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As filed with the Securities and Exchange Commission
on March 22, 1996
Registration Number 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
CERIDIAN CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 52-0278528
(State of incorporation) (I.R.S. Employer Identification
Number)
8100 34th Avenue South
Minneapolis, Minnesota 55425
(Address of principal executive offices)
EAS TECHNOLOGIES
STOCK OPTION PLAN
(Full title of the plan)
John A. Haveman
Vice President and Secretary
Ceridian Corporation
8100 34th Avenue South
Minneapolis, Minnesota 55425
(612) 853-7425
(Name, address and telephone number of agent for service)
Calculation of Registration Fee
Proposed Proposed
Title of maximum maximum
Securities Amount offering aggregate Amount of
to be to be price per offering Registration
registered registered (1) share(2) price (2) fee
Common Stock,
$.50 par value 50,327 shares $44.50 $2,239,552 $772.26
(1) In addition, pursuant to Rule 416 under the Securities Act
of 1933, as amended, this Registration Statement includes an
indeterminate number of additional shares as may be issuable
as a result of anti-dilution provisions described herein.
(2) Estimated solely for the purpose of calculating the amount
of the registration fee, based on the average high and low
sale prices reported for the Registrant's Common Stock on
the New York Stock Exchange on March 20, 1996.
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Part II Information Required in the Registration Statement
Item 3. Incorporation of Documents by Reference
The following documents filed with the Securities and Exchange
Commission (the "Commission") by Ceridian Corporation (the "Company")
are incorporated in this Registration Statement by reference:
(1) The Company's Annual Report on Form 10-K for the year ended
December 31, 1994;
(2) The Company's Quarterly Report on Form 10-Q for the quarters
ended March 31, 1995, June 30, 1995, and September 30, 1995;
(3) The Company's Current Report on Form 8-K dated January 19,
1995, August 24, 1995, and December 12, 1995;
(4) All other reports filed by the Company pursuant to Section
13(a) or 15(d) of the Securities Exchange Act of 1934
("Exchange Act") since December 31, 1994; and
(5) The description of the Company's Common Stock, par value
$.50 per share, contained in the Company's Registration
Statement on Form S-4, File No. 33-64089.
All documents filed by the Company with the Commission
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange
Act after the date of this Registration Statement and prior to
the filing of a post-effective amendment which indicates that all
securities offered have been sold or which deregisters all
securities then remaining unsold shall be deemed to be incorporated
by reference in this Registration Statement and to be a part hereof
from the date of filing of such documents.
Item 4. Description of Securities
The Company's Common Stock is registered under Section 12 of
the Exchange Act.
Item 5. Interests of Named Experts and Counsel
John A. Haveman, Vice President, Secretary and Associate
General Counsel for the Company, has provided an opinion as to
the legality of the securities being registered hereby. Mr.
Haveman holds options granted under the Company's stock based
compensation plans to acquire 15,466 shares of the Company's
Common Stock, holds 13,000 shares of the Company's Common Stock
that are subject to restrictions on transferability and possible
forfeiture, and is not eligible to participate in the EAS
Technologies Stock Option Plan.
The consolidated financial statements and financial
statement schedule of the Company for each of the years in the
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three-year period ended December 31, 1994 have been incorporated
by reference in this registration statement in reliance upon the
reports of KPMG Peat Marwick LLP, independent certified public
accountants, incorporated by reference herein, and upon the
authority of said firm as experts in accounting and auditing. To
the extent that KPMG Peat Marwick LLP examines and reports on
financial statements of the Company issued at future dates, and
consents to the use of their reports thereon, such financial
statements also will be incorporated by reference in this
registration statement in reliance upon their reports and said
authority.
Item 6. Indemnification of Directors and Officers
Section 145 of the General Corporation Law of the State of
Delaware ("DGCL") grants each corporation organized thereunder,
such as the Company, the power to indemnify its directors and
officers against liability for certain of their acts. Section
102(b)(7) of the DGCL permits a provision in the certificate of
incorporation of each corporation organized thereunder
eliminating or limiting, with certain exceptions, the personal
liability of a director to the corporation or its stockholders
for monetary damages for breach of fiduciary duty as a director.
The Company's certificate of incorporation contains such a
provision. The foregoing statements are subject to the detailed
provisions of Sections 145 and 102(b)(7) of the DGCL.
Article VI of the Company's Bylaws provides that the Company
shall indemnify its officers, directors and employees to the
fullest extent permitted by the DGCL in connection with
proceedings with which any such person is involved by virtue of
his or her status as an officer, director or employee. The
Company has also by contract agreed to indemnify its directors
against damages, judgments, settlements and costs arising out of
any actions against the directors brought by reason of the fact
that they are or were directors. The Company maintains
directors' and officers' liability insurance, including a
reimbursement policy in favor of the Company.
Item 7. Exemption from Registration Claimed
Not applicable.
Item 8. Exhibits
The following is a complete list of Exhibits filed or
incorporated by reference as part of this registration statement:
Exhibit Description
4.1 Restated Certificate of Incorporation of Ceridian
Corporation (incorporated by reference to Exhibit 4.01
to the Company's Registration Statement on Form S-8
(File No. 33-54379))
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4.2 Bylaws of Ceridian Corporation, as amended
(incorporated by reference to Exhibit 3.01 to the
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Company's Quarterly Report on Form 10-Q for the quarter
ended September 30, 1993 (File No. 1-1969))
5.1 Opinion and Consent of John A. Haveman
23.1 Consent of KPMG Peat Marwick LLP
23.2 Consent of John A. Haveman (included in Exhibit 5.1)
24.1 Power of Attorney (included on page 5 of this
Registration Statement)
99.1 EAS Technologies Stock Option Plan
Item 9. Undertakings
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration
Statement:
(i) To include any prospectus required by section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of 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;
(iii) To include any material information with respect
to the plan of distribution not previously disclosed in
the Registration Statement or any material change to
such information in the Registration Statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do
not apply if the registration statement is on Form S-3 or Form S-
8 and the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports
filed by the Registrant pursuant to section 13 or section 15(d)
of the Securities Exchange Act of 1934 that are incorporated by
reference in the 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.
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(3) To remove from registration by means of a post-
effective amendment any of the securities being registered
which remain unsold at the termination of the offering.
(b) The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of
1933, each filing of the Registrant's annual report pursuant to
section 13(a) or section 15(d) of the Securities Exchange Act of
1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to section 15(d) of the Securities
Exchange Act of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers
and controlling persons of the Registrant pursuant to the
foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities
(other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the
Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-8 and has duly caused
this Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized in the City of Minneapolis, State of Minnesota,
on March 22, 1996.
CERIDIAN CORPORATION
By: /s/John R. Eickhoff
John R. Eickhoff
Executive Vice President
and Chief Financial Officer
POWER OF ATTORNEY
We, the undersigned officers and directors of Ceridian Corporation,
hereby severally constitute John R. Eickhoff and John A. Haveman, and
either of them singly, our true and lawful attorneys with full power to
them, and each of them singly, to sign for us and in our name in the
capacities indicated below any and all amendments to this Registration
Statement on Form S-8 filed by Ceridian Corporation with the Securities and
Exchange Commission, and generally to do all such things in our name and
behalf in such capacities as may be necessary to enable Ceridian
Corporation to comply with the provisions of the Securities Act of 1933, as
amended, and all requirements of the Securities and Exchange Commission,
and we hereby ratify and confirm our signatures as they may be signed by
our said attorneys, or either of them, to any and all such amendments.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed as of March 22, 1996 by the
following persons in the capacities indicated.
/s/Ruth M. Davis
/s/Lawrence Perlman Ruth M. Davis, Director
Chairman, President and
Chief Executive Officer
(Principal Executive Allen W. Dawson, Director
Officer and Director)
/s/Richard G. Lareau
Richard G. Lareau, Director
/s/John R. Eickhoff
Executive Vice President George R. Lewis, Director
and Chief Financial
Officer (Principal /s/Charles Marshall
Financial Officer) Charles Marshall, Director
/s/Carole J. Uhrich
Carole J. Uhrich, Director
/s/Loren D. Gross
Vice President and Corporate
Controller (Principal Richard W. Vieser, Director
Accounting Officer)
/s/Paul S. Walsh
Paul S. Walsh, Director
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EXHIBIT INDEX
Exhibit Description Code
4.1 Restated Certificate of Incorporation of IBR
Ceridian Corporation
4.2 Bylaws of Ceridian Corporation, as amended IBR
5.1 Opinion and Consent of John A. Haveman E
23.1 Consent of KPMG Peat Marwick LLP E
23.2 Consent of John A. Haveman
(included in Exhibit 5.1)
24.1 Power of Attorney (included on page 5
of the Registration Statement)
99.1 Stock Option Plan E
Legend: E Electronic Filing
IBR Incorporated by Reference
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EXHIBIT 5.1
March 22, 1996
Ceridian Corporation
8100 34th Avenue South
Minneapolis, MN 55425
Re: Ceridian Corporation
Registration Statement on Form S-8
Dear Sir or Madam:
I have acted as counsel to Ceridian Corporation, a Delaware
corporation (the "Company") in connection with the registration
by the Company of 50,327 shares of the Company's Common Stock,
$.50 par value (the "Shares"), pursuant to the Company's
registration statement on Form S-8 which refers to the EAS
Technologies Stock Option Plan, which is to be filed with the
Securities and Exchange Commission on March 22, 1996 (the
" Registration Statement").
In this connection, I have examined originals or copies,
certified or otherwise identified to my satisfaction, of such
corporate records, certificates, and written and oral statements
of officers and accountants of the Company and of public
officials, and other documents that I have considered necessary
and appropriate for this opinion and, based thereon, I advise you
that, in my opinion:
1. The Company has been duly incorporated and is validly
existing under the laws of the State of Delaware.
2. The Company has corporate authority to issue the Shares
in the manner and under the terms set forth in the Registration
Statement.
3. The Shares have been duly authorized and, when issued
in accordance with the Plan referred to in the Registration
Statement, will be validly issued, fully paid and nonassessable.
I hereby consent to the filing of this opinion as Exhibit 5.1
to the Registration Statement and to its use as part of the
Registration Statement.
Very truly yours,
/s/John A. Haveman
Vice President, Secretary and
Associate General Counsel
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EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
The Board of Directors
Ceridian Corporation:
We consent to the use of our reports incorporated herein by
reference and to the reference to our firm under the heading
" Experts" in this Form S-8 Registration Statement.
KPMG PEAT MARWICK
/s/KPMG Peat Marwick LLP
Minneapolis, Minnesota
March 22, 1996
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EXHIBIT 99.1
EAS TECHNOLOGIES
STOCK OPTION PLAN
1. Purpose. The purpose of this Stock Option Plan (the
"Plan" is to further the best interests of Eye Access
Systems, Inc. d/b/a "EAS Technologies" (the "Corporation")
by encouraging its salaried employees to remain as employees of the
Corporation and by providing them with additional incentive for
unusual industry and efficiency by offering them an opportunity
to acquire a proprietary stake in the Corporation and its future
growth through compensation that is determined by reference to
the increase in value of the Corporation's stock. It is the
intention of the Corporation that the stock options granted under
this Plan that are designated "Incentive Stock Options"
constitute "incentive stock options" ("ISO's") within the
meaning of section 422 of the Internal Revenue Code of 1986, as
amended (the "Code"), and that the Participants be eligible to
take advantage of the tax treatment afforded such options
pursuant to section 421 of the Code. It is intended that any
option granted under this Plan that is not specifically
designated as an ISO shall not constitute an incentive stock
option.
2. Option Shares. The aggregate maximum number of shares of
the Corporation's stock which may be issued under this Plan shall
be Five Hundred (500) shares of the Corporation's common stock
(hereinafter the "Stock"). However, the number of shares that
may be issued under this Plan may be increased by action of the
Board of Directors of the Corporation (the "Board) but only
when such increase is merely to prevent the enlargement or
dilution of rights that would occur were the adjustment not made,
such as in the case of a change in capitalization of the
Corporation by way of a stock dividend or stock split. Any
shares of Stock subject to an option granted under this Plan that
terminates, is canceled, or expires unexercised for any reason
may, except as specifically provided herein, again be available
for option grants.
3. Employees Eligible to Participate in the Plan. All
salaried employees of the Corporation and all Subsidiaries of the
Corporation (including Subsidiaries which become Subsidiaries
after the date of adoption of this Plan) shall be eligible to
receive options pursuant to this Plan. ( Such employees shall
hereinafter be referred to as "Eligible Employees.")
4. Effective Date of the Plan. Options may be issued
pursuant to this Plan from the date of its approval by the
shareholders of the Corporation until the earlier of (i) its
termination by action of the Board or (ii) ten years from the
earlier of the date of adoption of this Plan by the Board or its
approval by the shareholders of the Corporation.
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5. Administration of the Plan. The Plan shall be
administered by the Board of Directors of the Corporation (the
"Board").
The Corporation, by action of the Board, and subject to other
provisions and limitations of this Plan, may from time to time
grant options to purchase shares of the Corporation's Stock to
such Eligible Employees as the Board may in its sole discretion
determine, for such number of shares of the Corporation's Stock
and on such terms and conditions as the Board may determine in
its sole discretion. The determination of whether or not any
particular option granted to any particular Eligible Employee
shall be an ISO shall be determined by the Board in its sole
discretion.
The Board may make, publish, amend, and rescind such rules
and regulations as it may in its sole discretion deem necessary
or helpful to the administration of the Plan and the issuance and
exercise of options pursuant to the Plan.
The Board shall also be entitled to grant Stock Appreciation
Rights to any Eligible Employee independently of, or in
conjunction with, the grant of a stock option pursuant to this
Plan.
Each grant of an option or a Stock Appreciation Right
pursuant to this Plan shall be made in writing upon such terms
and conditions as may be determined by the Board at the time of
grant, subject to the terms, conditions, and limitations set
forth in this Plan. The grant of an option or Stock Appreciation
Right shall be evidenced by written notice executed by the
President of the Corporation.
The Board shall not grant to any Eligible Employee any ISO's
(or any further ISO's) if the grant of the ISO would cause the
Employee to own ISO's which are first exercisable in any one year
as to more than $100, 000 worth of Stock of the Corporation and
its Subsidiaries as of the date of grant of the ISO, such value
to be determined in accordance with the Procedure for Valuation
set forth in Section 8 hereof.
6. Terms of Options.
(a) Form. The options granted pursuant to this Plan shall be
in the form of the exhibit attached hereto, or in
substantially similar form; provided, however, the Board
may modify the form of the option by the addition or
deletion of such terms and conditions as the Board in its
sole discretion deems advisable provided such
modifications are not in conflict with the terms of this
Plan.
(b) Incentive Stock Options Whether an option is to be an
ISO or not an ISO shall be determined by the Board in its
sole discretion. Each option that the Board intends to
constitute an ISO shall be specifically designated as
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such and each option that is not intended to constitute
an ISO shall specifically state ``This option is not an
incentive stock option. `` If any option is issued
without a specific designation, it shall be deemed not to
constitute an ISO. The Board may, however, specifically
provide that an option shall constitute an ISO to the
extent of its exercise as to any particular number of
shares and not an ISO to the extent of the remainder of
the shares, provided the Board specifically provides that
the option shall be deemed an ISO to the extent of the
first shares exercised up to the number of shares as to
which the option is intended to constitute an ISO, and
that the option shall be considered not an ISO as to the
remainder of the shares as to which it is exercised.
(c) Exercise Price. The options granted pursuant to this
Plan shall provide a specified price at which the shares
subject to the option may be purchased (hereinafter
called the "Exercise Price"). If any option issued
pursuant to this Plan is designated as an ISO, the
Exercise Price for each share of Stock subject to the ISO
shall, except as hereinafter provided, be an amount at
least equal to the fair market value of one share of
Stock of the Corporation as of the date of grant of the
ISO. Notwithstanding the above, in the event that on the
date of grant of the ISO, an Eligible Employee owns stock
(taking into account all classes of stock which are then
outstanding) in the Corporation which possesses more than
10% of the total combined voting power of all classes of
stock of the Corporation or owns stock of a Subsidiary of
the Corporation which possesses more than 10% of the
total combined voting power of all classes of stock of
the Corporation's Subsidiary, the Exercise Price for each
share of Stock subject to the ISO shall be an amount
equal to at least 110% of the fair market value of one
share of Stock of the Corporation as determined as of the
date of grant of the ISO. (For purposes of this
paragraph, the rules of attribution contained in section
424 (d) of the Code ( relating to the attribution of
stock ownership) shall be applied to determine stock
ownership.) For purposes of this paragraph, the fair
market value of the Stock of the Corporation as of the
date of grant of the ISO shall be determined by the Board
pursuant to the Procedure for Valuation set forth below.
(d) Exercise Period. Each option by its terms shall provide
the period during which it is exercisable, provided,
however, no option shall be exercisable until the
expiration of at least one year from the date the option
is granted. Each option granted under this Plan shall
provide an expiration date which date shall be set by the
Board but in no event shall the expiration date of any
option that is designated an ISO be a date later than ten
years from the date of grant of the ISO or, if the
grantee of the ISO, at the time of grant, owns stock
(taking into account all classes of stock then
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outstanding ) possessing more than 10% of the total
combined voting power of all classes of the stock of the
Corporation or any Subsidiary, the expiration date shall
not be more than five years from the date of grant. (For
purposes of this paragraph (the rules of attribution
contained in section 424(d) of the Code (relating to the
attribution of stock ownership) shall be applied to
determine stock ownership.) Each ISO issued under this
Plan shall provide for expiration within three months
after the termination of the Eligible Employee's
employment with the Corporation due to retirement. Each
ISO issued pursuant to this Plan may provide that it
shall be exercisable within one year after termination of
employment if the employee is Disabled. Further, each
ISO issued pursuant to this Plan may provide that in the
case of termination of employment by reason of the
employee's death, the ISO may be exercised by the
employee's estate or other person who receives the option
by bequest or the laws of descent and distribution for a
period of twelve months after the employee's death. In
no event shall the exercise period be extended beyond the
time which the employee would have been required to
exercise the ISO had he not become disabled or died. The
Board shall, except as specifically restricted herein, in
its own discretion, determine the term of non-ISO's and
Stock Appreciation Rights that are issued pursuant to
this Plan and the circumstances in which such non-ISO's
and Stock Appreciation Rights shall be exercisable beyond
the termination, disability or death of the Eligible
Employee provided that if the non-ISO or Stock
Appreciation Right does not specifically state when it
may be exercised after the termination of the grantee's
employment, death or disability, the option or Stock
Appreciation Right shall be governed by the provisions
stated above for ISO's.
(e) By Whom Option Shall be Exercisable and Transferability.
Each option granted under this Plan shall provide that
such option shall be exercisable during the grantee's
lifetime only by the grantee and that such option shall
not be transferable by the grantee other than by will or
the laws of descent and distribution. Options granted
pursuant to this Plan may , but need not, provide for
exercise by the Eligible Employee's estate or other
person who obtains the right to exercise the option by
bequest or pursuant to the laws of descent and
distribution.
(f) Payment of Exercise Price. Each option shall provide
that payment of the Exercise Price may be made in cash
or, if the owner of the option and the Board agree in
advance , in a number of shares of Stock of the
Corporation having an aggregate fair market value (as of
the date of exercise of the option or payment of the
Exercise Price if payment is to be made at a date later
than the date of exercise), determined in accordance with
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the Procedure for Valuation contained herein, equal to
the Exercise Price. Each option shall provide that the
Exercise Price shall be payable upon or before the
issuance of the Stock of the Corporation to be received
pursuant to the exercise of the option.
(g) Statement as to Withholding of Federal Income or Other
Taxes. Each option granted pursuant to this Plan shall
contain a statement to the effect that if the exercise of
the option is an event that would give rise to a federal
income tax deduction to the Corporation (or any
Subsidiary), but only if the Corporation (or a
Subsidiary) at the time of exercise or such other
required time withholds federal income or other taxes
from the Eligible Employee, then the Corporation shall
have the right to withhold from the Eligible Employee,
from the sources and in the manner required, such amounts
as may be required to entitle the Corporation or its
Subsidiary to the deduction.
(h) No stock option that is designated an ISO shall be issued
pursuant to terms under which the right to exercise the
ISO is affected by the exercise of another stock option
or the right or exercise another stock option is affected
by exercise of the ISO.
7. Stock-Appreciation Rights. Each Stock Appreciation Right
granted by the Board shall entitle the grantee to receive upon
exercise, as determined by the Board in its sole discretion,
either cash or shares of Stock (valued at their market price on
the date of exercise) in an amount equal to the excess of the
fair market value (on the date of exercise) of shares referred to
in the Stock Appreciation Right over the fair market value (on
the date of grant) of the shares so referred to in the Stock
Appreciation Right. Stock Appreciation Rights shall be granted
only to Eligible Employees. The grant of a Stock Appreciation
Right to an Eligible Employee shall not entitle the Eligible
Employee to receive the shares referred to in the Stock
Appreciation Right or to any dividends paid with respect thereto.
The Board may in its discretion grant Stock Appreciation Rights
independently of, or in conjunction with, the grant of any stock
option, whether an ISO or a non-ISO. However, should Stock
Appreciation Rights be granted in conjunction with an ISO under
terms pursuant to which exercise of the Stock Appreciation Right
terminates the ISO and it becomes no longer exercisable, in whole
or in part, the shares covered by the ISO, or part thereof that
is terminated and becomes no longer exercisable, shall not again
be available for option. If a Stock Appreciation Right is
granted under circumstances in which the exercise of the Stock
Appreciation Right affects the right to exercise an ISO or
exercise of the ISO affects the right to exercise a Stock
Appreciation Right, the terms of the Stock Appreciation Right
shall be such that (i) the Stock Appreciation Right shall not be
exercisable until the related ISO is exercisable (ii) the Stock
Appreciation Right shall expire no later than the related ISO,
(iii) the Stock Appreciation Right shall be exercisable only when
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the fair market value, on the date of exercise, of the shares
that are covered by the related ISO exceeds their exercise price,
(iv) the amount payable under the Stock Appreciation Right shall
not exceed the difference between the fair market value, on the
date of exercise, of the shares that are covered by the related
ISO and their exercise price, and (v) the Stock Appreciation
Right is transferable only when the related ISO is transferable,
and under the same conditions as the related ISO. The Board may
impose such further conditions upon the exercise of Stock
Appreciation Rights as it shall determine in its sole discretion.
8. Procedure for Valuation. Within thirty days prior to the
date of grant of an option to purchase stock of the Corporation
pursuant to this Plan, (or at such others times that it may be
necessary to value the Corporation's stock for purposes of this
Plan), the Board shall determine the "fair market value" of the
shares of the Corporation's Stock as to which the Corporation
intends to grant an option as of the proposed date of the grant
of the option. "Fair market value" shall mean the price at
which the shares would change hands between a willing buyer and a
willing seller, both reasonably informed of the relevant facts
and neither under any compulsion to act. The Board may, but
shall not be required to, obtain such appraisals of the
Corporation's Stock or assets as it may determine appropriate.
In appraising the value of the Stock subject to the option, the
Board shall consider factors enumerated in relevant Department of
Treasury Regulations, in Rev. Rule 59-60, 1950-1 C.B. 237, and
any other subsequent Internal Revenue Service pronunciations with
respect to the valuation of the stock. The Board shall also
consider any judicial precedent which they deem to be relevant.
In determining the fair market value of the shares of the
Corporation's Stock subject to the option which is proposed to be
granted, the Board shall give the greatest weight to the factors
having the greatest bearing on the value of the Corporation's
stock under the facts and circumstances then existing. Further,
if the Board believes that a particular factor is given greater
emphasis by buyers and sellers of the stock of corporations
similar to the Corporation, such factors shall be given greater
weight in valuing the Corporation's stock. Due regard may also
be given to the fact that a minority interest in an unlisted
corporation's stock is more difficult to seek than a controlling
interest of a listed corporation's stock.
Once having determined the fair market value of the shares of
stock as to which it is proposed that options shall be issued,
the Board shall record the value so determined and the method by
which the value was determined. Determinations made by the Board
pursuant to this Section 8 shall be final and conclusive and the
Board shall not have any liability to any person as a result of
action taken pursuant to this Section 8 or as a result of the
failure to take any action in connection with the valuation of
the Corporation's Stock.
These Procedures for Valuation shall also govern the
valuation of the Corporation`s Stock for purposes of determining
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the amount payable to any Eligible Employee pursuant to Stock
Appreciation Rights.
9. Termination of Employment. The employment of an Eligible
Employee by the Corporation shall not be deemed to have
terminated for purposes of this Plan if the Eligible Employee is
transferred to and becomes an employee of a Subsidiary of the
Corporation. Further, the Eligible Employee's employment by the
Corporation shall not be considered terminated if he becomes an
employee of another corporation (the "Other Corporation") which
assumes the stock options issued pursuant to this Plan or issues
its own stock option in substitution of an option issued under
this Plan in a transaction to which section 424(a) of the Code
applies, provided he becomes an employee of the Other Corporation
or its Subsidiary at the time of the transaction. Absence on
leave, whether paid or unpaid, approved by the management of the
Corporation shall not constitute the termination of employment
for any purpose of this Plan, provided the leave does not exceed
ninety (90) days. If the period of leave of absence exceeds
ninety (90) days, the leave of absence shall be considered a
termination of employment unless the employee's right to return
is guaranteed by statute or contract. If the employee's right to
return is not so guaranteed, the employee shall be considered to
have terminated his employment, for purposes of this Plan, as of
the end of the ninetieth (90th) day of such absence.
10. Requirements of Law. If any law, any regulation of the
Securities and Exchange Commission, or any regulation of any
other commission or agency having jurisdiction shall require the
Corporation or the exercising optionee to take any action with
respect to the shares of Stock to be acquired upon exercise of an
option, then the date upon which the Corporation shall deliver or
cause to be delivered the certificate or certificates for the
shares of Stock shall be postponed until full compliance has been
made with all such requirements of law or regulations. Further,
if the Corporation shall so require at or before the time of the
delivery of the shares with respect to which the exercise of an
option has been made, the exercising optionee shall deliver to
the Corporation his written statement that he intends to hold the
shares so acquired by him on exercise of the option for
investment only and not with a view to resale or other
distribution thereof to the public. Further, in the event the
Corporation shall have determined that in compliance with the
Securities Act of 1933 or other applicable statute or regulation,
it is necessary to register any of the shares of Stock with
respect to which the exercise of an option has been made, or
qualify such shares for exemption from any requirements of the
Securities Act of 1933 or other applicable statutes or
regulations, then the Corporation shall take such action at its
own expense, but not until such action has been completed shall
the option shares be delivered to the exercising optionee.
11. Dilution or Other Agreement. In the event that
additional shares of Stock are issued pursuant to a stock split
or a stock dividend, the number of shares of Stock then covered
by each outstanding option granted hereunder shall be increased
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proportionately with no increase in the total purchase price of
the shares then so covered, and the number of shares of Stock
reserved for the purpose of this Plan shall be increased by the
same proportion. In the event that the shares of Stock of the
Corporation from time to time issued and outstanding are reduced
by a combination of shares, the number of shares of Stock then
covered by each outstanding option granted hereunder shall be
reduced proportionately with no reduction in the total purchase
price of the shares then so covered, and the number of shares of
Stock reserved for the purposes of the Plan shall be reduced by
the same proportion. In the event that the Corporation should
transfer assets to another corporation and distribute the stock
of such other corporation without the surrender of stock of the
Corporation, and if such distribution is not taxable as a
dividend and no gain or loss is recognized by reason of Section
355 of the Code, or some similar section, then the total purchase
price of the shares covered by each outstanding option shall be
reduced by an amount which bears the same ratio to the total
purchase price then in effect as the market value of the stock
distributed in respect of a share of Stock of the Corporation,
immediately following the distribution, bears to the aggregate of
the fair market value at such time of a share of the Stock of the
Corporation and the stock distributed in respect thereof. All
such adjustments shall be made by the Board, whose determination
upon the same shall be final and binding upon the optionees. No
fractional shares shall be issued, and any fractional shares
resulting from the computations pursuant to this Section 11 shall
be eliminated from the respective option. No adjustment shall be
made for cash dividends or the issuance to stockholders of rights
to subscribe for additional stock or other securities.
Parallel adjustments shall be made with respect to each Stock
Appreciation Right that is outstanding at the time such
adjustments are made with respect to options.
12. Amendment or Discontinuance of the Plan. The Board may
amend, suspend, or discontinue this Plan at any time without
restriction; provided, however, that the Board may not altar,
amend, or discontinue or revoke or otherwise impair any
outstanding option or Stock Appreciation Right which has been
granted pursuant to this Plan and which remains unexercised
(except as may be required to make the adjustments referred to in
Section 11 above or in the event that there is secured the
written consent of the holders of the outstanding options
proposed to be so altered or amended), or, without shareholder
approval, (i) increase the number of shares which may be issued
pursuant to the Plan (except as may be necessary merely to
prevent the enlargement or dilution of rights which would occur
were the change not made, such as in the case of a stock dividend
or stock split), (ii) extend the period or periods during which
options may be granted or exercised, (iii) change the class of
Eligible Employees as to whom options may be granted or otherwise
materially modify the requirements for eligibility for
participation in the Plan, ( iv) change the provision with
respect to adjustments to be made upon changes in capitalization,
or (v) materially increase the benefits accruing to participants
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in the Plan. (Nothing in this section, however, shall prevent
the termination of an option which may be required, as
hereinabove provided by references made to termination of
employment of an optionee.) The Board shall be entitled to amend
this Plan by the deletion of the prohibition against the issuance
of ISO' s that would cause an Eligible Employee to own options
that are first exercisable in any year as to Stock having a fair
market value of greater than $100, 000, but only provided the
requirement that such a provision be included in incentive stock
option plans is deleted by amendment to section 422 of the Code.
The Board of Directors of the Corporation may also terminate or
suspend this Plan or vest the administration of the Plan in a
committee provided one member of any body that is vested with the
power to administer this plan shall be a member of the Board of
Directors of the Corporation and all members of such body shall
be "disinterested persons." In the event that the authority to
administer the Plan is vested in any body other than the Board,
the references herein to the Board shall be considered to be
references to that body.
13. Corporation's Right to Terminate Employees Not Impaired.
Notwithstanding the provisions of this Plan or the provisions of
options or Stock Appreciation Rights granted pursuant to this
Plan, the right of the Corporation (or any Subsidiary) to
terminate any employee shall not be in any manner affected or
impaired by the adoption of this Plan or by the grant of options
or Stock Appreciation Rights pursuant to this Plan.
14. Liquidation of the Corporation. In the event of the
complete liquidation or dissolution of the Corporation, any
options granted pursuant to this Plan remaining unexercised shall
be deemed canceled, without regard to or limitation by any other
provisions of this Plan.
15. Shareholder Approval. This Plan shall be submitted to a
meeting of the shareholders of the Corporation, either at the
regular annual meeting thereof or at a special meeting called for
the purpose of the consideration or this Plan, and this Plan
shall not become effective unless its adoption is approved by the
shareholders of the Corporation within twelve (12) months of its
adoption by the Board of Directors of the Corporation. Upon
approval by the shareholders, this Plan shall take effect without
further action by the Corporation, provided such approval is
obtained within twelve (12) months of the adoption of this Plan
by the Board.
16. Definitions.
As used in this Plan, the following terms shall have the
meanings set forth below:
(a) "Disabled" or "Disability" shall have the meaning
assigned thereto in section 22(e)(3) of the Code.
(b) "Disinterested Person" shall mean any person who is
not, and has not within the prior one year been eligible for
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selection as a person to whom stock may be allocated or to whom
stock options or stock appreciation rights may be granted
pursuant to this Plan or any other plan of the Corporation or any
of its affiliates entitling the participants therein to acquire
stock, stock options, or stock appreciation rights of the
Corporation or any of its affiliates. For purposes of this
definition, the terms contained herein shall have the same
meaning as they have in Rule 16b-3(d)(3) promulgated under the
Securities Exchange Act of 1934.
(c) "Stock Ownership," whenever necessary to determine a
person's stock ownership in the Corporation or any Subsidiary,
shall include stock actually owned and stock indirectly owned by
application of the rules of attribution contained in section
424(d) of the Code.
(d) "Subsidiary" shall have the meaning assigned thereto
in section 424 of the Code and the regulations promulgated
thereunder.
