<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 15 , 2000
REGISTRATION NO. 333-________
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------------------
IMAGEX.COM, INC.
(Exact name of Registrant as specified in its charter)
WASHINGTON 91-1727170
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
10800 N.E. 8TH STREET
SUITE 200
BELLEVUE, WASHINGTON 98004
(Address of principal executive offices, including zip code)
PRINTBID.COM, INC. STOCK INCENTIVE PLAN
(Full title of the plan)
RICHARD P. BEGERT
CHIEF EXECUTIVE OFFICER
IMAGEX.COM, INC.
10800 N.E. 8TH STREET
SUITE 200
BELLEVUE, WASHINGTON 98004
(425) 452-0011
(Name, address and telephone number, including area code, of agent for service)
----------------------
COPIES TO:
DAVID C. CLARKE
PERKINS COIE LLP
1201 THIRD AVENUE, 48TH FLOOR
SEATTLE, WASHINGTON 98101-3099
----------------------
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
===============================================================================================================
PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TITLE OF SECURITIES AMOUNT TO BE OFFERING PRICE PER AGGREGATE OFFERING REGISTRATION
TO BE REGISTERED REGISTERED(1)(2) SHARE(3) PRICE FEE
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $0.01 par value per
share, under the Printbid.com,
Inc. Stock Incentive Plan 189,150 $.04 $ 7,566.00
- ---------------------------------------------------------------------------------------------------------------
93,138 $.65 $60,539.70
- ---------------------------------------------------------------------------------------------------------------
549 $.66 $ 362.34
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TOTAL 282,837 $ 68,468.04 $18.08
===============================================================================================================
</TABLE>
(1) Together with an indeterminate number of additional shares which may be
necessary to adjust the number of shares reserved for issuance pursuant to
the plan as the result of any future stock split, stock dividend or similar
adjustment to the Registrant's outstanding Common Stock.
(2) Pursuant to an Agreement and Plan of Merger dated as of November 17, 1999,
as amended November 30, 1999 (the "Merger Agreement"), by and among the
Registrant, Orcas Acquisition Corp. and Printbid.com, Inc., the Registrant
assumed outstanding options to purchase capital stock of Printbid.com, Inc.
under the Printbid.com, Inc. Stock Incentive Plan (the "Printbid Assumed
Options), with appropriate adjustments to the number of shares and the
exercise price per share of each Printbid Assumed Option to reflect the
ratio at which outstanding options to purchase Printbid.com, Inc.'s capital
stock were converted into options to purchase Common Stock of the
Registrant under the Merger Agreement.
<PAGE> 2
(3) Shares are issuable upon exercise of outstanding options with fixed
exercise prices. Pursuant to Rule 457(h) under the Securities Act of 1933,
as amended, the proposed maximum aggregate offering price and the
registration fee have been computed upon the basis at which the options may
be exercised.
<PAGE> 3
PART II
INFORMATION REQUIRED IN REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Securities and Exchange
Commission (the "Commission") are hereby incorporated by reference in this
Registration Statement:
(a) The Registrant's prospectus filed on February 11, 2000,
pursuant to Rule 424(b) under the Securities Act of 1993, as amended (the
"Securities Act"); and
(b) All other reports filed by the Registrant pursuant to
pursuant to Section 13(a) or 15(d) of the Exchange Act since the end of the
fiscal year covered by the prospectus referred to above.
All documents filed by the Registrant pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act after the date hereof, and prior to the filing
of a post-effective amendment which indicates that the securities offered hereby
have been sold or which deregisters the securities covered hereby then remaining
unsold, shall also be deemed to be incorporated by reference into this
Registration Statement and to be a part hereof commencing on the respective
dates on which such documents are filed.
ITEM 4. DESCRIPTION OF SECURITIES
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
None.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Sections 23B.08.500 through 23B.08.600 of the Washington Business
Corporation Act authorize a court to award, or a corporation's board of
directors to grant, indemnification to directors and officers on terms
sufficiently broad to permit indemnification under certain circumstances for
liabilities arising under the Securities Act. Article 10 of the Registrant's
Amended and Restated Bylaws provides for indemnification of the Registrant's
directors, officers, employees and agents to the maximum extent permitted by
Washington law. The directors and officers of the Registrant also may be
indemnified against liability they may incur for serving in that capacity
pursuant to a liability insurance policy maintained by the Registrant for such
purpose.
Section 23B.08.320 of the Washington Business Corporation Act authorizes
a corporation to limit a director's liability to the corporation or its
shareholders for monetary damages for acts or omissions as a director, except in
certain circumstances involving intentional misconduct, self-dealing or illegal
corporate loans or distributions, or any transactions from which the director
personally receives a benefit in money, property or services to which the
director is not entitled. Article 7.2 of the Registrant's Restated Articles of
Incorporation contains provisions implementing, to the fullest extent permitted
by Washington law, such limitations on a director's liability to the Registrant
and its shareholders.
II-1
<PAGE> 4
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8. EXHIBITS
<TABLE>
<CAPTION>
Exhibit
Number Description
------- -----------
<S> <C>
5.1 Opinion of Perkins Coie LLP regarding legality of the Common
Stock being registered
23.1 Consent of PricewaterhouseCoopers LLP (Independent Accountants)
23.4 Consent of Perkins Coie LLP (included in opinion filed as
Exhibit 5.1)
24.1 Power of Attorney (see signature page)
99.1 Printbid.com, Inc. Stock Incentive Plan
</TABLE>
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;
(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; and
(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 (1)(i) and (1)(ii) above do not apply if 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, 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.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or 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.
II-2
<PAGE> 5
(c) Insofar as indemnification for liabilities arising under the Securities
Act 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 Commission such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the 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 and will be governed by the final
adjudication of such issue.
II-3
<PAGE> 6
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 Bellevue, State of Washington, on the 15th day of
February, 2000.
IMAGEX.COM, INC.
/s/ Richard P. Begert
---------------------------------------
By: Richard P. Begert
Chief Executive Officer
POWER OF ATTORNEY
Each person whose signature appears below authorizes Richard P. Begert
and Robin L. Krueger, or either of them, as attorneys-in-fact with full power of
substitution, to execute in the name and on the behalf of each person,
individually and in each capacity stated below, and to file, any and all
amendments to this Registration Statement, including any and all post-effective
amendments.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated below on the 15th day of February, 2000.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C>
/s/ Richard P. Begert President and Chief Executive Officer
- ---------------------------------- (Principal Executive Officer)
Richard P. Begert
/s/ Robin L. Krueger Chief Financial Officer
- ---------------------------------- (Principal Financial and Accounting Officer)
Robin L. Krueger
/s/ F. Joseph Verschueren Chairman of the Board
- ----------------------------------
F. Joseph Verschueren
/s/ John E. Ardell Director
- ----------------------------------
John E. Ardell
/s/ Garrett P. Gruener Director
- ----------------------------------
Garrett P. Gruener
/s/ Elwood D. Howse, Jr. Director
- ----------------------------------
Elwood D. Howse, Jr.
/s/ Wayne M. Perry Director
- ----------------------------------
Wayne M. Perry
/s/ Richard R. Sonstelie Director
- ----------------------------------
Richard R. Sonstelie
/s/ Bernee D. L. Strom Director
- ----------------------------------
Bernee D. L. Strom
</TABLE>
II-4
<PAGE> 7
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit
Number Description
------- -----------
<S> <C>
5.1 Opinion of Perkins Coie LLP regarding legality of the Common
Stock being registered
23.1 Consent of PricewaterhouseCoopers LLP (Independent Accountants)
23.4 Consent of Perkins Coie LLP (included in opinion filed as
Exhibit 5.1)
24.1 Power of Attorney (see signature page)
99.1 Printbid.com, Inc. 1999 Stock Incentive Plan
</TABLE>
<PAGE> 1
EXHIBIT 5.1
[PERKINS COIE LLP LETTERHEAD]
February 15, 2000
ImageX.com, Inc.
10800 N.E. 8th Street
Suite 200
Bellevue, Washington 98004
Re: Registration Statement on Form S-8 of Shares of Common Stock,
$0.01 Par Value, of ImageX.com, Inc.
Ladies and Gentlemen:
We have acted as counsel to ImageX.com, Inc. (the "Company") in
connection with the preparation of a Registration Statement on Form S-8 (the
"Registration Statement") under the Securities Act of 1933, as amended (the
"Act"), which the Company is filing with the Securities and Exchange Commission
with respect to up to 282,837 shares of Common Stock, $0.01 par value, which may
be issued under the Printbid.com, Inc. Stock Incentive Plan.
We have examined the Registration Statement and such documents and
records of the Company and other documents as we have deemed relevant and
necessary for the purpose of this opinion. In giving this opinion, we are
assuming the authenticity of all instruments presented to us as originals, the
conformity with originals of all instruments presented to us as copies and the
genuineness of all signatures.
Based on and subject to the foregoing, we are of the opinion that any
original issuance shares that may be issued pursuant to the Plan have been duly
authorized and that, upon the due execution by the Company and the registration
by its registrar of such shares, issuance thereof by the Company in accordance
with the terms of the Plan and the receipt of consideration therefor in
accordance with the terms of the Plan, such shares will be validly issued, fully
paid and nonassessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. In giving such consent, we do not admit that we are in
the category of persons whose consent is required under Section 7 of the Act.
Very truly yours,
/s/ Perkins Coie LLP
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated February 1, 2000, regarding the
financial statements of Imagex.com, Inc., which are incorporated by reference in
such Registration Statement.
PricewaterhouseCoopers LLP
Seattle, Washington
February 14, 2000
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<PAGE> 1
EXHIBIT 99.1
PRINTBID.COM, INC.
STOCK INCENTIVE PLAN
1. PURPOSE. The purpose of this Stock Incentive Plan (the "Plan") is
to enable Printbid.Com, Inc. (the "Company") to attract and retain the services
of (1) selected employees, officers and directors of the Company or of any
subsidiary of the Company and (2) selected nonemployee agents, consultants,
advisors and independent contractors of the Company or any subsidiary.
2. SHARES SUBJECT TO THE PLAN. Subject to adjustment as provided
below and in PARAGRAPHS 12 and 13, the shares to be offered under the Plan shall
consist of Common Stock of the Company, and the total number of shares of Common
Stock that may be issued under the Plan shall not exceed 2,400,000 shares. The
shares issued under the Plan may be authorized and unissued shares or reacquired
shares. If an option, stock appreciation right or performance unit granted under
the Plan expires, terminates or is canceled, the unissued shares subject to such
option, stock appreciation right or performance unit shall again be available
under the Plan. If shares sold or awarded as a bonus under the Plan are
forfeited to the Company or repurchased by the Company, the number of shares
forfeited or repurchased shall again be available under the Plan.
3. EFFECTIVE DATE AND DURATION OF PLAN.
(a) EFFECTIVE DATE. The Plan shall become effective when
adopted by the Board of Directors of the Company, but no Incentive Stock Option
granted under the Plan shall become exercisable until the Plan is approved by
the affirmative vote of the holders of a majority of the shares of Common Stock
represented at a shareholders meeting at which a quorum is present and any
Incentive Stock Options granted under the Plan prior to such approval shall be
conditioned on and subject to such approval. Subject to this limitation,
options, stock appreciation rights and performance units may be granted and
shares may be awarded as bonuses or sold under the Plan at any time after the
effective date and before termination of the Plan.
(b) DURATION. The Plan shall continue in effect until all
shares available for issuance under the Plan have been issued and all
restrictions on such shares have lapsed. The Board of Directors may suspend or
terminate the Plan at any time except with respect to options, performance units
and shares subject to restrictions then outstanding under the Plan. Termination
shall not affect any outstanding options, any right of the Company to repurchase
shares or the forfeitability of shares issued under the Plan.
4. ADMINISTRATION.
(a) BOARD OF DIRECTORS. The Plan shall be administered by the
Board of Directors of the Company, which shall determine and designate from time
to time the individuals to whom awards shall be made, the amount of the awards
and the other terms and conditions of the awards.
<PAGE> 2
Subject to the provisions of the Plan, the Board of Directors may from time to
time adopt and amend rules and regulations relating to administration of the
Plan, advance the lapse of any waiting period, accelerate any exercise date,
waive or modify any restriction applicable to shares (except those restrictions
imposed by law) and make all other determinations in the judgment of the Board
of Directors necessary or desirable for the administration of the Plan. The
interpretation and construction of the provisions of the Plan and related
agreements by the Board of Directors shall be final and conclusive. The Board of
Directors may correct any defect or supply any omission or reconcile any
inconsistency in the Plan or in any related agreement in the manner and to the
extent it shall deem expedient to carry the Plan into effect, and it shall be
the sole and final judge of such expediency.
(b) COMMITTEE. The Board of Directors may delegate to a
committee of the Board of Directors or specified officers of the Company, or
both (the "Committee") any or all authority for administration of the Plan. If
authority is delegated to a Committee, all references to the Board of Directors
in the Plan shall mean and relate to the Committee except (i) as otherwise
provided by the Board of Directors, and (ii) that only the Board of Directors
may amend or terminate the Plan as provided in PARAGRAPHS 3 and 16.
5. TYPES OF AWARDS; ELIGIBILITY. The Board of Directors may, from
time to time, take the following actions, separately or in combination, under
the Plan: (i) grant Incentive Stock Options, as defined in Section 422 of the
Internal Revenue Code of 1986, as amended (the "Code"), as provided in
PARAGRAPHS 6(a) and 6(b); (ii) grant options other than Incentive Stock Options
("Non-Statutory Stock Options") as provided in PARAGRAPHS 6(a) and 6(c); (iii)
award stock bonuses as provided in PARAGRAPH 7; (iv) sell shares subject to
restrictions as provided in PARAGRAPH 8; (v) grant stock appreciation rights as
provided in PARAGRAPH 9; (vi) grant cash bonus rights as provided in PARAGRAPH
10; and (vii) grant performance units as provided in PARAGRAPH 11. Any such
awards may be made to employees, including employees who are officers or
directors, and to other individuals described in PARAGRAPH 1 who the Board of
Directors believes have made or will make an important contribution to the
Company or any subsidiary of the Company; provided, however, that only employees
of the Company shall be eligible to receive Incentive Stock Options under the
Plan. The Board of Directors shall select the individuals to whom awards shall
be made and shall specify the action taken with respect to each individual to
whom an award is made. At the discretion of the Board of Directors, an
individual may be given an election to surrender an award in exchange for the
grant of a new award.
6. OPTION GRANTS.
(a) GENERAL RULES RELATING TO OPTIONS.
(i) Terms of Grant. The Board of Directors may grant
options under the Plan. With respect to each option grant, the Board of
Directors shall determine the number of shares subject to the option,
the option price, the period of the option, the time or times at which
the option may be exercised and whether the option is an Incentive Stock
Option or a Non-Statutory Stock Option. At the time of the grant of an
option or at any time thereafter, the Board of Directors may provide
that an optionee who exercised an option with Common Stock of the
Company shall automatically receive a new option to purchase additional
shares equal to the number of shares surrendered and may specify the
terms and conditions of such new options.
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<PAGE> 3
(ii) Exercise of Options. Except as provided in
PARAGRAPH 6(a)(iv) or as determined by the Board of Directors, no option
granted under the Plan may be exercised unless at the time of such
exercise the optionee is employed by or providing service to the Company
or any subsidiary of the Company and shall have been so employed or
provided such service continuously since the date such option was
granted. Absence on leave or on account of illness or disability under
rules established by the Board of Directors shall not, however, be
deemed an interruption of employment or service for this purpose. Unless
otherwise determined by the Board of Directors, vesting of options shall
not continue during an absence on leave (including an extended illness)
or on account of disability. Except as provided in PARAGRAPHS 6(a)(iv),
13 and 14, options granted under the Plan may be exercised from time to
time over the period stated in each option in such amounts and at such
times as shall be prescribed by the Board of Directors, provided that
options shall not be exercised for fractional shares. Unless otherwise
determined by the Board of Directors, if the optionee does not exercise
an option in any one period with respect to the full number of shares to
which the optionee is entitled in that period, the optionee's rights
shall be cumulative and the optionee may purchase those shares in any
subsequent period during the term of the option.
(iii) Nontransferability. Each Incentive Stock Option
and, unless otherwise determined by the Board of Directors, each other
option granted under the Plan by its terms shall be nonassignable and
nontransferable by the optionee, either voluntarily or by operation of
law, except by will or by the laws of descent and distribution of the
state or country of the optionee's domicile at the time of death.
(iv) Termination of Employment or Service.
(A) General Rule. Unless otherwise determined by
the Board of Directors, in the event the employment or service of
the optionee with or to the Company or a subsidiary terminates
for any reason other than because of physical disability or death
as provided in PARAGRAPH 6(a)(iv)(B), the option may be exercised
at any time prior to the expiration date of the option or the
expiration of 30 days after the date of such termination,
whichever is the shorter period, but only if and to the extent
the optionee was entitled to exercise the option at the date of
such termination.
(B) Termination Because of Death or Total
Disability. Unless otherwise determined by the Board of
Directors, in the event of the termination of employment or
service because of death or total disability, the option may be
exercised at any time prior to the expiration date of the option
or the expiration of one year after the date of such death or
termination, whichever is the shorter period, but only if and to
the extent the optionee was entitled to exercise the option at
the date of such death or termination. The term "total
disability" means permanent and total disability as defined in
Section 22(e)(3) of the Code. Total disability shall be deemed to
have occurred on the first day after the Company and the two
independent physicians have furnished their opinion of total
disability to the Company. In the event of death, the option may
be exercised only by the person or persons to whom such
optionee's rights under the option shall pass by the optionee's
will or by the laws of descent and distribution of the state or
country of domicile at the time of death.
-3-
<PAGE> 4
(C) Amendment of Exercise Period Applicable to
Termination. The Board of Directors, at the time of grant or at
any time thereafter, may extend the 30-day and one-year exercise
periods any length of time not longer than the original
expiration date of the option, and may increase the portion of an
option that is exercisable, subject to such terms and conditions
as the Board of Directors may determine, and, in the case of
Incentive Stock Options, subject to any limitations in the Code.
(D) Failure to Exercise Option. To the extent
that the option of any deceased optionee or of any optionee
whose employment or service terminates is not exercised within
the applicable period, all further rights to purchase shares
pursuant to such option shall cease and terminate.
(v) Purchase of Shares.
(A) Written Notice. Unless the Board of
Directors determines otherwise, shares may be acquired pursuant to an option
granted under the Plan only upon receipt by the Company of notice in writing
from the optionee of the optionee's intention to exercise, specifying the number
of shares as to which the optionee desires to exercise the option and the date
on which the optionee desires to complete the transaction, and if required in
order to comply with the Securities Act of 1933, as amended, containing a
representation that it is the optionee's present intention to acquire the shares
for investment and not with a view to distribution.
(B) Transfer Restrictions. Unless the Board of
Directors determines otherwise, any shares acquired by the optionee shall be
subject to any stock transfer restrictions in any agreement then in effect
between the Company and the holders of the Company's Common Stock, and the
exercise of an option shall not be effective until the optionee has signed and
delivered a signature page to such stock transfer restriction agreement.
(C) Payment. Unless the Board of Directors
determines otherwise, on or before the date specified for completion of the
purchase of shares pursuant to an option, the optionee must have paid the
Company the full purchase price of such shares in cash (including, with the
consent of the Board of Directors, cash that may be the proceeds of a loan from
the Company, which loan, in the case of an Incentive Stock Option, shall have
been approved at the time of the option grant) or, with the consent of the Board
of Directors, in whole or in part, in Common Stock of the Company valued at fair
market value, restricted stock, performance units or other contingent awards
denominated in either stock or cash, promissory notes and other forms of
consideration. The fair market value of Common Stock provided in payment of the
purchase price shall be determined by the Board of Directors. If the Common
Stock of the Company is not publicly traded on the date the option is exercised,
the Board of Directors may consider any valuation methods it deems appropriate
and may, but is not required to, obtain one or more independent appraisals of
the Company. If the Common Stock of the Company is publicly traded on the date
the option is exercised, the fair market value of Common Stock provided in
payment of the purchase price shall be the closing price of the Common Stock as
reported in The Wall Street Journal on the last trading day preceding the date
the option is exercised, or such other reported value of the Common Stock as
shall be specified by the Board of Directors. No shares shall be issued until
full payment for the shares has been made. With the consent of the Board of
Directors (which, in the case of an Incentive Stock Option, shall be given only
at the time of grant), an optionee may request the Company to apply
automatically the shares to
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<PAGE> 5
be received upon the exercise of a portion of a stock option (even though stock
certificates have not yet been issued) to satisfy the purchase price for
additional portions of the option.
(D) Taxes. Each optionee who has exercised an
option shall immediately upon notification of the amount due, if any, pay to the
Company in cash amounts necessary to satisfy any applicable federal, state and
local tax withholding requirements. If additional withholding is or becomes
required beyond any amount deposited before delivery of the certificates, the
optionee shall pay such amount to the Company on demand. If the optionee fails
to pay the amount demanded, the Company may withhold that amount from other
amounts payable by the Company to the optionee, including salary, subject to
applicable law. With the consent of the Board of Directors an optionee may
satisfy this obligation, in whole or in part, by having the Company withhold
from the shares to be issued upon the exercise that number of shares that would
satisfy the withholding amount due or by delivering to the Company Common Stock
to satisfy the withholding amount.
(E) Reduction of Shares. Upon the exercise of an
option, the number of shares reserved for issuance under the Plan shall be
reduced by the number of shares issued upon exercise of the option.
(b) INCENTIVE STOCK OPTIONS. Incentive Stock Options shall be
subject to the following additional terms and conditions:
(i) Limitation on Amount of Grants. No employee may be
granted Incentive Stock Options under the Plan if the aggregate fair
market value, on the date of grant, of the Common Stock with respect to
which Incentive Stock Options are exercisable for the first time by that
employee during any calendar year under the Plan and under any other
incentive stock option plan (within the meaning of Section 422 of the
Code) of the Company or any parent or subsidiary of the Company exceeds
$100,000.
(ii) Limitations on Grants to 10 Percent Shareholders.
An Incentive Stock Option may be granted under the Plan to an employee
possessing more than 10 percent of the total combined voting power of
all classes of stock of the Company or of any parent or subsidiary of
the Company only if the option price is at least 110 percent of the fair
market value of the Common Stock subject to the option on the date it is
granted, as described in PARAGRAPH 6(b)(iv), and the option by its terms
is not exercisable after the expiration of five years from the date it
is granted.
(iii) Duration of Options. Subject to PARAGRAPHS 6(a)(ii)
and 6(b)(ii), Incentive Stock Options granted under the Plan shall
continue in effect for the period fixed by the Board of Directors,
except that no Incentive Stock Option shall be exercisable after the
expiration of 10 years from the date it is granted.
(iv) Option Price. The option price per share shall be
determined by the Board of Directors at the time of grant. Except as
provided in PARAGRAPH 6(b)(ii), the option price shall not be less than
100 percent of the fair market value of the Common Stock covered by any
Incentive Stock Option at the date the option is granted. The fair
market value shall be determined by the Board of Directors. If the
Common Stock of the Company is not publicly traded on the
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<PAGE> 6
date the option is granted, the Board of Directors may consider any
valuation methods it deems appropriate and may, but is not required to,
obtain one or more independent appraisals of the Company. If the Common
Stock of the Company is publicly traded on the date the option is
exercised, the fair market value shall be deemed to be the closing price
of the Common Stock as reported in The Wall Street Journal on the day
preceding the date the option is granted, or if there has been no sale
on that date, on the last preceding date on which a sale occurred, or
such other value of the Common Stock as shall be specified by the Board
of Directors.
(v) Limitation on Time of Grant. No Incentive Stock
Option shall be granted on or after the tenth anniversary of the
effective date of the Plan.
(c) NON-STATUTORY STOCK OPTIONS. Non-Statutory Stock Options
shall be subject to the following terms and conditions in addition to those set
forth in PARAGRAPH 6(a) above:
(i) Option Price. The option price for Non-Statutory
Stock Options shall be determined by the Board of Directors at the time
of grant and may be any amount determined by the Board of Directors.
(ii) Duration of Options. Non-Statutory Stock Options
granted under the Plan shall continue in effect for the period fixed by
the Board of Directors.
7. STOCK BONUSES. The Board of Directors may award shares
under the Plan as stock bonuses. Shares awarded as a bonus shall be subject to
the terms, conditions, and restrictions determined by the Board of Directors.
The restrictions may include restrictions concerning transferability and
forfeiture of the shares awarded, together with such other restrictions as may
be determined by the Board of Directors. If shares are subject to forfeiture,
all dividends or other distributions paid by the Company with respect to the
shares shall be retained by the Company until the shares are no longer subject
to forfeiture, at which time all accumulated amounts shall be paid to the
recipient. The Board of Directors may require the recipient to sign an agreement
as a condition of the award, but may not require the recipient to pay any
monetary consideration other than amounts necessary to satisfy tax withholding
requirements. The agreement may contain any terms, conditions, restrictions,
representations and warranties required by the Board of Directors. The
certificates representing the shares awarded shall bear any legends required by
the Board of Directors. The Company may require any recipient of a stock bonus
to pay to the Company in cash upon demand amounts necessary to satisfy any
applicable federal, state or local tax withholding requirements. If the
recipient fails to pay the amount demanded, the Company may withhold that amount
from other amounts payable by the Company to the recipient, including salary or
fees for services, subject to applicable law. With the consent of the Board of
Directors, a recipient may deliver Common Stock to the Company to satisfy this
withholding obligation. Upon the issuance of a stock bonus, the number of shares
reserved for issuance under the Plan shall be reduced by the number of shares
issued.
8. RESTRICTED STOCK. The Board of Directors may issue shares
under the Plan for such consideration (including promissory notes and services)
as determined by the Board of Directors. Shares issued under the Plan shall be
subject to the terms, conditions and restrictions determined by the Board of
Directors. The restrictions may include restrictions concerning transferability,
repurchase by the Company and forfeiture of the shares issued, together with
such other restrictions as may be determined by the Board of Directors. If
shares are subject to forfeiture or repurchase by the Company, all dividends or
other distributions paid by the Company with respect to the shares shall be
retained by the Company until the shares are no longer subject to forfeiture or
repurchase, at which time all accumulated amounts shall be paid to the
recipient. All Common Stock issued pursuant to this PARAGRAPH 8 shall be subject
to a purchase agreement, which shall be executed by the Company and
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the prospective recipient of the shares prior to the delivery of certificates
representing such shares to the recipient. The purchase agreement may contain
any terms, conditions, restrictions, representations and warranties required by
the Board of Directors. The certificates representing the shares shall bear any
legends required by the Board of Directors. The Company may require any
purchaser of restricted stock to pay to the Company in cash upon demand amounts
necessary to satisfy any applicable federal, state or local tax withholding
requirements. If the purchaser fails to pay the amount demanded, the Company may
withhold that amount from other amounts payable by the Company to the purchaser,
including salary, subject to applicable law. With the consent of the Board of
Directors, a purchaser may deliver Common Stock to the Company to satisfy this
withholding obligation. Upon the issuance of restricted stock, the number of
shares reserved for issuance under the Plan shall be reduced by the number of
shares issued.
9. STOCK APPRECIATION RIGHTS.
(a) GRANT. Stock appreciation rights may be granted under the
Plan by the Board of Directors, subject to such rules, terms, and conditions as
the Board of Directors prescribes.
(b) EXERCISE.
(i) General. Each stock appreciation right shall
entitle the holder, upon exercise, to receive from the Company in
exchange therefor an amount equal in value to the excess of the fair
market value on the date of exercise of one share of Common Stock of the
Company over its fair market value on the date of grant (or, in the case
of a stock appreciation right granted in connection with an option, the
excess of the fair market value of one share of Common Stock of the
Company over the option price per share under the option to which the
stock appreciation right relates), multiplied by the number of shares
covered by the stock appreciation right or the option, or portion
thereof, that is surrendered. No stock appreciation right shall be
exercisable at a time that the amount determined under this paragraph is
negative. Payment by the Company upon exercise of a stock appreciation
right may be made in Common Stock valued at fair market value, in cash,
or partly in Common Stock and partly in cash, all as determined by the
Board of Directors.
(ii) Exercisability. A stock appreciation right shall be
exercisable only at the time or times established by the Board of
Directors. If a stock appreciation right is granted in connection with
an option, the following rules shall apply: (1) the stock appreciation
right shall be exercisable only to the extent and on the same conditions
that the related option could be exercised; (2) upon exercise of the
stock appreciation right, the option or portion thereof to which the
stock appreciation right relates terminates; and (3) upon exercise of
the option, the related stock appreciation right or portion thereof
terminates.
(iii) Conditions. The Board of Directors may withdraw any
stock appreciation right granted under the Plan at any time and may
impose any conditions upon the exercise of a stock appreciation right or
adopt rules and regulations from time to time affecting the rights of
holders of stock appreciation rights. Such rules and regulations may
govern the right to exercise stock appreciation rights granted prior to
adoption or amendment of such rules and regulations as well as stock
appreciation rights granted thereafter.
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<PAGE> 8
(iv) Fair Market Value. For purposes of this PARAGRAPH
9, the fair market value of the Common Stock shall be determined as of
the date the stock appreciation right is exercised, under the methods
set forth in PARAGRAPH 6(b)(iv).
(v) No Fractional Shares. No fractional shares shall be
issued upon exercise of a stock appreciation right. In lieu thereof,
cash may be paid in an amount equal to the value of the fraction or, if
the Board of Directors shall determine, the number of shares may be
rounded downward to the next whole share.
(vi) Nontransferability. Each stock appreciation right
granted in connection with an Incentive Stock Option, and unless
otherwise determined by the Board of Directors, each other stock
appreciation right granted under the Plan by its terms shall be
nonassignable and nontransferable by the holder, either voluntarily or
by operation of law, except by will or by the laws of descent and
distribution of the state or country of the holder's domicile at the
time of death, and each stock appreciation right by its terms shall be
exercisable during the holder's lifetime only by the holder.
(vii) Taxes. Each participant who has exercised a stock
appreciation right shall, upon notification of the amount due, pay to
the Company in cash amounts necessary to satisfy any applicable federal,
state and local tax withholding requirements. If the participant fails
to pay the amount demanded, the Company may withhold that amount from
other amounts payable by the Company to the participant including
salary, subject to applicable law. With the consent of the Board of
Directors a participant may satisfy this obligation, in whole or in
part, by having the Company withhold from any shares to be issued upon
the exercise that number of shares that would satisfy the withholding
amount due or by delivering Common Stock to the Company to satisfy the
withholding amount.
(viii) Reduction in Shares. Upon the exercise of a stock
appreciation right for shares, the number of shares reserved for
issuance under the Plan shall be reduced by the number of shares issued.
Cash payments of stock appreciation rights shall not reduce the number
of shares of Common Stock reserved for issuance under the Plan.
10. CASH BONUS RIGHTS.
(a) GRANT. The Board of Directors may grant cash bonus rights
under the Plan in connection with (i) options granted or previously granted,
(ii) stock appreciation rights granted or previously granted, (iii) stock
bonuses awarded or previously awarded and (iv) shares sold or previously sold
under the Plan. Cash bonus rights will be subject to rules, terms and conditions
as the Board of Directors may prescribe. Unless otherwise determined by the
Board of Directors, each cash bonus right granted under the Plan by its terms
shall be nonassignable and nontransferable by the holder, either voluntarily or
by operation of law, except by will or by the laws of descent and distribution
of the state or country of the holder's domicile at the time of death. The
payment of a cash bonus shall not reduce the number of shares of Common Stock
reserved for issuance under the Plan.
(b) CASH BONUS RIGHTS IN CONNECTION WITH OPTIONS. A cash bonus
right granted in connection with an option will entitle an optionee to a cash
bonus when the related option is exercised (or terminates in connection with the
exercise of a stock appreciation right related to the option) in whole or in
part if, in the sole discretion of the Board of Directors, the bonus right will
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<PAGE> 9
result in a tax deduction that the Company has sufficient taxable income to use.
If an optionee purchases shares upon exercise of an option and does not exercise
a related stock appreciation right, the amount of the bonus, if any, shall be
determined by multiplying the excess of the total fair market value of the
shares to be acquired upon the exercise over the total option price for the
shares by the applicable bonus percentage. If the optionee exercises a related
stock appreciation right in connection with the termination of an option, the
amount of the bonus, if any, shall be determined by multiplying the total fair
market value of the shares and cash received pursuant to the exercise of the
stock appreciation right by the applicable bonus percentage. The bonus
percentage applicable to a bonus right, including a previously granted bonus
right, shall be determined and may be changed from time to time by the Board of
Directors but shall in no event exceed 75 percent.
(c) CASH BONUS RIGHTS IN CONNECTION WITH STOCK BONUS. A cash
bonus right granted in connection with a stock bonus will entitle the recipient
to a cash bonus payable when the stock bonus is awarded or restrictions, if any,
to which the stock is subject lapse. If bonus stock awarded is subject to
restrictions and is repurchased by the Company or forfeited by the holder, the
cash bonus right granted in connection with the stock bonus shall terminate and
may not be exercised. The amount and timing of payment of a cash bonus shall be
determined by the Board of Directors.
(d) CASH BONUS RIGHTS IN CONNECTION WITH STOCK PURCHASES. A
cash bonus right granted in connection with the purchase of stock pursuant to
PARAGRAPH 8 will entitle the recipient to a cash bonus when the shares are
purchased or restrictions, if any, to which the stock is subject lapse. Any cash
bonus right granted in connection with shares purchased pursuant to PARAGRAPH 8
shall terminate and may not be exercised in the event the shares are repurchased
by the Company or forfeited by the holder pursuant to applicable restrictions.
The amount of any cash bonus to be awarded and timing of payment of a cash bonus
shall be determined by the Board of Directors.
(e) TAXES. The Company shall withhold from any cash bonus paid
pursuant to PARAGRAPH 10 the amount necessary to satisfy any applicable federal,
state and local withholding requirements.
11. PERFORMANCE UNITS.
(a) GRANT. The Board of Directors may grant performance units
consisting of monetary units which may be earned in whole or in part if the
Company achieves certain goals established by the Board of Directors over a
designated period of time, but not in any event more than 10 years. The goals
established by the Board of Directors may include earnings per share, return on
shareholders" equity, return on invested capital, and such other goals as may be
established by the Board of Directors. In the event that the minimum performance
goal established by the Board of Directors is not achieved at the conclusion of
a period, no payment shall be made to the participants. In the event the maximum
corporate goal is achieved, 100 percent of the monetary value of the performance
units shall be paid to or vested in the participants. Partial achievement of the
maximum goal may result in a payment or vesting corresponding to the degree of
achievement as determined by the Board of Directors. Payment of an award earned
may be in cash or in Common Stock or in a combination of both, and may be made
when earned, or vested and deferred, as the Board of Directors determines.
Deferred awards shall earn interest on the terms and at a rate determined by the
Board of Directors.
(b) NONTRANSFERABILITY. Unless otherwise determined by the
Board of Directors, each performance unit granted under the Plan by its terms
shall be nonassignable and nontransferable
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<PAGE> 10
by the holder, either voluntarily or by operation of law, except by will or by
the laws of descent and distribution of the state or country of the holder's
domicile at the time of death.
(c) TAXES. Each participant who has been awarded a performance
unit shall, upon notification of the amount due, pay to the Company in cash
amounts necessary to satisfy any applicable federal, state and local tax
withholding requirements. If the participant fails to pay the amount demanded,
the Company may withhold that amount from other amounts payable by the Company
to the participant, including salary or fees for services, subject to applicable
law. With the consent of the Board of Directors a participant may satisfy this
obligation, in whole or in part, by having the Company withhold from any shares
to be issued that number of shares that would satisfy the withholding amount due
or by delivering Common Stock to the Company to satisfy the withholding amount.
(d) REDUCTION IN SHARES. The payment of a performance unit in
cash shall not reduce the number of shares of Common Stock reserved for issuance
under the Plan. The number of shares reserved for issuance under the Plan shall
be reduced by the number of shares issued upon payment of an award.
12. FOREIGN QUALIFIED GRANTS. Awards under the Plan may be granted to
such officers and employees of the Company and its subsidiaries and such other
persons described in paragraph 1 residing in foreign jurisdictions as the Board
of Directors may determine from time to time. The Board of Directors may adopt
such supplements to the Plan as may be necessary to comply with the applicable
laws of such foreign jurisdictions and to afford participants favorable
treatment under such laws; provided, however, that no award shall be granted
under any such supplement with terms which are more beneficial to the
participants than the terms permitted by the Plan.
13. CHANGES IN CAPITAL STRUCTURE.
(a) STOCK SPLITS; COMBINATIONS; DIVIDENDS. If the outstanding
Common Stock of the Company is hereafter 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 stock split, combination of shares, reclassification,
or dividend payable in shares, appropriate adjustment shall be made by the Board
of Directors in the number and kind of shares available for awards under the
Plan. In addition, the Board of Directors shall make appropriate adjustment in
the number and kind of shares as to which outstanding options and stock
appreciation rights, or portions thereof then unexercised, shall be exercisable,
so that the optionee's proportionate interest before and after the occurrence of
the event is maintained. Notwithstanding the foregoing, the Board of Directors
shall have no obligation to effect any adjustment that would or might result in
the issuance of fractional shares, and any fractional shares resulting from any
adjustment may be disregarded or provided for in any manner determined by the
Board of Directors. Any such adjustments made by the Board of Directors shall be
conclusive.
(b) MERGERS, REORGANIZATIONS, ETC. In the event of a merger,
consolidation, plan of exchange, acquisition of property or stock, separation or
reorganization to which the Company or a subsidiary is a party or a sale of all
or substantially all of the Company's assets (each, a "Transaction"), the Board
of Directors shall, in its sole discretion and to the extent possible under the
structure of the Transaction, select one of the following alternatives for
treating outstanding awards under the Plan:
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<PAGE> 11
(i) The Board of Directors may provide that all
outstanding awards, including options, shall remain in effect in
accordance with their terms.
(ii) If the stockholders of the Company receive capital
stock of another corporation ("Exchange Stock") in exchange for their
shares of Common Stock in any Transaction, the Board of Directors may
provide that all options granted hereunder shall be converted into
options to purchase shares of Exchange Stock. The amount and price of
converted options shall be determined by adjusting the amount and price
of the options granted hereunder in the same proportion as used for
determining the number of shares of Exchange Stock the holders of the
Common Stock receive in such Transaction. Unless otherwise determined by
the Board of Directors, the converted options shall be vested only to
the extent that the vesting requirements relating to options granted
hereunder have been satisfied.
(iii) The Board of Directors may provide a 30-day period
prior to the consummation of the Transaction during which optionees
shall have the right to exercise options and stock appreciation rights
to the extent vested and upon the expiration of which 30-day period all
unexercised options and stock appreciation rights shall immediately
terminate. The Board of Directors may, in its sole discretion,
accelerate the exercisability of options and stock appreciation rights
so that they are exercisable in full during such 30-day period.
14. DISSOLUTION. In the event of the dissolution of the Company,
options and stock appreciation rights shall be treated in accordance with
PARAGRAPH 13(c)(iii).
15. RIGHTS ISSUED BY ANOTHER CORPORATION. The Board of Directors may
also grant options, stock appreciation rights, performance units, stock bonuses
and cash bonuses and issue restricted stock under the Plan having terms,
conditions and provisions that vary from those specified in the Plan provided
that any such awards are granted in substitution for, or in connection with the
assumption of, existing options, stock appreciation rights, stock bonuses, cash
bonuses, restricted stock and performance units granted, awarded or issued by
another corporation and assumed or otherwise agreed to be provided for by the
Company pursuant to or by reason of a Transaction.
16. AMENDMENT OF PLAN. The Board of Directors may at any time, and
from time to time, modify or amend the Plan in such respects as it shall deem
advisable because of changes in the law while the Plan is in effect or for any
other reason. Except as provided in PARAGRAPHS 6(a)(iv)(C), 9(b)(iii), 10, 13
and 14, however, no change in an award already granted shall be made without the
written consent of the holder of such award.
17. APPROVALS. The obligations of the Company under the Plan are
subject to the approval of state and federal authorities or agencies with
jurisdiction in the matter. The Company will use its best efforts to take steps
required by state or federal law or applicable regulations, including rules and
regulations of the Securities and Exchange Commission and any stock exchange on
which the Company's shares may then be listed, in connection with the grants
under the Plan. The foregoing notwithstanding, the Company shall not be
obligated to issue or deliver Common Stock under the Plan if such issuance or
delivery would violate applicable state or federal securities laws.
18. EMPLOYMENT AND SERVICE RIGHTS. Nothing in the Plan or any award
pursuant to the Plan shall (i) confer upon any employee any right to be
continued in the employment of the Company or any subsidiary or interfere in any
way with the right of the Company or any subsidiary by whom
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<PAGE> 12
such employee is employed to terminate such employee's employment at any time,
for any reason, with or without cause, or to decrease such employee's
compensation or benefits, or (ii) confer upon any person engaged by the Company
to provide services any right to be retained or engaged by the Company or to the
continuation, extension, renewal, or modification of any compensation, contract,
or arrangement with or by the Company.
19. RIGHTS AS A SHAREHOLDER. The recipient of any award under the
Plan shall have no rights as a shareholder with respect to any Common Stock
until the date of issue to the recipient of a stock certificate for such shares.
Except as otherwise expressly provided in the Plan, no adjustment shall be made
for dividends or other rights for which the record date occurs prior to the date
such stock certificate is issued.
20. NOTICES. Any notices required or permitted to be given to holders
of awards pursuant to the Plan shall be in writing, addressed to the most recent
address on the Company's records, and shall be deemed to be effectively given
when (a) mailed by registered or certified mail with postage and fees prepaid,
(b) sent by overnight delivery service, (c) personally delivered, or (d) sent by
facsimile with confirmed transmission.
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