- --------------------------------------------------------------------------------
As filed with the Securities and Exchange Commission on January 25, 2000 -
Registration No. _________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
APPLIED FILMS CORPORATION
(Exact name of registrant as specified in its charter)
Colorado 84-1311581
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
9586 I-25 Frontage Road, Longmont, Colorado 80504
(Address of Principal Executive Offices) (Zip Code)
Applied Films Corporation Outside Director Stock Option Plan
(Full Title of the Plan)
Lawrence D. Firestone, 9586 I-25 Frontage Road, Longmont, Colorado 80504,
(303) 774-3246
(Name, address, and telephone number of agent for service)
Copies of Communications to:
William J. Lawrence III
Varnum, Riddering, Schmidt & Howlett LLP
333 Bridge Street, N.W., P.O. Box 352
Grand Rapids, Michigan 49501-0352
(616) 336-6000
CALCULATION OF REGISTRATION FEE
<TABLE>
=======================================================================================================================
Proposed Proposed
Maximum Maximum Amount of
Title of Securities Amount Being Offering Price Aggregate Registration
Being Registered Registered Per Share(1) Offering Price(1) Fee(2)
=======================================================================================================================
<S> <C> <C> <C> <C>
Common Stock 24,000 shares $14.97 $359,280 $95
=======================================================================================================================
</TABLE>
(1) For the purpose of computing the registration fee only, the price
shown is based upon the price of $14.97 per share, the average of the
high and low sales prices for the Common Stock of Applied Films
Corporation in the NASDAQ National Market System on January 21, 2000,
in accordance with Rule 457(h).
(2) Registration fee is calculated on the basis of 1/37.8787 of 1%
(.000264) of the proposed maximum aggregate offering price of $359,280.
Pursuant to Rule 416(a) of the General Rules and Regulations under the
Securities Act of 1933, this Registration Statement shall cover such additional
securities as may be offered or issued to prevent dilution resulting from stock
splits, stock dividends or similar transactions.
================================================================================
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Information required by Part I to be contained in the Section 10(a)
prospectus is omitted from this Registration Statement in accordance with Rule
428 under the Securities Act of 1933 (the "Securities Act") and the Note to Part
I of Form S-8.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
The following documents filed with the Securities and Exchange Commission
(the "Commission") are incorporated herein by reference:
(a) The Annual Report on Form 10-K and 10-K/A of the Registrant for
the year ended July 3, 1999.
(b) All other reports filed pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), since the
end of the fiscal year covered by the Annual Report on Form 10-K referred
to in (a) above.
(c) The description of the Registrant's Common Stock contained in the
Registrant's Registration Statement on Form 8-A filed pursuant to Section
12(b) of the Exchange Act, including any amendments or reports filed for
the purpose of updating such description.
All reports and other documents subsequently filed by the Registrant
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to
the filing of a post-effective amendment which indicates that all securities
offered hereby have been sold or which deregisters all securities then remaining
unsold, shall be deemed to be incorporated by reference herein and to be a part
hereof from the date of the filing of such reports and 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 incorporated or 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 4. Description of Securities
The class of securities to be offered is registered under Section 12 of the
Exchange Act.
Item 5. Interests of Named Experts and Counsel
Not Applicable.
Item 6. Indemnification of Directors and Officers
Section 7-109-102 through 7-109-110 of the Colorado Business Corporation
Act (the "Act") grant the Registrant broad powers to indemnify any person in
connection with legal proceedings brought against him by reason of his present
or past status as an officer or director of the Registrant, provided with
respect to conduct in an official
S-2
<PAGE>
capacity with the Registrant, the person acted in good faith and in a manner he
reasonably believed to be in the best interests of the Registrant, with respect
to all other conduct, the person believed the conduct to be in or not opposed to
the best interests of the Registrant, and with respect to any criminal action or
proceeding, the person had no reasonable cause to believe his conduct was
unlawful. Indemnification is limited to reasonable expenses incurred in
connection with the proceeding. No indemnification may be made (i) in connection
with a proceeding by or in the right of the Registrant in which the person was
adjudged liable to the Registrant; or (ii) in connection with any other
proceedings charging that the person derived an improper personal benefit,
whether or not involving action in an official capacity, in which proceeding the
person was judged liable on the basis that he derived an improper personal
benefit, unless and only to the extent the court in which such action was
brought or another court of competent jurisdiction determines upon application
that, despite such adjudication, but in view of all relevant circumstances, the
person is fairly and reasonably entitled to indemnity for reasonable expenses as
the court deems proper. In addition, to the extent that any such person is
successful in the defense of any such legal proceeding, the Registrant is
required by the Act to Indemnify him against reasonable expenses.
The Registrant's Amended and Restated Articles of Incorporation contain
provisions which permit the Registrant to indemnify its officers and directors
to the fullest extent permitted by the Colorado Business Corporation Act. The
Registrant has entered into indemnification agreements with each of its
directors and certain of its officers providing for similar indemnification. In
addition to the available indemnification, the Registrant's Amended and Restated
Articles of Incorporation limit the personal liability of the members of its
Board of Directors, subject to certain exceptions, for monetary damages with
respect to claims by the Registrant or its shareholders.
The Registrant's Amended and Restated Bylaws provide that the Registrant
may purchase and maintain insurance on behalf of its directors, officers,
employees, fiduciaries and agents against liability asserted against or incurred
by such persons in any such capacity.
Item 7. Exemption from Registration Claimed
Not Applicable.
Item 8. Exhibits
Reference is made to the Exhibit Index which appears on page S-6.
Item 9. Undertakings
The undersigned registrant hereby undertakes:
(a) 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, represents a fundamental change in the information set
forth in the Registration Statement. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high and of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more than
20 percent change in the maximum aggregate
S-3
<PAGE>
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)(i) and
(a)(ii) do not apply if the Registration Statement is on Form S-3,
Form S-8, or Form F-3, and the information required to be included in
a post-effective amendment by those paragraphs is contained in
periodic reports filed by the Registrant pursuant to Section 13 or
Section 15(d) of Securities Exchange Act of 1934 that are incorporated
by reference in the Registration Statement.
(b) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new Registration Statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(c) 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.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (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.
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.
S-4
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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 Longmont, State of Colorado, on the 25th day of
January, 2000.
APPLIED FILMS CORPORATION
By /s/ Thomas T. Edman
Thomas T. Edman, President and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Thomas T. Edman and Lawrence D. Firestone, and
each of them, his true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for him and in his name, place and stead, 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 any other regulatory authority, granting
unto said attorney-in-fact and agent, full power and authority to do and perform
each and every act and thing required and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his substitute, 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 below on January 25, 2000, by the
following persons in the capacities indicated.
Signatures Title
/s/ Thomas T. Edman President, Chief Executive Officer and Director
Thomas T. Edman (principal executive officer)
Chief Financial Officer and Treasurer (principal
/s/ Lawrence D. Firestone financial officer and principal accounting officer)
Lawrence D. Firestone
/s/ Richard P. Beck Director
Richard P. Beck
/s/ John S. Chapin Vice President -- Research, Secretary and Director
John S. Chapin
/s/ Vincent Sollito, Jr. Director
Vincent Sollito, Jr.
/s/ Chad D. Quist Director
Chad D. Quist
/s/ Cecil Van Alsburg Director
Cecil Van Alsburg
<PAGE>
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors
Applied Films Corporation
As independent public accountants, we hereby consent to incorporation by
reference in this registration statement of our report dated July 27, 1999,
included in Applied Films Corporation's annual report on Form 10-K and Form
10-K/A (Registration No. 000-23103), and to all references to our firm included
in this registration statement.
/s/ ARTHUR ANDERSEN LLP
Denver, Colorado
January 24, 2000
S-5
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EXHIBIT INDEX
The following exhibits are filed as a part of the Registration Statement:
Exhibit
Number Description of Document
4.1 Applied Films Corporation Outside Director Stock Option Plan
5.1 Opinion of Varnum, Riddering, Schmidt & Howlett LLP with respect to the
legality of the securities being registered
23.1 Consent of Arthur Andersen LLP - included on page S-6 hereof
23.2 Consent of Varnum, Riddering, Schmidt & Howlett LLP (included in
opinion filed as Exhibit 5.1)
24.1 Power of Attorney - included on page S-5 hereof
S-6
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APPLIED FILMS CORPORATION
OUTSIDE DIRECTOR STOCK OPTION PLAN
1. Name and Purpose. This plan shall be called the Applied Films
Corporation Outside Director Stock Option Plan (the "Plan"). The Plan is
intended to encourage stock ownership by nonemployee directors of Applied Films
Corporation (the "Company"), to provide such directors with an additional
incentive to manage the Company effectively and to contribute to its success,
and to provide a form of compensation which will attract and retain highly
qualified individuals as members of the Board of Directors of the Company.
2. Effective Date and Term of the Plan. The Plan shall become effective
upon its approval by the Board of Directors of the Company (the "Effective
Date"). Options may not be granted under the Plan after the tenth (10th)
anniversary of the Effective Date (the "Term"); provided, however, that all
options outstanding as of that date shall remain or become exercisable pursuant
to their terms and the terms of the Plan.
3. Administration. The Plan shall be administered by a committee designated
by the Board of Directors of the Company (the "Committee") consisting of not
less than two (2) directors who shall be appointed from time to time by the
Board, each of whom shall qualify as a Nonemployee Director, as defined in Rule
16b-3(b)(3) of the Securities Exchange Act of 1934, as amended.
The Committee may, from time to time, establish such regulations,
provisions and procedures, within the terms of the Plan, as in the opinion of
its members may be advisable in the administration of the Plan. The Committee
shall keep minutes of its meetings. A majority of the Committee shall constitute
a quorum, and the acts of a majority of a quorum at any meeting, or acts reduced
to or approved in writing by a majority of the members of the Committee, shall
be the valid acts of the Committee.
The interpretation and construction by the Committee of any provisions of
the Plan or of any option granted pursuant to the Plan shall be final and
binding upon the Company, the Board of Directors of the Company and any
optionee. No member of the Board of Directors of the Company or the Committee
shall be liable for any action or determination made in good faith with respect
to the Plan or any option granted pursuant thereto.
4. Participation. Subject to the limitations contained in this Section 4,
directors of the Company, who are neither contractual nor common law employees
of the Company or any of its subsidiaries, shall be granted options to purchase
shares of the Company's common stock in accordance with the provisions of
Section 6 of the Plan and consistent with the terms and conditions of the Plan.
An optionee may hold more than one option, but only on the terms and subject to
the restrictions hereafter set forth. Subject to adjustments consistent with the
provisions of
EXHIBIT 4.1
<PAGE>
Subsection 6(h), no one nonemployee director may be granted options covering
more than a total of fifteen percent (15%) of the common stock originally
reserved for issuance under the Plan, as defined in Section 5, plus such
increases therein as may from time to time be approved by the Company's
shareholders.
5. Stock Available for Options. Subject to the adjustments as provided in
Subsection 6(h), the aggregate number of shares reserved for purposes of the
Plan shall be 24,000 authorized and unissued shares or issued shares reacquired
by the Company (the "Shares"). Determinations as to the number of Shares that
remain available for issuance under the Plan shall be made in accordance with
such rules and procedures as the Committee shall determine from time to time,
which shall be consistent with the requirements of Rule 16b-3 of the Securities
Exchange Act of 1934, as amended, and such interpretations thereof. If any
outstanding option under the Plan expires or is terminated for any reason before
the end of the Term of the Plan, the shares allocable to the unexercised portion
of such option shall become available for the grant of other options under the
Plan. No shares delivered to the Company in full or partial payment upon
exercise of an option pursuant to Subsection 6(d) or in full or partial payment
of any withholding tax liability permitted under Section 9 shall become
available for the grant of other options under the Plan.
6. Terms and Conditions of Option Agreement. Options granted under this
Plan shall be evidenced by agreements in such form as the Committee shall from
time to time approve, which agreements shall comply with and be subject to the
following conditions:
(a) Optionee's Agreement. Each optionee shall agree to continue to
serve as a director of the Company for the lesser of at least twelve (12)
months from the date of the grant of the option or for the remainder of
such optionee's term as a director of the Company. Such agreement shall not
impose upon the Company, its Board of Directors, or its shareholders any
obligation to retain the optionee as a director for any period.
(b) Number of Shares and Term of Options. Each option shall state the
number of shares of the Common Stock of the Company to which it pertains.
The term of each option shall be for a period of not greater than ten (10)
years from the date of grant of the option.
(c) Option Price. The exercise price of each option shall be equal to
one hundred percent (100%) of the Fair Market Value of the shares of Common
Stock on the date of the grant of the option. If the shares are traded in
the over-the-counter market, the Fair Market Value per share shall be the
closing price on the national market list as quoted in the National
Association of Securities Dealers Automated Quotation System ("NASDAQ") on
the day the option is granted or if no sale of shares is reflected in
NASDAQ on that day, on the next preceding day on which there was a sale of
shares reflected in NASDAQ. If the shares are not traded in the
over-the-counter market but are listed upon an established stock exchange
or exchanges, such Fair Market Value shall be deemed to be the closing
price of the shares on such stock exchange or exchanges on the day the
option is granted or if no sale of the
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shares shall have been made on any stock exchange on that day, on the next
preceding day on which there was a sale of the shares.
(d) Medium of Payment. The option price shall be payable to the
Company either (i) in United States dollars in cash or by check, bank
draft, or money order payable to the order of the Company or (ii) through
the delivery of shares of the Company's Common Stock with a Fair Market
Value on the date of the exercise equal to the option price, provided such
shares are utilized as payment to acquire at least 100 shares of Common
Stock, or (iii) by a combination of (i) and (ii) above. Fair Market Value
will be determined in the manner specified in Subsection 6(c) except as to
the date of determination.
(e) Exercise of Options. Except as provided in Subsection 6(h) no
option shall be exercisable, either in whole or in part, prior to the first
anniversary of the date of grant of the option. Subject to the foregoing,
the Committee shall have the authority to determine, at the time of the
grant of each Option, the times at which an Option may be exercised and any
conditions precedent to the exercise of an Option. An option shall be
exercisable upon written notice to the Chief Financial Officer of the
Company, as to any or all shares covered by the option, until its
termination or expiration in accordance with its terms or the provisions of
the Plan. Notwithstanding the foregoing, an option shall not at any time be
exercisable with respect to less than 100 shares unless the remaining
shares covered by an option are less than 100 shares. The purchase price of
the shares purchased pursuant to an option shall be paid in full upon
delivery to the optionee of certificates for such shares. Exercise by an
optionee's heir or personal representative shall be accompanied by evidence
of his or her authority to act, in a form reasonably satisfactory to the
Company.
(f) Options not Transferable. Options may not be sold, pledged,
assigned, or transferred in any manner otherwise than by will or the laws
of descent or distribution to the extent provided in Subsection 6(g).
During the lifetime of an optionee, the options shall be exercisable only
by the optionee. Following the death of an optionee, the options shall be
exercisable only to the extent provided in Subsection 6(g).
(g) Termination of Service as Director.
(i) Termination of Service for any Reason Other than Death. In
the event an optionee shall cease to serve the Company as a director
for any reason other than such optionee's death, each option held by
such optionee shall remain exercisable, subject to prior expiration
according to its terms and other limitations imposed by the Plan, for
a period of one (1) year following the optionee's cessation of service
as a director of the Company. If the optionee dies after such
cessation of service, the optionee's options shall be exercisable in
accordance with Subsection 6(g)(ii) hereof.
(ii) Termination of Service for Death. If an optionee ceases to
be a director by reason of death, each option held by such optionee
shall, to the extent
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rights to purchase shares under the option have been accrued at the
time of death and shall not have been fully exercised, be exercisable,
in whole or in part, by the personal representative of the optionee's
estate or by any person or persons who have acquired the option
directly from the optionee by bequest or inheritance during the
shorter of the following periods: (i) the term of the option, or (ii)
a period of one (1) year from the death of such optionee. If an
optionee dies during the extended exercise period following cessation
of service specified in Subsection 6(g)(i) above, such option may be
exercised any time within the longer of such extended period or one
(1) year after death, subject to the prior expiration of the term of
the option.
(h) Adjustment in Shares Covered by Option. The number of shares
covered by each outstanding option, and the purchase price per share
thereof, shall be proportionately adjusted for any increase or decrease in
the number of issued and outstanding shares resulting from a split in or
combination of shares or the payment of a stock dividend on the shares or
any other increase or decrease in the number of such shares effected
without receipt of consideration by the Company.
If the Company shall be the surviving corporation in any merger or
consolidation or if the Company is merged into a wholly owned subsidiary solely
for purposes of changing the Company's state of incorporation, each outstanding
option shall pertain to and apply to the securities to which a holder of the
number of shares subject to the option would have been entitled. A dissolution
or liquidation of the Company or a merger or consolidation in which the Company
is not the surviving corporation, except as above provided, shall cause each
outstanding option to terminate, provided, that each optionee shall, in that
event, have the right immediately prior to such dissolution or liquidation, or
merger or consolidation in which the Company is not the surviving corporation,
to exercise his or her option in whole or in part.
In the event of a change in the shares as presently constituted, which is
limited to a change of all of its authorized shares with par value into the same
number of shares with a different par value or without par value, the shares
resulting from any such change shall be deemed to be the shares within the
meaning of the Plan.
To the extent that the foregoing adjustments relate to stock or securities
of the Company, such adjustments shall be made by the Committee, whose
determination in that respect shall be final, binding and conclusive. Any such
adjustment may provide for the elimination of any fractional share which might
otherwise become subject to an option.
Except as hereinbefore expressly provided in this Subsection 6(h), the
optionee shall have no rights by reason of any split or combination of shares of
stock of any class or the payment of any stock dividend or any other increase or
decrease in the number of shares of stock of any class or by reason of any
dissolution, liquidation, merger, or consolidation or spinoff of assets or stock
of another corporation, and any issue by the Company of shares of
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stock of any class, or securities convertible into shares of stock of any class,
shall not affect, and no adjustment by reason thereof shall be made with respect
to, the number or price of shares of stock subject to the option.
The grant of an option pursuant to the Plan shall not affect in any way the
right or power of the Company to make adjustments, reclassifications,
reorganizations, or changes of its capital or business structure, or to merge or
to consolidate or to dissolve, liquidate or sell, or transfer all or any part of
its business or assets.
(i) Rights of a Shareholder. An optionee shall have no rights as a
shareholder with respect to any shares covered by his or her option until
the date on which the optionee becomes the holder of record of such shares.
No adjustment shall be made for dividends, distributions, or other rights
for which the record date is prior to the date on which he or she shall
have become the holder of record thereof, except as provided in Subsection
6(h).
(j) Postponement of Delivery of Shares and Representations. The
Company, in its discretion, may postpone the issuance and/or delivery of
shares upon any exercise of an option until completion of the registration
or other qualification of such shares under any state and/or federal law,
rule or regulation as the Company may consider appropriate, and may require
any person exercising an option to make such representations, including a
representation that it is the optionee's intention to acquire shares for
investment and not with a view to distribution thereof, and furnish such
information as it may consider appropriate in connection with the issuance
or delivery of the shares in compliance with applicable laws, rules, and
regulations. In such event no shares shall be issued to such holder unless
and until the Company is satisfied with the accuracy of any such
representations.
(k) Other Provisions. The option agreements authorized under the Plan
shall contain such other provisions, including, without limitation,
restrictions upon the exercise of the option, as the Committee shall deem
advisable.
7. Adjustments in Shares Available for Options. The adjustments in number
and kind of shares and the substitution of shares, affecting outstanding options
in accordance with Subsection 6(h) hereof, shall also apply to the number and
kind of shares reserved for issuance pursuant to the Plan, but not yet covered
by options.
8. Amendment of the Plan. The Committee, insofar as permitted by law, shall
have the right from time to time, with respect to any shares at the time not
subject to options, to suspend or discontinue the Plan or revise or amend it in
any respect whatsoever, and except that, without approval of the Board of
Directors of the Company, no such revision or amendment shall:
(a) increase the maximum number of shares which may be subject to the
Plan,
(b) materially increase the benefits accruing to option holders under
the Plan,
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<PAGE>
(c) decrease the exercise price of options granted under the Plan,
(d) remove the administration of the Plan from the Committee, or
(e) permit the granting of options under the Plan after the Term of
the Plan.
9. Withholding of Taxes. The Company shall have the right to deduct from
any payment to be made pursuant to this Plan, or to otherwise require, prior to
the issuance or delivery of any shares of Common Stock, payment by the optionee
of any federal, state, or local taxes required by law to be withheld. Unless
otherwise prohibited by the Committee, an optionee may satisfy any such
withholding tax obligation by any of the following means or by a combination of
such means:
(a) tendering a cash payment;
(b) authorizing the Company to withhold from the shares otherwise
issuable to the optionee a number of shares having a Fair Market Value as
of the "Tax Date," less than or equal to the amount of withholding tax
obligation; or
(c) delivering to the Company unencumbered shares owned by the
optionee having a Fair Market Value, as of the Tax Date, less than or equal
to the amount of the withholding tax obligation.
The "Tax Date" shall be the date that the amount of tax to be withheld is
determined. Fair Market Value shall be determined in the manner specified in
Subsection 6(c), except as to the date of determination. An optionee's election
to pay the withholding tax obligation by either of (b) or (c) above shall be
irrevocable, may be disapproved by the Committee, and must be made either six
months prior to the Tax Date or during the period beginning on the third
business day following the date of release of the Company's quarterly or annual
summary statement of sales and earnings and ending on the twelfth business day
following such date.
10. Right of Board of Directors to Terminate Director's Service. Nothing in
this Plan or in the grant of any option hereunder shall in any way limit or
effect the right of the Board of Directors of the Company to remove any director
or otherwise terminate his or her service as a director, pursuant to law, the
Articles of Incorporation, or Bylaws of the Company.
11. Application of Funds. The proceeds received by the Company from the
sale of stock pursuant to options will be used for general corporate purposes.
12. No Obligation to Exercise Option. The granting of an option shall
impose no obligation upon the optionee to exercise such option.
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13. Construction. This Plan shall be construed under the laws of the State
of Colorado, United States of America.
APPROVED:
/s/ Thomas T. Edman
Thomas T. Edman, President
CERTIFICATION
This Plan was duly adopted by the Board of Directors of the Company the
26th day of October, 1999.
/s/ John S. Chapin
John S. Chapin, Secretary
::ODMA\PCDOCS\GRR\380623\3
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January 25, 2000
Applied Films Corporation
9586 I-25 Frontage Road
Longmont, Colorado 80504
Re: Registration Statement on Form S-8 Relating to the Applied
Films Corporation Outside Director Stock Option Plan (the
"Plan")
Gentlemen:
With respect to the Registration Statement on Form S-8 (the "Registration
Statement) filed by Applied Films Corporation, a Colorado corporation (the
"Company") with the Securities and Exchange Commission, for the purpose of
registering under the Securities Act of 1933, as amended, 24,000 shares of the
Company's common stock, no par value, for issuance pursuant to the Plan, we have
examined such documents and questions of law we consider necessary or
appropriate for the purpose of giving this opinion. On the basis of such
evaluation, we advise you that in our opinion the 24,000 shares covered by the
Registration Statement, upon the exercise of stock options, at the prices
described in the Registration Statement but not less than the par value thereof,
and upon delivery of such shares and payment therefor in accordance with the
terms stated in the Plan and the Registration Statement, will be duly and
legally authorized, issued and outstanding, and will be fully paid and
nonassessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. In giving this consent, we do not thereby admit that we
are within the category of persons whose consent is required under Section 7 of
the Securities Act of 1933, as amended, or under the rules and regulations of
the Securities and Exchange Commission relating thereto.
Sincerely,
VARNUM, RIDDERING, SCHMIDT & HOWLETT LLP
/s/ William J. Lawrence III
William J. Lawrence III, Partner
EXHIBIT 5.1
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