<PAGE> 1
As Filed with the Securities and Exchange Commission on March 15, 2000
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------
TEKGRAF, INC.
(Exact name of registrant as specified in its charter)
GEORGIA
(State or other jurisdiction of incorporation))
58-2033795
(I.R.S. Employer Identification No.
980 CORPORATE WOODS PARKWAY
VERNON HILLS, ILLINOIS 60061
(Address of principal executive offices)
---------------
TEKGRAF, INC. 1997 EMPLOYEE STOCK OPTION PLAN
(Full title of the plan)
<TABLE>
<S> <C>
WILLIAM M. RYCHEL Copy to:
CHIEF EXECUTIVE OFFICER PHILIP H. MOISE, ESQ.
TEKGRAF, INC. NELSON MULLINS RILEY & SCARBOROUGH, L.L.P.
980 CORPORATE WOODS PARKWAY FIRST UNION PLAZA, SUITE 1400
VERNON HILLS, ILLINOIS 60061 999 PEACHTREE STREET, N.E.
(770) 442-6060 ATLANTA, GEORGIA 30309
(404) 817-6000
(Name and address of Agent for Service)
(Telephone number, including area code, of Agent for
Service)
</TABLE>
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
======================================================================================================================
PROPOSED MAXIMUM
TITLE OF SECURITIES TO BE AMOUNT TO BE PROPOSED MAXIMUM OFFERING AGGREGATE OFFERING AMOUNT OF
REGISTERED REGISTERED PRICE PER SHARE(1) PRICE(1) REGISTRATION FEE
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A Common Stock, 600,000 $4.0469 $2,428,140.00 $641.03
$0.001 par value
</TABLE>
(1) Estimated pursuant to Rules 457(h) and 457(c) of the Securities Act of
1933, as amended, solely for purposes of calculating the registration
fee, based on the average of the high and low prices of our Class A
Common Stock on March 10, 2000.
===============================================================================
<PAGE> 2
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. Incorporation of Documents by Reference.
The following documents, listed below and filed by us with the Securities
and Exchange Commission, are incorporated in this registration statement by
reference:
(a) Our latest annual report filed pursuant to Section 13(a) or
15(d) of the Securities Exchange Act of 1934, or the latest
prospectus filed pursuant to Rule 424(b) under the Securities
Act of 1933 that contains audited financial statements for
our latest fiscal year for which such statements have been
filed.
(b) All other reports filed pursuant to Section 13(a) or 15(d) of
the Securities Exchange Act of 1934 since the end of the
fiscal year covered by the annual report or prospectus
referred to in (a) above.
(c) The description of our Class A Common Stock contained in our
registration statement filed under Section 12 of the
Securities Exchange Act of 1934, including any amendment or
report filed for the purpose of updating the description.
In addition, all reports and other documents subsequently filed by us
under Sections 13(a) and (c), 14 and 15(d) of the Securities Exchange Act of
1934 shall be incorporated by reference in this registration statement. Such
reports and documents shall be incorporated by reference if they are filed
prior to the filing of a post-effective amendment which indicates that all
securities offered by our stock option plan have been sold or which
de-registers all securities remaining unsold. The reports and documents shall
be a part of this registration statement from the date of the filing of such
reports and documents
ITEM 4. Description of Securities.
Not applicable.
ITEM 5. Interests of Named Experts and Counsel.
Not applicable.
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<PAGE> 3
ITEM 6. Indemnification of Directors and Officers.
We have entered into indemnification agreements with each of our
directors and executive officers. In each indemnification agreement, we agree
to indemnify the person named as indemnitee for expenses, including reasonable
attorneys' fees, judgments, penalties, fines and amounts paid in settlement
actually and reasonably incurred by that person in connection with certain
civil or criminal actions or administrative proceedings arising out of that
person's performance of their duties as a director or officer. The
indemnification will not cover a lawsuit brought by the director or officer.
The indemnification will be available only if the person named as indemnitee
acted in good faith and in a manner they reasonably believed to be in, or not
opposed to, the best interests of our company. Further, in connection with a
criminal matter, the indemnification will be available only if that person had
no reasonable cause to believe their conduct was unlawful. The indemnification
agreements also require us to indemnify that person to the fullest extent
permitted by applicable law. Each indemnification agreement permits the
indemnitee to bring a lawsuit under that indemnification agreement, and to
recover the expenses of such a lawsuit if it is successful.
Our bylaws provide that we must indemnify its directors, officers,
employees or agents to the full extent permitted by the laws of Georgia. We
have the right to purchase and maintain insurance on behalf of any of these
persons whether or not we have the power to indemnify that person against the
liability. We have purchased a standard policy of directors' and officers'
liability insurance covering our directors and officers with respect to
liabilities incurred as a result of their service in those positions.
At present, there is no pending litigation or proceeding involving a
director, officer, employee or agent of ours where indemnification will be
required or permitted. However, by letter dated December 22, 1999, a
shareholder of the corporation gave notice that it may file a shareholder
derivative action against members of the board of directors and against the
Company for alleged breaches of fiduciary duties. Under Georgia law, the
shareholder may not commence such a suit until March 21, 2000. The board of
directors has appointed a special committee of independent directors to
investigate the allegations in the letter.
ITEM 7. Exemption from Registration Claimed.
Not applicable.
ITEM 8. Exhibits.
<TABLE>
<S> <C>
4.1 Tekgraf, Inc. 1997 Employee Stock Option Plan, effective as of August
7, 1996, as amended on May 26, 1999.
4.2 Form of Stock Option Agreement under the Tekgraf 1997 Employee Stock
Option Plan.
5.1 Opinion of Nelson Mullins Riley & Scarborough, L.L.P.
</TABLE>
3
<PAGE> 4
<TABLE>
<S> <C>
23.1 Consent of PricwaterhouseCoopers LLP.
23.2 Consent of Nelson Mullins Riley & Scarborough, L.L.P. (included as
part of Exhibit 5.1).
24.1 Power of Attorney (contained on signature page of this filing).
</TABLE>
ITEM 9. Undertakings.
Tekgraf, Inc. hereby undertakes:
(1) To file an amendment to this registration statement during
any period in which offers or sales are made. That amendment,
effective after the filing of this registration statement,
shall include:
(a) any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(b) in the prospectus, a reference to any facts or
events occurring after the effective date of this
registration statement which represent a fundamental
change in the information in this registration
statement. This includes any fact or event that
individually or in conjunction with other facts or
events represents a fundamental change in this
information. Despite the preceding sentences, the
following events may be reflected in the form of a
prospectus filed with the Securities and Exchange
Commission pursuant to Rule 424(b):
- any increase or decrease in the
volume of securities offered;
- any deviation from the low or
high; or
- any deviation of the estimated
maximum offering range.
These events may be reflected in a prospectus if, in
total, the changes in volume and price amount to no
more than a twenty percent (20%) change in the
maximum aggregate offering price as displayed in the
"Calculation of Registration Fee" table of the
effective registration statement;
(c) any material information or change to information
concerning the plan of distribution not previously
disclosed in this registration statement;
The undertakings described in paragraphs (a) and (b) above do
not apply if the information required by those paragraphs is
contained in periodic reports filed with the Securities and
Exchange Commission pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934, and incorporated by
reference in this registration statement.
(2) To remove from registration any of the securities being registered
which remain unsold at the end of the offering. This removal shall be
made through an amendment effective after the filing of this
registration statement.
(3) That for the purpose of determining any liability under the Securities
Act of 1933, each amendment shall be a new registration statement
relating to the securities offered in that
4
<PAGE> 5
amendment. The offering of those securities shall be the initial bona
fide offering of the securities at the time of the filing of the
amendment.
We further undertake that for the purpose of determining any liability
under the Securities Act of 1933, each filing of our annual report pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of 1934 shall be a new
registration statement relating to the securities offered in that new
registration statement. The offering of those securities shall be the initial
bona fide offering of the securities at the time of the filing of the new
registration statement.
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.
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 caused this registration
statement to be signed on its behalf by the fully authorized undersigned in the
City of Vernon Hills, State of Illinois, on this 15th day of March, 2000.
TEKGRAF, INC.
By: /s/ William M. Rychel
-------------------------------
William M. Rychel,
Chief Executive Officer
5
<PAGE> 6
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below appoints William M. Rychel as their 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 attached exhibits, and
other documents in connection with it, with the Securities and Exchange
Commission. The undersigned also grant unto William M. Rychel, 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 and to all intents and purposes
as he might or could do in person, hereby ratifying and confirming all which
William M. Rychel, or his 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 dates indicated.
<TABLE>
<CAPTION>
SIGNATURE CAPACITY DATE
- --------- -------- ----
<S> <C> <C>
/s/ William M. Rychel Chief Executive Officer March 15, 2000
- ------------------------- (principal executive officer) and
William M. Rychel Director
/s/ Thomas M. Mason Vice President of Finance and Chief March 15, 2000
- ----------------------- Financial Officer (principal financial
Thomas M. Mason and accounting officer)
/s/ Albert E. Sisto Director March 15, 2000
- ---------------------------
Albert E. Sisto
/s/ Frank X. Dalton, Jr. Director March 15, 2000
- ---------------------------
Frank X. Dalton, Jr.
</TABLE>
6
<PAGE> 7
EXHIBIT INDEX
<TABLE>
<CAPTION>
===================== ======================================================================================================
Exhibit Exhibit
Number
===================== ======================================================================================================
<S> <C>
4.1 Tekgraf, Inc. 1997 Employee Stock Option Plan, effective as of August 7, 1996, as
amended on May 26, 1999.
- --------------------- ------------------------------------------------------------------------------------------------------
4.2 Form of Stock Option Agreement under the Tekgraf, Inc. 1997 Employee Stock
Option Plan.
- --------------------- ------------------------------------------------------------------------------------------------------
5.1 Opinion of Nelson Mullins Riley & Scarborough, L.L.P.
- --------------------- ------------------------------------------------------------------------------------------------------
23.1 Consent of PricewaterhouseCoopers LLP.
- --------------------- ------------------------------------------------------------------------------------------------------
23.2 Consent of Nelson Mullins Riley & Scarborough, L.L.P. (included as part of Exhibit
5.1).
- --------------------- ------------------------------------------------------------------------------------------------------
24.1 Power of Attorney (contained on signature page of this filing).
- --------------------- ------------------------------------------------------------------------------------------------------
</TABLE>
7
<PAGE> 1
EXHIBIT 4.1
TEKGRAF, INC.
1997 STOCK OPTION PLAN
1. Purpose.
The purpose of this plan (the "Plan") is to secure for TEKGRAF, INC.
(the "Company") and its stockholders the benefits arising from capital stock
ownership by employees, officers and directors of, and consultants or advisors
to, the Company who are expected to contribute to the Company's future growth
and success. Except where the context otherwise requires, the term "Company"
shall include all present and future subsidiaries of the Company as defined in
Sections 424(e) and 424(f) of the Internal Revenue Code of 1986, as amended or
replaced from time to time (the "Code"). Those provisions of the Plan which
make express reference to Section 422 shall apply only to Incentive Stock
Options (as that term is defined in the Plan).
2. Type of Options and Administration.
(a) Types of Options. Options granted pursuant to the Plan shall
be authorized by action of the Board of Directors of the Company (or a
Committee designated by the Board of Directors) and may be either incentive
stock options ("Incentive Stock Options") meeting the requirements of Section
422 of the Code or non-statutory options which are not intended to meet the
requirements of Section 422 of the Code.
(b) Administration. The Plan will be administered by a committee
(the "Committee") appointed by the Board of Directors of the Company, whose
construction and interpretation of the terms and provisions of the Plan shall
be final and conclusive. The delegation of powers to the Committee shall be
consistent with applicable laws or regulations (including, without limitation,
applicable state law and Rule 16b-3 promulgated under the Securities Exchange
Act of 1934 (the "Exchange Act"), or any successor rule ("Rule 16b-3")). The
Committee may in its sole discretion grant options to purchase shares of the
Company's Class A Common Stock, $.001 par value per share ("Common Stock") and
issue shares upon exercise of such options as provided in the Plan. The
Committee shall have authority, subject to the express provisions of the Plan,
to construe the respective option agreements and the Plan, to prescribe, amend
and rescind rules and regulations relating to the Plan, to determine the terms
and provisions of the respective option agreements, which need not be
identical, and to make all other determinations in the judgment of the
Committee necessary or desirable for the administration of the Plan. The
Committee may correct any defect or supply any omission or reconcile any
inconsistency in the Plan or in any option agreement in the manner and to the
extent it shall deem expedient to carry the Plan into effect and it shall be
the sole and final judge of such expediency. No director or person acting
pursuant to authority delegated by the Board of Directors shall be liable for
any action or determination under the Plan made in good faith.
(c) Applicability of Rule 16b-3. Those provisions of the Plan
which make express reference to Rule 16b-3 shall apply to the Company only at
such time as the Company's Common Stock is registered under the Exchange Act,
subject to the last sentence of Section 3(b), and then only to such persons as
are required to file reports under Section 16(a) of the Exchange Act (a
"Reporting Person").
3. Eligibility.
(a) General. Options may be granted to persons who are, at the
time of grant, employees,
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<PAGE> 2
officers or directors of, or consultants or advisors to, the Company provided,
that Incentive Stock options may only be granted to individuals who are
employees of the Company (within the meaning of Section 3401(c) of the Code). A
person who has been granted an option may, if he or she is otherwise eligible,
be granted additional options if the Board of Directors shall so determine.
(b) Grant of Options to Reporting Persons. From and after the
registration of the Common Stock of the Company under the Exchange Act, the
selection of a director or an officer who is a Reporting Person (as the terms
"director" and "officer" are defined for purposes of Rule 16b-3) as a recipient
of an option, the timing of the option grant, the exercise price of the option
and the number of shares subject to the option shall be determined either (i)
by the Board of Directors, of which all members shall be "disinterested
persons" (as hereinafter defined), or (ii) by a committee consisting of two or
more directors having full authority to act in the matter, each of whom shall
be a "disinterested person." For the purposes of the Plan, a director shall be
deemed to be a "disinterested person, only if such person qualifies as a
"disinterested person" within the meaning of Rule 16b-3, as such term is
interpreted from time to time. If at least two of the members of the Board of
Directors do not qualify as a "disinterested person" within the meaning of Rule
16b-3, as such term is interpreted from time to time, then the granting of
options to officers and directors who are Reporting Persons under the Plan
shall not be determined in accordance with this Section 3(b) but shall be
determined in accordance with the other provisions of the Plan.
4. Stock Subject to Plan.
The stock subject to options granted under the Plan shall be shares of
authorized but unissued or reacquired Common Stock. Subject to adjustment as
provided in Section 15 below, the maximum number of shares of Common Stock of
the Company which may be issued and sold under the Plan is 600,000 shares. If
an option granted under the Plan shall expire, terminate or is cancelled for
any reason without having been exercised in full, the unpurchased shares
subject to such option shall again be available for subsequent option grants
under the Plan.
5. Forms of Option Agreements.
As a condition to the grant of an option under the Plan, each
recipient of an option shall execute an option agreement in such form not
inconsistent with the Plan as may be approved by the Board of Directors. Such
option agreements may differ among recipients.
6. Purchase Price.
(a) General. The purchase price per share of stock deliverable
upon the exercise of an option shall be determined by the Board of Directors at
the time of grant of such option; provided, however, that in the case of an
Incentive Stock Option, the exercise price shall not be less than 100% of the
Fair Market Value (as hereinafter defined) of such stock, at the time of grant
of such option, or less than 110% of such Fair Market Value in the case of
options described in Section 11(b). "Fair Market Value" of a share of Common
Stock of the Company as of a specified date for the purposes of the Plan shall
mean the closing price of a share of the Common Stock on the principal
securities exchange on which such shares are traded on the day immediately
preceding the date as of which Fair Market Value is being determined, or on the
next preceding date on which such shares are traded if no shares were traded on
such immediately preceding day, or if the shares are not traded on a securities
exchange, Fair Market Value shall be deemed to be the average of the high bid
and low asked prices of the shares in the over-the-counter market on the day
immediately preceding the date as of which Fair Market Value is being
determined or on the next preceding date on which such high bid and low asked
prices were recorded. If the shares are not publicly traded, Fair Market Value
of a share of Common Stock (including, in the case of any repurchase of
2
<PAGE> 3
shares, any distributions with respect thereto which would be repurchased with
the shares) shall be determined in good faith by the Board of Directors. In no
case shall Fair Market Value be determined with regard to restrictions other
than restrictions which, by their terms, will never lapse.
(b) Payment of Purchase Price. Options granted under the Plan may
provide for the payment of the exercise price by delivery of cash or a check to
the order of the Company in an amount equal to the exercise price of such
options, or, to the extent provided in the applicable option agreement, (i) by
delivery to the Company of shares of Common Stock of the Company having a Fair
Market Value on the date of exercise equal in amount to the exercise price of
the options being exercised, (ii) by any other means which the Board of
Directors determines are consistent with the purpose of the Plan and with
applicable laws and regulations (including, without limitation, the provisions
of Rule 16b-3 and Regulation T promulgated by the Federal Reserve Board) or
(iii) by any combination of such methods of payment.
7. Option Period.
Subject to earlier termination as provided in the Plan, each option
and all rights thereunder shall expire on such date as determined by the Board
of Directors and set forth in the applicable option agreement, provided, that
such date shall not be later than (10) ten years after the date on which the
option is granted.
8. Exercise of Options.
Each option granted under the Plan shall be exercisable either in full
or in installments at such time or times and during such period as shall be set
forth in the option agreement evidencing such option, subject to the provisions
of the Plan. No option granted to a Reporting Person for purposes of the
Exchange Act, however, shall be exercisable during the first six months after
the date of grant. Subject to the requirements in the immediately preceding
sentence, if an option is not at the time of grant immediately exercisable, the
Board of Directors may (i) in the agreement evidencing such option, provide for
the acceleration of the exercise date or dates of the subject option upon the
occurrence of specified events, and/or (ii) at any time prior to the complete
termination of an option, accelerate the exercise date or dates of such option.
9. Nontransferability of Options.
No option granted under this Plan shall be assignable or otherwise
transferable by the optionee except by will or by the laws of descent and
distribution or pursuant to a qualified domestic relations order as defined in
the Code or Title I of the Employee Retirement Income Security Act, or the
rules thereunder. An option may be exercised during the lifetime of the
optionee only by the optionee. In the event an optionee dies during his
employment by the Company or any of its subsidiaries, or during the three-month
period following the date of termination of such employment, his option shall
thereafter be exercisable, during the period specified in the option agreement,
by his executors or administrators to the full extent to which such option was
exercisable by the optionee at the time of his death during the periods set
forth in Section 10 or 11(d).
10. Effect of Termination of Employment or Other Relationship.
Except as provided in Section 11(d) with respect to Incentive Stock
Options, and subject to the provisions of the Plan, an optionee may exercise an
option at any time within three (3) months following the termination of the
optionee's employment or other relationship with the Company or within one (1)
year if such termination was due to the death or disability of the optionee,
but, except in the case of the
3
<PAGE> 4
optionee's death, in no event later than the expiration date of the Option. If
the termination of the optionee's employment is for cause or is otherwise
attributable to a breach by the optionee of an employment or confidentiality or
non-disclosure agreement, the option shall expire immediately upon such
termination. The Board of Directors shall have the power to determine what
constitutes a termination for cause or a breach of an employment or
confidentiality or non-disclosure agreement, whether an optionee has been
terminated for cause or has breached such an agreement, and the date upon which
such termination for cause or breach occurs. Any such determinations shall be
final and conclusive and binding upon the optionee.
11. Incentive Stock Options.
Options granted under the Plan which are intended to be Incentive
Stock Options shall be subject to the following additional terms and
conditions:
(a) Express Designation. All Incentive Stock Options granted
under the Plan shall, at the time of grant, be specifically designated as such
in the option agreement covering such Incentive Stock Options.
(b) 10% Stockholder. If any employee to whom an Incentive Stock
Option is to be granted under the Plan is, at the time of the grant of such
option, the owner of stock possessing more than 10% of the total combined
voting power of all classes of stock of the Company (after taking into account
the attribution of stock ownership rules of Section 424(d) of the Code), then
the following special provisions shall be applicable to the Incentive Stock
Option granted to such individual:
(i) The purchase price per share of the Common Stock
subject to such Incentive Stock Option shall not be less than 110% of
the Fair Market Value of one share of Common Stock at the time of
grant; and
(ii) the option exercise period shall not exceed five
years from the date of grant.
(c) Dollar Limitation. For so long as the Code shall so provide,
options granted to any employee under the Plan (and any other incentive stock
option plans of the Company) which are intended to constitute Incentive Stock
Options shall not constitute Incentive Stock Options to the extent that such
options, in the aggregate, become exercisable for the first time in any one
calendar year for shares of Common Stock with an aggregate Fair Market Value,
as of the respective date or dates of grant, of more than $100,000.
(d) Termination of Employees, Death or Disability. No Incentive
Stock Option may be exercised unless, at the time of such exercise, the
optionee is, and has been continuously since the date of grant of his or her
option, employed by the Company, except that:
(i) an Incentive Stock Option may be exercised within
the period of three months after the date the optionee ceases to be an
employee of the Company (or within such lesser period as may be
specified in the applicable option agreement), provided, that the
agreement with respect to such option may designate a longer exercise
period and that the exercise after such three-month period shall be
treated as the exercise of a non-statutory option under the Plan;
(ii) if the optionee dies while in the employ of the
Company, or within three months after the optionee ceases to be such
an employee, the Incentive Stock Option may be exercised by the person
to whom it is transferred by will or the laws of descent and
distribution within the period of one year after the date of death (or
within such lesser period as may be
4
<PAGE> 5
specified in the applicable option agreement); and
(iii) if the optionee becomes disabled (within the meaning
of Section 22(e) (3) of the Code or any successor provisions thereto)
while in the employ of the Company, the Incentive Stock Option may be
exercised within the period of one year after the date the optionee
ceases to be such an employee because of such disability (or within
such lesser period as may be specified in the applicable option
agreement).
For all purposes of the Plan and any option granted hereunder, "employment"
shall be defined in accordance with the provisions of Section 1.421-7(h) of the
Income Tax Regulations (or any successor regulations). Notwithstanding the
foregoing provisions, no Incentive Stock Option may be exercised after its
expiration date.
12. Additional Provisions.
(a) Additional Option Provisions. The Board of Directors may, in
its sole discretion, include additional provisions in option agreements
covering options granted under the Plan, including without limitation
restrictions on transfer, repurchase rights, rights of first refusal,
commitments to pay cash bonuses, to make, arrange for or guaranty loans or to
transfer other property to optionees upon exercise of options, or such other
provisions as shall be determined by the Board of Directors; provided, that
such additional provisions shall not be inconsistent with any other term or
condition of the Plan and such additional provisions shall not cause any
Incentive Stock Option granted under the Plan to fail to qualify as an
Incentive Stock Option within the meaning of Section 422 of the Code.
(b) Acceleration, Extension, Etc. The Board of Directors may, in
its sole discretion, (i) accelerate the date or dates on which all or any
particular option or options granted under the Plan may be exercised or (ii)
extend the dates during which all, or any particular, option or options granted
under the Plan may be exercised; provided, however, that no such extension
shall be permitted if it would cause the Plan to fail to comply with Section
422 of the Code or with Rule 16b-3 (if applicable).
13. General Restrictions.
(a) Investment Representations. The Company may require any
person to whom an option is granted, as a condition of exercising such option,
to give written assurances in substance and form satisfactory to the Company to
the effect that such person is acquiring the Common Stock subject to the option
for his or her own account for investment and not with any present intention of
selling or otherwise distributing the same, and to such other effects as the
Company deems necessary or appropriate in order to comply with federal and
applicable state securities laws, or with covenants or representations made by
the Company in connection with any public offering of its Common Stock.
(b) Compliance With Securities Laws. Each option shall be subject
to the requirement that if, at any time, counsel to the Company shall determine
that the listing, registration or qualification of the shares subject to such
option upon any securities exchange or under any state or federal law, or the
consent or approval of any governmental or regulatory body, or that the
disclosure of non-public information or the satisfaction of any other condition
is necessary as a condition of, or in connection with the issuance or purchase
of shares thereunder, such option may not be exercised, in whole or in part,
unless such listing, registration, qualification, consent, or approval, or
satisfaction of such condition shall have been effected or obtained on
conditions acceptable to the Board of Directors. Nothing herein shall be deemed
to require the Company to apply for or to obtain such listing, registration or
qualification, or to satisfy such condition.
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<PAGE> 6
14. Rights as a Stockholder.
The holder of an option shall have no rights as a stockholder with
respect to any shares covered by the option (including, without limitation, any
rights to receive dividends or non-cash distributions with respect to such
shares) until the date of issue of a stock certificate to him or her for such
shares. No adjustment shall be made for dividends or other rights for which the
record date is prior to the date such stock certificate is issued.
15. Adjustment Provisions for Recapitalizations, Reorganizations and
Related Transactions.
(a) Recapitalizations and Related Transactions. If, through or as
a result of any recapitalization, reclassification, stock dividend, stock
split, reverse stock split or other similar transaction, (i) the outstanding
shares of Common Stock are increased, decreased or exchanged for a different
number or kind of shares or other securities of the Company, or (ii) additional
shares or new or different shares or other non-cash assets are distributed with
respect to such shares of Common Stock or other securities, an appropriate and
proportionate adjustment shall be made in (x) the maximum number and kind of
shares reserved for issuance under the Plan, (y) the number and kind of shares
or other securities subject to any then outstanding options under the Plan, and
(z) the price for each share subject to any then outstanding options under the
Plan, without changing the aggregate purchase price as to which such options
remain exercisable. Notwithstanding the foregoing, no adjustment shall be made
pursuant to this Section 15 if such adjustment (i) would cause the Plan to fail
to comply with Section 422 of the Code or with Rule 16b-3 or (ii) would be
considered as the adoption of a new plan requiring stockholder approval.
(b) Reorganization, Merger and Related Transactions. If the
Company shall be the surviving corporation in any reorganization, merger or
consolidation of the Company with one or more other corporations, any then
outstanding option granted pursuant to the Plan shall pertain to and apply to
the securities to which a holder of the number of shares of Common Stock
subject to such options would have been entitled immediately following such
reorganization, merger, or consolidation, with a corresponding proportionate
adjustment of the purchase price as to which such options may be exercised so
that the aggregate purchase price as to which such options may be exercised
shall be the same as the aggregate purchase price as to which such options may
be exercised for the shares remaining subject to the options immediately prior
to such reorganization, merger, or consolidation.
(c) Board Authority to Make Adjustments. Any adjustments under
this Section 15 will be made by the Board of Directors, whose determination as
to what adjustments, if any, will be made and the extent thereof will be final,
binding and conclusive. No fractional shares will be issued under the Plan on
account of any such adjustments.
16. Merger, Consolidation, Asset Sale, Liquidation, Etc.
(a) General. In the event of a consolidation or merger in which
the Company is not the surviving corporation, or sale of all or substantially
all of the assets of the Company in which outstanding shares of Common Stock
are exchanged for securities, cash or other property of any other corporation
or business entity or in the event of a liquidation of the Company
(collectively, a "Corporate Transaction"), the Board of Directors of the
Company, or the board of directors of any corporation assuming the obligations
of the Company, may, in its discretion, take any one or more of the following
actions, as to outstanding options: (i) provide that such options shall be
assumed, or equivalent options shall be substituted, by the acquiring or
succeeding corporation (or an affiliate thereof), provided that any such
options substituted for Incentive Stock Options shall meet the requirements of
Section 424(a) of the Code, (ii) upon written notice to the optionees, provide
that all unexercised options will terminate immediately prior to the
consummation of such transaction unless exercised by the optionee within a
specified period following the date of such
6
<PAGE> 7
notice, (iii) in the event of a Corporate Transaction under the terms of which
holders of the Common Stock of the Company will receive upon consummation
thereof a cash payment for each share surrendered in the Corporate Transaction
(the "Transaction Price"), make or provide for a cash payment to the optionees
equal to the difference between (A) the Transaction Price times the number of
shares of Common Stock subject to such outstanding options (to the extent then
exercisable at prices not in excess of the Transaction Price) and (B) the
aggregate exercise price of all such outstanding options in exchange for the
termination of such options, and (iv) provide that all or any outstanding
options shall become exercisable in full immediately prior to such event.
(b) Substitute Options. The Company may grant options under the
Plan in substitution for options held by employees of another corporation who
become employees of the Company, or a subsidiary of the Company, as the result
of a merger or consolidation of the employing corporation with the Company or a
subsidiary of the Company, or as a result of the acquisition by the Company, or
one of its subsidiaries, of property or stock of the employing corporation. The
Company may direct that substitute options be granted on such terms and
conditions as the Board of Directors considers appropriate in the
circumstances.
17. No Special Employment Rights.
Nothing contained in the Plan or in any option shall confer upon any
optionee any right with respect to the continuation of his or her employment by
the Company or interfere in any way with the right of the Company at any time
to terminate such employment or to increase or decrease the compensation of the
optionee.
18. Other Employee Benefits.
Except as to plans which by their terms include such amounts as
compensation, the amount of any compensation deemed to be received by an
employee as a result of the exercise of an option or the sale of shares
received upon such exercise will not constitute compensation with respect to
which any other employee benefits of such employee are determined, including,
without limitation, benefits under any bonus, pension, profit-sharing, life
insurance or salary continuation plan, except as otherwise specifically
determined by the Board of Directors.
19. Amendment of the Plan.
(a) The Board of Directors may at any time, and from time to
time, modify or amend the Plan in any respect, except that if at any time the
approval of the stockholders of the Company is required under Section 422 of
the Code or any successor provision with respect to Incentive Stock Options, or
under Rule 16b-3, the Board of Directors may not effect such modification or
amendment without such approval.
(b) The modification or amendment of the Plan shall not, without
the consent of an optionee, affect his or her rights under an option previously
granted to him or her. With the consent of the optionee affected, the Board of
Directors may amend outstanding option agreements in a manner not inconsistent
with the Plan. The Board of Directors shall have the right to amend or modify
(i) the terms and provisions of the Plan and of any outstanding Incentive Stock
Options granted under the Plan to the extent necessary to qualify any or all
such options for such favorable federal income tax treatment (including
deferral of taxation upon exercise) as may be afforded incentive stock options
under Section 422 of the Code and (ii) the terms and provisions of the Plan and
of any outstanding option to the extent necessary to ensure the qualification
of the Plan under Rule 16b-3.
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<PAGE> 8
20. Withholding.
(a) The Company shall have the right to deduct from payments of
any kind otherwise due to the optionee any federal, state or local taxes of any
kind required by law to be withheld with respect to any shares issued upon
exercise of options under the Plan. Subject to the prior approval of the
Company, which may be withheld by the Company in its sole discretion, the
optionee may elect to satisfy such obligations, in whole or in part, (i) by
causing the Company to withhold shares of Common Stock otherwise issuable
pursuant to the exercise of an option or (ii) by delivering to the Company
shares of Common Stock already owned by the optionee. The shares so delivered
or withheld shall have a Fair Market Value equal to such withholding obligation
as of the date that the amount of tax to be withheld is to be determined. An
optionee who has made an election pursuant to this Section 20(a) may only
satisfy his or her withholding obligation with shares of Common Stock which are
not subject to any repurchase, forfeiture, unfulfilled vesting or other similar
requirements.
(b) The acceptance of shares of Common Stock upon exercise of an
Incentive Stock Option shall constitute an agreement by the optionee (i) to
notify the Company if any or all of such shares are disposed of by the optionee
within two years from the date the option was granted or within one year from
the date the shares were issued to the optionee pursuant to the exercise of the
option, and (ii) if required by law, to remit to the Company, at the time of
and in the case of any such disposition, an amount sufficient to satisfy the
Company's federal, state and local withholding tax obligations with respect to
such disposition, whether or not, as to both (i) and (ii), the optionee is in
the employ of the Company at the time of such disposition.
(c) Notwithstanding the foregoing, in the case of a Reporting
Person whose options have been granted in accordance with the provisions of
Section 3(b) herein, no election to use shares for the payment of withholding
taxes shall be effective unless made in compliance with any applicable
requirements of Rule 16b-3.
21. Cancellation and New Grant of Options, Etc.
The Board of Directors shall have the authority to effect, at any time
and from time to time, with the consent of the affected optionees, (i) the
cancellation of any or all outstanding options under the Plan and the grant in
substitution therefor of new options under the Plan covering the same or
different numbers of shares of Common Stock and having an option exercise price
per share which may be lower or higher than the exercise price per share of the
cancelled options or (ii) the amendment of the terms of any and all outstanding
options under the Plan to provide an option exercise price per share which is
higher or lower than the then-current exercise price per share of such
outstanding options.
22. Effective Date and Duration of the Plan.
(a) Effective Date. The Plan shall become effective when adopted
by the Board of Directors, but no Incentive Stock Option granted under the Plan
shall become exercisable unless and until the Plan shall have been approved by
the Company's stockholders. If such stockholder approval is not obtained within
twelve months after the date of the Board's adoption of the Plan, no options
previously granted under the Plan shall be deemed to be Incentive Stock Options
and no Incentive Stock options shall be granted thereafter. Amendments to the
Plan not requiring stockholder approval shall become effective when adopted by
the Board of Directors; amendments requiring stockholder approval (as provided
in Section 19) shall become effective when adopted by the Board of Directors,
but no Incentive Stock Option granted after the date of such amendment shall
become exercisable (to the extent that such amendment to the Plan was required
to enable the Company to grant such incentive Stock Option to a particular
optionee) unless and until such amendment shall have been approved by the
Company's stockholders. If
8
<PAGE> 9
such stockholder approval is not obtained within twelve months of the Board's
adoption of such amendment, any Incentive Stock Options granted on or after the
date of such amendment shall terminate to the extent that such amendment to the
Plan was required to enable the Company to grant such option to a particular
optionee. Subject to this limitation, options may be granted under the Plan at
any time after the effective date and before the date fixed for termination of
the Plan.
(b) Termination. Unless sooner terminated in accordance with
Section 16, the Plan shall terminate upon the earlier of (i) the close of
business on the day next preceding the tenth anniversary of the date of its
adoption by the Board of Directors, or (ii) the date on which all shares
available for issuance under the Plan shall have been issued pursuant to the
exercise or cancellation of options granted under the Plan. If the date of
termination is determined under (i) above, then options outstanding on such
date shall continue to have force and effect in accordance with the provisions
of the instruments evidencing such options.
23. Provision for Foreign Participants.
The Board of Directors may, without amending the Plan, modify awards
or options granted to participants who are foreign nationals or employed
outside the United States to recognize differences in laws, rules, regulations
or customs of such foreign jurisdictions with respect to tax, securities,
currency, employee benefit or other matters.
24. Governing Law.
The provisions of this Plan shall be governed and construed in
accordance with the laws of the State of Delaware without regard to the
principles of conflicts of laws.
Adopted by the Board of Directors on August 7, 1996, and amended on
May 26, 1999.
9
<PAGE> 1
EXHIBIT 4.2
FORM OF TEKGRAF, INC.
STOCK OPTION AGREEMENT
THIS STOCK OPTION AGREEMENT (this "Agreement"), entered into as of
this________ day of _______________ , 1999, by and between Tekgraf, Inc., a
Georgia corporation (the "Company"), and ___________________ (the "Optionee").
WHEREAS, effective as of August 7, 1996, the Board of Directors of the
Company adopted a stock option plan known as the "Tekgraf, Inc. 1997 Stock
Option Plan" (the "Plan"); and
WHEREAS, the Committee previously granted the Optionee a stock option
to purchase the number of shares of the Company's common stock as set forth
below, and in consideration of the granting of that stock option the Optionee
intends to remain in the employ of the Company; and
WHEREAS, the Company and the Optionee desire to enter into a written
agreement with respect to such option in accordance with the Plan.
NOW, THEREFORE, as an employment incentive and to encourage stock
ownership, and also in consideration of the mutual covenants contained herein,
the parties hereto agree as follows.
1. Incorporation of Plan. This option is granted pursuant to the
provisions of the Plan and the terms and definitions of the
Plan are incorporated herein by reference and made a part
hereof. A copy of the Plan has been delivered to, and receipt
is hereby acknowledged by, the Optionee.
2. Grant of Option. Subject to the terms, restrictions,
limitations and conditions stated herein, the Company hereby
evidences its grant to the Optionee, not in lieu of salary or
other compensation, of the right and option (the "Option") to
purchase all or any part of the number of shares of the
Company's Class A Common Stock, $.001 par value (the
"Stock"), set forth on Schedule A attached hereto and
incorporated herein by reference. The Option shall be
exercisable in the amounts and at the time specified on
Schedule A. The Option shall expire and shall not be
exercisable on the date specified on Schedule A or on such
earlier date as determined pursuant to Section 8, 9, or 10
hereof. Schedule A states whether the Option is intended to
be an Incentive Stock Option.
3. Purchase Price. The price per share to be paid by the
Optionee for the shares subject to this Option (the "Exercise
Price") shall be as specified on Schedule A, which price
shall be an amount not less than the Fair Market Value of a
share of Stock as of the Date of Grant (as defined in Section
11 below) if the Option is an Incentive Stock Option.
4. Exercise Terms. The Optionee must exercise the Option for at
least the lesser of 100 shares or the number of shares of
Purchasable Stock as to which the Option remains unexercised.
In the event this Option is not exercised with respect to all
or any part of the shares subject to this Option prior to its
expiration, the shares with respect to which this Option was
not exercised shall no longer be subject to this Option.
5. Option Non-Transferable. No Option shall be transferable by
an Optionee other than by will or the laws of descent and
distribution or, in the case of non-Incentive Stock Options,
pursuant to a Qualified Domestic Relations Order, and no
Option shall be transferable by
1
<PAGE> 2
an Optionee who is a Section 16 Insider prior to shareholder
approval of the Plan. During the lifetime of an Optionee,
Options shall be exercisable only by such Optionee (or by
such Optionee's guardian or legal representative, should one
be appointed).
6. Notice of Exercise of Option. This Option may be exercised by
the Optionee, or by the Optionee's administrators, executors
or personal representatives, by a written notice (in
substantially the form of the Notice of Exercise attached
hereto as Schedule B) signed by the Optionee, or by such
administrators, executors or personal representatives, and
delivered or mailed to the Company as specified in Section 14
hereof to the attention of the President or such other
officer as the Company may designate. Any such notice shall
(a) specify the number of shares of Stock which the Optionee
or the Optionee's administrators, executors or personal
representatives, as the case may be, then elects to purchase
hereunder, (b) contain such information as may be reasonably
required pursuant to Section 12 hereof, and (c) be
accompanied by (i) a certified or cashier's check payable to
the Company in payment of the total Exercise Price applicable
to such shares as provided herein, (ii) shares of Stock owned
by the Optionee and duly endorsed or accompanied by stock
transfer powers having a Fair Market Value equal to the total
Exercise Price applicable to such shares purchased hereunder,
or (iii) a certified or cashier's check accompanied by the
number of shares of Stock whose Fair Market Value when added
to the amount of the check equals the total Exercise Price
applicable to such shares purchased hereunder. Upon receipt
of any such notice and accompanying payment, and subject to
the terms hereof, the Company agrees to issue to the Optionee
or the Optionee's administrators, executors or personal
representatives, as the case may be, stock certificates for
the number of shares specified in such notice registered in
the name of the person exercising this Option.
7. Adjustment in Option. The number of shares subject to this
Option, the Exercise Price and other matters are subject to
adjustment during the term of this Option in accordance with
Sections 15 and 16 of the Plan.
8. Termination of Employment.
(a) Except as otherwise specified in Schedule A hereto,
in the event of the termination of the Optionee's
employment with the Company or any of its
subsidiaries, other than a termination that is
either (i) for Cause, or (ii) for reasons of death
or disability, the Optionee may exercise this Option
at any time within three (3) months after such
termination to the extent of the number of shares
which were Purchasable hereunder at the date of such
termination.
(b) Except as specified in Schedule A attached hereto,
in the event of a termination of the Optionee's
employment that is for Cause, this Option, to the
extent not previously exercised, shall terminate
immediately and shall not thereafter be or become
exercisable.
9. Disabled Optionee. In the event of the termination of the
Optionee's employment because of the Optionee's becoming a
Disabled Optionee, the Optionee (or his or her personal
representative) may exercise this Option within a period
ending on the earlier of (a) the last day of the one year
period following the Optionee's death or (b) the expiration
date of this Option, in either case to the extent of the
number of shares which were Purchasable hereunder at the date
of such termination.
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<PAGE> 3
10. Death of Optionee. Except as otherwise set forth in Schedule
A with respect to the rights of the Optionee upon termination
of employment under Section 8(a) above, in the event of the
Optionee's death while employed by the Company or any of its
subsidiaries, the appropriate persons described in Section 6
hereof or persons to whom all or a portion of this Option is
transferred in accordance with Section 5 hereof may exercise
this Option at any time within one (1) year of such
termination. If the Optionee was an employee of the Company
at the time of death, this Option may be so exercised to the
extent of the number of shares that were Purchasable
hereunder at the date of death. If the Optionee's employment
terminated prior to his or her death, this Option may be
exercised only to the extent of the number of shares covered
by this Option which were Purchasable hereunder at the date
of such termination.
11. Date of Grant. This Option was granted by the Board of
Directors of the Company on the date set forth in Schedule A
(the "Date of Grant").
12. Compliance with Regulatory Matters. The Optionee acknowledges
that the issuance of capital stock of the Company is subject
to limitations imposed by federal and state law and the
Optionee hereby agrees that the Company shall not be
obligated to issue any shares of Stock upon exercise of this
Option that would cause the Company to violate law or any
rule, regulation, order or consent decree of any regulatory
authority (including without limitation the Securities and
Exchange Commission) having jurisdiction over the affairs of
the Company. The Optionee agrees that he or she will provide
the Company with such information as is reasonably requested
by the Company or its counsel to determine whether the
issuance of Stock complies with the provisions described by
this Section 12.
13. Restriction on Disposition of Shares. The shares purchased
pursuant to the exercise of an Incentive Stock Option shall
not be transferred by the Optionee except pursuant to the
Optionee's will, or the laws of descent and distribution,
until such date which is the later of two years after the
grant of such Incentive Stock Option or one year after the
transfer of the shares to the Optionee pursuant to the
exercise of such Incentive Stock Option.
14. Miscellaneous.
(a) This Agreement shall be binding upon the parties
hereto and their representatives, successors and
assigns.
(b) This Agreement is executed and delivered in, and
shall be governed by the laws of, the State of
Georgia.
(c) Any requests or notices to be given hereunder shall
be deemed given, and any elections or exercises to
be made or accomplished shall be deemed made or
accomplished, upon actual delivery thereof to the
designated recipient, or three days after deposit
thereof in the United States mail, registered,
return receipt requested and postage prepaid,
addressed, if to the Optionee, at the address set
forth below and, if to the Company, to the executive
offices of the Company at 645 Hembree Parkway, Suite
J, Roswell, Georgia 30076.
(d) This Agreement may not be modified except in writing
executed by each of the parties hereto.
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<PAGE> 4
IN WITNESS WHEREOF, the Board of Directors of the Company has caused
this Stock Option Agreement to be executed on behalf of the Company, and the
Optionee has executed this Stock Option Agreement, all as of the day and year
first above written.
TEKGRAF, INC. OPTIONEE
By:
------------------------------ ------------------------------
Name: Name:
Title: Address:
4
<PAGE> 5
SCHEDULE A
TO
STOCK OPTION AGREEMENT
BETWEEN
TEKGRAF, INC.
AND
_____________________________
Dated: _______________
1. Number of Shares Subject to Option: _______________ shares.
2. This Option (Check one) [ ] is [ ] is not an Incentive Stock Option.
3. Option Exercise Price: $__________ per share.
4. Date of Grant:_______________
5. Option Vesting Schedule:
Check one:
( ) Options are exercisable with respect to all shares
on or after the date hereof
( ) Options are exercisable with respect to the number
of shares indicated below on or after the date
indicated next to the number of shares:
No. of Shares Vesting Date
6. Option Exercise Period:
Check One:
( ) All options expire and are void unless exercised on
or before __________, 200_.
( ) Options expire and are void unless exercised on or
before the date indicated next to the number of
shares:
No. of Shares Expiration Date
7. Effect of Termination of Employment of Optionee (if different from
that set forth in Sections 8, 9 and 10 of the Stock Option Agreement):
<PAGE> 6
SCHEDULE B
NOTICE OF EXERCISE
The undersigned hereby notifies Tekgraf, Inc. (the "Company")
of his or her election to exercise the undersigned's stock option to purchase
______ shares of the Company's Class A Common Stock, $.001 par value (the
"Common Stock"), pursuant to the Stock Option Agreement (the "Agreement")
between the undersigned and the Company dated ________________. Accompanying
this Notice is (1) a certified or a cashier's check in the amount of $________
payable to the Company, and/or (2) __________ shares of the Company's Common
Stock presently owned by the undersigned and duly endorsed or accompanied by
stock transfer powers, having an aggregate Fair Market Value (as defined in
Tekgraf, Inc. 1997 Stock Option Plan) as of the date hereof of $____________,
such amounts being equal, in the aggregate, to the purchase price per share set
forth in Section 3 of the Agreement multiplied by the number of shares being
purchased hereby (in each instance subject to appropriate adjustment pursuant to
Sections 16 or 17 of the Plan).
IN WITNESS WHEREOF, the undersigned has set his hand and seal, this
_____ day of ______________, _______.
OPTIONEE [OR OPTIONEE'S
ADMINISTRATOR,
EXECUTOR OR PERSONAL
REPRESENTATIVE]
------------------------------------------
Name:
Position (if other than Optionee):
<PAGE> 1
EXHIBIT 5.1
LAW OFFICES
Nelson Mullins Riley & Scarborough, L.L.P.
A REGISTERED LIMITED LIABILITY PARTNERSHIP
999 PEACHTREE STREET, N.E.
FIRST UNION PLAZA
SUITE 1400
Atlanta, Georgia 30309
TELEPHONE (404) 817-6000
FACSIMILE (404) 817-6050
www.nmrs.com
OTHER OFFICES:
Charleston, South Carolina
Charlotte, North Carolina
Columbia, South Carolina
Greenville, South Carolina
Myrtle Beach, South Carolina
________
Munich, Germany
March 15, 2000
Tekgraf, Inc.
980 Corporate Woods Parkway
Vernon Hills, Illinois 60061
Gentlemen:
We have acted as counsel to Tekgraf, Inc. (the "Company") in
connection with the filing of a Registration Statement on Form S-8 (the
"Registration Statement") under the Securities Act of 1933, covering the
offering of up to 600,000 shares (the "Plan Shares") of the Registrant's Class
A Common Stock, $0.001 par value per share (the "Common Stock"), that may be
issued pursuant to the Tekgraf, Inc. 1997 Employee Stock Option Plan, effective
as of August 7, 1996 and amended on May 26, 1999 (the "Plan"). In connection
therewith, we have examined such corporate records, certificates of public
officials and other documents and records as we have considered necessary or
proper for the purpose of this opinion.
This opinion is limited by, and is in accordance with, the January 1,
1992, edition of the Interpretive Standards applicable to Legal Opinions to
Third Parties in Corporate Transactions adopted by the Legal Opinion Committee
of the Corporate and Banking Law Section of the State Bar of Georgia.
Based on the foregoing, and having regard to legal considerations
which we deem relevant, we are of the opinion that the Plan Shares covered by
the Registration Statement, which may be issued pursuant to the Plan, will,
when issued in accordance with the Plan, be validly issued, fully paid and
nonassessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to all references to our firm included in or made a
part of the Registration Statement.
Sincerely,
NELSON MULLINS RILEY & SCARBOROUGH, L.L.P.
By: /s/ Philip H. Moise
-------------------------------------------
Philip H. Moise
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of TEKGRAF, Inc. of our report dated February 25, 1999,
except as to Note 15 for which the date is March 25, 1999, included in Tekgraf,
Inc.'s Annual Report on Form 10-K for the year ended December 31, 1998.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Atlanta, Georgia
March 15, 2000
