's Quarterly Report on Form 10-Q for the quarter ended
June 30, 1998;
(d) The Company's Quarterly Report on Form 10-Q for the quarter ended
September 30, 1998; and
(e) The description of the Common Stock contained in the Company's
Registration Statement on Form 8-A filed June 13, 1997 and in any
amendment or report filed for the purpose of amending such
description.
Additionally, all documents subsequently filed by the Company pursuant
to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934,
as amended, prior to the filing of a post-effective amendment hereto which
indicates that all of the shares of Common Stock offered hereby have been sold
or which deregisters all such shares then remaining unsold, shall be deemed to
be incorporated by reference herein and to be part hereof from the date of
filing of such documents.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Registration Statement to the extent that a statement
contained herein or in any other subsequently filed document which also is or
is deemed to be incorporated by reference herein, modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Registration
Statement.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
The legality of the Common Stock offered hereby (through options under
the Plan) has been passed upon by Powell, Goldstein, Frazer and Murphy LLP,
Atlanta, Georgia.
II-1
<PAGE> 5
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company's articles of incorporation ("Charter") require the
Company, to the fullest extent permitted or required by the Florida Business
Corporation Act ("Florida Act"), to indemnify its directors and officers
against any and all liabilities incurred by reason of the fact that such person
was or is a director or officer of the Company or was serving at the request of
the Company in the same or a similar capacity for any other corporation,
partnership or other entity. Generally, the Florida Act permits indemnification
of a director or officer upon a determination that he or she acted in good
faith and in a manner he or she 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 his or her conduct was
unlawful. The right to indemnification granted in the Charter is not exclusive
of any other rights to indemnification against liabilities or the advancement
of expenses to which a director or officer may be entitled under any written
agreement, Board resolution, vote of shareholders, the Florida Act or
otherwise.
The Company has also entered into agreements with each of its current
directors and executive officers pursuant to which it is obligated to indemnify
those persons to the fullest extent authorized by law and to advance payments
to cover defense costs against an unsecured obligation to repay such advances
if it is ultimately determined that the recipient of the advance is not
entitled to indemnification. No indemnification or advancement of expenses
would be made (a) if a final adjudication established that the actions or
omissions were material to the cause of action so adjudicated and constitute:
(i) a violation of criminal law (unless the indemnitee had reasonable cause to
believe that his actions were lawful or had no reasonable cause to believe his
conduct was unlawful); (ii) a transaction from which the indemnitee derived an
improper personal benefit; (iii) an unlawful distribution or dividend under the
Florida Act; or (iv) willful misconduct or a conscious disregard for the just
interests of the Company in a derivative or shareholder action; (b) for
liability under Section 16(b) of the Exchange Act, or (c) if a final decision
by a court having jurisdiction in the matter determined that indemnification
was not lawful.
At present, the Company is not aware of any pending or threatened
litigation or proceeding involving a director, officer, employee or agent of
the Company in which indemnification would be required or permitted under the
Charter, the indemnification agreements or Florida law.
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Company, the Company has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act and is, therefore, enforceable. In
the event that a
II-2
<PAGE> 6
claim for indemnification against such liabilities (other than the payment by
the Company of expenses incurred or paid by a director, office or controlling
person of the Company in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Company undertakes, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, to submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and agrees to be governed by the final adjudication of such
issue.
ITEM 8. EXHIBITS
3.1 Articles of Incorporation of the registrant (filed as Exhibit 3.1
to the Registrant's Registration Statement on Form S-1 (No.
333-22933) and incorporated herein by reference)
3.2 Bylaws of the registrant (filed as Exhibit 3.2 to the
Registrant's Registration Statement on Form S-1 (No. 333-22933)
and incorporated herein by reference)
4.1 Staff Leasing, Inc. 1997 Stock Incentive Plan
5.1 Opinion of Powell, Goldstein, Frazer & Murphy LLP
23.1 Consent of Deloitte & Touche LLP
23.2 Consent of Powell, Goldstein, Frazer & Murphy LLP (included in
Exhibit 5.1)
24.1 Powers of Attorney (Page II - 5)
ITEM 9. UNDERTAKINGS
The Company hereby undertakes:
(1) to file, during any period in which offers or sales of the Common Stock
are being made, a post-effective amendment to this registration statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, as amended (the "Securities Act"); (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; (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 that if the information required in clauses (i) and (ii) above to
be included in a post-effective
II-3
<PAGE> 7
amendment hereto is contained in one or more periodic reports filed by the
registrant pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934, no post-effective amendment hereto shall be
required.
(2) that, for the purpose of determining any liability under the Securities
Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) to remove from registration by means of a post-effective amendment any of
the securities being registered which remain unsold at the termination of
the offering.
Additionally, the Company hereby undertakes that, for purposes of determining
any liability under the Securities Act, each filing of the Company's annual
report pursuant to Section 13(a) or Section 15(d) of the Exchange Act that is
incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act may
be permitted to directors, officers and controlling persons of the Company
pursuant to the foregoing provisions, or otherwise, the Company has been
advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Company of expenses
incurred or paid by a director, officer or controlling person in the successful
defense of any action, suit or proceeding) is asserted by such director,
officer or controlling person in connection with the securities being
registered, the Company will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
II-4
<PAGE> 8
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 Bradenton, state of Florida, on the 15th day
of December, 1998.
STAFF LEASING, INC.
By: /s/ Richard A. Goldman
----------------------------------
Richard A. Goldman
President
Each person whose signature appears below hereby constitutes and
appoints Richard A. Goldman and John E. Panning as their true and lawful
attorneys-in-fact and agents of the undersigned, with full power of
substitution and resubstitution, for and in the name, place and stead of the
undersigned, in any and all capacities, to sign any and all amendments
(including post-effective amendments) to this Registration Statement, and to
file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as the undersigned might or could do in person, hereby
ratifying and confirming all that such attorneys-in-fact and agents, or their
substitute or substitutes, may lawfully do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<S> <C> <C>
/s/ Charles S. Craig Chairman of the Board and Chief
- ----------------------------- Executive Officer and Director
Charles S. Craig (a principal executive officer) December 15, 1998
/s/ Richard A. Goldman President and Director
- ----------------------------- (a principal executive officer) December 15, 1998
Richard A. Goldman
/s/ John E. Panning Chief Financial Officer and Director
- ----------------------------- (principal financial and accounting
John E. Panning officer) December 15, 1998
/s/ George B. Beitzel Director December 15, 1998
- -----------------------------
George B. Beitzel
/s/ Ronald V. Davis Director December 15, 1998
- -----------------------------
Ronald V. Davis
/s/ Melvin R. Laird Director December 15, 1998
- -----------------------------
Melvin R. Laird
/s/ Elliot B. Ross Director December 15, 1998
- -----------------------------
Elliot B. Ross
</TABLE>
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<PAGE> 9
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Description
<S> <C>
3.1 Articles of Incorporation of the registrant (filed as Exhibit 3.1 to the
Registrant's Registration Statement on Form S-1 (No. 333-22933) and
incorporated herein by reference)
3.2 Bylaws of the registrant (filed as Exhibit 3.2 to the Registrant's
Registration Statement on Form S-1 (No. 333-22933) and incorporated
herein by reference)
4.1 Staff Leasing, Inc. 1997 Stock Incentive Plan
5.1 Opinion of Powell, Goldstein, Frazer & Murphy LLP
23.1 Consent of Deloitte & Touche LLP
23.2 Consent of Powell, Goldstein, Frazer & Murphy LLP (included in Exhibit
5.1)
24.1 Powers of Attorney (Page II - 5)
</TABLE>
<PAGE> 1
EXHIBIT 4.1
(As amended through November 19, 1998)
STAFF LEASING, INC.
1997 STOCK INCENTIVE PLAN
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C> <C>
SECTION 1 DEFINITIONS.......................................................................................... 1
1.1 Definitions................................................................................. 1
SECTION 2 THE STOCK INCENTIVE PLAN............................................................................. 4
2.1 Purpose of the Plan......................................................................... 4
2.2 Stock Subject to the Plan................................................................... 4
2.3 Administration of the Plan.................................................................. 5
2.4 Eligibility and Limits...................................................................... 5
SECTION 3 TERMS OF STOCK INCENTIVES............................................................................ 6
3.1 Terms and Conditions of All Stock Incentives................................................ 6
3.2 Terms and Conditions of Options............................................................. 7
(a) Option Price....................................................................... 7
(b) Option Term........................................................................ 8
(c) Payment............................................................................ 8
(d) Conditions to the Exercise of an Option............................................ 8
(e) Termination of Incentive Stock Option.............................................. 8
(f) Special Provisions for Certain Substitute Options.................................. 9
3.3 Terms and Conditions of Stock Appreciation Rights........................................... 9
(a) Settlement......................................................................... 9
(b) Conditions to Exercise............................................................. 9
3.4 Terms and Conditions of Stock Awards........................................................ 9
3.5 Terms and Conditions of Dividend Equivalent Rights.......................................... 10
(a) Payment............................................................................ 10
(b) Conditions to Payment.............................................................. 10
3.6 Terms and Conditions of Performance Unit Awards............................................. 10
(a) Payment............................................................................ 10
(b) Conditions to Payment.............................................................. 10
3.7 Terms and Conditions of Phantom Shares...................................................... 10
(a) Payment............................................................................ 11
(b) Conditions to Payment.............................................................. 11
3.8 Treatment of Awards Upon Termination of Service............................................. 11
SECTION 4 RESTRICTIONS ON STOCK................................................................................ 11
4.1 Escrow of Shares............................................................................ 11
4.2 Forfeiture of Shares........................................................................ 12
4.3 Restrictions on Transfer.................................................................... 12
</TABLE>
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<PAGE> 3
<TABLE>
<S> <C> <C>
SECTION 5 GENERAL PROVISIONS................................................................................... 12
5.1 Withholding................................................................................. 12
5.2 Changes in Capitalization; Merger; Liquidation.............................................. 12
5.3 Cash Awards................................................................................. 13
5.4 Compliance with Code........................................................................ 13
5.5 Right to Terminate Service.................................................................. 13
5.6 Restrictions on Delivery and Sale of Shares; Legends........................................ 13
5.7 Non-alienation of Benefits.................................................................. 14
5.8 Termination and Amendment of the Plan....................................................... 14
5.9 Stockholder Approval........................................................................ 14
5.10 Choice of Law............................................................................... 14
5.11 Effective Date of Plan...................................................................... 14
</TABLE>
-ii-
<PAGE> 4
STAFF LEASING, INC.
1997 STOCK INCENTIVE PLAN
SECTION 1 DEFINITIONS
1.1 Definitions. Whenever used herein, the masculine pronoun shall be
deemed to include the feminine, and the singular to include the plural, unless
the context clearly indicates otherwise, and the following capitalized words
and phrases are used herein with the meaning thereafter ascribed:
(a) "Board of Directors" means the board of directors of the
Company.
(b) "Cause" has the same meaning as provided in the employment
agreement between the Participant and the Company or, if applicable, any
affiliate of the Company on the date of Termination of Service, or if no such
definition or employment agreement exists, "Cause" means conduct amounting to
(1) fraud or dishonesty against the Company or its affiliates, (2)
Participant's willful misconduct, repeated refusal to follow the reasonable
directions of the board of directors of the Company or its affiliates, or
knowing violation of law in the course of performance of the duties of
Participant's service with the Company or its affiliates, (3) repeated absences
from work without a reasonable excuse, (4) repeated intoxication with alcohol
or drugs while on the Company or affiliates' premises during regular business
hours, (5) a conviction or plea of guilty or nolo contendere to a felony or a
crime involving dishonesty, or (6) a breach or violation of the terms of any
agreement to which Participant and the Company or its affiliates are party.
(c) "Change in Control" means any one of the following events
which may occur following completion of the initial public offering, if any, of
the Company, but only if the event shall have occurred without the approval of
the Board of Directors:
(1) there occurs the acquisition by any person or persons
acting in concert of the Company's then outstanding voting securities if, after
the transaction, the acquiring person (or persons) owns, controls or holds with
power to vote twenty-five percent (25%) or more of any class of voting
securities of the Company; provided, however, that the provisions of the
foregoing clauses (1) shall not apply to the acquisition of securities by any
person who, as of the date of consummation of the initial public offering of
shares of Common Stock, $.01 par value per share (the "Common Stock"), together
with his or its affiliates, is the Beneficial Owner of more than 5,000,000
shares of Common Stock.
(2) within any twelve-month period the persons who were
directors of the Company immediately before the beginning of such twelve-month
period (the "Incumbent Directors") shall cease to constitute at least a
majority of the Board of Directors; provided that any director who was not a
director immediately following any initial public offering shall be deemed to
be an Incumbent Director if that director was elected to the Board of Directors
by, or on the recommendation of or with the approval of, at least two-thirds of
the directors who then qualified as Incumbent Directors; and provided further
that no director whose initial assumption of office is in connection with an
actual or threatened election contest (as such terms are used in Rule 14a-11 of
<PAGE> 5
Regulation 14A promulgated under the Securities Exchange Act of 1934) relating
to the election of directors of the Company shall be deemed to be an Incumbent
Director;
(3) there occurs the approval by shareholders of the
Company of a reorganization, merger or consolidation, with respect to which
persons who were the shareholders of the Company immediately prior to such
reorganization, merger or consolidation do not, immediately thereafter, own
more than fifty percent (50%) of the combined voting power entitled to vote in
the election of directors of the reorganized, merged or consolidated company's
then outstanding voting securities; or
(4) there occurs the sale, transfer or assignment of all
or substantially all of the assets of the Company and its subsidiaries to any
third party.
(d) "Code" means the Internal Revenue Code of 1986, as amended.
(e) "Committee" means the committee appointed by the Board of
Directors to administer the Plan pursuant to Plan Section 2.3.
(f) "Company" means Staff Leasing, Inc., a Florida corporation.
(g) "Disability" has the same meaning as provided in the
long-term disability plan or policy maintained or, if applicable, most recently
maintained, by the Company or, if applicable, any affiliate of the Company for
the Participant. If no long-term disability plan or policy was ever maintained
on behalf of the Participant or, if the determination of Disability relates to
an Incentive Stock Option, Disability shall mean that condition described in
Code Section 22(e)(3), as amended from time to time. In the event of a dispute,
the determination of Disability shall be made by the Board of Directors and
shall be supported by advice of a physician competent in the area to which such
Disability relates.
(h) "Disposition" means any conveyance, sale, transfer,
assignment, pledge or hypothecation, whether outright or as security, inter
vivos or testamentary, with or without consideration, voluntary or involuntary.
(i) "Dividend Equivalent Rights" means certain rights to
receive cash payments as described in Plan Section 3.5.
(j) "Fair Market Value" refers to the determination of value of
a share of Stock. If the Stock is actively traded on any national securities
exchange or any Nasdaq quotation or market system, Fair Market Value shall mean
the closing price at which sales of Stock shall have been sold on the most
recent trading date immediately prior to the date of determination, as reported
by any such exchange or system selected by the Committee on which the shares of
Stock are then traded. If the shares of Stock are not actively traded on any
such exchange or system, Fair Market Value shall mean the arithmetic mean of
the bid and asked prices for the shares of Stock on the most recent trading
date within a reasonable period prior to the determination date as reported by
such exchange or system. If there are no bid and asked prices within a
reasonable period or if the shares of Stock
<PAGE> 6
are not traded on any exchange or system as of the determination date, Fair
Market Value shall mean the fair market value of a share of Stock as determined
by the Committee taking into account such facts and circumstances deemed to be
material by the Committee to the value of the Stock in the hands of the
Participant; provided that, for purposes of granting awards other than
Incentive Stock Options, Fair Market Value of a share of Stock may be
determined by the Committee by reference to the average market value determined
over a period certain or as of specified dates, to a tender offer price for the
shares of Stock (if settlement of an award is triggered by such an event) or to
any other reasonable measure of fair market value and provided further that,
for purposes of granting Incentive Stock Options, Fair Market Value of a share
of Stock shall be determined in accordance with the valuation principles
described in the regulations promulgated under Code Section 422.
(k) "Incentive Stock Option" means an incentive stock option,
as defined in Code Section 422, described in Plan Section 3.2.
(l) "Non-Qualified Stock Option" means a stock option, other
than an option qualifying as an Incentive Stock Option, described in Plan
Section 3.2.
(m) "Option" means a Non-Qualified Stock Option or an Incentive
Stock Option.
(n) "Over 10% Owner" means an individual who at the time an
Incentive Stock Option is granted owns Stock possessing more than 10% of the
total combined voting power of the Company or one of its Parents or
Subsidiaries, determined by applying the attribution rules of Code Section
424(d).
(o) "Parent" means any corporation (other than the Company) in
an unbroken chain of corporations ending with the Company if, with respect to
Incentive Stock Options, at the time of granting of the Option, each of the
corporations other than the Company owns stock possessing 50% or more of the
total combined voting power of all classes of stock in one of the other
corporations in the chain.
(p) "Participant" means an individual who receives a Stock
Incentive hereunder.
(q) "Performance Unit Award" refers to a performance unit award
described in Plan Section 3.6.
(r) "Phantom Shares" refers to the rights described in Plan
Section 3.7.
(s) "Plan" means the Staff Leasing, Inc. 1997 Stock Incentive
Plan.
(t) "Stock" means the Company's common stock, $.01 par value.
(u) "Stock Appreciation Right" means a stock appreciation right
described in Plan Section 3.3.
(v) "Stock Award" means a stock award described in Plan Section
3.4.
<PAGE> 7
(w) "Stock Incentive Agreement" means an agreement between the
Company and a Participant or other documentation evidencing an award of a Stock
Incentive.
(x) "Stock Incentive Program" means a written program
established by the Committee pursuant to which Stock Incentives, other than
Options or Stock Appreciation Rights, are awarded under the Plan under uniform
terms, conditions and restrictions set forth in such written program and
distributed among eligible officers, employees and directors.
(y) "Stock Incentives" means, collectively, Dividend Equivalent
Rights, Incentive Stock Options, Non-Qualified Stock Options, Performance Unit
Awards, Phantom Shares, Stock Appreciation Rights and Stock Awards.
(z) "Subsidiary" means any corporation (other than the Company)
in an unbroken chain of corporations beginning with the Company if, with
respect to Incentive Stock Options, at the time of the granting of the Option,
each of the corporations other than the last corporation in the unbroken chain
owns stock possessing 50% or more of the total combined voting power of all
classes of stock in one of the other corporations in the chain.
(aa) "Termination of Service" means the termination of the
service relationship, whether employment or otherwise, between a Participant
and the Company and its affiliates, regardless of the fact that severance or
similar payments are made to the Participant for any reason, including, but not
by way of limitation, a termination by resignation, discharge, death,
Disability or retirement. The Committee shall, in its absolute discretion,
determine the effect of all matters and questions relating to Termination of
Service, including, but not by way of limitation, the question of whether a
leave of absence constitutes a Termination of Service, or whether a Termination
of Service is for Cause.
SECTION 2 THE STOCK INCENTIVE PLAN
2.1 Purpose of the Plan. The Plan is intended to (a) provide
incentive to officers, employees, directors and consultants of the Company and
its affiliates to stimulate their efforts toward the continued success of the
Company and to operate and manage the business in a manner that will provide
for the long-term growth and profitability of the Company; (b) encourage stock
ownership by officers, employees, directors and consultants by providing them
with a means to acquire a proprietary interest in the Company by acquiring
shares of Stock or to receive compensation which is based upon appreciation in
the value of Stock; and (c) provide a means of obtaining and rewarding key
personnel.
2.2 Stock Subject to the Plan. Subject to adjustment in accordance
with Section 5.2, 3,000,000 shares of Stock (the "Maximum Plan Shares") are
hereby reserved exclusively for issuance pursuant to Stock Incentives. At no
time shall the Company have outstanding Stock Incentives and shares of Stock
issued in respect of Stock Incentives in excess of the Maximum Plan Shares. The
shares of Stock attributable to the nonvested, unpaid, unexercised, unconverted
or otherwise unsettled portion of any Stock Incentive that is forfeited or
cancelled or expires or
<PAGE> 8
terminates for any reason without becoming vested, paid, exercised, converted
or otherwise settled in full shall again be available for purposes of the Plan.
2.3 Administration of the Plan. The Plan shall be administered by the
Committee. The Committee shall have full authority in its discretion to
determine the officers, employees, directors and consultants of the Company or
its affiliates to whom Stock Incentives shall be granted and the terms and
provisions of Stock Incentives, subject to the Plan. Subject to the provisions
of the Plan, the Committee shall have full and conclusive authority to
interpret the Plan; to prescribe, amend and rescind rules and regulations
relating to the Plan; to determine the terms and provisions of the respective
Stock Incentive Agreements or Stock Incentive Programs and to make all other
determinations necessary or advisable for the proper administration of the
Plan. The Committee's determinations under the Plan need not be uniform and may
be made by it selectively among persons who receive, or are eligible to
receive, awards under the Plan (whether or not such persons are similarly
situated). The Committee's decisions shall be final and binding on all
Participants.
As to any matter involving a Participant who is not a "reporting
person" for purposes of Section 16 of the Securities Exchange Act of 1934, the
Committee may delegate to any member of the Board of Directors or officer of
the Company the administrative authority to (a) interpret the provisions of the
Participant's Stock Incentive Agreement and (b) determine the treatment of
Stock Incentives upon a Termination of Service, as contemplated by Plan Section
3.8.
The Committee shall consist of at least two members of the Board of
Directors each of whom, during those periods that the Company is subject to the
provisions of Section 16 of the Securities Exchange Act of 1934, shall qualify
as a "non-employee director," as defined in Rule 16b-3 as promulgated under the
Securities Exchange Act of 1934, and each of whom, during those periods that
the Company has issued equity securities required to be registered under
Section 12 of the Securities Exchange Act of 1934, shall separately qualify as
an "outside director," within the meaning of Code Section 162(m) and the
regulations promulgated thereunder. The Board of Directors may from time to
time remove members from or add members to the Committee. Vacancies on the
Committee shall be filled by the Board of Directors.
2.4 Eligibility and Limits. Stock Incentives may be granted only to
officers, employees, directors and consultants of the Company or an affiliate;
provided, however, that an Incentive Stock Option may only be granted to an
employee of the Company or any Parent or Subsidiary. In the case of Incentive
Stock Options, the aggregate Fair Market Value (determined as at the date an
Incentive Stock Option is granted) of stock with respect to which stock options
intended to meet the requirements of Code Section 422 become exercisable for
the first time by an individual during any calendar year under all plans of the
Company and its Parents and Subsidiaries shall not exceed $100,000; provided
further, that if the limitation is exceeded, the Incentive Stock Option(s)
which cause the limitation to be exceeded shall be treated as Non-Qualified
Stock Option(s); except as the terms of the Stock Incentive Agreement may
expressly provide otherwise. To the extent required under Code Section 162(m)
and regulations thereunder for compensation to be treated as qualified
performance-based compensation, the maximum number of shares of Stock with
respect to which Options or Stock Appreciation Rights may be granted during any
single fiscal year of the Company
<PAGE> 9
to any Participant who is a "covered employee," within the meaning of Code
Section 162(m) and the regulations promulgated thereunder (a "Covered
Employee"), shall not exceed 100,000.
SECTION 3 TERMS OF STOCK INCENTIVES
3.1 Terms and Conditions of All Stock Incentives.
(a) The number of shares of Stock as to which a Stock Incentive
shall be granted shall be determined by the Committee in its sole discretion,
subject to the provisions of Section 2.2 as to the total number of shares
available for grants under the Plan. If a Stock Incentive Agreement so
provides, a Participant may be granted a new Option to purchase a number of
shares of Stock equal to the number of previously owned shares of Stock
tendered in payment of the Exercise Price (as defined below) for each share of
Stock purchased pursuant to the terms of the Stock Incentive Agreement.
(b) Each Stock Incentive shall be evidenced either by a Stock
Incentive Agreement in such form and containing such terms, conditions and
restrictions as the Committee may determine is appropriate or be made subject
to the terms of a Stock Incentive Program, containing such terms, conditions
and restrictions as the Committee may determine is appropriate. Each Stock
Incentive Agreement or Stock Incentive Program shall be subject to the terms of
the Plan and any provision in a Stock Incentive Agreement or Stock Incentive
Program that is inconsistent with the Plan shall be null and void.
(c) The date a Stock Incentive is granted shall be the date on
which the Committee has approved the terms and conditions of the Stock
Incentive Agreement or Stock Incentive Program and has determined the recipient
of the Stock Incentive and the number of shares covered by the Stock Incentive
and has taken all such other action necessary to complete the grant of the
Stock Incentive.
(d) The Committee may provide in any Stock Incentive Agreement
or pursuant to any Stock Incentive Program (or subsequent to the award of a
Stock Incentive but prior to its expiration or cancellation, as the case may
be) that, in the event of a Change in Control, the Stock Incentive shall or may
be cashed out on the basis of any price not greater than the highest price paid
for a share of Stock in any transaction reported by any market or system
selected by the Committee on which the shares of Stock are then actively traded
during a specified period immediately preceding or including the date of the
Change in Control or offered for a share of Stock in any tender offer occurring
during a specified period immediately preceding or including the date the
tender offer commences; provided that, in no case shall any such specified
period exceed one (1) year (the "Change in Control Price"). For purposes of
this Subsection, the cash-out of a Stock Incentive shall be determined as
follows:
(i) Options shall be cashed out on the basis of the
excess, if any, of the Change in Control Price (but not more than the Fair
Market Value of the Stock on the date of the cash-out in the case of Incentive
Stock Options) over the Exercise Price with or without regard to whether the
Option may otherwise be exercisable only in part;
<PAGE> 10
(ii) Stock Awards and Phantom Shares shall be cashed out in
an amount equal to the Change in Control Price with or without regard to any
conditions or restrictions otherwise applicable to any such Stock Incentive;
and
(iii) Stock Appreciation Rights, Dividend Equivalent Rights
and Performance Unit Awards shall be cashed out with or without regard to any
conditions or restrictions otherwise applicable to any such Stock Incentive and
the amount of the cash out shall be determined by reference to the number of
shares of Stock that would be required to pay the Participant in kind for the
value of the Stock Incentive as of the date of the Change in Control multiplied
by the Change in Control Price.
(e) Any Stock Incentive may be granted in connection with all or
any portion of a previously or contemporaneously granted Stock Incentive.
Exercise or vesting of a Stock Incentive granted in connection with another
Stock Incentive may result in a pro rata surrender or cancellation of any
related Stock Incentive, as specified in the applicable Stock Incentive
Agreement or Stock Incentive Program.
(f) Stock Incentives shall not be transferable or assignable
except by will or by the laws of descent and distribution and shall be
exercisable, during the Participant's lifetime, only by the Participant; in the
event of the Disability of the Participant, by the legal representative of the
Participant; or in the event of the death of the participant, by the personal
representative of the Participant's estate or if no personal representative has
been appointed, by the successor in interest determined under the Participant's
will.
3.2 Terms and Conditions of Options. Each Option granted under the
Plan shall be evidenced by a Stock Incentive Agreement. At the time any Option
is granted, the Committee shall determine whether the Option is to be an
Incentive Stock Option or a Non-Qualified Stock Option, and the Option shall be
clearly identified as to its status as an Incentive Stock Option or a
Non-Qualified Stock Option. At the time any Incentive Stock Option is
exercised, the Company shall be entitled to place a legend on the certificates
representing the shares of Stock purchased pursuant to the Option to clearly
identify them as shares of Stock purchased upon exercise of an Incentive Stock
Option. An Incentive Stock Option may only be granted within ten (10) years
from the earlier of the date the Plan is adopted by the Board of Directors or
approved by the Company's shareholders.
(a) Option Price. Subject to adjustment in accordance with
Section 5.2 and the other provisions of this Section 3.2, the exercise price
(the "Exercise Price") per share of Stock purchasable under any Option shall be
as set forth in the applicable Stock Incentive Agreement. With respect to each
grant of an Incentive Stock Option to a Participant who is not an Over 10%
Owner or to each grant of any Option to a Participant who is then a Covered
Employee, the Exercise Price per share shall not be less than the Fair Market
Value on the date the Option is granted. With respect to each grant of an
Incentive Stock Option to a Participant who is an Over 10% Owner, the Exercise
Price shall not be less than 110% of the Fair Market Value on the date the
Option is granted.
<PAGE> 11
(b) Option Term. The term of an Option shall be as specified in
the applicable Stock Incentive Agreement; provided, however that any Incentive
Stock Option granted to a Participant who is not an Over 10% Owner shall not be
exercisable after the expiration of ten (10) years after the date the Option is
granted and any Incentive Stock Option granted to an Over 10% Owner shall not
be exercisable after the expiration of five (5) years after the date the Option
is granted.
(c) Payment. Payment for all shares of Stock purchased pursuant
to exercise of an Option shall be made in any form or manner authorized by the
Committee in the Stock Incentive Agreement or by amendment thereto, including,
but not limited to, cash or, if the Stock Incentive Agreement provides, (1) by
delivery to the Company of a number of shares of Stock which have been owned by
the holder for at least six (6) months prior to the date of exercise having an
aggregate Fair Market Value of not less than the product of the Exercise Price
multiplied by the number of shares the Participant intends to purchase upon
exercise of the Option on the date of delivery; (2) in a cashless exercise
through a broker; or (3) by having a number of shares of Stock withheld, the
Fair Market Value of which as of the date of exercise is sufficient to satisfy
the Exercise Price. In its discretion, the Committee also may authorize (at the
time an Option is granted or thereafter) Company financing to assist the
Participant as to payment of the Exercise Price on such terms as may be offered
by the Committee in its discretion. Payment shall be made at the time that the
Option or any part thereof is exercised, and no shares shall be issued or
delivered upon exercise of an option until full payment has been made by the
Participant. The holder of an Option, as such, shall have none of the rights of
a stockholder.
(d) Conditions to the Exercise of an Option. Each Option
granted under the Plan shall be exercisable by whom, at such time or times, or
upon the occurrence of such event or events, and in such amounts, as the
Committee shall specify in the Stock Incentive Agreement; provided, however,
that subsequent to the grant of an Option, the Committee, at any time before
complete termination of such Option, may accelerate the time or times at which
such Option may be exercised in whole or in part, including, without
limitation, upon a Change in Control and may permit the Participant or any
other designated person to exercise the Option, or any portion thereof, for all
or part of the remaining Option term notwithstanding any provision of the Stock
Incentive Agreement to the contrary.
<PAGE> 12
(e) Termination of Option. With respect to an Incentive Stock
Option, and, unless otherwise provided in a Stock Incentive Agreement, with
respect to any other Option, in the event of the Termination of Service of a
Participant, the Option or portion thereof held by the Participant which is
unexercised shall expire, terminate, and become unexercisable no later than the
expiration of three (3) months after the date of Termination of Service;
provided, however, that in the case of a holder whose Termination of Service is
due to death or Disability, one (1) year shall be substituted for such three
(3) month period. For purposes of this Subsection (e), Termination of Service
of the Participant shall not be deemed to have occurred if the Participant is
employed by another corporation (or a parent or subsidiary corporation of such
other corporation) which has assumed the Incentive Stock Option of the
Participant in a transaction to which Code Section 424(a) is applicable.
(f) Special Provisions for Certain Substitute Options.
Notwithstanding anything to the contrary in this Section 3.2, any Option issued
in substitution for an option previously issued by another entity, which
substitution occurs in connection with a transaction to which Code Section
424(a) is applicable, may provide for an exercise price computed in accordance
with such Code Section and the regulations thereunder and may contain such
other terms and conditions as the Committee may prescribe to cause such
substitute Option to contain as nearly as possible the same terms and
conditions (including the applicable vesting and termination provisions) as
those contained in the previously issued option being replaced thereby.
3.3 Terms and Conditions of Stock Appreciation Rights. Each Stock
Appreciation Right granted under the Plan shall be evidenced by a Stock
Incentive Agreement. A Stock Appreciation Right may be granted in connection
with all or any portion of a previously or contemporaneously granted Stock
Incentive or not in connection with a Stock Incentive. A Stock Appreciation
Right shall entitle the Participant to receive the excess of (a) the Fair
Market Value of a specified or determinable number of shares of the Stock at
the time of payment or exercise over (b) a specified price (1) which, in the
case of a Stock Appreciation Right granted in connection with an Option, shall
be not less than the Exercise Price for that number of shares and (2) which, in
the case of a Stock Appreciation Right that is granted to a Participant who is
then a Covered Employee, shall not be less than the Fair Market Value of the
Stock at the time of the award. A Stock Appreciation Right granted in
connection with a Stock Incentive may only be exercised to the extent that the
related Stock Incentive has not been exercised, paid or otherwise settled. The
exercise of a Stock Appreciation Right granted in connection with a Stock
Incentive shall result in a pro rata surrender or cancellation of any related
Stock Incentive to the extent the Stock Appreciation Right has been exercised.
(a) Settlement. Upon settlement of a Stock Appreciation Right,
the Company shall pay to the Participant the appreciation in cash or shares of
Stock (valued at the aggregate Fair Market Value on the date of payment or
exercise) as provided in the Stock Incentive Agreement or, in the absence of
such provision, as the Committee may determine.
<PAGE> 13
(b) Conditions to Exercise. Each Stock Appreciation Right
granted under the Plan shall be exercisable or payable at such time or times,
or upon the occurrence of such event or events, and in such amounts, as the
Committee shall specify in the Stock Incentive Agreement; provided, however,
that subsequent to the grant of a Stock Appreciation Right, the Committee, at
any time before complete termination of such Stock Appreciation Right, may
accelerate the time or times at which such Stock Appreciation Right may be
exercised or paid in whole or in part.
3.4 Terms and Conditions of Stock Awards. The number of shares of
Stock subject to a Stock Award and restrictions or conditions on such shares,
if any, shall be as the Committee determines, and the certificate for such
shares shall bear evidence of any restrictions or conditions. Subsequent to the
date of the grant of the Stock Award, the Committee shall have the power to
permit, in its discretion, an acceleration of the expiration of an applicable
restriction period with respect to any part or all of the shares awarded to a
Participant. The Committee may require a cash payment from the Participant in
an amount no greater than the aggregate Fair Market Value of the shares of
Stock awarded determined at the date of grant in exchange for the grant of a
Stock Award or may grant a Stock Award without the requirement of a cash
payment.
3.5 Terms and Conditions of Dividend Equivalent Rights. A Dividend
Equivalent Right shall entitle the Participant to receive payments from the
Company in an amount determined by reference to any cash dividends paid on a
specified number of shares of Stock to Company shareholders of record during
the period such rights are effective. The Committee may impose such
restrictions and conditions on any Dividend Equivalent Right as the Committee
in its discretion shall determine, including the date any such right shall
terminate and may reserve the right to terminate, amend or suspend any such
right at any time.
(a) Payment. Payment in respect of a Dividend Equivalent Right
may be made by the Company in cash or shares of Stock (valued at Fair Market
Value on the date of payment) as provided in the Stock Incentive Agreement or,
in the absence of such provision, as the Committee may determine.
(b) Conditions to Payment. Each Dividend Equivalent Right
granted under the Plan shall be payable at such time or times, or upon the
occurrence of such event or events, and in such amounts, as the Committee shall
specify in the Stock Incentive Agreement or Stock Incentive Program; provided,
however, that subsequent to the grant of a Dividend Equivalent Right, the
Committee, at any time before complete termination of such Dividend Equivalent
Right, may accelerate the time or times at which such Dividend Equivalent Right
may be paid in whole or in part.
3.6 Terms and Conditions of Performance Unit Awards. A Performance
Unit Award shall entitle the Participant to receive, at a future date, payment
of an amount equal to all or a portion of the value of a number of units
(stated in terms of a designated dollar amount per unit) granted by the
Committee, all as the Committee shall specify in the Stock Incentive Agreement
or Stock Incentive Program. At the time of the grant, the Committee
<PAGE> 14
must determine the base value of each unit, the number of units subject to a
Performance Unit Award, the performance factors applicable to the determination
of the ultimate payment value of the Performance Unit Award and the period over
which Company performance shall be measured. The Committee may provide for an
alternate base value for each unit under certain specified conditions.
(a) Payment. Payment in respect of Performance Unit Awards may
be made by the Company in cash or shares of Stock (valued at Fair Market Value
on the date of payment) as provided in the Stock Incentive Agreement or Stock
Incentive Program or, in the absence of such provision, as the Committee may
determine.
(b) Conditions to Payment. Each Performance Unit Award granted
under the Plan shall be payable at such time or times, or upon the occurrence
of such event or events, and in such amounts, as the Committee shall specify in
the Stock Incentive Agreement or Stock Incentive Program; provided, however,
that subsequent to the grant of a Performance Unit Award, the Committee, at any
time before complete termination of such Performance Unit Award, may accelerate
the time or times at which such Performance Unit Award may be paid in whole or
in part.
3.7 Terms and Conditions of Phantom Shares. Phantom Shares shall
entitle the Participant to receive, at a future date, payment of an amount
equal to all or a portion of the Fair Market Value of a number of shares of
Stock at the end of a certain period, all as the Committee shall specify in the
Stock Incentive Agreement or Stock Incentive Program. At the time of the grant,
the Committee shall determine the factors which will govern the portion of the
rights so payable, including, at the discretion of the Committee, any
performance criteria that must be satisfied as a condition to payment.
(a) Payment. Payment in respect of Phantom Shares may be made
by the Company in cash or shares of Stock (valued at Fair Market Value on the
date of payment) as provided in the Stock Incentive Agreement or Stock
Incentive Program or, in the absence of such provision, as the Committee may
determine.
(b) Conditions to Payment. Each Phantom Share granted under the
Plan shall be payable at such time or times, or upon the occurrence of such
event or events, and in such amounts, as the Committee shall specify in the
Stock Incentive Agreement or Stock Incentive Program; provided, however, that
subsequent to the grant of a Phantom Share, the Committee, at any time before
complete termination of such Phantom Share, may accelerate the time or times at
which such Phantom Share may be paid in whole or in part.
3.8 Treatment of Awards Upon Termination of Service. Except as
otherwise provided by Plan Section 3.2(e), any award under this Plan to a
Participant who suffers a Termination of Service may be cancelled, accelerated,
paid or continued, as provided in the Stock Incentive Agreement or Stock
Incentive Program or, in the absence of such provision, as the Committee may
determine. The portion of any award exercisable in the event of continuation or
the amount of any payment due under a continued award may be adjusted by the
Committee to reflect the Participant's period of service from the date of grant
through the
<PAGE> 15
date of the Participant's Termination of Service or such other factors as the
Committee determines are relevant to its decision to continue the award.
SECTION 4 RESTRICTIONS ON STOCK
4.1 Escrow of Shares. Any certificates representing the shares of
Stock issued under the Plan shall be issued in the Participant's name, but, if
the Stock Incentive Agreement or Stock Incentive Program so provides, the
shares of Stock shall be held by a custodian designated by the Committee (the
"Custodian"). Each applicable Stock Incentive Agreement or Stock Incentive
Program providing for transfer of shares of Stock to the Custodian shall
appoint the Custodian as the attorney-in-fact for the Participant for the term
specified in the applicable Stock Incentive Agreement or Stock Incentive
Program, with full power and authority in the Participant's name, place and
stead to transfer, assign and convey to the Company any shares of Stock held by
the Custodian for such Participant, if the Participant forfeits the shares
under the terms of the applicable Stock Incentive Agreement or Stock Incentive
Program. During the period that the Custodian holds the shares subject to this
Section, the Participant shall be entitled to all rights, except as provided in
the applicable Stock Incentive Agreement or Stock Incentive Program, applicable
to shares of Stock not so held. Any dividends declared on shares of Stock held
by the Custodian shall, as the Committee may provide in the applicable Stock
Incentive Agreement or Stock Incentive Program, be paid directly to the
Participant or, in the alternative, be retained by the Custodian until the
expiration of the term specified in the applicable Stock Incentive Agreement or
Stock Incentive Program and shall then be delivered, together with any
proceeds, with the shares of Stock to the Participant or to the Company, as
applicable.
4.2 Forfeiture of Shares. Notwithstanding any vesting schedule set
forth in any Stock Incentive Agreement or Stock Incentive Program, in the event
that the Participant violates a noncompetition agreement as set forth in the
Stock Incentive Agreement or Stock Incentive Program, all Stock Incentives and
shares of Stock issued to the holder pursuant to the Plan shall be forfeited;
provided, however, that the Company shall return to the holder the lesser of
any consideration paid by the Participant in exchange for Stock issued to the
Participant pursuant to the Plan or the then Fair Market Value of the Stock
forfeited hereunder.
4.3 Restrictions on Transfer. The Participant shall not have the
right to make or permit to exist any Disposition of the shares of Stock issued
pursuant to the Plan except as provided in the Plan or the applicable Stock
Incentive Agreement or Stock Incentive Program. Any Disposition of the shares
of Stock issued under the Plan by the Participant not made in accordance with
the Plan or the applicable Stock Incentive Agreement or Stock Incentive Program
shall be void. The Company shall not recognize, or have the duty to recognize,
any Disposition not made in accordance with the Plan and the applicable Stock
Incentive Agreement or Stock Incentive Program, and the shares so transferred
shall continue to be bound by the Plan and the applicable Stock Incentive
Agreement or Stock Incentive Program.
<PAGE> 16
SECTION 5 GENERAL PROVISIONS
5.1 Withholding. The Company shall deduct from all cash distributions
under the Plan any taxes required to be withheld by federal, state or local
government. Whenever the Company proposes or is required to issue or transfer
shares of Stock under the Plan or upon the vesting of any Stock Award, the
Company shall have the right to require the recipient to remit to the Company
an amount sufficient to satisfy any federal, state and local withholding tax
requirements prior to the delivery of any certificate or certificates for such
shares or the vesting of such Stock Award. A Participant may pay the
withholding tax in cash, or, if the applicable Stock Incentive Agreement or
Stock Incentive Program provides, a Participant may elect to have the number of
shares of Stock he is to receive reduced by, or with respect to a Stock Award,
tender back to the Company, the smallest number of whole shares of Stock which,
when multiplied by the Fair Market Value of the shares of Stock determined as
of the Tax Date (defined below), is sufficient to satisfy federal, state and
local, if any, withholding taxes arising from exercise or payment of a Stock
Incentive (a "Withholding Election"). A Participant may make a Withholding
Election only if both of the following conditions are met:
(a) The Withholding Election must be made on or prior to the
date on which the amount of tax required to be withheld is determined (the "Tax
Date") by executing and delivering to the Company a properly completed notice
of Withholding Election as prescribed by the Committee; and
(b) Any Withholding Election made will be irrevocable; however,
the Committee may in its sole discretion disapprove and give no effect to the
Withholding Election.
5.2 Changes in Capitalization; Merger; Liquidation.
(a) The number of shares of Stock reserved for the grant of
Options, Dividend Equivalent Rights, Performance Unit Awards, Phantom Shares,
Stock Appreciation Rights and Stock Awards; the number of shares of Stock
reserved for issuance upon the exercise or payment, as applicable, of each
outstanding Option, Dividend Equivalent Right, Performance Unit Award, Phantom
Share and Stock Appreciation Right and upon vesting or grant, as applicable, of
each Stock Award; the Exercise Price of each outstanding Option and the
specified number of shares of Stock to which each outstanding Dividend
Equivalent Right, Phantom Share and Stock Appreciation Right pertains shall be
proportionately adjusted for any increase or decrease in the number of issued
shares of Stock resulting from a subdivision or combination of shares or the
payment of an ordinary stock dividend in shares of Stock to holders of
outstanding shares of Stock or any other increase or decrease in the number of
shares of Stock outstanding effected without receipt of consideration by the
Company.
(b) In the event of any merger, consolidation, extraordinary
dividend (including a spin-off), reorganization or other change in the
corporate structure of the Company or its Stock or tender offer for shares of
Stock, the Committee, in its sole
<PAGE> 17
discretion, may make such adjustments with respect to awards and take such
other action as it deems necessary or appropriate to reflect or in anticipation
of such merger, consolidation, extraordinary dividend, reorganization, other
change in corporate structure or tender offer, including, without limitation,
the substitution of new awards, the termination or adjustment of outstanding
awards, the acceleration of awards or the removal of restrictions on
outstanding awards. Any adjustment pursuant to this Section 5.2 may provide, in
the Committee's discretion, for the elimination without payment therefor of any
fractional shares that might otherwise become subject to any Stock Incentive.
(c) The existence of the Plan and the Stock Incentives granted
pursuant to the Plan shall not affect in any way the right or power of the
Company to make or authorize any adjustment, reclassification, reorganization
or other change in its capital or business structure, any merger or
consolidation of the Company, any issue of debt or equity securities having
preferences or priorities as to the Stock or the rights thereof, the
dissolution or liquidation of the Company, any sale or transfer of all or any
part of its business or assets, or any other corporate act or proceeding.
5.3 Cash Awards. The Committee may, at any time and in its
discretion, grant to any holder of a Stock Incentive the right to receive, at
such times and in such amounts as determined by the Committee in its
discretion, a cash amount which is intended to reimburse such person for all or
a portion of the federal, state and local income taxes imposed upon such person
as a consequence of the receipt of the Stock Incentive or the exercise of
rights thereunder.
5.4 Compliance with Code. All Incentive Stock Options to be granted
hereunder are intended to comply with Code Section 422, and all provisions of
the Plan and all Incentive Stock Options granted hereunder shall be construed
in such manner as to effectuate that intent.
5.5 Right to Terminate Service. Nothing in the Plan or in any Stock
Incentive Agreement or Stock Incentive Program shall confer upon any
Participant the right to continue as an employee, officer, director or
consultant of the Company or any of its affiliates or affect the right of the
Company or any of its affiliates to terminate the Participant's service at any
time.
5.6 Restrictions on Delivery and Sale of Shares; Legends. Each Stock
Incentive is subject to the condition that if at any time the Committee, in its
discretion, shall determine that the listing, registration or qualification of
the shares covered by such Stock Incentive upon any securities exchange or
under any state or federal law is necessary or desirable as a condition of or
in connection with the granting of such Stock Incentive or the purchase or
delivery of shares thereunder, the delivery of any or all shares pursuant to
such Stock Incentive may be withheld unless and until such listing,
registration or qualification shall have been effected. If a registration
statement is not in effect under the Securities Act of 1933 or any applicable
state securities laws with respect to the shares of Stock purchasable or
otherwise deliverable under Stock Incentives then outstanding, the Committee
may require, as a condition of exercise of any Option or as a condition to any
other delivery of Stock
<PAGE> 18
pursuant to a Stock Incentive, that the Participant or other recipient of a
Stock Incentive represent, in writing, that the shares received pursuant to the
Stock Incentive are being acquired for investment and not with a view to
distribution and agree that the shares will not be disposed of except pursuant
to an effective registration statement, unless the Company shall have received
an opinion of counsel that such disposition is exempt from such requirement
under the Securities Act of 1933 and any applicable state securities laws. The
Company may include on certificates representing shares delivered pursuant to a
Stock Incentive such legends referring to the foregoing representations or
restrictions or any other applicable restrictions on resale as the Company, in
its discretion, shall deem appropriate.
5.7 Non-alienation of Benefits. Other than as specifically provided
with regard to the death of a Participant, no benefit under the Plan shall be
subject in any manner to anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance or charge; and any attempt to do so shall be void. No such
benefit shall, prior to receipt by the Participant, be in any manner liable for
or subject to the debts, contracts, liabilities, engagements or torts of the
Participant.
5.8 Termination and Amendment of the Plan. The Board of Directors at
any time may amend or terminate the Plan without stockholder approval;
provided, however, that the Board of Directors may condition any amendment on
the approval of shareholders of the Company if such approval is necessary or
advisable with respect to tax, securities or other applicable laws. No such
termination or amendment without the consent of the holder of a Stock Incentive
shall adversely affect the rights of the Participant under such Stock
Incentive.
5.9 Stockholder Approval. The Plan shall be submitted to the
shareholders of the Company for their approval within twelve (12) months before
or after its adoption by the Board of Directors. If such approval is not
obtained, any Stock Incentive granted under the Plan shall be void.
5.10 Choice of Law. The laws of the State of Florida shall govern
the Plan, to the extent not preempted by federal law.
5.11 Effective Date of Plan. The Plan shall become effective upon the
date the Plan is approved by the Board of Directors.
<PAGE> 19
IN WITNESS WHEREOF, the Company has caused this Plan to be executed
this ___________ day of __________________________, 1997.
STAFF LEASING, INC.
By:
-----------------------------------
Title:
Attest:
- --------------------------------
Secretary
[CORPORATE SEAL]
<PAGE> 1
EXHIBIT 5.1
[Powell, Goldstein, Frazer & Murphy LLP letterhead]
December 15, 1998
STAFF LEASING, INC.
600 301 Boulevard West
Suite 202
Bradenton, Florida 34205
Re: Registration Statement on Form S-8
Staff Leasing, Inc. 1997 Stock Incentive Plan
Ladies and Gentlemen:
We have served as counsel for Staff Leasing, Inc., a Florida
corporation (the "Company"), in connection with the registration under the
Securities Act of 1933, as amended, pursuant to a Registration Statement on
Form S-8 (the "Registration Statement"), of an aggregate of 2,500,000 shares
(the "Shares") of common stock, $.01 par value of the Company, to be issued and
sold by the Company upon the exercise of options granted to certain officers,
directors, consultants and key employees of the Company pursuant to the Staff
Leasing, Inc. 1997 Stock Incentive Plan (the "Plan").
We have examined and are familiar with originals or copies (certified,
photostatic or otherwise identified to our satisfaction) of such documents,
corporate records and other instruments relating to the incorporation of the
Company and the authorization of the grants of stock options pursuant to the
Plan as we have deemed necessary and advisable. In such examinations, we have
assumed the genuineness of all signatures on all originals and copies of
documents we have examined, the authenticity of all documents submitted to us
as originals and the conformity to original documents of all certified,
conformed or photostatic copies. As to questions of fact material and relevant
to our opinion, we have relied upon certificates or representations of Company
officials and of appropriate governmental officials.
We express no opinion as to matters under or involving the laws of any
jurisdiction other than the corporate law of the State of Florida.
Based upon and subject to the foregoing and having regard for such
legal considerations as we have deemed relevant, it is our opinion that:
<PAGE> 2
Staff Leasing, Inc.
Page 2 of 2
1. The Shares have been duly authorized; and
2. Upon the issuance and delivery of the Shares pursuant to the
exercise of options and payment therefor as provided in the Plan and as
contemplated by the Registration Statement, such Shares will be legally and
validly issued, fully paid and non-assessable.
We hereby consent to the filing of this opinion as Exhibit 5 to the
Registration Statement.
Very truly yours,
POWELL, GOLDSTEIN, FRAZER & MURPHY LLP
<PAGE> 1
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration
Statement of Staff Leasing, Inc. on Form S-8 of our report dated February 20,
1998, appearing in the Annual Report on Form 10-K of Staff Leasing, Inc. for
the year ended December 31, 1997.
DELOITTE & TOUCHE
Stamford, Connecticut
December 15, 1998
