As filed with the Securities and Exchange Commission on October 29, 1999.
Registration No. 333-_______
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
- --------------------------------------------------------------------------------
TROPICAL SPORTSWEAR INT'L CORPORATION
(Exact Name of Issuer as Specified in its Charter)
Florida 59-3424305
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
4902 West Waters Avenue
Tampa, Florida 33634-1302
(813) 249-4900
(Address, including zip code, and telephone number of
principal executive offices)
TROPICAL SPORTSWEAR INT'L CORPORATION
EMPLOYEE STOCK OPTION PLAN,
AS AMENDED AND RESTATED
(Full Title of the Plan)
N. LARRY McPHERSON
Executive Vice President and Treasurer
TROPICAL SPORTSWEAR INT'L CORPORATION
4902 West Waters Avenue
Tampa, Florida 33634-1302
(813) 249-4900
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
-----------------------
CALCULATION OF REGISTRATION FEE
- ------------------- ------------ ---------- ---------- ------------------
Proposed Proposed
Title of Maximum Maximum
Securities Amount Offering Aggregate
to be to be Price Per Offering Amount of
Registered Registered Share (1) Price (1) Registration Fee
- ------------------- ------------ ---------- ---------- ------------------
Common Stock,
$.01 par value per 500,000 $18.25 $9,125,000 $2,537
share
- ------------------- ------------ ---------- ---------- ------------------
(1) Determined in accordance with Rule 457(h), the registration fee calculation
is based on the average of the high and low prices of a share of the
Registrant's Common Stock reported on the Nasdaq National Market on October
25, 1999.
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
(a) The documents constituting Part I of this Registration Statement
will be sent or given to participants in the Plan as specified by Rule 428(b)(1)
under the Securities Act of 1933, as amended.
(b) Upon written or oral request, Tropical Sportswear Int'l Corporation
(the "Company") will provide, without charge, the documents incorporated by
reference in Item 3 of Part II of this Registration Statement. The documents are
incorporated by reference in the Section 10(a) prospectus. The Company will also
provide, without charge, upon written or oral request, other documents requested
to be delivered to employees pursuant to Rule 428(b). Requests for the above
mentioned information should be directed to N. Larry McPherson at the address on
the cover of this Registration Statement.
PART II
INFORMATION REQUIRED IN REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents filed by the Company (File No. 000-23161) with
the Securities and Exchange Commission (the "Commission") pursuant to the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), are
incorporated herein by reference and are deemed to be a part hereof from the
date of the filing of such documents:
(1) The Company's Annual Report on Form 10-K for the fiscal year ended
September 30, 1998.
(2) All other reports filed by the Company pursuant to Section 13 (a)
or 15(d) of the Exchange Act since October 3, 1998.
(3) The description of the Company's Common Stock contained in the
Company's Registration Statement filed under Section 12 of the Exchange Act,
including all amendments or reports filed for the purpose of updating such
description.
(4) All other documents subsequently filed by the Company pursuant to
Section 13(a), 13(c), 14 and 15(d) of the Exchange Act prior to the filing of a
post-effective amendment to this Registration Statement that indicates that all
securities offered have been sold or that deregisters all securities that remain
unsold.
Any statement contained in a document incorporated or deemed
incorporated herein by reference shall be deemed to be modified or superseded
for the purpose of this Registration Statement to the extent that a statement
contained herein or in any subsequently filed document which also is, or is
deemed to be, incorporated herein by reference 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. Not Applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL. Not Applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Florida Business Corporation Act (the "Florida Act") permits a
Florida corporation to indemnify a present or former director or officer of the
corporation (and certain other persons serving at the request of the corporation
in related capacities) for liabilities, including legal expenses, arising by
reason of service in such capacity if such person shall have acted in good faith
and in a manner he reasonably believed to be in or not opposed to the best
interests of the corporation, and in any criminal proceeding if such person had
no reasonable cause to believe his conduct was unlawful. However, in the case of
actions brought by or in the right of the corporation, no indemnification may be
made with respect to any matter as to which such director or officer shall have
been adjudged liable, except in certain limited circumstances.
The Company's Articles of Incorporation and Bylaws provide that the
Company shall indemnify directors and executive officers to the fullest extent
now or hereafter permitted by the Florida Act. In addition, the Company may
enter into Indemnification Agreements with its directors and executive officers
in which the Company may agree to indemnify such persons to the fullest extent
now or hereafter permitted by the Florida Act.
The indemnification provided by the Florida Act, and the Company's
Bylaws is not exclusive of any other rights to which a director or officer may
be entitled. The general effect of the foregoing provisions may be to reduce the
circumstances which an officer or director may be required to bear the economic
burden of the foregoing liabilities and expense.
The Company may obtain a liability insurance policy for its directors
and officers as permitted by the Florida Act which may extend to, among other
things, liability arising under the Securities Act of 1933, as amended.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED. Not Applicable.
ITEM 8. EXHIBITS
The exhibits listed in the Exhibit Index are filed as part of this
Registration Statement.
ITEM 9. UNDERTAKINGS
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of this Registration Statement (or the
most recent post-effective amendment thereof) which, individually or in
the aggregate, represent a fundamental change in the information set
forth in this Registration Statement;
(iii) To include any material information with
respect to the plan of distribution not previously disclosed in this
Registration Statement or any material change to such information in
this Registration Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) above do
not apply if the registration statement is on Form S-3 or Form S-8, 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 the Exchange Act that are incorporated by
reference in this Registration Statement.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities being offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in this Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
(Signatures on following page)
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the Company 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 Tampa, State of Florida, on October 29, 1999.
TROPICAL SPORTSWEAR INT'L CORPORATION
By: /s/ N. Larry McPherson
N. Larry McPherson
Executive Vice President and Treasurer
Power of Attorney
KNOW ALL MEN BY THESE PRESENTS that each person whose signature appears
below constitutes and appoints William W. Compton and Michael Kagan and each of
them (with full power in each to act alone), as his true and lawful
attorneys-in-fact and agents, with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign 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, granting unto such attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or either of them, or
their 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, as amended,
this Registration Statement has been signed by the following persons in the
capacities indicated as of October 29, 1999.
Signature Capacity
/s/ William W. Compton Chairman of the Board, Chief Executive Officer,
William W. Compton and Director (Principal Executive Officer)
[Signatures continued on following page]
<PAGE>
/s/ Michael Kagan Executive Vice President, Chief Financial
Michael Kagan Officer, Secretary and Director (Principal
Financial and Accounting Officer)
Eloy S. Vallina-Laguera Director
Director
Jesus Alvarex-Morodo
/s/ Leslie J. Gillock Director
Leslie J. Gillock
/s/ Donald H. Livingston Director
Donald H. Livingston
/s/ Leon H. Reinhart Director
Leon H. Reinhart
Richard C. Allender Director
/s/ Charles J. Smith Director
Charles J. Smith
<PAGE>
Registration No. 333-________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
EXHIBITS FILED WITH
REGISTRATION STATEMENT
ON FORM S-8
UNDER
THE SECURITIES ACT OF 1933
Tropical Sportswear Int'l Corporation
4902 West Waters Avenue
Tampa, Florida 33634-1302
(813) 249-4900
<PAGE>
EXHIBIT INDEX
TO
REGISTRATION STATEMENT ON FORM S-8
Exhibit Number Description
3.1 Amended and Restated Articles of Incorporation of
Tropical Sportswear Int'l Corporation, as amended,
dated November 13, 1998
5 Opinion of Alston & Bird LLP as to the legality
of the securities to be issued (filed herewith)
23.1 Consent of Alston & Bird LLP (contained in its
opinion filed herewith as Exhibit 5 and
incorporated herein by reference)
23.2 Consent of Ernst & Young LLP (filed herewith)
24.1 Power of Attorney (contained in Part II)
99.1 Tropical Sportswear Int'l Corporation Employee
Stock Option Plan, as amended and restated (filed
herewith)
AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF
TROPICAL SPORTSWEAR INT'L CORPORATION
TROPICAL SPORTSWEAR INT'L CORPORATION (the "Corporation"), under the
Florida Business Corporation Act, Chapter 607 of the Florida Statutes, as
hereafter amended and modified (the "FBCA"), hereby adopts the following
Amended and Restated Articles of Incorporation of the Corporation, effective as
of October 23, 1997, pursuant to Sections 607.1006 and 607.1007 of the FBCA:
ARTICLE 1
Name
The name of the Corporation is:
TROPICAL SPORTSWEAR INT'L CORPORATION
ARTICLE 2
Business and Activities
The Corporation may, and is authorized to, engage in any activity or
business now or hereafter permitted under the laws of the United States and of
the State of Florida.
ARTICLE 3
Capital Stock
3.1 Authorized Shares. The total number of shares of all classes of
capital stock that the Corporation shall have the authority to issue shall be
60,000,000 shares, of which 50,000,000 shares shall be Common Stock having a
par value of $0.01 per share ("Common Stock") and 10,000,000 shares shall be
Preferred Stock, par value of $0.01 per share ("Preferred Stock"). The Board of
Directors is expressly authorized, pursuant to Section 607.0602 of the FBCA, to
provide for the classification and reclassification of any unissued shares of
Common Stock or Preferred Stock and the issuance thereof in one or more classes
or series without the approval of the shareholders of the Corporation, all
within the limitations set forth in Section 607.0601 of the FBCA.
3.2 Common Stock.
(A) Relative Rights. The Common Stock shall be subject to all
of the rights, privileges, preferences and priorities of the Preferred Stock as
set forth in the Articles of Amendment to these Amended and Restated Articles of
Incorporation that may hereafter be filed pursuant to Section 607.0602 of the
FBCA to establish the respective class or series of the Preferred Stock. Except
as otherwise provided in these Amended and Restated Articles of Incorporation,
each share of Common Stock shall have the same rights as and be identical in all
respects to all the other shares of Common Stock.
(B) Voting Rights. Except as otherwise provided in these
Amended and Restated Articles of Incorporation, except as otherwise provided by
the FBCA and except as may be determined by the Board of Directors with respect
to the Preferred Stock, only the holders of Common Stock shall be entitled to
vote for the election of directors of the Corporation and for all other
corporate purposes. Upon any such vote, each holder of Common Stock shall,
except as otherwise provided by the FBCA, be entitled to one vote for each
share of Common Stock held by such holder.
(C) Dividends. Whenever there shall have been paid, or
declared and set aside for payment, to the holders of the shares of any class
of stock having preference over the Common Stock as to the payment of
dividends, the full amount of dividends and of sinking fund or retirement
payments, if any, to which such holders are respectively entitled in preference
to the Common Stock, then the holders of record of the Common Stock and any
class or series of stock entitled to participate therewith as to dividends,
shall be entitled to receive dividends, when, as, and if declared by the Board
of Directors, out of any assets legally available for the payment of dividends
thereon.
(D) Dissolution, Liquidation, Winding Up. In the event of any
dissolution, liquidation, or winding up of the Corporation, whether voluntary
or involuntary, the holders of record of the Common Stock then outstanding, and
all holders of any class or series of stock entitled to participate therewith
in whole or in part, as to the distribution of assets, shall become entitled to
participate in the distribution of assets of the Corporation remaining after
the Corporation shall have paid, or set aside for payment, to the holders of
any class of stock having preference over the Common Stock in the event of
dissolution, liquidation, or winding up, the full preferential amounts (if any)
to which they are entitled, and shall have paid or provided for payment of all
debts and liabilities of the Corporation.
3.3 Preferred Stock.
(A) Issuance, Designations, Powers, Etc. The Board of
Directors is expressly authorized, subject to the limitations prescribed by the
FBCA and the provisions of these Amended and Restated Articles of
Incorporation, to provide, by resolution and by filing Articles of Amendment to
these Amended and Restated Articles of Incorporation, which, pursuant to
Section 607.0602 of the FBCA shall be effective without shareholder action, for
the issuance from time to time of the shares of the Preferred Stock in one or
more classes or series, to establish from time to time the number of shares to
be included in each such class or series, and to fix the designations, powers,
preferences and other rights of the shares of each such class or series and to
fix the qualifications, limitations and restrictions thereon, including, but
without limiting the generality of the foregoing, the following:
(1) the number of shares constituting that class
or series and the distinctive designation of that class or series;
(2) the dividend rate on the shares of that
class or series, whether dividends shall be cumulative, or partially
cumulative and, if so, from which date or dates, and the relative
rights of priority, if any, of payments of dividends on shares
of that class or series;
(3) whether that class or series shall have
voting rights, in addition to the voting rights provided by the FBCA,
and, if so, the terms of such voting rights;
(4) whether that class or series shall have
conversion privileges, and, if so, the terms and conditions of such
conversion, including provision for adjustment of the conversion rate
in such events as the Board of Directors shall determine;
(5) whether or not the shares of that class or
series shall be redeemable, and, if so, the terms and conditions of
such redemption, including the dates upon or after which they shall be
redeemable, and the amount per share payable in case of redemption,
which amount may vary under different conditions and at different
redemption dates;
(6) whether that class or series shall have a
sinking fund for the redemption or purchase of shares of that class or
series, and, if so, the terms and amount of such sinking fund;
(7) the rights of the shares of that class or
series in the event of voluntary or involuntary liquidation,
dissolution, or winding up of the Corporation, and the relative rights
of priority, if any, of payment of shares of that class or series; and
(8) any other relative powers, preferences, and
rights of that class or series, and qualifications, limitations or
restrictions on that class or series.
(B) Dissolution, Liquidation, Winding Up. In the event of any
liquidation, dissolution or winding up of the Corporation, whether voluntary or
involuntary, the holders of Preferred Stock of each class or series shall be
entitled to receive only such amount or amounts as shall have been fixed by the
Articles of Amendment to these Amended and Restated Articles of Incorporation
or by the resolution or resolutions of the Board of Directors providing for the
issuance of such class or series.
3.4 No Preemptive Rights. Except as the Board of Directors may
otherwise determine, no shareholder of the Corporation shall have any
preferential or preemptive right to subscribe for or purchase from the
Corporation any new or additional shares of capital stock, or securities
convertible into shares of capital stock, of the Corporation, whether now or
hereafter authorized.
3.5 Special Classes of Stock Prior to Initial Public Offering. Each
share of preferred stock of the Corporation that was issued and outstanding
immediately prior to the adoption of these Amended and Restated Articles of
Incorporation shall be canceled and deemed to constitute one share of Preferred
Stock hereunder, having the rights, preferences, qualifications, limitations
and restrictions set forth below (the "Special Preferred Stock"). Anything in
Section 3.3 to the contrary notwithstanding, the Board of Directors shall not
be required to file Articles of Amendment to these Amended and Restated
Articles of Incorporation in order to issue shares of Special Preferred Stock.
The Corporation shall not have authority to issue any additional shares of
Special Preferred Stock.
(1) Voting Rights. Except as otherwise provided by
the FBCA, the holders of issued and outstanding shares of Special
Preferred Stock ("Special Preferred Holders") shall not be entitled to
vote for the election of directors of the Corporation or for all other
corporate matters.
(2) Dividend Rights. The Special Preferred Holders
shall not be entitled to receive dividends.
(3) Dissolution, Liquidation, Winding Up. In the
event of any dissolution, liquidation or winding up of the
Corporation, whether voluntary or involuntary, before any assets of
the Corporation shall be paid to, set aside for or distributed to
holders of issued and outstanding shares of Common Stock or other
Preferred Stock, each Special Preferred Holder shall be entitled to
receive out of the assets of the Corporation or the proceeds thereof,
a preferential payment in an amount equal to $100.00 per share. Except
as provided herein, the Special Preferred Holders shall not be
entitled to participate in any further distribution of the assets of
the Corporation or otherwise. If the assets distributable upon a
liquidation shall be insufficient to permit the distribution to the
Special Preferred Holders of the full preferential amounts to which
such Special Preferred Holders shall be entitled, then such amounts
shall be distributed ratably to such Special Preferred Holders in
proportion to the full amounts to which they respectively are
entitled. Neither the consolidation or merger of the Corporation with
or into any other corporation or corporations, nor the sale or
transfer by the Corporation of all or any part of its assets or stock,
shall be deemed to be a liquidation of the Corporation for purposes of
this Section.
(4) Redemption Rights.
(i) At the option of the Corporation, as evidenced
by resolution of its Board of Directors, the Corporation may
at any time, and from time to time, redeem the entire amount
or any part of the shares of issued and outstanding Special
Preferred Stock, without any redemption premium or penalty,
at an amount equal to $100.00 per share.
(ii) If less than all the issued and outstanding
shares of Special Preferred Stock are to be redeemed by the
Corporation, the particular shares to be redeemed shall be
conclusively selected or determined by the Board of Directors
of the Corporation rata or by such other equitable manner as
the Board of Directors of the Corporation shall designate and
prescribe by resolution.
(iii) In case less than all the shares of Special
Preferred Stock represented by any surrendered certificate
are redeemed by the Corporation, a new certificate shall be
issued representing the unredeemed shares.
(iv) All shares of-Special Preferred-Stock redeemed
as hereinabove provided or otherwise shall be reared and
canceled and shall not be reissued.
(5) Other Rights. Holders of the Special Preferred Stock
shall not be entitled to any conversion rights, preemptive rights, or
any other rights not specified in this Section 3.5.
ARTICLE 4
Board of Directors
4.1 Classification. Except as otherwise provided in these Amended and
Restated Articles of Incorporation or Articles of Amendment filed pursuant to
Section 3.3 hereof relating to the rights of the holders of any class or series
of Preferred Stock, voting separately by class or series, to elect additional
directors under specified circumstances, the number of directors of the
Corporation shall be fixed from time to time by or pursuant to these Amended
and Restated Articles of Incorporation or by bylaws of the Corporation (the
"Bylaws"). The directors, other than those who may be elected by the holders of
any class or series of Preferred Stock voting separately by class or series,
shall be classified, with respect to the time for which they severally hold
office, into three classes, Class I, Class II and Class III, each of which
shall be as nearly equal in number as possible, and shall be adjusted from time
to time in the manner specified in the Bylaws to maintain such proportionality.
Each initial director in Class I shall hold office for a term expiring at the
2000 annual meeting of the shareholders; each initial director in Class II
shall hold office for a term expiring at the 1999 annual meeting of the
shareholders; and each initial director in Class III shall hold office for a
term expiring at the 1998 annual meeting of the shareholders. Notwithstanding
the foregoing provisions of this Section 4.1, each director shall serve until
such director's successor is duly elected and qualified, or until such
director's earlier death, resignation or removal. At each annual meeting of the
shareholders, the successors to the class of directors whose term expires at
that meeting shall be elected to hold office for a term expiring at the annual
meeting of the shareholders held in the third year following the year of their
election and until their successors shall have been duly elected and qualified,
or until such director's earlier death, resignation or removal.
4.2 Special Nomination Rights. Notwithstanding the provisions of these
Amended and Restated Articles of Incorporation or the Corporation's Bylaws as
in effect from time to time, (i) Accel, S.A. de C.V. ("Accel") shall be
entitled to nominate for election to the Board of Directors of the Corporation
two persons, one of whom shall be a Class I director and one of whom shall be a
Class II director; (ii) Schakale Internacional, S.A. ("Schakale") shall be
entitled to nominate for such election one person, who shall be a Class III
director; (iii) the Compton Family Limited Partnership ("Compton") shall be
entitled to nominate for such election one person, who shall be a Class I
director; and (iv) the Kagan Family Limited Partnership ("Kagan") shall be
entitled to nominate for such election one person, who shall be a Class III
director; provided, however, that (y) should at any time the percentage of
Common Stock beneficially owned by Accel fall below twelve percent (12 %) of
the aggregate number of shares of Common Stock issued and outstanding, then
Accel shall, automatically and without any right of reinstatement, forfeit the
right pursuant to this Section 4.2 to nominate for election to the Board a
Class I director, and (z) should at any time the percentage of Common Stock
beneficially owned by any of Accel, Schakale, Compton or Kagan fall below five
percent (5 %) of the aggregate number of shares of Common Stock issued and
outstanding, then such party so falling below shall forfeit, automatically and
without any right of reinstatement, the right pursuant to this Section 4.2 to
nominate any person for election to the Board. The failure of any person
nominated by any party pursuant to this Section 4.2 to be elected or qualified
shall not in any way affect such party's future nomination rights under this
Section 4.2. For purposes of calculating the foregoing percentages, the number
of shares of Common Stock beneficially owned by each of Accel, Schakale,
Compton or Kagan shall include any shares of Common Stock owned beneficially
and of record by any of its affiliates, or members of their immediate families,
in each case as such term is defined under the Securities Exchange Act of 1934,
as amended (the "Exchange Act"). Except as set forth in the immediately
following sentence, and notwithstanding any other provision in these Amended
and Restated Articles of Incorporation to the contrary, at the time for
nomination to fill a vacancy resulting from the death, resignation or removal
of a director who was elected pursuant to a nomination under this Section 4.2
(or who was an opponent of such a nominee and was elected instead) (a
"Ceasing-to-be Director"), then Accel, Schakale, Compton or Kagan, whichever
initially nominated such Ceasing-to-be-Director (or whichever nominated the
defeated opponent of such director), shall have the right (provided such right
has not been forfeited as set forth in this Section 4.2) to nominate another
person for election to the Board of Directors of the Corporation at the next
annual meeting of shareholders to complete such director's term.
Notwithstanding the foregoing, the Board of Directors shall be entitled to fill
or leave vacant the seat of any Ceasing-to-be-Director between the time that
such Director ceases to be a director and the next annual meeting of
shareholders. To be timely, nomination pursuant to this Section 4.2 must be
delivered to or mailed and received at the principal business office of the
Corporation not more than ten (10) days after notice of the date of the annual
meeting of shareholders is given to such shareholders or prior public
disclosure of the date of the meeting is made, except that, in the case of a
sitting director previously so nominated under this Section 4.2, the
Corporation shall communicate with such director on a timely basis for the
purpose of confirming that such director is to be nominated again and
requesting the information requested of nominees indicated below. Any
nomination pursuant to this Section 4.2 shall set forth (a) as to the person
such party proposes to nominate for election or re-election as a director, (i)
the name, age, business address and residence address of such proposed nominee,
(ii) the principal occupation or employment of such person,(iii) the class and
number of shares of capital stock of the Corporation which are beneficially
owned by such person, and (iv) any other information relating to such person
that is required to be disclosed in solicitations of proxies for election of
directors, or is otherwise required, in each case pursuant to Regulation 14A
under the Exchange Act (including without limitation such person's written
consent to being named in the proxy statement as a nominee and to serving as a
director if elected); and (b) as to the party making such nomination (i) the
name and address, as they appear on the Corporation's books, of the party
proposing such nomination, and (ii) the class and number of shares of stock of
the Corporation which are beneficially owned by the shareholder, as calculated
in accordance herewith. Notwithstanding the foregoing, no person shall be
nominated for election as a director of the Corporation by any party pursuant
to this Section 4.2 if such person has previously been removed as a director
for cause as provided in Section 4.3 below. Notwithstanding the provisions of
the Company's Bylaws as in effect from time to time, in the event a person is
properly nominated to stand for election as a director of the Corporation
pursuant to this Section 4.2, such person shall be regarded as a nominee of the
Board of Directors for purposes of Regulation 14A under the Exchange Act. The
forfeiture by any party of any special nomination rights pursuant to this
Section 4.2 shall not affect such party's rights as a shareholder of the
Corporation generally (it not being the intent hereof to deprive any party
hereto of any right otherwise incident to share ownership).
4.3 Removal.
(A) Removal For Cause. Except as otherwise provided pursuant
to the provisions of these Amended and Restated Articles of Incorporation or
Articles of Amendment relating to the rights of the holders of any class or
series of Preferred Stock, voting separately by class or series, to elect
directors under specified circumstances, any director or directors may be
removed from office at any time, but only for cause (as defined in Section
4.3(B) hereof) and only by the affirmative vote, at a special meeting of the
shareholders called for such a purpose, of not less than sixty-six and
two-thirds percent (66-2/3 %) of the total number of votes of the then
outstanding shares of capital stock of the Corporation entitled to vote
generally in the election of directors, voting together as a single class, but
only if notice of such proposed removal was contained in the notice of such
meeting. At least thirty (30) days prior to such special meeting of
shareholders, written notice shall be sent to the director or directors whose
removal will be considered at such meeting. Except as provided by Section 4.2,
any vacancy on the Board of Directors resulting from such removal or otherwise
shall be filled only by vote of a majority of the directors then in office,
although less than a quorum, and any director so chosen shall hold office until
the next election of the class for which such director shall have been chosen
and until his or her successor shall have been elected and qualified or until
any such director's earlier death, resignation or removal.
(B) "Cause" Defined. For the purposes of this Section 4.3,
"cause" shall mean (i) misconduct as a director of the Corporation or any
subsidiary of the Corporation which involves dishonesty with respect to a
substantial or material corporate activity or corporate assets, or (ii)
conviction of an offense punishable by one (1) or more years of imprisonment
(other than minor regulatory infractions and traffic violations which do not
materially and adversely affect the Corporation.)
4.4 Change of Number of Directors. In the event of any
increase or decrease in the authorized number of directors, no decrease in the
number of directors constituting the Board of Directors shall shorten the term
of any incumbent director.
4.5 Directors Elected by Holders of Preferred Stock.
Notwithstanding the foregoing, whenever the holders of any one or more classes
or series of Preferred Stock issued by the Corporation shall have the right,
voting separately by class or series, to elect one or more directors at an
annual or special meeting of shareholders, the election, term of office,
filling of vacancies and other features of such directorships shall be governed
by the terms of these Amended and Restated Articles of Incorporation, as
amended by Articles of Amendment applicable to such classes or series of
Preferred Stock.
4.6 Exercise of Business Judgment. In discharging his or her
duties as a director of the Corporation, a director may consider such factors
as the director considers relevant, including the long-term prospects and
interests of the Corporation and its shareholders, the social, economic, legal,
or other effects of any corporate action or inaction upon the employees,
suppliers, customers of the Corporation or its subsidiaries, the communities
and society in which the Corporation or its subsidiaries operate and the
economy of the State of Florida and the United States.
4.7 Number of Directors. The number of directors constituting
the Board of Directors of the Corporation is eight (8); provided, however that
in the event the percentage of Common Stock beneficially owned by Schakale
immediately following the last to occur of (i) the expiration of the
over-allotment options granted to the underwriters in connection with the
initial public offering of shares of Common Stock and (ii) the closing of the
last sale pursuant to any exercise thereof, falls below five percent (5%) of
the aggregate-number of shares of Common Stock issued and outstanding, then,
notwithstanding any other provision of these Amended and Restated Articles of
Incorporation, David Garza-Santos (or his successor, if any) shall be
automatically removed as a director of the Corporation and the number of
directors constituting the Board of Directors of the Corporation shall be
reduced to seven (7) without the need for any further action by either the
Board of Directors or shareholders of the Corporation. The number of directors
may be increased or decreased from time to time as provided in the Bylaws, but
in no event shall the number of directors be less than five (5) nor more than
fifteen (15); provided, however, that, unless required by law, the number of
directors shall not be increased or decreased without the consent of each party
remaining entitled to special nomination rights pursuant to Section 4.2 above.
ARTICLE 5
Action By Shareholders
5.1 Call For Special Meeting. Special meetings of the shareholders of
the Corporation may be called at any time, but only by (a) the Chairman of the
Board of the Corporation, (b) the Chief Executive Officer of the Corporation,
(c) a majority of the directors then in of office, and (d) the holders of not
less than twenty-five percent (25 %) of the total number of votes of the then
outstanding shares of capital stock of the Corporation entitled to vote
generally in the election of directors, voting together as a single class.
5.2 Shareholder Action By Written Consent. Any action required or
permitted by the FBCA to be taken at any annual or special meeting of
shareholders may be taken without a meeting, without prior notice, and without
a vote if one or more written consents describing the action taken shall be
signed and dated by the holders of outstanding capital stock of the Corporation
of each voting group entitled to vote thereon having not less than the minimum
number of votes with respect to each voting group that would be necessary to
authorize or take such action at a meeting at which all voting groups and
shares entitled to vote thereon were present and voted. Such consents must be
delivered to the principal office of the Corporation in Florida, the
Corporation's principal place of business, the Secretary, or another officer or
agent of the Corporation having custody of the books in which proceedings of
meetings of shareholders are recorded. No written consent shall be effective to
take the corporate action referred to therein unless, within sixty days of the
date of the earliest dated consent delivered in the manner required herein,
written consents signed by the number of holders required to take action are
delivered to the Corporation by delivery as set forth in this Section.
ARTICLE 6
Indemnification
6.1 Provision of Indemnification. The Corporation shall, to the
fullest extent permitted or required by the FBCA, including any amendments
thereto (but in the case of any such amendment, only to the extent such
amendment permits or requires the Corporation to provide broader
indemnification rights than prior to such amendment), indemnify its Directors
and Executive Officers against any and all Liabilities, and advance any and all
reasonable Expenses, incurred thereby in any Proceeding to which any such
Director or Executive Officer is a Party or in which such Director or Executive
Officer is deposed or called to testify as a witness because he or she is or
was a Director or Executive Officer of the Corporation. The rights to
indemnification granted hereunder shall not be deemed exclusive of any other
rights to indemnification against Liabilities or the advancement of Expenses
which a Director or Executive Officer may be entitled under any written
agreement, Board of Directors' resolution, vote of shareholders, the FBCA, or
otherwise. The Corporation may, but shall not be required to, supplement the
foregoing rights to indemnification against Liabilities and advancement of
Expenses by the purchase of insurance on behalf of any one or more of its
Directors or Executive Officers whether or not the Corporation would be
obligated to indemnify or advance Expenses to such Director or Executive
Officer under this Article. For purposes of this Article, the term "Directors"
includes former directors of the Corporation and any director who is or was
serving at the request of the Corporation as a director, officer, employee, or
agent of another Corporation, partnership, joint venture, trust, or other
enterprise, including, without limitation, any employee benefit plan (other
than in the capacity as an agent separately retained and compensated for the
provision of goods or services to the enterprise, including, without
limitation, attorneys-at-law, accountants, and financial consultants). The term
"Executive Officers" includes those individuals who are or were at any time
"executive officers" of the Corporation as defined in Securities and Exchange
Commission Rule 3b-7 promulgated under the Securities Exchange Act of 1934, as
amended. All other capitalized terms used in this Article 6 and not otherwise
defined herein have the meaning set forth in FBCA Section 607.0850. The
provisions of this Article 6 are intended solely for the benefit of the
indemnified parties described herein, their heirs and personal representatives
and shall not create any rights in favor of third parties. No amendment to or
repeal of this Article Vl shall diminish the rights of indemnification provided
for herein prior to such amendment or repeal.
ARTICLE 7
Amendments
7.1 Amended and Restated Articles of Incorporation. Notwithstanding
any other provision of these Amended and Restated Articles of Incorporation or
the Bylaws of the Corporation (and notwithstanding that a lesser percentage may
be specified by law) the affirmative vote of sixty-six and two-thirds percent
(66-2/3%) of the total number of votes of the then outstanding shares of the
capital stock of the Corporation entitled to vote generally in the election of
directors, voting together as a single class, shall be required (unless
separate voting by classes is required by the FBCA, in which event the
affirmative vote of sixty-six and two-thirds percent (66-2/3%) of the number of
shares of each class or series entitled to vote as a class shall be required),
to amend or repeal, or to adopt any provision inconsistent with the purpose or
intent of, Articles 4, 5, 6 or this Article 7 of these Amended and Restated
Articles of Incorporation. Notice of any such proposed amendment, repeal or
adoption shall be contained in the notice of the meeting at which it is to be
considered. Subject to the provisions set forth herein, the Corporation
reserves the right to amend, alter, repeal or rescind any provision contained
in these Amended and Restated Articles of Incorporation in the manner now or
hereafter prescribed by law. Notwithstanding the foregoing, Sections 4.1 and
4.2 of Article 4 of these Amended and Restated Articles of Incorporation may
not be amended without the consent of each party remaining entitled to any
special nomination rights pursuant to Section 4.2 hereof.
7.2 Bylaws. The shareholders of the Corporation may adopt or amend a
bylaw which fixes a greater quorum or voting requirement for shareholders (or
voting groups of shareholders) than is required by the FBCA. The adoption or
amendment of a bylaw that adds, changes or deletes a greater quorum or voting
requirement for shareholders must meet the same quorum or voting requirement
and be adopted by the same vote and voting groups required to take action under
the quorum or voting requirement then in effect or proposed to be adopted,
whichever is greater.
ARTICLE 8
Registered Office and Agent
The address of the Registered Office of the Corporation is 4902 West
Waters Avenue, Tampa, FL 33634, and the Registered Agent at such address is
Richard J. Domino.
ARTICLE 9
Principal Office and Mailing Address
The address of the Principal Office of the Corporation and its mailing
address is 4902 West Waters Avenue, Tampa, FL 33634. The location of
the Principal Office and the mailing address shall be subject to
change as may be provided in the Bylaws.
IN WITNESS WHEREOF, these Amended and Restated Articles of
Incorporation have been signed this 22nd day of October, 1997.
/s/ William W. Compton
William W. Compton
Chief Executive Officer
ATTEST:
/s/ Michael Kagan
Michael Kagan
Secretary
<PAGE>
ACCEPTANCE OF APPOINTMENT
BY REGISTERED AGENT
THE UNDERSIGNED, having been named in Article 8 of the foregoing
Amended and Restated Articles of Incorporation as the Registered Agent at the
office designated therein, hereby accepts such appointment and agrees to act in
such capacity. The undersigned hereby states that he is familiar with, and
hereby accepts, the obligations set forth in Section 607.0505, Florida Statutes,
and the undersigned will further comply with any other provisions of law made
applicable to him as Registered Agent of the Corporation.
DATED this 22nd day of October, 1997
/s/ Richard J. Domino
Richard J. Domino
Registered Agent
<PAGE>
ARTICLES OF AMENDMENT
TO THE AMENDED AND RESTATED ARTICLES OF INCORPORATION OF
TROPICAL SPORTSWEAR INT'L CORPORATION
1.
The name of the corporation is "Tropical Sportswear Int'l Corporation."
2.
The articles of incorporation of Tropical Sportswear Int'l Corporation
are amended by adding new Section 3.6 as follows:
"3.6. Series A Junior Participating Preferred Stock. There is hereby
established a series of Preferred Stock, par value $0.01 per share, of the
Corporation, and the designation and certain terms, powers, preferences and
other rights of the shares of such series, and certain qualifications,
limitations and restrictions thereon, are hereby fixed as follows:
(i) The distinctive serial designation of this series shall be "Series A
Junior Participating Preferred Stock" (hereinafter called "this
Series"). Each share of this Series shall be identical in all respects
with the other shares of this Series except as to the dates from and
after which dividends thereon shall be cumulative.
(ii) The number of shares in this Series shall initially be 100,000, which
number may from time to time be increased or decreased (but not below
the number then outstanding) by the Board of Directors. Shares of this
Series purchased by the Corporation shall be canceled and shall revert
to authorized but unissued shares of Preferred Stock undesignated as to
series. Shares of this Series may be issued in fractional shares, which
fractional shares shall entitle the holder, in proportion to such
holder's fractional share, to all rights of a holder of a whole share
of this Series.
(iii) The holders of full or fractional shares of this Series shall be
entitled to receive, when and as declared by the Board of Directors,
but only out of funds legally available therefor, dividends, (A) on
each date that dividends or other istributions payable in respect of
Common Stock of the Corporation are payable on or in respect of Common
Stock comprising part of the Reference Package (as defined below), in
an amount per whole share of this Series equal to the aggregate amount
of dividends or other distributions (other than dividends or
distributions payable in Common Stock of the Corporation) that would be
payable on such date to a holder of the Reference Package and (B) on
the last day of March, June, September and December in each year, in
an amount per whole share of this Series equal to the excess (if any)
of $1.00 over the aggregate dividends paid per whole share of this
Series during the three-month period ending on such last day. Each
dividend shall be paid to the holders of record of shares of this
Series on the date, not exceeding sixty days preceding such
dividend or distribution payment date, fixed for that purpose by the
Board of Directors in advance of payment of each particular
dividend or distribution. Dividends on each full and each fractional
share of this Series shall be cumulative from the date such full or
fractional share is originally issued; provided that any such full or
fractional share originally issued after a dividend record date and on
or prior to the dividend payment date to which such record date relates
shall not be entitled to receive the dividend payable on such dividend
payment date or any amount in respect of the period from such original
issuance to such dividend payment date.
The term "Reference Package" shall initially mean 1,000 shares of
Common Stock, par value $0.01 per share ("Common Stock"), of the
Corporation. In the event the Corporation shall at any time (A) declare
or pay a dividend or other distribution on the Common Stock payable in
Common Stock, (B) subdivide the Common Stock or (C) combine the Common
Stock into a smaller number of shares, then and in each such case the
Reference Package after such event shall be the Common Stock that a
holder of the Reference Package immediately prior to such event would
hold thereafter as a result thereof.
Holders of shares of this Series shall not be entitled to any
dividends, whether payable in cash, property or stock, in excess of
full cumulative dividends, as herein provided, on this Series.
So long as any shares of this Series are outstanding, no dividend
(other than a dividend in Common Stock or in any other shares of
capital stock ranking junior to this Series as to dividends and upon
liquidation) shall be declared or paid or set aside for payment or
other distribution declared or made upon the Common Stock or upon any
other shares of capital stock ranking junior to this Series as to
dividends or upon liquidation, nor shall any Common Stock nor any
other shares of capital stock of the Corporation ranking junior to or
on a parity with this Series as to dividends or upon liquidation be
redeemed, purchased or otherwise acquired for any consideration (or any
moneys be paid to or made available for a sinking fund for the
redemption of any shares of any such stock) by the Corporation (except
by conversion into or exchange for shares of capital stock of the
Corporation ranking junior to this Series as to dividends and upon
liquidation), unless, in each case, the full cumulative dividends
(including the dividend to be due upon payment of such dividend,
distribution, redemption, purchase or other acquisition) on all
outstanding shares of this Series shall have been, or shall
contemporaneously be, paid.
(iv) In the event of any merger, consolidation, reclassification or other
transaction in which the shares of Common Stock are exchanged for or
changed into other shares of capital stock or securities, cash and/or
any other property, then in any such case the shares of this Series
shall at the same time be similarly exchanged or changed in an amount
per whole share equal to the aggregate amount of capital stock,
securities, cash and/or any other property (payable in kind), as the
case may be, that a holder of the Reference Package would be entitled
to receive as a result of such transaction.
(v) In the event of any liquidation, dissolution or winding up of the
affairs of the Corporation, whether voluntary or involuntary, the
holders of full and fractional shares of this Series shall be entitled,
before any distribution or payment is made on any date to the holders
of the Common Stock or any other shares of capital stock of the
Corporation ranking junior to this Series upon liquidation, to be paid
in full an amount per whole share of this Series equal to the greater
of (A) $1.00 or (B) the aggregate amount distributed or to be
distributed in connection with such liquidation, dissolution or
winding up to a holder of the Reference Package (such greater
amount being hereinafter referred to as the "Liquidation Preference"),
together with accrued dividends to such distribution or payment date,
whether or not earned or declared. If such payment shall have been
made in full to all holders of shares of this Series, the holders of
shares of this Series as such shall have no right or claim to any of
the remaining assets of the Corporation.
In the event the assets of the Corporation available for distribution
to the holders of shares of this Series upon any liquidation,
dissolution or winding up of the Corporation, whether voluntary or
involuntary, shall be insufficient to pay in full all amounts to
which such holders are entitled pursuant to the first paragraph of
this Section (v), no such distribution shall be made on account of
any shares of any other class or series of Preferred Stock ranking on
a parity with the shares of this Series upon such liquidation,
dissolution or winding up unless proportionate distributive amounts
shall be paid on account of the shares of this Series, ratably in
proportion to the full distributable, amounts for which holders of all
such parity shares are respectively entitled upon such liquidation,
dissolution or winding up.
Upon the liquidation, dissolution or winding up of the Corporation,
the holders of shares of this Series then outstanding shall be entitled
to be paid out of assets of the Corporation available for distribution
to its shareholders all amounts to which such holders are entitled
pursuant to the first paragraph of this Section (v) before any payment
shall be made to the holders of Common Stock or any other stock of the
Corporation ranking junior upon liquidation to this Series.
For the purposes of this Section (v), the consolidation or merger of,
or binding share exchange by, the Corporation with any other
corporation shall not be deemed to constitute a liquidation,
dissolution or winding up of the corporation.
(vi) The shares of this Series shall not be redeemable.
(vii) In addition to any other vote or consent of stockholders required by
law or the Articles of Incorporation of the Corporation, each whole
share of this Series shall, on any matter, vote as a class with any
other shares of capital stock comprising part of the Reference Package
and entitled to vote on such matter and shall have the number of votes
thereon that a holder of the Reference Package would have."
3.
The amendment was adopted on November 13, 1998.
4.
The amendment was duly adopted by the Board of Directors of Tropical
Sportswear Int'l Corporation pursuant to Section 607.0602 of the Florida
Business Corporation Act.
IN WITNESS WHEREOF, Tropical Sportswear Int'l Corporation has caused
these Articles of Amendment to be executed as of November 13, 1998.
TROPICAL SPORTSWEAR INT'L CORPORATION
By: /s/ Michael Kagan
Michael Kagan
Executive Vice President, CFO
Exhibit 5
Opinion of Alston & Bird LLP
<PAGE>
ALSTON&BIRD LLP
One Atlantic Center
1201 West Peachtree Street
Atlanta, Georgia 30309-3424
404-881-7000
Fax: 404-881-4777
www.alston.com
October 29, 1999
Tropical Sportswear Int'l Corporation
4902 West Waters Avenue
Tampa, Florida 33634-1302
Re: Form S-8 Registration Statement --
Tropical Sportswear Int'l Corporation Employee Stock Option Plan,
as amended and restated
Ladies and Gentlemen:
We have acted as counsel for Tropical Sportswear Int'l Corporation, a
Florida corporation (the "Corporation"), in connection with the referenced
Registration Statement on Form S-8 (the "Registration Statement") being filed by
the Corporation with the Securities and Exchange Commission (the "Commission")
under the Securities Act of 1933, as amended, and covering 500,000 shares of the
Corporation's common stock, $0.01 par value ("Common Stock"), that may be issued
pursuant to the grant or exercise of awards under the Tropical Sportswear Int'l
Corporation Employee Stock Option Plan, as amended (the "Plan"). This Opinion
Letter is rendered pursuant to Item 8 of Form S-8 and Item 601(b)(5) of
Regulation S-K.
In the capacity described above, we have considered such matters of law
and of fact, including the examination of originals or copies, certified or
otherwise identified to our satisfaction, of such records and documents of the
Corporation, certificates of public officials and such other documents as we
have deemed appropriate as a basis for the opinions hereinafter set forth.
Based upon the foregoing, it is our opinion that the 500,000 shares of
Common Stock covered by the Registration Statement and to be issued pursuant to
the Plan, when issued accordance with the terms and conditions of the Plan, will
be legally and validly issued, fully paid and nonassessable.
We are licensed to practice law in the State of Georgia and express no
opinion as to any laws other than those of the State of Georgia and the federal
laws of the United States. To the extent that the opinions expressed herein
relate to the laws of any jurisdiction other than the above stated laws, we have
assumed, with your permission and without any independent investigation, that
the laws of such other jurisdiction are identical to the laws of the State of
Georgia.
This Opinion Letter is provided to you for your benefit and for the
benefit of the Commission, in each case, solely with regard to the Registration
Statement, may be relied upon by you and the Commission only in connection with
the Registration Statement, and may not be relied upon by any other person or
for any other purpose without our prior written consent.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and further consent to the use of our name wherever
appearing in the Registration Statement.
Sincerely,
ALSTON & BIRD LLP
By: /s/ Alston & Bird LLP
Partner
Exhibit 23.2
Consent of Ernst & Young LLP
<PAGE>
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement
(Form S-8 No. 333-_____) pertaining to the Tropical Sportswear Int'l Corporation
Employee Stock Option Plan, As Amended, of our report dated November 16, 1998,
with respect to the consolidated financial statements and schedule of Tropical
Sportswear Int'l Corporation included in its Annual Report (Form 10-K) for the
year ended October 3, 1998, filed with the Securities and Exchange Commission.
ERNST & YOUNG LLP
Tampa, Florida
October 26, 1999
Exhibit 99.1
Tropical Sportswear Int'l Corporation
EMPLOYEE STOCK OPTION PLAN
AS AMENDED AND RESTATED ON FEBRUARY 4, 1999
<PAGE>
TROPICAL SPORTSWEAR INT'L CORPORATION
EMPLOYEE STOCK OPTION PLAN
(AS AMENDED AND RESTATED ON FEBRUARY 4, 1999)
1. PURPOSE OF PLAN
The purpose of this Plan is to enable Tropical Sportswear Int'l
Corporation (the "Company") and its Subsidiaries to compete successfully in
attracting, motivating and retaining Employees with outstanding abilities by
making it possible for them to purchase Shares on terms that will give them a
direct and continuing interest in the future success of the businesses of the
Company and its Subsidiaries and encourage them to remain in the employ of the
Company or one or more of its Subsidiaries. Each Option is intended to be an
Incentive Stock Option, except to the extent that (a) any such Option would
exceed the limitations set forth in Section 3.(c) hereof and (b) for Options
specifically designated at the time of grant as not being Incentive Stock
Options.
2. DEFINITIONS
For purposes of the Plan, except where the context clearly indicates
otherwise, the following terms shall have the meanings set forth below:
(a) "Board" means the Board of Directors of the Company.
(b) "Code" means the United States Internal Revenue Code of 1986, as
amended.
(c) "Committee" means the Committee described in Section 9 hereof.
(d) "Effective Date" means the later of (i) the effective date of any
registration statement with respect to the Shares under the Securities Exchange
Act of 1934, as amended, and (ii) the time the underwriting agreement has been
executed and delivered by all parties thereto, where the "underwriting
agreement" is that underwriting agreement referred to in the prospectus included
in such registration statement when it first became effective. Such execution
and delivery shall be definitively evidenced by any certificate to such effect
by any officer of the Company.
(e) "Employee" means a person who is regularly employed on a salary
basis by the Company or any Subsidiary, including an officer or director of the
Company or any Subsidiary who is also an employee of the Company or a
Subsidiary.
(f) "Fair Market Value," on any date, means, with respect to a Share,
(i) if the Shares are listed on a securities exchange or are traded over the
Nasdaq National Market, the closing sales price on such exchange or over such
system on such date or, in the absence of reported sales on such date, the
closing sales price on the immediately preceding date on which sales were
reported, or (ii) if the Shares are not listed on a securities exchange or
traded over the Nasdaq National Market, the mean between the bid and offered
prices as quoted by Nasdaq for such date, provided that if it is determined that
the fair market value is not properly reflected by such Nasdaq quotations, Fair
Market Value will be determined by such other method as the Committee determines
in good faith to be reasonable.
(g) "Incentive Stock Option" means an option granted under this Plan
and which is an incentive stock option within the meaning of section 422 of the
Code, or the corresponding provision of any subsequently enacted tax statute.
(h) "Option" means an option granted under this Plan, whether or not
such option is an Incentive Stock Option.
(i) "Optionee" means any person who has been granted an Option which
Option has not expired or been fully exercised or surrendered.
(j) "Plan" means the Company's Employee Stock Option Plan.
(k) "Rule 16b-3" means Rule 16b-3 promulgated pursuant to Section 16(b)
of the Securities Exchange Act of 1934, as amended, or any successor rule.
(l) "Share" means one share of voting common stock, par value $.01 per
share, of the Company, and such other stock or securities that may be
substituted therefor pursuant to Section 6 hereof.
(m) "Subsidiary" means any corporation, limited liability company,
partnership or other entity of which a majority of the outstanding voting stock
or voting power is beneficially owned directly or indirectly by the Corporation.
For Incentive Stock Options, the term shall have the meaning set forth in
Section 424(f) of the Code.
3. LIMITS ON OPTIONS
(a) The total number of Shares with respect to which Options may be
granted under the Plan shall not exceed in the aggregate 1,000,000 Shares,
subject to adjustment as provided in Section 6 hereof. If any Option expires,
terminates or is terminated for any reason prior to its exercise in full, the
Shares that were subject to the unexercised portion of such Option shall be
available for future grants under the Plan.
(b) No Incentive Stock Option shall be granted to any Employee who at
the time such option is granted, owns capital stock of the Company possessing
more than 10% of the total combined voting power or value of all classes of
capital stock of the Company or any Subsidiary, determined in accordance with
the provisions of Section 422(b)(6) and 424(d) of the Code, unless the option
price at the time such Incentive Stock Option is granted is at least 110 percent
(110%) of the Fair Market Value of the Shares subject to the Incentive Stock
Option and such Incentive Stock Option is not exercisable by its terms after the
expiration of five (5) years from the date of grant.
(c) An Incentive Stock Option shall be granted hereunder only to the
extent that the aggregate Fair Market Value (determined at the time the
Incentive Stock Option is granted) of the Shares with respect to which such
Incentive Stock Option and any other "incentive stock option" (within the
meaning of Section 422 of the Code) are exercisable for the first time by any
Optionee during any calendar year (under the Plan and all other plans of the
Optionee's employer corporation and its parent and subsidiary corporations
within the meaning of Section 422(d) of the Code) does not exceed $100,000. This
limitation shall be applied by taking Incentive Stock Options and any such other
"incentive stock options" into account in the order in which such Incentive
Stock Options and any such other "incentive stock options" were granted.
(d) No Optionee shall, in any calendar year, be granted Options to
purchase more than 200,000 Shares. Options granted to the Optionee and cancelled
during the same calendar year shall be counted against such maximum number of
Shares. In the event that the number of Options which may be granted is adjusted
as provided in the Plan, the above limit shall automatically be adjusted in the
same ratio.
4. GRANTING OF OPTIONS
The Committee is authorized to grant Options to selected Employees
pursuant to the Plan beginning on the Effective Date. Subject to the provisions
of the Plan, the Committee shall have exclusive authority to select the
Employees to whom Options will be awarded under the Plan, to determine the
number of Shares to be included in such Options, and to determine such other
terms and conditions of Options, including terms and conditions which may be
necessary to qualify Incentive Stock Options as "incentive stock options" under
Section 422 of the Code. The date on which the Committee approves the grant of
an Option shall be considered the date on which such Option is granted, unless
the Committee provides for a specific date of grant which is subsequent to the
date of such approval.
5. TERMS OF STOCK OPTIONS
Subject to Section 3 hereof, the terms of Options granted under this
Plan shall be as follows:
(a) The exercise price of each Share subject to an Option shall be
fixed by the Committee. Notwithstanding the prior sentence, the option exercise
price of an Incentive Stock Option shall be fixed by the Committee but shall in
no event be less than 100% of the Fair Market Value of the Shares subject to
such Option.
(b) Options shall not be assignable or transferable by the Optionee
other than by will or by the laws of descent and distribution except that the
Optionee may, with the consent of the Committee, transfer without consideration
Options that do not constitute Incentive Stock Options to the Optionee's spouse,
children or grandchildren (or to one or more trusts for the benefit of any such
family members or to one or more partnerships in which any such family members
are the only partners).
(c) Each Option shall expire and all rights thereunder shall end at the
expiration of such period (which shall not be more than ten (10) years) after
the date on which it was granted as shall be fixed by the Committee, subject in
all cases to earlier expiration as provided in subsections (d) and (e) of this
Section 5.
(d) During the life of an Optionee, an Option shall be exercisable only
by such Optionee (or Optionee's permitted assignee in the case of Options that
do not constitute Incentive Stock Options) and only prior to the end of one (1)
month after the termination of the Optionee's employment with the Company or a
Subsidiary, other than by reason of the Optionee's death, permanent disability
or retirement with the consent of the Company or a Subsidiary as provided in
subsection (e) of this Section 5, but only if and to the extent the Option was
exercisable immediately prior to such termination, and subject to the provisions
of subsection (c) of this Section 5. If the Optionee's employment is terminated
for cause, or the Optionee terminates his employment with the Company, all
Options granted to date by the Company to the Optionee (including any Options
that have become exercisable) shall terminate immediately on the date of
termination of employment. Cause shall have the meaning set forth in any
employment agreement then in effect between the Optionee and the Company or any
of its Subsidiaries, or if the Optionee does not have any employment agreement,
cause shall mean (i) if the Optionee engages in conduct which has caused, or is
reasonably likely to cause, demonstrable and serious injury to the Company, or
(ii) if the Optionee is convicted of a felony, as evidenced by a binding and
final judgment, order or decree of a court of competent jurisdiction, which, in
the opinion of the Board, substantially impairs the Optionee's ability to
perform his or her duties to the Company.
(e) If an Optionee: (i) dies while employed by the Company or a
Subsidiary or within the period when an Option could have otherwise been
exercised by the Optionee; (ii) terminates employment with, or has his
employment terminated by, the Company or a Subsidiary by reason of the
"permanent and total disability" (within the meaning of Section 22(e)(3) of the
Code) of such Optionee; or (iii) terminates employment with the Company or a
Subsidiary as a result of such Optionee's retirement, provided that the Company
or such Subsidiary has consented in writing to such Optionee's retirement, then,
in each such case, such Optionee, or the duly authorized representatives of such
Optionee (or Optionee's permitted assignee in the case of Options that do not
constitute Incentive Stock Options), shall have the right, at any time within
three (3) months after the death, disability or retirement of the Optionee, as
the case may be, and prior to the termination of the Option pursuant to
subsection (c) of this Section 5, to exercise any Option to the extent such
Option was exercisable by the Optionee immediately prior to such Optionee's
death, disability or retirement. In the discretion of the Committee, the
three-month period referenced in the immediately preceding sentence may be
extended for a period of up to one year.
(f) Subject to the foregoing terms and to such additional terms
regarding the exercise of an Option as the Committee may fix at the time of
grant, an Option may be exercised in whole at one time or in part from time to
time.
(g) Options granted pursuant to the Plan shall be evidenced by an
agreement in writing setting forth the material terms and conditions of the
grant, including, but not limited to, the number of Shares subject to options.
Option agreements covering Options need not contain similar provisions;
provided, however, that all such option agreements shall comply with the terms
of the Plan.
(h) The Committee is authorized to modify, amend or waive any
conditions or other restrictions with respect to Options, including conditions
regarding the exercise of Options.
6. EFFECT OF CHANGES IN CAPITALIZATION
(a) If the number of outstanding Shares is increased or decreased or
changed into or exchanged for a different number or kind of shares or other
securities of the Company by reason of any recapitalization, reclassification,
stock split, combination of shares, exchange of shares, stock dividend or other
distribution payable in capital stock, or other increase or decrease in such
shares effected, in each case without receipt of consideration by the Company, a
proportionate and appropriate adjustment shall be made by the Committee in (i)
the aggregate number of Shares subject to the Plan, (ii) the maximum number of
Shares for which Options may be granted to any Employee during any calendar
year, and (iii) the number and kind of shares for which Options are outstanding,
so that the proportionate interest of the Optionee immediately following such
event shall, to the extent practicable, be the same as immediately prior to such
event. Any such adjustment in outstanding Options shall not change the aggregate
option price payable with respect to Shares subject to the unexercised portion
of the Options outstanding but shall include a corresponding proportionate
adjustment in the option price per Share.
(b) Subject to Section 6.(c) hereof, if the Company shall be the
surviving corporation in any reorganization, merger, share exchange or
consolidation of the Company with one or more other corporations or other
entities, any Option theretofore granted shall pertain to and apply to the
securities to which a holder of the number of Shares subject to such Option
would have been entitled immediately following such reorganization, merger,
share exchange or consolidation, with a corresponding proportionate adjustment
of the option price per Share so that the aggregate option price thereafter
shall be the same as the aggregate option price of the Shares remaining subject
to the Option immediately prior to such reorganization, merger, share exchange
or consolidation.
(c) In the event of: (i) the adoption of a plan of reorganization,
merger, share exchange or consolidation of the Company with one or more other
corporations or other entities as a result of which the holders of the Shares as
a group would receive less than fifty percent (50%) of the voting power of the
capital stock or other interests of the surviving or resulting corporation or
entity; (ii) the adoption of a plan of liquidation or the approval of the
dissolution of the Company; (iii) the approval by the Board of an agreement
providing for the sale or transfer (other than as a security for obligations of
the Company or any Subsidiary) of substantially all of the assets of the
Company; or (iv) the acquisition of more than twenty percent (20%) of the
outstanding Shares by any person within the meaning of Rule 13(d)(3) under the
Securities Exchange Act of 1934, as amended, if such acquisition is not preceded
by a prior expression of approval by the Board, then, in each such case, any
Option granted hereunder shall become immediately exercisable in full, subject
to any appropriate adjustments in the number of Shares subject to such Option
and the option price, regardless of any provision contained in the Plan or any
stock option agreement with respect thereto limiting the exercisability of the
Option for any length of time. Notwithstanding the foregoing, if a successor
corporation or other entity as contemplated in clause (i) or (iii) of the
preceding sentence agrees to assume the outstanding Options or to substitute
substantially equivalent options, then the outstanding Options issued hereunder
shall not be immediately exercisable, but shall remain exercisable in accordance
with the terms of the Plan and the applicable stock option agreements.
(d) Adjustments under this Section 6 relating to Shares or securities
of the Company shall be made by the Committee, whose determination in that
respect shall be final and conclusive. Options subject to grant or previously
granted under the Plan at the time of any event described in this Section 6
shall be subject to only such adjustments as shall be necessary to maintain the
proportionate interest of the options and preserve, without exceeding, the value
of such options. No fractional Shares or units of other securities shall be
issued pursuant to any such adjustment, and any fractions resulting from any
such adjustment shall be eliminated in each case by rounding upward to the
nearest whole Share or unit.
(e) The grant of an Option pursuant to the Plan shall not affect or
limit 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, consolidate, dissolve or liquidate, or to sell or
transfer all or any part of its business or assets.
7. DELIVERY AND PAYMENT FOR SHARES; REPLACEMENT OPTIONS
(a) No Shares shall be delivered upon the exercise of an Option until
the option price for the Shares acquired has been paid in full. No Shares shall
be issued or transferred under the Plan unless and until all legal requirements
applicable to the issuance or transfer of such Shares have been complied with to
the satisfaction of the Committee and adequate provision has been made by the
Optionee for satisfying any applicable federal, state or local income or other
taxes incurred by reason of the exercise of the Option. Any Shares issued by the
Company to an Optionee upon exercise of an Option may be made only in strict
compliance with and in accordance with applicable state and federal securities
laws.
(b) Payment of the option price for the Shares purchased pursuant to
the exercise of an Option and of any applicable withholding taxes shall be made,
as determined by the Committee and set forth in the option agreement pertaining
to such Option: (i) in cash or by check payable to the order of the Company;
(ii) through the tender to the Company of Shares, which Shares shall be valued,
for purposes of determining the extent to which the option price has been paid
thereby, at their Fair Market Value on the date of exercise; or (iii) by a
combination of the methods described in (a) and (b) hereof; provided, however,
that the Committee may in its discretion impose and set forth in the option
agreement pertaining to an Option such limitations or prohibitions on the use of
Shares to exercise Options as it deems appropriate. The Committee also may
authorize payment in accordance with a cashless exercise program under which, if
so instructed by the Optionee, Shares may be issued directly to the Optionee's
broker upon receipt of the option price in cash from the broker.
(c) To the extent that the payment of the exercise price for the Shares
purchased pursuant to the exercise of an Option is made with Shares as provided
in Section 7.(b) hereof, then, at the discretion of the Committee, the Optionee
may be granted a replacement Option under the Plan to purchase a number of
Shares equal to the number of Shares tendered as permitted in Section 7.(b)
hereof, with an exercise price per Share equal to the Fair Market Value on the
date of grant of such replacement Option and with a term extending to the
expiration date of the original Option.
8. NO CONTINUATION OF EMPLOYMENT AND DISCLAIMER OF RIGHTS
No provision in the Plan or in any Option granted or option agreement
entered into pursuant to the Plan shall be construed to confer upon any
individual the right to remain a director or in the employ of either the Company
or any Subsidiary, or to interfere in any way with the right and authority of
the Company or any Subsidiary either to increase or decrease the compensation of
any individual at any time, or to terminate any employment or other relationship
between any individual and the Company or any Subsidiary. The Plan shall in no
way be interpreted to require the Company to transfer any amounts to a third
party trustee or otherwise hold any amounts in trust or escrow for payment to
any Optionee or beneficiary under the terms of the Plan. An Optionee shall have
none of the rights of a shareholder of the Company until and to the extent all
or some of the Shares covered by an Option are fully paid and issued to such
Optionee.
9. ADMINISTRATION
(a) Subject to the provisions of subsection (b) of this Section 9, the
Plan shall be administered by the Committee which shall interpret the Plan and
make all other determinations necessary or advisable for its administration,
including such rules and regulations and procedures as it deems appropriate. The
Committee shall consist of not fewer than two members of the Board each of whom
shall qualify (at the time of appointment to the Committee and during all
periods of service on the Committee) in all respects as a "non-employee
director" as defined in Rule 16b-3 and as an "outside director" as defined in
Section 162(m) of the Code and regulations thereunder. The deduction limits of
Section 162(m) of the Code and the regulations thereunder do not apply to the
Company until such time, if any, as any class of the Company's common equity
securities is registered under Section 12 of the Securities and Exchange Act of
1934, as amended, or the Company otherwise meets the definition of a "publicly
held corporation" under Treasury Regulation 1.162-27(c) or any successor
provision. Upon becoming a publicly held corporation, the deduction limits of
Section 162(m) of the Code and the regulations thereunder shall not apply to
compensation payable under this Plan until the expiration of the reliance period
described in Treasury Regulation 1.162-27(f) or any successor regulation.
Subject to the provisions of subsection (b) of this Section 9, in the event of a
disagreement as to the interpretation of the Plan or any amendment hereto or any
rule, regulation or procedure hereunder or as to any right or obligation arising
from or related to the Plan, the decision of the Committee shall be final and
binding upon all persons in interest, including the Company, the Optionee and
the Company's shareholders.
(b) Notwithstanding any provision of the Plan to the contrary, any
determination or interpretation to be made by the Committee with regard to any
question arising under the Plan or any option agreement entered into hereunder
may be made by the Board (excluding any Optionee whose Options or the grant to
whom is at issue) and shall be final and binding upon all persons in interest,
including the Company, the Optionee and the Company's shareholders.
(c) No member of the Committee or the Board shall be liable for any
action taken or decision made, or any failure to take any action, in good faith
with respect to the Plan or any Option granted or option agreement entered into
hereunder.
10. NO OBLIGATION TO RESERVE OR RETAIN SHARES
The Board adopted, as of the Effective Date, a resolution initially
reserving authorized but unissued Shares for the Plan. The Company will be under
no further obligation to reserve, or to retain in its treasury, any particular
number of Shares in connection with its obligations hereunder.
11. AMENDMENT OF PLAN
The Board, without further action by the shareholders, may amend this
Plan from time to time as it deems desirable and shall make any amendments which
may be required so that Options intended to be Incentive Stock Options shall at
all times continue to be Incentive Stock Options for purpose of the Code;
provided, however, that the Board or Committee may condition any amendment or
modification on the approval of stockholders of the Company if such approval is
necessary or deemed advisable with respect to tax, securities or other
applicable laws, policies or regulations.
12. TERMINATION OF PLAN
This Plan shall terminate ten (10) years from the Effective Date. The
Board may, in its discretion, suspend or terminate the Plan at any time prior to
such date, but such termination or suspension shall not adversely affect any
right or obligation with respect to any outstanding Option.
13. EFFECTIVE DATE
The Plan shall become effective on the Effective Date and Options
hereunder may be granted at any time on or after that date. If the shareholders
of the Company fail to approve the Plan prior to, or within one year after, the
Effective Date, any Incentive Stock Option granted hereunder shall be
automatically converted to non-qualified stock options without any further act.
