<PAGE>
As filed with the Securities and Exchange Commission on November 22, 1999
Reg. No. 33-
=============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-----------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
-----------------
HAWKER PACIFIC AEROSPACE
(Exact name of registrant as specified in its charter)
CALIFORNIA 95-3528840
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
11249 SHERMAN WAY
SUN VALLEY, CALIFORNIA 91352
(Address of principal executive offices) (Zip Code)
-----------------
MANAGEMENT STOCK OPTION AGREEMENT
1997 STOCK OPTION PLAN
(Full title of the plan)
-----------------
DAVID L. LOKKEN
PRESIDENT AND CHIEF EXECUTIVE OFFICER
HAWKER PACIFIC AEROSPACE
11240 SHERMAN WAY
SUN VALLEY, CALIFORNIA 91352
(Name and address of agent for service)
TEL: (818) 765-6201
FAX: (818) 765-8073
(Telephone number, including area code, of agent for service)
COPY TO:
YVONNE E. CHESTER, ESQ.
TROY & GOULD PROFESSIONAL CORPORATION
1801 CENTURY PARK EAST, SUITE 1600
LOS ANGELES, CALIFORNIA 90067
TEL: (310) 553-4441
FAX: (310) 201-4746
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
======================================================================================================
Proposed Maximum Proposed Maximum
Title of Securities Amount To Be Offering Price Aggregate Offering Amount of
To Be Registered Registered(1) Per Share(2) Price(2) Registration Fee
- ------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock no par value.. 735,459 $6.375 $4,688,551 $1,303
======================================================================================================
</TABLE>
(1) In accordance with Rule 416 of the General Rules and Regulations under
the Securities Act of 1933 (the "General Rules"), there also are being
registered such indeterminate number of additional shares of Common
Stock as may become issuable pursuant to anti-dilution provisions of
the plans.
(2) Estimated pursuant to Rule 457(h) of the General Rules, solely for the
purpose of computing the registration fee, based on the last reported
sales price of the Common Stock as reported on The Nasdaq National
Market on November 18, 1999.
=============================================================================
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
ITEM 1. PLAN INFORMATION.*
ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.*
* Information required by Items 1 and 2 of Part I to be contained in the
Section 10(a) Prospectus is omitted from the Registration Statement in
accordance with Rule 428 under the Securities Act of 1933, as amended
(the "Securities Act") and the Note to Part I of Form S-8.
<PAGE>
EXPLANATORY NOTE
The Prospectus filed as part of this Registration Statement has been
prepared in accordance with the requirements of Part I of Form S-3 and may be
used for reofferings of Common Stock of Hawker Pacific Aerospace acquired by
the persons named therein pursuant to the 1997 Stock Option Plan and the
Management Stock Option Agreements of Hawker Pacific Aerospace.
<PAGE>
PROSPECTUS
735,459 SHARES
HAWKER PACIFIC AEROSPACE
COMMON STOCK
---------------
This Prospectus relates to the offer by certain shareholders
(collectively, the "Selling Shareholders") for sale from time to time of up
to 735,459 shares of Common Stock, no par value (the "Shares"). The Shares
offered hereby are shares of Common Stock previously issued and to be issued
to officers, employees, directors and consultants of Hawker Pacific Aerospace
(the "Company") upon the exercise of employee stock options granted pursuant
to the Company's 1997 Stock Option Plan and Management Stock Option
Agreements (collectively, the "Plans"). The Company's Common Stock is traded
on The Nasdaq National Market under the Symbol "HPAC." The last sale price
for the Common Stock on November 18, 1999 as reported on the Nasdaq National
Market, was $6.375 per share.
The Selling Shareholders have advised the Company that they may sell,
directly or through brokers, all or a portion of the Shares owned by each of
them in negotiated transactions or in transactions on The Nasdaq National
Market or otherwise at prices and terms prevailing at the time of sale. It is
anticipated that usual and customary brokerage fees will be paid by the
Selling Shareholders. In connection with such sales, the Selling Shareholders
and any participating broker or dealer may be deemed to be "underwriters" of
the Shares within the meaning of the Securities Act.
We have informed certain of the Selling Shareholders that the
anti-manipulation provisions of Regulation M under the Securities Exchange
Act of 1934 (the "Exchange Act") may apply to their sales of the shares
offered hereby and have furnished each of such Selling Shareholders with
a copy of these provisions. We have also advised the Selling Shareholders of
the requirement for delivery of this prospectus in connection with any public
sale of the shares.
SEE "RISK FACTORS" BEGINNING ON PAGE 4 FOR A DISCUSSION OF CERTAIN
FACTORS THAT SHOULD BE CONSIDERED BY PROSPECTIVE PURCHASERS OF THE COMMON
STOCK OFFERED HEREBY.
---------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is November 22, 1999
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934 (the "Exchange Act") and, in accordance
therewith, files reports, proxy or information statements, and other
information with the Securities and Exchange Commission (the "Commission").
Such reports, proxy statements, and other information can be inspected and
copied at the public reference facilities maintained by the Commission at
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, as well as
at the following regional offices: 7 World Trade Center, New York, New York
10048, and Northwestern Atrium Center, 500 W. Madison Street, Suite 1400,
Chicago, Illinois 60661. Copies of such materials also can be obtained from
the Public Reference Section of the Commission at Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549, at prescribed rates. The Commission
maintains a web site at http://www.sec.gov which contains reports, proxy and
information statements, and other information regarding registrants that file
electronically with the Commission. The Securities are traded on The Nasdaq
National Market and the Company's reports, proxy or information statements,
and other information filed with Nasdaq may be inspected at Nasdaq's offices
at 1735 K Street, N.W., Washington, D.C., 20006.
Additional information regarding the Company and the Common Stock
offered hereby is contained in the Registration Statement on Form S-8 of
which this Prospectus is a part (including all exhibits and amendments
thereto, the "Registration Statement"), filed with the Commission under the
Securities Act of 1933, as amended (the "Securities Act"). For further
information pertaining to the Company and the Common Stock, reference is made
to the Registration Statement and the exhibits thereto, which may be
inspected and copied at the Commission's public reference facilities at
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company (Commission File No.
0-29490) with the Commission under the Exchange Act are incorporated in this
Prospectus by reference: (a) the Company's Annual Report on Form 10-K for the
year ended December 31, 1998; (b) the Company's Quarterly Report on Form 10-Q
for the quarter ended March 31, 1999; (c) the Company's Quarterly Report on
Form 10-Q for the quarter ended June 30, 1999; (d) all other reports filed
pursuant to Section 13(a) or 15(d) of the Exchange Act since the end of
fiscal 1997; and (e) the description of the Company's Common Stock contained
in the Company's Registration Statement on Form 8-A (Reg. No. 000-29490)
under the Exchange Act, including any amendment or report subsequently filed
by the Company for the purpose of updating that description.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14
and 15(d) of the Exchange Act subsequent to the date of this Prospectus and
prior to the termination of this offering shall be deemed to be incorporated
by reference into this Prospectus and to be a part of this Prospectus from
the date of filing of such documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed
to be modified or superseded for purposes of this Prospectus to the extent
that a statement contained herein (or in any other subsequently filed
document which also is, or is deemed to be, incorporated by reference herein)
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
On request, the Company will provide, without charge, to each person,
including any beneficial owner, to whom this Prospectus is delivered a copy
of any or all of the documents incorporated by reference (other than exhibits
to such documents that are not specifically incorporated by reference in such
documents). Requests for such copies should be directed to Hawker Pacific
Aerospace, 11240 Sherman Way, Sun Valley, California 91352, Attention: Phil
Panzera, telephone number (818) 765-6201.
2.
<PAGE>
______________________________________________________________________________
PROSPECTUS SUMMARY
THE FOLLOWING INFORMATION IS QUALIFIED IN ITS ENTIRETY BY THE MORE
DETAILED INFORMATION, INCLUDING "RISK FACTORS" AND THE COMPANY'S FINANCIAL
STATEMENTS AND NOTES THERETO INCORPORATED BY REFERENCE HEREIN. UNLESS
OTHERWISE INDICATED, THE INFORMATION CONTAINED IN THIS PROSPECTUS ASSUMES
THAT OUTSTANDING WARRANTS, AND OPTIONS OUTSTANDING UNDER THE COMPANY'S PLANS,
ARE NOT EXERCISED.
THE COMPANY
Hawker Pacific was incorporated in California in 1980 and its principal
executive offices are located at 11240 Sherman Way, Sun Valley, California
91352. The Company's telephone number is (818) 765-6201. Unless the context
otherwise requires, the term "Company" refers to Hawker Pacific and Hawker
Pacific Aerospace Limited, a wholly-owned United Kingdom subsidiary formed in
November 1997.
THE OFFERING
<TABLE>
<S> <S>
Common Stock offered hereby....... 735,459 shares
Common Stock to be
outstanding after offering...... 6,557,681 shares(1)
Use of proceeds .................. All of the proceeds from the sale of
the Common Stock offered hereby will be
received by the Selling Shareholders.
The Company will not receive any of the
proceeds from this offering but will
bear estimated expenses of
approximately $8,000.
Nasdaq National Market Symbol..... HPAC
</TABLE>
- ----------
(1) Assuming exercise of all options issued or issuable to the Selling
Shareholders under the Plans, and based upon the 5,822,222 issued and
outstanding shares of Common Stock on November 15, 1999.
______________________________________________________________________________
3.
<PAGE>
RISK FACTORS
IN ADDITION TO THE OTHER INFORMATION SET FORTH IN THIS PROSPECTUS,
INVESTORS SHOULD CAREFULLY CONSIDER THE FOLLOWING RISK FACTORS WHEN
EVALUATING AN INVESTMENT IN THE SHARES OFFERED HEREBY. THIS PROSPECTUS
CONTAINS FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF THE "SAFE HARBOR"
PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 THAT
INVOLVE RISKS AND UNCERTAINTIES, SUCH AS STATEMENTS OF THE COMPANY'S PLANS,
OBJECTIVES, EXPECTATIONS AND INTENTIONS. THE COMPANY'S ACTUAL RESULTS COULD
DIFFER MATERIALLY FROM THOSE DISCUSSED HEREIN. FACTORS THAT COULD CAUSE OR
CONTRIBUTE TO SUCH DIFFERENCES INCLUDE THOSE DISCUSSED BELOW, AS WELL AS
THOSE DISCUSSED ELSEWHERE IN THIS PROSPECTUS.
AVIATION INDUSTRY RISKS
The Company derives all of its sales and operating income from the
services and parts that it provides to its customers in the aviation
industry. Therefore, the Company's business is directly affected by economic
factors and other trends that affect its customers in the aviation industry,
including a possible decrease in aviation activity, a decrease in outsourcing
by aircraft operators or the failure of projected market growth to
materialize or continue. When such economic and other factors adversely
affect the aviation industry, they tend to reduce the overall demand for the
Company's products and services, thereby decreasing the Company's sales and
operating income.
FLUCTUATIONS IN RESULTS OF OPERATIONS
The Company's operating results are affected by a number of factors,
including the timing of orders for the repair and overhaul of landing gear
and fulfillment of such contracts, the timing of expenditures to manufacture
parts and purchase inventory in anticipation of future services and sales,
parts shortages that delay work in progress, general economic conditions and
other factors. Although the Company has secured several long-term agreements
to service multiple aircraft, the Company receives sales under these
agreements only when it actually performs a repair or overhaul. Because the
average time between landing gear overhauls is seven years, the work orders
that the Company receives and the number of repairs or overhauls that the
Company performs in particular periods may vary significantly causing the
Company's quarterly sales and results of operations to fluctuate
substantially. The Company is unable to predict the timing of the actual
receipt of such orders and, as a result, significant variations between
forecasts and actual orders will often occur. In addition, the Company's need
to make significant expenditures to support new aircraft in advance of
generating revenues from repairing or overhauling such aircraft may cause the
Company's quarterly operating results to fluctuate. Furthermore, the
rescheduling of the shipment of any large order, or portion thereof, or any
production difficulties or delays by the Company, could have a material
adverse effect on the Company's quarterly operating results.
RISKS RELATING TO ACQUISITION STRATEGY; ESTABLISHMENT OF UNITED KINGDOM
OPERATIONS
The Company may attempt to grow by acquiring service and parts providers
whose operations or inventories complement or expand the Company's existing
repair and overhaul businesses, or whose strategic locations enable the
Company to expand into new geographic markets. The Company's ability to grow
by acquisition depends upon, and may be limited by, the availability of
suitable acquisition candidates and the Company's capital resources.
Acquisitions involve risks that could adversely affect the Company's
operating results, including the assimilation of the operations and personnel
of acquired companies, the amortization of acquired intangible assets and the
loss of key employees of acquired companies. Although the Company
investigates the operations and assets that it acquires, there may be
liabilities that the Company fails or is unable to discover, and for which
the Company as a successor owner or operator may be liable. In addition,
costs and charges, including legal and accounting fees and reserves and
write-downs relating to an acquisition, may be incurred by the Company or may
be reported in connection with any such acquisition. The Company evaluates
acquisition opportunities from time to time, but the Company has not entered
into any commitments or binding agreements to date, except with respect to
the BA Acquisition. There can be no assurance that the Company will be able
to consummate acquisitions on satisfactory terms, or at all, or that it will
be successful in integrating any such acquisitions, including the BA
Acquisition, into its operations. The Company had no history or experience
operating in the United Kingdom prior to the BA
4.
<PAGE>
acquisition. The likelihood of the success of the Company's United Kingdom
operations must be considered in light of the problems, expenses,
difficulties, complications and delays frequently encountered in connection
with a new business. These include, without limitation, the need to establish
operating, marketing and administrative capabilities, the need to implement
the Company's management information system in its new location, the need to
locate and move into a new facility, unanticipated marketing problems, new
competitive pressures, and increased expenses.
RISKS ASSOCIATED WITH EXPANSION OF INTERNATIONAL OPERATIONS
The Company's growth strategy is based in large part on the Company's
ability to expand its international operations, which will require
significant management attention and financial resources. The Company
currently has a subsidiary in the United Kingdom and a division in the
Netherlands. There can be no assurance that the Company's efforts to expand
operations internationally will be successful. In addition, international
operations are subject to a number of risks, including longer accounts
receivable collection periods and greater difficulty in accounts receivable
collections, unexpected changes in regulatory requirements, foreign currency
fluctuations, import and export restrictions and tariffs, difficulties and
costs of staffing and managing foreign operations, potentially adverse tax
consequences, political instability, the burdens of complying with multiple,
potentially conflicting laws and the impact of business cycles and economic
instability outside the United States.
The Company's sales are principally denominated in United States dollars
and British pounds, and to a lesser extent in Dutch guilders. The Company
makes substantial inventory purchases in French francs from such suppliers as
Messier-Bugatti, Societe D'Applications Des Machines Motrices and Eurocopter
France. The Company's Netherlands facility's inventory purchases are
primarily United States dollar denominated, while sales and operating
expenses are partially denominated in Dutch guilders. To date, the Company's
business has not been significantly affected by currency fluctuations or
inflation. Fluctuations in currency exchange rates could cause the Company's
products to become relatively more expensive in particular countries, leading
to a reduction in sales in that country.
SUBSTANTIAL COMPETITION
Numerous companies compete with the Company in the aviation services
industry. The Company expects that competition in its industry will increase
substantially as a result of industry consolidations and alliances in
response to the trend in the aviation industry toward outsourcing of repair
and overhaul services. In addition, as the Company moves into new geographic
or product markets it will encounter new competition.
The Company believes that the primary competitive factors in its
marketplace are quality, price, rapid turnaround time and industry
experience. Certain of the Company's competitors have substantially greater
financial, technical, marketing and other resources than the Company. These
competitors may have the ability to adapt more quickly to changes in customer
requirements, may have stronger customer relationships and greater name
recognition and may devote greater resources to the development, promotion
and sale of their products than the Company. There can be no assurance that
competitive pressures will not materially and adversely affect the Company's
business, financial condition or results of operations.
GOVERNMENT REGULATION
The Company's operations are regularly audited and accredited by the
Coordinating Agency for Supplier Evaluation, formed by commercial airlines to
approve FAA approved repair stations and aviation parts suppliers. If
material authorizations or approvals are revoked or suspended, the Company's
operations will be materially and adversely affected. As the Company attempts
to commence operations in countries in which it has not previously operated,
it will need to obtain new certifications and approvals. In addition, if new
and more stringent regulations are adopted by foreign or domestic regulatory
agencies, or oversight of the aviation industry is increased in the future,
the Company's business may be adversely affected.
5.
<PAGE>
DEPENDENCE ON KEY SUPPLIERS
The Company purchases landing gear spare parts and components for a
variety of fixed wing aircraft and helicopters. The Company has separate
10-year agreements that each expire in October 2006 with: (i) Dunlop Limited,
Aviation Division; (ii) Dunlop Limited, Precision Rubber; and (iii) Dunlop
Equipment Division. Under two of these agreements, the Company purchases
discounted parts for resale and repair from Dunlop. For the years ended
December 31, 1998 and 1997, Dunlop accounted for approximately $4,513,000 and
$4,301,000, respectively, of the spare parts and components that the Company
purchased in such periods. Failure by any one of these divisions of Dunlop to
renew its agreement on similar terms when it expires could have a material
adverse affect on the Company's business. The Company's single largest
supplier during 1998 was Boeing, who provided the Company $13,000,000 of
spare parts and components.
In addition, the Company has agreements with Messier-Bugatti, SAMM and
Eurocopter France that enable the Company to purchase new aircraft parts at
discounts from list price. Many of the Company's supplier agreements, other
than its agreements with Dunlop, are short-term and can be terminated by the
supplier upon providing ninety days prior written notice. A decision by any
of these suppliers to terminate their agreements would reduce the competitive
advantage the Company derives therefrom.
CUSTOMER CONCENTRATION
British Airways, Federal Express and the USCG have been the only
customers accounting for more than 10% of sales during the last three years.
CONCENTRATION OF CREDIT RISK
At December 31, 1998, 25.7% and 19.4% of the Company's total accounts
receivable were associated with British Airways and Federal Express,
respectively. At December 31, 1997, 18.9% and 6.1% of the Company's total
accounts receivable were associated with Federal Express and British Airways,
respectively. At December 31, 1996, 7.4% and 9.3% of the Company's total
accounts receivable were associated with Federal Express and the USCG,
respectively.
Write-offs against accounts receivable have been one-twentieth of one
percent in 1998, and two-tenths of one percent in 1997. The Company can not
provide any assurance that such favorable bad debt experience will continue.
ENVIRONMENTAL REGULATIONS
The Company's operations are subject to extensive and frequently
changing federal, state and local environmental laws and substantial related
regulation by government agencies, including the EPA, the California
Environmental Protection Agency and the United States Occupational Safety and
Health Administration. Among other matters, these regulatory authorities
impose requirements that regulate the operation, handling, transportation and
disposal of hazardous materials generated by the Company during the normal
course of its operations, govern the health and safety of the Company's
employees and require the Company to obtain and maintain permits in
connection with its operations. This extensive regulatory framework imposes
significant compliance burdens and risks on the Company and, as a result,
substantially affects its operational costs. In addition, the Company may
become liable for the cost of removal or remediation of certain hazardous
substances released on or in its facilities without regard to whether the
Company knew of, or caused, the release of such substances. The Company
believes that it currently is in material compliance with applicable laws and
regulations and is not aware of any material environmental problem at any of
its current or former facilities. There can be no assurance, however, that
its prior activities did not create a material problem for which the Company
could be responsible or that future uses or conditions (including, without
limitation, changes in applicable environmental laws and regulation, or an
increase in the amount of hazardous substances generated by the Company's
operations) will not result in material environmental liability to the
Company and materially and adversely affect the Company's financial condition
and results of operations. The Company's plating operations, which use a
number of hazardous materials and generate
6.
<PAGE>
a significant volume of hazardous waste, increase the Company's regulatory
compliance burden and compound the risk that the Company may encounter a
material environmental problem in the future. Furthermore, compliance with
laws and regulations in foreign countries in which the Company locates its
operations may cause future increases in the Company's operating costs or
otherwise adversely affect the Company's results of operations or financial
condition.
PRODUCT LIABILITY RISKS
The Company's business exposes it to possible claims for personal
injury, death or property damage which may result from the failure or
malfunction of landing gears, hydromechanical components or aircraft spare
parts repaired or overhauled by the Company. Many factors beyond the
Company's control could lead to liability claims, including the failure of
the aircraft on which landing gear or hydromechanical components overhauled
by the Company is installed, the reliability of the customer's operators of
the aircraft and the maintenance of the aircraft by the customer. The Company
currently has in force aviation products liability and premises insurance,
which the Company believes provides coverage in amounts and on terms that are
generally consistent with industry practice. The Company has not experienced
any material product liability claims related to its products. There can be
no assurance that the amount of product liability insurance that the Company
carries at the time a product liability claim is be made will be sufficient
to protect the Company.
DEPENDENCE ON KEY PERSONNEL
The continued success of the Company depends to a large degree upon the
services of certain of its executive officers and upon the Company's ability
to attract and retain qualified managerial and technical personnel
experienced in the various operations of the Company's business. Loss of the
services of such employees, particularly David Lokken, President and Chief
Executive Officer; Philip Panzera, Executive Vice President; Dennis Biety,
Managing Director of Hawker Pacific Aerospace Ltd.; Brian Carr, Managing
Director of Sun Valley Operations; or Michael Riley, Vice President-Sales and
Marketing, could adversely affect the operations of the Company.
The Company has entered into employment agreements expiring in 2001 with
Messrs. Lokken and Panzera, and 2003 with Mr. Biety. Messrs. Carr and Riley
have employment agreements with the Company which expire on October 31, 2000.
RISK ASSOCIATED WITH FACILITIES REORGANIZATION
The Company's UK subsidiary has relocated to a new facility in 1999. The
Company believes it has moved the facility with a minimum of disruption,
although operations have been affected by the move.
The Company is in the process of expanding its plating operations at its
Sun Valley facility. This expansion is not expected to be completed until
sometime in 2000. The plating shop of the UK operation is not scheduled to
move to the new facility until sometime in early 2000. Any failure or delay
in the expansion or relocation of these plating operations could impair the
Company's ability to service its customers.
YEAR 2000 COMPLIANCE
The year 2000 problem is the result of computer programs being written
using two digits (rather than four) to define the applicable year. Any of the
Company's programs that have time-sensitive software may recognize a date
using "00" as the year 1900 rather than the year 2000, which could result in
miscalculation or system failures. The Company believes that its mainframe
database and operating systems are year 2000 compliant. However, certain of
the Company's software applications currently are coded using two digits
rather than four to define the applicable year. The Company is systematically
modifying such software applications to be coded as four digits. In addition,
the Company is working with its external suppliers, vendors and service
providers to ensure that their systems will be able to support and interact
with the Company's server and network. The Company has not quantified the
total costs required to become year 2000 compliant, but does not expect such
costs to be material.
7.
<PAGE>
As of September 30, 1999, the total costs incurred to address the Company's
year 2000 issues have not been material. However, if the Company, its
customers or vendors are unable to resolve such processing issues in a timely
manner, it could have a material adverse impact on the Company's business,
financial condition and results of operations. Accordingly, the Company plans
to devote the necessary resources to becoming year 2000 compliant in a timely
manner.
8.
<PAGE>
SELLING SHAREHOLDERS
The following table lists the Selling Shareholders, the number of shares
of Common Stock held by each such Selling Shareholder as of the commencement
of this offering, the number of shares included in the offering and the
number of shares of Common Stock held by each such Selling Shareholder after
the offering. The shares included in the Prospectus were issued or are
issuable to the Selling Shareholders in connection with their exercise of
options pursuant to the Plans. Each Selling Shareholder has advised the
Company that such Selling Shareholder intends to offer for sale all of the
Shares listed below under the heading "Number of Shares Being Offered."
The remaining Selling Shareholders are not currently known by the
Company, but will be current or future officers, directors, employees or
consultants of the Company who may, in the future, be granted stock options
under either of the Plans.
<TABLE>
<CAPTION>
Ownership Prior Ownership
to Registration Number After Offering(1)
------------------- of Shares -------------------
Number of Being Number of
Beneficial Owner Position Shares(2) Percent Offered(3) Shares Percent
- ---------------- -------- ---------- ------- ---------- --------- -------
<S> <C> <C> <C> <C> <C> <C>
David L. Lokken President, Chief Executive
Officer and Director 326,401(4) 5.4% 187,471 138,930 2.3%
Phil Panzera Executive Vice President 43,261(5) * 43,261 0 *
Brian S. Carr Managing Director of
Sun Valley Operations 71,967(5) 1.2% 43,261 28,706 *
Michael A. Riley Vice President
Sales and Marketing 71,967(5) 1.2% 43,261 28,706 *
Dennis Biety Managing Director of
United Kingdom Operations 28,841(6) * 28,841 0 *
Dan Toomey, Jr. Director 16,861 * 14,861 2,000 *
Joel McIntyre Director 16,861 * 14,861 2,000 *
Mellon C. Baird Director 16,861 * 14,861 2,000 *
Remaining Selling
Shareholders 177,842(7) * 177,842 0 *
</TABLE>
- ----------
* Less than 1%
(1) The table assumes that the Selling Shareholders will dispose of all of
the Company's Common Stock owned by them which are being registered.
(2) Owned of record or beneficially.
(3) Options to purchase a total of 568,520 shares are outstanding under
Management Stock Option Agreements (100,945) and the 1997 Stock Option
Plan (467,575).
(4) Includes shares which are not outstanding but subject to options to
purchase common stock, and 138,930 shares held by the David L. Lokken
and Susan M. Lokken Revocable Trust Dated 3-20-98, of which Mr. Lokken
is a co-trustee.
(5) Includes 43,261 shares which are not outstanding but subject to options
to purchase common stock.
(6) Includes 28,841 shares which are not outstanding but subject to options
to purchase Common Stock.
(7) All of which shares are not outstanding but subject to options to
purchase common stock.
9.
<PAGE>
DESCRIPTION OF CAPITAL STOCK
As of the date of this Prospectus, the authorized capital stock of the
Company consists of 20,000,000 shares of Common Stock and 5,000,000 shares of
preferred stock.
COMMON STOCK
As of November 15, 1999, 5,822,222 shares of Common Stock were
outstanding, held of record by 34 registered shareholders. The holders of
Common Stock are entitled to one vote for each share held of record on all
matters submitted to a vote of the shareholders and may cumulate their votes
in the election of directors upon giving notice required by law. Subject to
preferences that may be applicable to any shares of Preferred Stock issued in
the future, holders of Common Stock are entitled to receive ratably such
dividends as may be declared by the Board of Directors out of funds legally
available therefore. See "Dividend Policy." The Company's shareholders
currently may cumulate their votes for the election of directors so long as
at least one shareholder has given notice at the meeting of shareholders
prior to the voting of that shareholder's desire to cumulate his or her
votes. Cumulative voting means that in any election of directors, each
shareholder may give one candidate a number of votes equal to the number of
directors to be elected multiplied by the number of shares held by such
shareholder, or such shareholder may distribute such number of votes among as
many candidates as the shareholder sees fit. Cumulative voting will no longer
be required or permitted under the Amended Articles at such time as (i) the
Company's shares of Common Stock are listed on the Nasdaq National Market and
the Company has at least 800 holders of its equity securities as of the
record date of the Company's most recent annual meeting of shareholders or
(ii) the Company's shares of Common Stock are listed on the New York Stock
Exchange or the American Stock Exchange. At that time, the Company may divide
its Board into classes of directors. In the event of a liquidation,
dissolution or winding up of the Company, holders of the Common Stock are
entitled to share ratably with the holders of any then outstanding Preferred
Stock in all assets remaining after payment of liabilities and the
liquidation preference of any then outstanding Preferred Stock. Holders of
Common Stock have no preemptive rights and no right to convert their Common
Stock into any other securities. There are no redemption or sinking fund
provisions applicable to the Common Stock. All outstanding shares of Common
Stock are, and all shares of Common Stock issued by the Company in the
initial public offering are, fully paid and nonassessable.
PREFERRED STOCK
The Board of Directors has authority to fix the rights, preferences,
privileges and restrictions, including voting rights, of those shares without
any future vote or action by the shareholders. The rights of the holders of
the Common Stock will be subject to, and may be adversely affected by, the
rights of the holders of any preferred stock that may be issued in the
future. The issuance of preferred stock could have the effect of making it
more difficult for a third party to acquire a majority of the outstanding
voting stock of the Company, thereby delaying, deferring or preventing a
change in control of the Company. Furthermore, such preferred stock may have
other rights, including economic rights senior to the common stock, and, as a
result, the issuance thereof could have a material adverse effect on the
market value of the Common Stock.
In March 1999, the Company adopted a Rights Agreement and in connection
therewith, created a Series B Junior Participating Preferred Stock. No shares
of preferred stock are currently outstanding.
STOCK TRANSFER AGENT AND REGISTRAR
The transfer agent and registrar for the Company's Common Stock is U.S.
Stock Transfer Corporation, Glendale, California.
10.
<PAGE>
LIMITATION OF LIABILITY AND INDEMNIFICATION MATTERS
The Company's Amended and Restated Articles of Incorporation, as amended
("Amended Articles") provide that, pursuant to the California Corporations
Code, the liability of the directors of the Company for monetary damages
shall be eliminated to the fullest extent permissible under California law.
This is intended to eliminate the personal liability of a director for
monetary damages in an action brought by, or in the right of, the Company for
breach of a director's duties to the Company or its shareholders. This
provision in the Amended Articles does not eliminate the directors' fiduciary
duty and does not apply for certain liabilities: (i) for acts or omissions
that involve intentional misconduct or a knowing and culpable violation of
law; (ii) for acts or omissions that a director believes to be contrary to
the best interest of the Company or its shareholders or that involve the
absence of good faith on the part of the director; (iii) for any transaction
from which a director derived an improper personal benefit; (iv) for acts or
omissions that show a reckless disregard for the director's duty to the
Company or its shareholders in circumstances in which the director was aware,
or should have been aware, in the ordinary course of performing a director's
duties, of a risk of serious injury to the Company or its shareholders; (v)
for acts or omissions that constitute an unexcused pattern of inattention
that amounts to an abdication of the director's duty to the Company or its
shareholders; (vi) with respect to certain transactions or the approval of
transactions in which a director has a material financial interest; and (vii)
expressly imposed by statute for approval of certain improper distributions
to shareholders or certain loans or guarantees. This provision also does not
limit or eliminate the rights of the Company or any shareholder to seek
non-monetary relief such as an injunction or rescission in the event of a
breach of a director's duty of care. The Company's Amended and Restated
Bylaws require the Company to indemnify its officers and directors to the
full extent permitted by law, including circumstances in which
indemnification would otherwise be discretionary. Among other things, the
Bylaws require the Company to indemnify directors and officers against
certain liabilities that may arise by reason of their status or service as
directors and officers and allows the Company to advance their expenses
incurred as a result of any proceeding against them as to which they could be
indemnified.
The Company believes that it is the position of the Commission that
insofar as the foregoing provision may be invoked to disclaim liability for
damages arising under the Securities Act, the provision is against public
policy as expressed in the Securities Act and is therefore unenforceable.
Such limitation of liability also does not affect the availability of
equitable remedies such as injunctive relief or rescission.
The Company has entered into indemnification agreements
("Indemnification Agreement(s)") with each of its directors and executive
officers. Each such Indemnification Agreement provides that the Company will
indemnify the indemnitee against expenses, including reasonable attorneys'
fees, judgments, penalties, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with any civil or criminal action or
administrative proceeding arising out of the performance of his duties as a
director or officer, other than an action instituted by the director or
officer. Such indemnification is available if the indemnitee acted in good
faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the Company, and, with respect to any criminal action, had
no reasonable cause to believe his conduct was unlawful. The Indemnification
Agreements require that the Company indemnify the director or other party
thereto in all cases to the fullest extent permitted by applicable law. Each
Indemnification Agreement permits the director or officer that is party
thereto to bring suit to seek recovery of amounts due under the
Indemnification Agreement and to recover the expenses of such a suit if he is
successful. Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers or persons controlling
the Company pursuant to the foregoing provisions, the Company has been
informed that in the opinion of the Commission, such indemnification is
against public policy as expressed in the Securities Act and is therefore
unenforceable. The Company believes that its Amended Articles and Bylaw
provisions are necessary to attract and retain qualified persons as directors
and officers.
The Company has been informed that, in the opinion of the Securities and
Exchange Commission (the "Commission"), indemnification provisions such as
the foregoing are against public policy as expressed in the Securities Act
and are therefore unenforceable with respect to claims arising under federal
securities laws.
11.
<PAGE>
=================================================
NO PERSON HAS BEEN AUTHORIZED IN
CONNECTION WITH THE OFFERING MADE HEREBY TO
GIVE ANY INFORMATION OR MAKE ANY REPRESENTATION
NOT CONTAINED IN THIS PROSPECTUS AND, IF GIVEN
OR MADE, SUCH INFORMATION OR REPRESENTATION
MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE COMPANY OR ANY SELLING
SHAREHOLDER. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER TO SELL OR A SOLICITATION
OF AN OFFER TO BUY ANY OF THE SECURITIES
OFFERED HEREBY TO ANY PERSON IN OR BY ANYONE IN
ANY JURISDICTION IN WHICH IT IS UNLAWFUL TO
MAKE SUCH OFFER OR SOLICITATION. NEITHER THE
DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE
HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES,
CREATE ANY IMPLICATION THAT THE INFORMATION
HEREIN IS CORRECT AS OF ANY DATE SUBSEQUENT TO
THE DATE HEREOF.
--------
TABLE OF CONTENTS
<TABLE>
<S> <C>
Available Information....................... 2
Incorporation of Certain Documents
by Reference.............................. 2
Prospectus Summary.......................... 3
Risk Factors................................ 4
Selling Shareholders........................ 9
Plan of Distribution........................ 10
Description of Capital Stock................ 11
</TABLE>
=================================================
=================================================
HAWKER PACIFIC AEROSPACE
735,459 shares of Common Stock
---------------
PROSPECTUS
---------------
November 22, 1999
=================================================
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents filed by Hawker Pacific Aerospace (the
"Company") with the Securities and Exchange Commission (the "Commission") are
incorporated by reference herein:
(i) the Company's Annual Report on Form 10-K, as amended, for the
fiscal year ended December 31, 1998;
(ii) the Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1999;
(iii) the Company's Quarterly Report on Form 10-Q for the quarter ended
June 30, 1999, as amended by Form 10-Q/A filed November 15, 1999;
(iv) the Company's Quarterly Report on Form 10-Q for the quarter ended
September 30, 1999;
(v) all other reports filed by the Company pursuant to Section 13(a)
or 15(d) of the Securities Exchange Act of 1934 (the "Exchange Act") since
December 31, 1998; and
(vi) the description of the Company's Common Stock contained in the
Company's Registration Statement on Form 8-A (Reg. No. 000-29490) under the
Exchange Act filed with the Commission on December 18, 1997, including any
amendment or report subsequently filed by the Company for the purpose of
updating that description.
(vii) the description of the Company's Series B Participating Preferred
Stock contained in the Company's Registration Statement on Form 8-A (Reg No.
000-29490) under the Exchange Act filed with the Commission on December 18,
1997, including any amendment or report subsequently filed by the Company
for the purpose of updating that description.
In addition, any document filed by the Company with the Commission
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent
to the date hereof, but prior to the filing of a post-effective amendment to
this Registration Statement which indicates that all shares of the Company's
Common Stock registered hereunder have been sold or that deregisters all such
shares of Common Stock then remaining unsold, will be deemed to be
incorporated by reference herein and to be a part hereof from the date of
filing of such documents. Any statement contained herein or in a document,
all or a portion of which is incorporated or deemed to be incorporated by
reference herein shall be deemed to be modified or superseded for purposes of
this Registration Statement to the extent that a statement contained herein
or in any other subsequently filed document which also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any
such statement so modified or superseded shall not be deemed, except as so
modified or amended, to constitute a part of this Registration Statement.
ITEM 4. DESCRIPTION OF SECURITIES
Not Applicable.
ITEM 5. INTEREST OF NAMED EXPERTS AND COUNSEL
Not Applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company's Amended and Restated Articles of Incorporation, as amended
("Amended Articles") provide that, pursuant to the California Corporations
Code, the liability of the directors of the Company for monetary damages
shall be eliminated to the fullest extent permissible under California law.
This is intended to eliminate the personal liability of a director for
monetary damages in an action brought by, or in the right of, the Company for
13.
<PAGE>
breach of a director's duties to the Company or its shareholders. This
provision in the Amended Articles does not eliminate the directors' fiduciary
duty and does not apply for certain liabilities: (i) for acts or omissions
that involve intentional misconduct or a knowing and culpable violation of
law; (ii) for acts or omissions that a director believes to be contrary to
the best interest of the Company or its shareholders or that involve the
absence of good faith on the part of the director; (iii) for any transaction
from which a director derived an improper personal benefit; (iv) for acts or
omissions that show a reckless disregard for the director's duty to the
Company or its shareholders in circumstances in which the director was aware,
or should have been aware, in the ordinary course of performing a director's
duties, of a risk of serious injury to the Company or its shareholders; (v)
for acts or omissions that constitute an unexcused pattern of inattention
that amounts to an abdication of the director's duty to the Company or its
shareholders; (vi) with respect to certain transactions or the approval of
transactions in which a director has a material financial interest; and (vii)
expressly imposed by statute for approval of certain improper distributions
to shareholders or certain loans or guarantees. This provision also does not
limit or eliminate the rights of the Company or any shareholder to seek
non-monetary relief such as an injunction or rescission in the event of a
breach of a director's duty of care. The Company's Amended and Restated
Bylaws require the Company to indemnify its officers and directors to the
full extent permitted by law, including circumstances in which
indemnification would otherwise be discretionary. Among other things, the
Bylaws require the Company to indemnify directors and officers against
certain liabilities that may arise by reason of their status or service as
directors and officers and allows the Company to advance their expenses
incurred as a result of any proceeding against them as to which they could be
indemnified.
The Company believes that it is the position of the Commission that
insofar as the foregoing provision may be invoked to disclaim liability for
damages arising under the Securities Act, the provision is against public
policy as expressed in the Securities Act and is therefore unenforceable.
Such limitation of liability also does not affect the availability of
equitable remedies such as injunctive relief or rescission.
The Company has entered into indemnification agreements
("Indemnification Agreement(s)") with each of its directors and executive
officers. Each such Indemnification Agreement provides that the Company will
indemnify the indemnitee against expenses, including reasonable attorneys'
fees, judgments, penalties, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with any civil or criminal action or
administrative proceeding arising out of the performance of his duties as a
director or officer, other than an action instituted by the director or
officer. Such indemnification is available if the indemnitee acted in good
faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the Company, and, with respect to any criminal action, had
no reasonable cause to believe his conduct was unlawful. The Indemnification
Agreements require that the Company indemnify the director or other party
thereto in all cases to the fullest extent permitted by applicable law. Each
Indemnification Agreement permits the director or officer that is party
thereto to bring suit to seek recovery of amounts due under the
Indemnification Agreement and to recover the expenses of such a suit if he is
successful. Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers or persons controlling
the Company pursuant to the foregoing provisions, the Company has been
informed that in the opinion of the Commission, such indemnification is
against public policy as expressed in the Securities Act and is therefore
unenforceable. The Company believes that its Amended Articles and Bylaw
provisions are necessary to attract and retain qualified persons as directors
and officers.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not Applicable.
ITEM 8. EXHIBITS
The following exhibits included herewith or incorporated herein by
reference are made part of this Registration Statement:
4.1 Specimen Common Stock certificate (filed with the Commission on
January 28, 1998 as Exhibit 4.1 to Amendment No. 2 to the
Company's Registration Statement on Form S-1 (Reg. No. 333-40295)
and incorporated herein by reference).
14.
<PAGE>
4.2 Hawker Pacific Aerospace 1997 Stock Option Plan and form of Stock
Option Agreement (filed with the Commission on November 14, 1997
as Exhibit 10.1 to the Company's Registration Statement on Form
S-1 (Reg. No. 333-40295) and incorporated herein by reference).
4.3 Amendment No. 1 to Hawker Pacific Aerospace 1997 Stock Option Plan
(filed with the Commission on January 23, 1998 as Exhibit 10.1A to
Company's Registration Statement on Form S-1 (Reg. No. 333-40295)
and incorporated herein by reference).
4.4 Form of Management Stock Option Agreement (filed herewith)
4.5 Form of Amendment Number One to Management Stock Option Agreement.
(filed herewith)
5.1 Opinion of Troy & Gould Professional Corporation regarding the
legality of the securities registered hereunder. (filed herewith)
23.1 Consent of Ernest & Young L.L.P. (filed herewith)
23.2 Consent of Troy & Gould Professional Corporation (contained in
Exhibit 5.1).
24.1 Power of Attorney (contained in Part II).
ITEM 9. UNDERTAKINGS
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement; and
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration statement or any
material change to such information in this Registration Statement;
PROVIDED, HOWEVER, that paragraphs (1)(i) and (1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the registrant pursuant to Section 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 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.
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 the registration statement shall be deemed to be
a
15.
<PAGE>
new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons
of the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as
expressed in the Securities Act of 1933 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 Securities Act of 1933 and will be
governed by the final adjudication of such issue.
16.
<PAGE>
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 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 Sun Valley, State of California, on
November 19, 1999.
HAWKER PACIFIC AEROSPACE
By: /S/ DAN LUBECK
---------------------------------------
Daniel J. Lubeck
Chairman of the Board
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints David Lokken, Phil Panzera and Dan Lubeck, and
each of them, 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 said
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 he might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any
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, this
registration statement has been signed below by the following persons on
behalf of the registrant and in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Dan Lubeck Chairman of the Board November 19, 1999
- ---------------------------------
Daniel J. Lubeck
/s/ David L. Lokken Chief Executive Officer November 19, 1999
- --------------------------------- (Principal Executive Officer),
David L. Lokken President and Director
/s/ Philip Panzera Executive Vice President November 19, 1999
- --------------------------------- (Principal Financial and
Philip Panzera Accounting Officer)
/s/ Scott W. Hartman Director November 19, 1999
- ---------------------------------
Scott W. Hartman
/s/ John G. Makoff Director November 19, 1999
- ---------------------------------
John G. Makoff
/s/ Daniel C. Toomey, Jr. Director November 19, 1999
- ---------------------------------
Daniel C. Toomey, Jr.
/s/ Mellon C. Baird Director November 19, 1999
- ---------------------------------
Mellon C. Baird
/s/ Joel F. McIntyre Director November 19, 1999
- ---------------------------------
Joel F. McIntyre
</TABLE>
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NUMBER PAGE
- -------------- ----
<S> <C> <C>
4.4 Form of Management Stock Option Agreement
4.5 Form of Amendment Number One to Management Stock
Option Agreement
5.1 Opinion of Troy & Gould Professional Corporation.
23.1 Consent of Ernest & Young L.L.P.
</TABLE>
<PAGE>
EXHIBIT 4.4
NOTIFICATION OF REVERSE STOCK SPLIT
Please note that on January 28, 1998, subsequent to the grant date for this
stock option, Hawker Pacific Aerospace effected a one for .9907406 reverse
stock split of its outstanding common stock causing a downward adjustment in
the number of shares of common stock subject to this stock option.
HAWKER PACIFIC AEROSPACE
MANAGEMENT STOCK OPTION AGREEMENT
THIS MANAGEMENT STOCK OPTION AGREEMENT (the "Agreement") is made as of
the _____ day of ______________, 19___ by and between Hawker Pacific
Aerospace, a California corporation (the "Company"), and ____________________
("Optionee").
R E C I T A L
In consideration of Optionee's service to the Company, the Board of
Directors of the Company (the "Board") has authorized the granting to
Optionee of this management stock option to purchase the number of shares of
Common Stock of the Company specified in Paragraph 1 hereof at the price
specified therein, such option to be for the term and upon the terms and
conditions hereinafter stated.
A G R E E M E N T
NOW, THEREFORE, in consideration of the promises and of the undertakings
of the parties hereto contained herein, it is hereby agreed:
1. NUMBER OF SHARES; OPTION PRICE. Pursuant to said action of the
Board, the Company hereby grants to Optionee the option ("Option") to
purchase, upon and subject to the terms and conditions of this Agreement,
__________ shares of Common Stock of the Company ("Shares") at the price of
$________ per share. The number of Shares and the exercise price of the
Option stated herein gives effect to a 579.48618-for-1 stock split of the
Company's Common Stock effected in November 1997.
2. TERM. This Option shall expire on the day before the fifth
anniversary of the date hereof (the "Expiration Date").
3. SHARES SUBJECT TO EXERCISE. All Shares shall vest immediately and
be subject to exercise as of the effective date of this Agreement and shall
thereafter remain subject to exercise for the term specified in Paragraph 2
hereof, notwithstanding any termination of the Optionee's employment by the
Company or its Affiliate. The term "Affiliate" as used herein means a parent
or subsidiary corporation as defined in the applicable sections (currently
Sections 424(e) and (f), respectively) of the Internal Revenue Code of 1986,
as amended (the "Code").
4. METHOD AND TIME OF EXERCISE. The Option may be exercised by written
notice delivered to the Company at its principal executive office stating the
number of shares with respect to which the Option is being exercised. Except
as provided below, payment in full, in cash, shall be made for all stock
purchased at the time written notice of exercise of this Option is given to
the Company, and proceeds of any payment shall constitute general funds of the
1
<PAGE>
Company. Such payment may be made by check or money order made payable to the
Company in the amount of the exercise price and any withholding tax as
provided under Paragraph 5 hereof. The Board, in its sole discretion, after
considering any tax, accounting and financial consequences, may authorize any
one or more of the following additional methods of payment:
(a) Acceptance of Optionee's full recourse promissory note for all
or part of the exercise price in a form approved by the Board, payable on
such terms and bearing such interest rate as determined by the Board (but in
no event less than the minimum interest rate specified under the Code at
which no additional interest would be imputed), which promissory note may be
either secured or unsecured in such manner as the Board shall approve
(including, without limitation, by a security interest in the shares of the
Company); or
(b) Subject to the discretion of the Board, through the surrender
of shares of Common Stock then issuable upon exercise of this Option,
provided the fair market value (as determined by the Board in accordance with
Paragraph 6 hereof) of such shares of Common Stock is equal on the date of
exercise to the exercise price, or such portion thereof as Optionee is
authorized to pay by surrender of such stock; or
(c) If expressly authorized in writing by the Board, in its sole
discretion, at the time of exercise of this Option, the tender to the Company
of shares of the Company's Common Stock already owned by Optionee, having a
fair market value on the date of exercise, as determined by the Board in
accordance with Paragraph 6 hereof, equal to the exercise price, or such
portion thereof as Optionee is authorized to pay by surrender of such stock,
plus the amount of applicable federal, state and local withholding taxes; or
(d) If any other method such as cashless exercise (as permitted
under applicable rules and regulations of the Securities and Exchange
Commission and the Federal Reserve Board) is expressly authorized in writing
by the Board, in its sole discretion, at the time of exercise of this Option,
the tender of such consideration having a fair market value, as determined by
the Board, not less than the exercise price, plus the amount of applicable
federal, state and local withholding taxes.
Not less than 100 shares may be purchased at any one time unless the number
purchased is the total number purchasable under such Option at the time. Only
whole shares may be purchased.
5. WITHHOLDING AND EMPLOYMENT TAXES. At the time of exercise of this
Option and as a condition thereto, or at such other time as the amount of
such obligation becomes determinable, Optionee shall remit to the Company in
cash all applicable federal and state withholding and employment taxes that
the Company is required to withhold with respect to the exercise of this
Option. At the request of Optionee, such obligation to remit may be
satisfied, if authorized by the Board, in its sole discretion, after
considering any tax, accounting and financial consequences, by Optionee's (i)
delivery of a promissory note in the required amount on such terms as the
Board deems appropriate, (ii) tendering to the Company previously owned
shares of Common Stock or other securities of the Company with a fair market
value equal to
2
<PAGE>
the required amount, or (iii) agreeing to have shares of Common Stock (with a
fair market value equal to the required amount) which are acquired upon
exercise of the Option withheld by the Company. Fair market value of Common
Stock or other securities of the Company surrendered pursuant to this
Paragraph 5 shall be determined by the Board in accordance with Paragraph 6
hereof.
6. DETERMINATION OF VALUE. For purposes of this Option, the fair
market value of Common Stock or other securities of the Company shall be
determined as follows:
(a) If the stock of the Company is regularly quoted by a recognized
securities dealer, and selling prices are reported, its fair market value
shall be the closing price of such stock on the date the value is to be
determined, but if selling prices are not reported, its fair market value
shall be the mean between the high bid and low asked prices for such stock on
the date the value is to be determined (or if there are no quoted prices for
the date of grant, then for the last preceding business day on which there
were quoted prices).
(b) In the absence of an established market for the stock, the fair
market value thereof shall be determined in good faith by the Board, with
reference to the Company's net worth, prospective earning power,
dividend-paying capacity, and other relevant factors, including the goodwill
of the Company, the economic outlook in the Company's industry, the Company's
position in its industry, the Company's management, and the values of stock
of other corporations in the same or a similar line of business.
7. EXERCISE ON TERMINATION OF EMPLOYMENT. If Optionee ceases to be
employed by the Company or any of its Affiliates (such event being called a
"Termination"), or dies or becomes permanently and totally disabled (within
the meaning of Section 22(e)(3) of the Code) while employed by the Company or
an Affiliate, this Option may be exercised, in whole or in part, by Optionee,
by Optionee's personal representative or by the person to whom this Option is
transferred by devise or the laws of descent and distribution, at any time
after such Termination, death or permanent and total disability of Optionee
before the Expiration Date.
8. NONTRANSFERABILITY. Except with the express written approval of the
Board, this Option may not be assigned or transferred except by will or by
the laws of descent and distribution, and may be exercised only by Optionee
during his lifetime and, after his death, only by his personal representative
or by the person entitled thereto under his will or the laws of intestate
succession.
9. OPTIONEE NOT A SHAREHOLDER. Optionee shall have no rights as a
shareholder with respect to the Common Stock of the Company covered by this
Option until the date of issuance of a stock certificate or stock
certificates to him upon exercise of this Option. No adjustment will be made
for dividends or other rights for which the record date is prior to the date
such stock certificate or certificates are issued.
3
<PAGE>
10. NO RIGHT TO EMPLOYMENT. Nothing in the Option granted hereby shall
interfere with or limit in any way the right of the Company or of any of its
Affiliates to terminate Optionee's employment or consulting at any time, nor
confer upon Optionee any right to continue in the employ of, or consult with,
the Company or any of its Affiliates.
11. MODIFICATION AND TERMINATION. The rights of Optionee hereunder are
subject to modification and termination in the following events:
11.1 CHANGES IN CAPITAL STRUCTURE. Subject to Section 11.2, if the
stock of the Company is changed by reason of a stock split, reverse stock
split, stock dividend, or recapitalization, combination or reclassification,
appropriate adjustments shall be made by the Board in (a) the number and
class of shares of stock subject to this Option and (b) the exercise price of
this Option; PROVIDED, HOWEVER, that the Company shall not be required to
issue fractional shares as a result of any such adjustments. Each such
adjustment shall be subject to approval by the Board in its sole discretion.
11.2 CORPORATE TRANSACTIONS. In the event of the proposed dissolution
or liquidation of the Company, the Board shall notify Optionee at least 30
days prior to such proposed action. To the extent not previously exercised,
this Option will terminate immediately prior to the consummation of such
proposed action. In the event of a merger or consolidation of the Company
with or into another corporation or entity in which the Company does not
survive, or in the event of a sale of all or substantially all of the assets
of the Company in which the shareholders of the Company receive securities of
the acquiring entity or an affiliate thereof, this Option shall be assumed or
an equivalent option shall be substituted by the successor corporation (or
other entity) or a parent or subsidiary of such successor corporation (or
other entity).
12. RESTRICTIONS ON SALE OF SHARES. Optionee represents and agrees
that upon his exercise of this Option, in whole or in part, unless there is
in effect at that time under the Securities Act of 1933, as amended (the
"Securities Act"), a registration statement relating to the Shares issued to
him, he will acquire the Shares issuable upon exercise of this Option for the
purpose of investment and not with a view to their resale or further
distribution, and that upon such exercise thereof he will furnish to the
Company a written statement to such effect, satisfactory to the Company in
form and substance. Optionee agrees that any certificates issued upon
exercise of this Option may bear a legend indicating that their
transferability is restricted in accordance with applicable state and federal
securities law. Any person or persons entitled to exercise this Option under
the provisions of Paragraphs 7 and 8 hereof shall, upon each exercise of this
Option under circumstances in which Optionee would be required to furnish
such a written statement, also furnish to the Company a written statement to
the same effect, satisfactory to the Company in form and substance.
13. MANNER OF EXERCISE
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(a) Before exercising this Option, Optionee shall give written
notice to the Company at its principal executive office, to the attention of
the officer of the Company designated by the Board, accompanied by payment of
the exercise price and withholding taxes as provided in Paragraphs 4 and 5
hereof. The date the Company receives written notice of an exercise hereunder
accompanied by payment of the exercise price will be considered as the date
such Option was exercised.
(b) Promptly after receipt of written notice of exercise of an
Option and the payments called for by Paragraph 13(a), the Company shall,
without stock issue or transfer taxes to Optionee or such other as may be
person entitled to exercise this Option, deliver to Optionee or such other
person a certificate or certificates for the requisite number of shares of
stock. Optionee or a permitted transferee of this Option shall not have any
privileges as a shareholder with respect to any shares of stock covered by
the Option until the date of issuance (as evidenced by the appropriate entry
on the books of the Company or a duly authorized transfer agent) of such
shares.
14. CONDITIONS UPON ISSUANCE OF SHARES. Shares of Common Stock shall
not be issued pursuant to the exercise of this Option unless the exercise of
such Option and the issuance and delivery of such shares pursuant hereto
complies with all relevant provisions of law, including, without limitation,
the Securities Act.
15. DELIVERY OF FINANCIAL STATEMENTS. To the extent required by
applicable laws, rules and regulations, the Company shall deliver to Optionee
financial statements of the Company at least annually while Optionee holds
the Option.
16. NOTICES. All notices to the Company shall be addressed to the
Chief Financial Officer at the principal executive offices of the Company at
11240 Sherman Way, Sun Valley, California 91352, and all notices to Optionee
shall be addressed to Optionee at the address of Optionee on file with the
Company or its Affiliate, or to such other address as either may designate to
the other in writing. A notice shall be deemed to be duly given if and when
enclosed in a properly addressed sealed envelope deposited, postage prepaid,
with the United States Postal Service. In lieu of giving notice by mail as
aforesaid, written notices under this Agreement may be given by personal
delivery to Optionee or to the Chief Financial Officer (as the case may be).
17. SALE OR OTHER DISPOSITION. If Optionee at any time contemplates
the disposition (whether by sale, gift, exchange, or other form or transfer)
of any Shares acquired by exercise of this Option, he or she shall first
notify the Company in writing of such proposed disposition and cooperate with
the Company in complying with all applicable requirements of law, which, in
the judgment of the Company, must be satisfied prior to such disposition.
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<PAGE>
18. MARKET STANDOFF. The Optionee, if so requested by the Company or
any representative of the underwriters in connection with any registration of
the offering of any securities of the Company under the Securities Act, shall
not sell or otherwise transfer any shares of Common Stock acquired upon
exercise of this Option during the 180-day period following the effective
date of a registration statement of the Company filed under the Securities
Act; PROVIDED, HOWEVER, that such restriction shall apply only to
registration statements of the Company to become effective under the
Securities Act after the date of this Agreement which includes securities to
be sold on behalf of the Company to the public in an underwritten public
offering under the Securities Act. The Company may impose stop-transfer
instructions with respect to securities subject to the foregoing restriction
until the end of such 180-day period.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date and year first above written.
HAWKER PACIFIC AEROSPACE
By______________________________________
Name:
Title:
OPTIONEE
By______________________________________
Name:
Address:
______________________________________
______________________________________
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<PAGE>
EXHIBIT 4.5
AMENDMENT NUMBER ONE TO THE
HAWKER PACIFIC AEROSPACE
MANAGEMENT STOCK OPTION AGREEMENT
THIS AMENDMENT NUMBER ONE TO THE HAWKER PACIFIC AEROSPACE MANAGEMENT
STOCK OPTION AGREEMENT (this "Agreement") is made as of the 28th day of
October, 1998 by and between Hawker Pacific Aerospace, a California
corporation (the "Company"), and __________ ("Optionee").
R E C I T A L
WHEREAS, pursuant to action by the Board of directors of the Company,
the Company was authorized to grant to Optionee a management stock option to
purchase _______ shares of Common Stock of the Company (the "Option Shares");
and
WHEREAS, the Company and Optionee entered into a Management Stock
Option Agreement dated November 14, 1997 (the "Option Agreement"); and
WHEREAS, the Company effected a one-for-.9907406 reverse stock split in
January, 1998, so that the _______ shares set forth in the original
Management Stock Option Agreement actually represent _______ shares subject
to the Option Agreement; and
WHEREAS, the Company desires to decrease the price per share of said
Option Shares from its current exercise price of $8.00 per share.
A G R E E M E N T
NOW, THEREFORE, in consideration of the promises and of the undertakings
of the parties hereto contained herein, it is hereby agreed that Paragraph 1
of the Option Agreement is hereby amended to read in its entirety as follows:
"II. NUMBER OF SHARES; OPTION PRICE. Pursuant to said action of the
Board of Directors, the Company hereby grants to Optionee the option
("Option") to purchase, upon and subject to the terms and conditions of this
agreement, ______ shares of Common Stock of the Company ("Shares") at a price
per share of $3.563. The number of Shares and the exercise price of the
Option stated herein give effect to a 579.48618-for-1 stock split of the
Company's Common Stock effected in November 1997 and the one-for-.9907406
reverse stock split effected January 28, 1998."
<PAGE>
In all other respects, the Option Agreement shall remain in full force
and effect.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date and year first above written.
HAWKER PACIFIC AEROSPACE
By __________________________________
Chairman
OPTIONEE
_____________________________________
Address:
_____________________________________
_____________________________________
_____________________________________
<PAGE>
EXHIBIT 5
November 19, 1999
Hawker Pacific Aerospace
11240 Sherman Way
Sun Valley, California 91352
Re: REGISTRATION STATEMENT ON FORM S-8
Ladies and Gentlemen:
At your request, we have examined the Registration Statement on Form S-8
(the "Registration Statement") of Hawker Pacific Aerospace (the "Company"),
and the exhibits filed in connection therewith, which you have filed with the
Securities and Exchange Commission in connection with the registration under
the Securities Act of 1933, as amended (the "Securities Act"), of up to
735,459 shares of the Company's Common Stock ("Common Stock") issuable under
the Company's 1997 Stock Option Plan and Management Stock Option Agreements
(the "Plans").
For purposes of this opinion, we have examined such matters of law and
originals, or copies certified or otherwise identified to our satisfaction,
of the Plans and of such documents, corporate records and other instruments
relating to the adoption and implementation of the Plans as we have deemed
necessary. In our examination, we have assumed the genuineness of all
signatures, the authenticity of all documents submitted to us as originals,
the conformity to originals of all documents submitted to us as certified,
photostatic or conformed copies, and the authenticity of originals of all
such latter documents. We have also assumed the due execution and delivery of
all documents where due execution and delivery are prerequisites to the
effectiveness thereof. We have relied upon certificates of public officials
and certificates of officers of the Company for the accuracy of material
factual matters contained therein which were not independently established.
<PAGE>
Hawker Pacific Aerospace
November 19, 1999
Page Two
Based on the foregoing examination, we are of the opinion that the
shares of Common Stock issuable upon exercise of stock options granted
pursuant to the Plans are duly authorized and, when issued and paid for in
accordance with the Plans, will be validly issued, fully paid and
nonassessable.
We consent to the use of our name in the Prospectus and the Registration
Statement, and to the filing of this opinion as an exhibit to the
Registration Statement. By giving you this opinion, we do not admit that we
are experts with respect to any part of the Registration Statement or
Prospectus within the meaning of the term "expert" as used in Section 11 of
the Securities Act or the rules and regulations promulgated thereunder.
Very truly yours,
/s/ TROY & GOULD PROFESSIONAL CORPORATION
TROY & GOULD
Professional Corporation
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement
(Form S-8) pertaining to Hawker Pacific Aerospace's 1997 Stock Option Plan
and Management Stock Option Agreements of our report dated February 13, 1999,
except for paragraphs 5 through 9 of Note 5 for which the date is April 12,
1999, with respect to the consolidated financial statements of Hawker Pacific
Aerospace included in its Annual Report (Form 10-K) for the year ended
December 31, 1998 and the related financial statement schedules included
therein, filed with the Securities and Exchange Commission.
Woodland Hills, California
November 19, 1999
