As filed with the Securities and Exchange Commission on March 24,
1995
Registration No. 33-
SECURITIES AND EXCHANGE
COMMISSION
Washington, D.C. 20549
Form S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
Data General Corporation
(Exact name of Registrant as specified in its charter)
Delaware 04-2436397
(State or other jurisdiction of (IRS Employer
incorporation or organization Identification No.)
4400 Computer Drive, Westboro, Massachusetts 01580 (508)898-5000
(address, including zip code and telephone number of
registrant's principal executive offices)
EMPLOYEE STOCK OPTION PLAN
(Full Title of the Plan)
RONALD L. SKATES
President and Chief Executive Officer
Data General Corporation
4400 Computer Drive
Westboro, Massachusetts 01580
(508) 898-5000
(name, address, including zip code and telephone number of agent
for service)
Copies of all communications, including all communications
sent to the agent for service, should be sent to:
Carl E. Kaplan, Esq.
Fulbright & Jaworski L.L.P
666 Fifth Avenue
New York, New York 10103
Approximate date of proposed commencement of sales pursuant
to the Employee Stock Option Plan: As and when options become
exercisable after the effective date of this Registration
Statement.
CALCULATION OF REGISTRATION FEE
Title of each class of Amount to be registered Proposed Maximum
securities to be offering price
registered per share (a)
Common Stock, $.01 par 3,000,000 shares $7.38
----------------------------------------------------------------
Proposed maximum aggregate offering Amount of registration
price (a) fee
$22,140,000 $7394.76
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(a) The price stated is estimated in accordance with Rule 457(g)
under the Securities Act of 1933,as amended, solely for the
purpose of calculating the registration fee and is the product
resulting from multiplying the sum of the number of additional
shares registered as part of this Registration Statement
(3,000,000) as to which options may be granted under the Plan by
the closing sale price for the Common Stock ($7.38) on the New
York Stock Exchange on March 22, 1995.
Pursuant to Rule 429, the Prospectus contained in this
Registration Statement also relates to 4,000,000 shares of Common
Stock previously registered pursuant to Registration Statement
Nos. 2-75556, 2-95402 and 33-11527.
Data General Corporation
Employee Stock Option Plan
Cross Reference Sheet Pursuant to Item 501(b) of Regulation S-K
Form S-8 Item No. Heading or
Location in Prospectus
1. Plan Information
(a) .. . .. . .. . .. . .. . .. . .The Plan, Available
Information
(b) . . . . . . . . . . . . . . . .Facing Page
(c) . . . . . . . . . . . . . . . .Eligibility and
Participation
(d) . . . . . . . . . . . . . . . .Exercise of Options
(e) . . . . . . . . . . . . . . . .Restrictions and Resale
by Affiliates
(f) . . . . . . . . . . . . . . . .Tax Consequences
(g) . . . . . . . . . . . . . . . . *
(h) . . . . . . . . . . . . . . . .Restrictions
(i) . . . . . . . . . . . . . . . . *
(j) . . . . . . . . . . . . . . . . *
2.. Registrant and Employee Plan Information . . Available
Information
3. Incorporation of Documents by reference. . . Incorporation
by Reference
4. Description of Registrant's Securities . . . Incorporation
by Reference
5. Interest of Named Experts and Counsel. . . . Appendix B
6. Indemnification of Directors and Officers. . Part II
7. Exemption from Registration . . . . *
8. Exhibits. . . . . . . . . . . . . ..Part II
9 Undertakings. . . . . . . . . . . ..Part II
* Not Applicable
P R O S P E C T U S
7,000,000 Shares
Data General Corporation
Common Stock
($.01 Par Value)
Under the
Data General Corporation
Employee Stock Option Plan
_______________
Participation in Data General Corporation's Employee Stock
Option Plan (the "Plan") is offered on the basis set forth herein
to employees of Data General Corporation, and its subsidiaries
upon the terms and conditions entered into pursuant to the Plan.
Data General Corporation together with such subsidiaries is
herein referred to as the "Company" or "Data General."
_______________
Offers or resales of shares of common stock acquired under
the Plan by "affiliates" of the Company, as defined in Rule 405
under the Securities Act of 1933, as amended (the "1933 Act"),
are subject to certain restrictions (see "Resale of Shares By
Affiliates").
_______________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
_______________
No person has been authorized to give any information or to
make any representation other than as contained herein in
connection with the offer contained in this Prospectus and, if
given or made, such information or representation must not be
relied upon as having been authorized by the Company. This
Prospectus does not constitute an offer to sell, or a
solicitation of an offer to buy, any of the securities offered
by this Prospectus in any jurisdiction to any person to whom it
is unlawful to make such an offer of solicitation.
_______________
The date of this Prospectus is March 24, 1995
The delivery of this Prospectus at any time does not imply
that information herein is correct as of any time subsequent to
the date of this Prospectus. Statements in this Prospectus as to
the provisions of the Plan are not necessarily complete and in
each instance reference is made to the copy of the Plan which
appears as Appendix A to the Prospectus, and each such statement
in this Prospectus is qualified in all respects by such
reference.
The Company does not intend to update this Prospectus in the
future unless and until there is a material change in the
information contained herein. However, the Company intends to
reflect any change in the information contained in this
Prospectus by distributing, as and when considered appropriate by
the Company in light of the nature of such change, an Appendix to
every person to whom this Prospectus has previously been given
and who continues to hold or is granted an outstanding option
under the Plan, unless such change (i) is reflected in any
document filed by the Company with the Securities and Exchange
Commission (the "Commission") after the date of this Prospectus
and incorporated by reference into this Prospectus, (ii) is
otherwise communicated to such person in accordance with the
rules and regulations of the Commission in effect from time to
time, or (iii) is not required to be reflected in an update
to this Prospectus by such rules and regulations.
Notwithstanding the foregoing, any person holding options who
receives only the Appendix may obtain a copy of this
Prospectus, upon request, from the Company, 4400 Computer Drive,
Westboro, Massachusetts 01580, Attention: Mr. David Roy, Office
of Public Affairs (telephone (508) 898-5000).
AVAILABLE INFORMATION
Data General is subject to the informational requirements of
the Securities Exchange Act of 1934, as amended (the "1934 Act"),
and in accordance therewith, files proxy statements, reports and
other information with the Commission. Such proxy statements,
reports and other information filed by the Company may be
inspected and copied at the public reference facilities
maintained by the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549 or at the Regional Offices of the
Commission: Suite 1400, Northwestern Atrium Center, West Madison
Street, Chicago, Illinois 60661 and Room 1100, Jacob Javits
Federal Building, 26 Federal Plaza, New York, New York, 10007.
Copies of such material can be obtained at prescribed rates from
the Public Reference section of the Commission at 450 Fifth
Street, N.W., Washington, D.C. 20549. In addition, such
information can be inspected at the offices of the New York Stock
Exchange, Inc., 20 Broad Street, New York, New York 10005.
The Company has filed with the Commission a Registration
Statement under the 1933 Act with respect to the securities
offered hereby. This Prospectus does not contain
all the information set forth in the Registration Statement,
certain parts of which are omitted in accordance with the rules
and regulations of the Commission. For further information with
respect to the Company and the securities covered hereby,
reference is made to the Registration Statement and to the
exhibits thereto filed as a part thereof.
The Company will furnish without charge to each person to
whom this Prospectus is delivered, upon request, a copy of any or
all of the documents that have been incorporated by reference in
the Registration Statement of which this Prospectus is a part,
other than exhibits to such documents. Requests should be
addressed to: Mr. David Roy, Office of Public Affairs, Data
General Corporation, 4400 Computer Drive, Westboro,
Massachusetts 01580 (telephone number (508) 898-5000).
INTRODUCTION
The Company has filed a Registration Statement with the
Commission under the 1933 Act for the registration of 7,000,000
shares of Common Stock, $.01 par value per share, of Data General
Corporation ("Common Stock"), which may be purchased by the
exercise of options granted pursuant to the Plan.
The principal executive offices of the Company are located
at 4400 Computer Drive, Westboro, Massachusetts 01580 and the
telephone number is (508) 898-5000.
THE PLAN
Nature and Purposes of the Plan
The Plan is intended to provide a method whereby employees
of the Company and its subsidiaries who are making and are
expected to continue to make substantial contributions to the
successful management and growth of the Company and its
subsidiaries may be offered an opportunity to acquire Common
Stock of the Company in order to increase their proprietary
interests in the Company and their incentive to remain and
advance in the employ of the Company and its subsidiaries. It is
also the purpose of the Plan to strengthen the ability of the
Company and its subsidiaries to attract and retain personnel of
experience and ability by granting such persons an opportunity to
acquire a proprietary interest in the Company.
The Plan was adopted by the Board of Directors on October 6,
1981 and approved by the stockholders on January 19, 1982. In
November 1986, the Board of Directors amended the Plan, effective
for options granted after December 31, 1986, to provide that the
aggregate fair market value (as of the date of grant) of the
stock for which an optionee may be granted incentive stock
options are exercisable for the first time by any participant
during any calendar year shall not exceed $100,000. In November
1986, the Board of Directors also amended the Plan to provide
that incentive stock options granted to an optionee after January
1, 1987 will be exercisable even if there exists an earlier
unexercised option granted to that optionee. The Plan previously
provided that no incentive stock option was exercisable while
there was outstanding any previously granted incentive stock
option. In November 1987, the Board of Directors amended the
Plan to (i) eliminate the $100,000 limitation discussed above,
(ii) permit the adjustment of the option price for options issued
under the Plan provided that the option price of incentive stock
options shall not be less than one hundred percent (100%) of the
fair market value on the date of grant and the option price of
non-qualified stock options shall not be the lower of (A) fifty
percent (50%) of the book value per share as of the end
of the fiscal year immediately preceding the date of grant or (B)
twenty-five percent (25%) of the fair market value per share on
the date of grant and (iii) subject to stockholder approval
(which was obtained January 27, 1988) to change the title of the
Plan from "Employee Incentive Stock Option Plan" to the "Employee
Stock Option Plan" and permit the remaining shares available for
the grant of options under the Plan to be granted in
the discretion of the Committee as non-qualified stock options.
On November 2, 1994 the Board of Directors amended to (i) provide
for the granting of options with respect to
up to an aggregate of 7,000,000 shares of Common Stock, (ii)
grant the Employee Stock Option Plan Committee flexibility
concerning transferability of options and (iii) extend the
Plan until November 2, 2004. These amendments were approved by
stockholders on January 25, 1995.
Duration and Modification
The Plan will terminate on November 2, 2004 and no option
shall be granted pursuant to the Plan after the termination of
the Plan; provided, however, that options granted on or before
such date will remain exercisable, in accordance with their
respective terms.
The Board of Directors of the Company may at any time
terminate or from time to time modify or suspend the Plan;
provided, however, that no such action shall impair any
options theretofore granted; and provided further, that no such
modification without the approval of the holders of at least a
majority of the voting stock of the Company epresented at a duly
held meeting the Company shall: (a) increase the maximum
number of shares which may be issued under the Plan in the
aggregate (except for ppropriate adjustments in the event of
split-ups, combinations of shares, recapitalizations
or readjustment of the Company's capital stock or stock
dividends); or (b) amend the ption exercise price in violation of
the provisions of subparagraphs 6(b) or 6(c) of the Plan (except
for appropriate adjustments in the event of split-ups,
combinations of shares, recapitalizations or readjustment of the
Company's capital stock or stock dividends); or (c) extend the
period during which options may be granted under the Plan.
Administration of the Plan
The Plan is administered by an Employee Stock Option Plan
Committee (the "Committee") appointed by the Board of Directors
of the Company. The Committee consists of not fewer than three
(3) disinterested directors, as defined in subparagraph (d)(3) of
Rule 16b-3, as in effect from time to time, under the '34 Act.
The Board of Directors may from time to time remove members or
add members to the Committee. Vacancies on the Committee,
however caused, shall be filled by the Board of Directors.
The Committee acts as the Plan Administrator and subject to the
terms and conditions of the Plan, the Committee shall have
exclusive authority to select the times when and the
employees to whom options may be granted, to determine whether
options granted under the Plan shall be incentive stock options
or non-qualified stock options, to determine whether or not the
options shall be transferable, to determine the terms and
conditions of option agreements, the number of shares of Common
Stock to be acquired by the exercise of options, the option price
and term during which options may be exercised. The address of
the Committee is c/o Data General Corporation, 4400 Computer
Drive, Westboro, Massachusetts 01580. For information regarding
the present composition of the Committee, see Appendix B.
Federal Income Tax Consequences
Stock Options. Options granted under the Plan are intended
to be either non-qualified (non-Statutory) stock options or
"incentive stock options" within the meaning of Section 422 of
the Internal Revenue Code of 1986 (the "Code"). The Plan is not
a qualified pension, profit sharing or stock bonus plan under
Section 401(a) of the Code nor is it an "employee benefit plan"
subject to the provisions of the Employee Retirement
Income Security Act of 1974 ("ERISA").
Fulbright & Jaworski, L.L.P., counsel to the Company, has
provided the Company with the following general description of
the Federal income tax consequences of the grant and exercise of
options and the sale of option shares. These consequences will
vary depending upon, among other factors, whether the optionee
pays the exercise price with shares or with consideration other
than shares. Each optionee is urged to consult his own tax
advisor regarding his participation in the Plan.
1. Grant. An optionee will recognize no taxable income
upon the grant of an incentive stock option or upon the grant of
a non-qualified stock option.
2. Exercise of an Incentive Stock Option. An optionee
generally will not recognize taxable income upon the exercise of
an incentive stock option. However, the "Option Spread"
(i.e., the amount by which the
fair market value of the shares acquired exceeds, at the time of
exercise, the exercise price) generally will constitute an item
of tax preference for purposes of the "alternative minimum
tax" of Section 55 of the Code. An optionee who incurs an
alternative minimum tax liability after 1986 with respect to an
exercise of an incentive stock option will
be entitled under the Code, pursuant to the Tax Reform Act
of 1986 (the "1986 Act"), to a tax credit which can be carried
forward indefinitely and applied against
the optionee's regular tax liability in such year as the
optionee may be subject to the regular tax.
3. Exercise of a Non-Qualified Stock Option. Ordinary
income will be recognized on the exercise of a non-qualified
stock options if shares received on the exercise are not
subject to the restrictions on disposition or obligation of
resale imposed under the Plan or to other restrictions which make
the shares "non-transferable" or subject to a "substantial risk
of forfeiture" under Section 83 of the Code. Such income will be
recognized as ordinary income on the date the shares are
"transferred" to the optionee to the extent that the market value
of the shares on such date exceeds the exercise price. A
substantial risk of forfeiture generally exists, for example, if
an employee must sell stock back to his employer at its original
cost on termination of employment prior to the performance of
substantial future services. Stock will become "substantially
vested" when it is either transferable or is not subject to a
substantial risk of forfeiture. The holding period for
determining long-term capital gain on shares purchased by the
optionee begins on the date the shares are transferred to the
optionee, and the basis of the shares will equal the market value
of the shares on such date. Shares will be treated as having
been transferred to an optionee on the date the shares are issued
to such optionee, which date generally will be the date of
exercise of the option.
In the case of shares which are subject to the restrictions
on disposition and obligation of resale imposed under the Plan or
to other restrictions which make the shares "non-transferable"
and subject to a "substantial risk of forfeiture" under Section
83 of the Code, the optionee generally will not recognize gain
taxable as ordinary income until the date on which such
restrictions lapse. The amount of the gain on such date will
equal the amount by which the market value of the shares on such
date exceeds the exercise price. The holding period for
determining long-term capital gain on shares purchased by the
optionee begins on such date, and the basis of the shares will
equal the market value of the shares on such date.
As an alternative to the result described in (3), an
optionee who exercises an option may elect, within a period not
later than 30 days of the date of exercise, to treat the shares
as not subject to a substantial risk of forfeiture and thus
recognize ordinary income for the year in which the shares are
exercised to the extent of the difference, if any, between the
fair market value of the shares on the date of exercise and the
exercise price. Once the election is made it may not be revoked
without the consent of the Secretary of the Treasury. If such
an election is made, any appreciation in the value of the shares
occurring subsequent to the date of transfer will be eligible for
capital gain treatment, and in the event of a forfeiture of the
shares under the Plan subsequent to the election, the optionee
will not be allowed a deduction in respect of such forfeiture.
The holding period for determining long-term capital gain on
shares purchased by an optionee who makes such an election begins
on the date of transfer, and the basis of the shares will be an
amount equal to their market value on the date of transfer.
4. Sale of Shares Acquired Upon the Exercise of Incentive
Stock Options. Gain or loss realized on the sale of Common Stock
acquired upon the exercise of an incentive stock option will be
measured, other than for purposes of the alternative minimum tax,
by the difference between the exercise price of the incentive
stock option and the amount realized on the sale. Such gain or
loss will be treated as long-term capital gain or loss if the
shares are not sold within two years of the grant of the
incentive stock option and one year of its exercise.
If the shares acquired on the exercise of an incentive stock
option are sold prior to the satisfaction of both the two-year
and one-year holding periods, the sale will be considered a
"disqualifying disposition," and a portion of any gain recognized
on the sale will be taxed as compensation income rather than as
capital gain. In general, the amount of compensation would equal
the excess of the fair market value of the Common Stock on the
date the incentive stock option was exercised (or, if lower, the
amount realized on the sale) over the exercise price of the
incentive stock option. However, in the case of an optionee
subject to Section 16(b) of the 1934 Act, the compensation
portion generally would be calculated using the fair market value
of the shares on the date the shares are no longer subject to the
trading restrictions of Section 16(b) of the 1934 Act rather than
the fair market value on the date of exercise. Any gain in
excess of the compensation portion would be treated as a capital
gain and would be long-term or short-term depending on whether
the sale occurred more than one year after the date of exercise.
Under the 1986 Act, a basis adjustment applies for purposes
of the alternative minimum tax in the case of stock acquired
pursuant to the exercise of an incentive stock option in a
taxable year beginning after December 31, 1986. Specifically,
the option spread is added to the basis of such stock in
determining gain or loss, for purposes of the alternative minimum
tax, on any disposition of such stock.
5. Sale of Shares Acquired Upon Exercise of Non-Qualified Stock
Options. If the shares
acquired upon the exercise of an option are sold subsequent to
the date on which
ordinary income is recognized as discussed above, any gain or
loss on such sale will be a capital gain or loss to the extent of
the difference between the basis of the shares and the amount
realized on the sale of the shares. The Optionee's basis in the
shares will equal the market value of the shares on the date
ordinary income is recognized with respect to the non-qualified
stock option under the rules discussed above. An optionee's
holding period begins on the date ordinary income is recognized
with respect to the non-qualified stock option under the rules
discussed above. If the optionee's holding period prior to the
sale is more than one year, any capital gain or loss on the sale
will be long-term capital gain or loss.
6. Exercise of Incentive Stock Options with Shares. An
optionee will recognize no gain or loss on the surrender of
shares to exercise an incentive stock option, provided the
shares surrendered were not acquired pursuant to the exercise of
an incentive stock option or, if so acquired, provided both the
two-year and one-year holding periods applicable to such shares
were satisfied at the time the shares were surrendered.
Regulations setting forth the holding period and basis which
apply to shares acquired upon the exercise of an incentive stock
option with shares have been adopted.
7. Exercise of Non-Qualified Stock Options with Shares. Some
but not all of the Federal income tax consequences of an
optionee's use of shares as payment for all or a portion of the
exercise price of a non-statutory stock option are set forth in a
ruling published by the Internal Revenue Service in 1980. Under
the ruling, one set of tax consequences applies to those shares
received which are equal in number to the number of shares
surrendered and another set of tax consequences applies to those
shares received which are in excess of the number of shares
surrendered.
The ruling provides that if an optionee pays the exercise
price of an option with stock and receives shares which are not
subject to restrictions which make the shares "non-transferable"
or subject to a "substantial risk of forfeiture" under Section 83
of the Code, then as to those shares received which are equal in
number to the number of shares surrendered:
(i) no gain or loss will be recognized by the optionee upon the
receipt of such shares or upon the surrender of shares in payment
of the exercise price;
(ii) the optionee's basis in the shares received will be the
same as his basis in the shares surrendered; and
(iii) the holding period of the shares received will include the
holding period of the shares surrendered.
To the extent the number of shares received on the exercise
exceeds the number of shares surrendered and if, as in the
ruling, the shares received are not subject to restrictions which
make the shares "non-transferable" or subject to a "substantial
risk of forfeiture" under Section 83 of the Code, then as to such
excess shares:
(i) the optionee will recognize ordinary income in an amount
equal to the fair market value of the excess shares on the date
such shares are transferred to the optionee;
(ii) the optionee's basis in the excess shares will equal their
fair market value on the date such shares are transferred to the
optionee; and
(iii) the holding period for such excess shares will begin on the
date such shares are transferred to the optionee.
In general, the Company will be allowed a business expense
deduction to the extent that an optionee is required to recognize
ordinary income pursuant to the foregoing rules.
The foregoing is only a summary of the Federal income tax
treatment of options granted and Common Stock issued under the
Plan. Moreover, the applicable provisions of the Code and
regulations promulgated thereunder are subject to change.
Therefore, each employee should consult his own tax advisor with
respect to his participation in the Plan.
Securities Subject to the Plan
The Company has reserved an aggregate of 7,000,000 shares of
Common Stock for issuance under the Plan. If, prior to the
termination of the Plan, options granted expire or terminate for
any reason without having been exercised in full, or shares
issued under the Plan are reacquired by the Company pursuant to
the provisions of the Plan, such shares (or unpurchased shares
subject to option) will again become available for issuance under
the Plan. For information regarding the number of shares issued,
outstanding and available for the grant of additional options
under the Plan as of a recent date, see Appendix B.
Adjustment of Option Shares
Upon any readjustment or recapitalization of the Company's
capital stock whereby the character of the Common Stock shall be
changed, appropriate adjustments shall be made so that the
capital stock to be purchased under the Plan after such
readjustment or recapitalization shall be the substantial
equivalent of the Common Stock. In the event that the number of
outstanding shares of Common Stock of the Company shall be
changed by reason of split-ups, combinations of shares,
recapitalizations or stock dividends, the number of shares
covered by outstanding options, the option exercise price and the
number of shares which may thereafter be available under the Plan
may be appropriately adjusted as determined by the Board of
Directors so as to reflect any such change.
Eligibility and Participation
Options may be granted to employees of the Company or its
participating subsidiaries. No option shall be granted to an
employee who, at the time the option is granted, owns capital
stock possessing more than ten percent (10%) of the total
combined voting power of all classes of capital stock of the
Company. The number of shares granted to any one employee
pursuant to stock options under the Plan shall not exceed 400,000
shares in any calendar year. The term "employees" shall include
both officers and directors who are full-time or part-time
employees of the Company or its subsidiaries. The term
"subsidiary" shall mean "subsidiary corporation" as defined in
Section 425 of the Code. Subject to the foregoing, receipt of
stock options under any other stock option plan maintained by the
Company or any subsidiary shall not, for that reason, preclude an
employee from receiving options under the Plan. For information
regarding the number of employees eligible to participate and
participating in the Plan as of a recent date, see Appendix B.
Non-Transferability of Options
Unless otherwise designated by the Committee, no option
under the Plan shall be sold, assigned, pledged, encumbered or
otherwise transferred by the employee who is granted such option.
Terms, Conditions and Exercise of Options
Options shall be in such form, and on such terms and
conditions as the Committee shall from time to time approve,
subject to the following terms and conditions:
(a) An option shall state the number of shares of Common Stock
to which it relates and no fractional shares of Common Stock
shall be issued.
(b) The option price per share of Common Stock issuable upon
exercise of an incentive stock option shall not be less than one
hundred percent (100%) of the fair market value per share of
Common Stock on the date of such grant.
(c) The option price per share of Common Stock issuable upon the
exercise of a non-qualified stock option shall be determined by
the Committee; provided, however, that in no event shall such
price be less than the lower of (i) fifty percent (50%) of the
book value per share of Common Stock as of the end of the fiscal
year immediately preceding the date of grant, or (ii) twenty-five
percent (25%) of the fair market value per share of Common Stock
on the date of such grant.
(d) Notwithstanding any other provision of the Plan, the term of
an option shall not be more than ten (10) years from the date
such option is granted.
Agreements granting options under the Plan shall be in writing,
duly executed and delivered by or on behalf of the Company and
the employee and shall contain such terms and conditions as the
Committee deems advisable. If there is any conflict between the
terms and conditions of any option agreement and the Plan, the
terms and conditions of the Plan shall control.
An employee electing to exercise an option shall give written
notice to the Company of such election and of the number of
shares of Common Stock that he has elected to acquire. An
employee shall have no rights of a stockholder with respect to
shares of Common Stock to be acquired by the exercise of an
option until the issuance to him of a certificate representing
said shares. The exercise date will be the date the Company
receives the employees written notice of exercise. The date on
which the shares are issued will be the date on the certificate
representing such shares; generally, the Company will give
instructions to its transfer agent so that the date on the
certificate will be the date the Company has received both
written notice of exercise and payment. The date on the
certificate will be the date on which the shares are deemed
"transferred" to the employee for tax purposes.
The option price shall be payable upon exercise of an option and
shall be paid in cash, by certified check, by cashier's check, in
shares of Common Stock. If shares of Common Stock are tendered
as payment of the option price, the value of such shares shall be
their fair market value as of the date of exercise. If such
tender would result in the issuance of fractional shares of
Common Stock, the Company shall instead require an additional
amount that will result in the issuance of another whole share.
Under a program available to all participants in the Plan who
open brokerage accounts with Smith Barney Inc. (the "Smith Barney
Program"), an employee may elect to exercise his option by
authorizing Smith Barney to immediately sell the shares being
acquired. Smith Barney will then forward the option price and
the taxes to be withheld directly to the Company. The employee
will receive the balance of the proceeds from the sale directly
from Smith Barney. The Company loans the employee the option
price for the period from placing the order with Smith Barney
through the date the Company receives the option price and taxes
to be withheld from Smith Barney .
Restrictions on Disposition and Obligation of Resale of Stock
Shares of Common Stock acquired by a employee pursuant to the
exercise of an option under the Plan shall not be sold,
transferred, or otherwise disposed of and shall not be pledged or
otherwise hypothecated, except as provided below. (Any such
sale, transfer or other disposition, or any pledge or other
hypothecation shall hereinafter be referred to as a
"disposition".) In the event of the employee's termination of
employment for any reason except death or retirement with the
consent of the Company, such shares shall, except as provided
below, be offered for resale to the Company at their original
acquisition price. Shares as to which the restrictions against
disposition and the obligation of resale to the Company have
lapsed in accordance with the provisions set forth below shall be
referred to as "free shares." Shares as to which the
restrictions against disposition and obligation of resale to the
Company have not lapsed as provided below shall be referred to as
"restricted shares."
The restrictions against disposition and the obligation of
resale to the Company of shares acquired pursuant to the Plan
shall lapse as the Committee shall determine, and such terms
shall be incorporated into and be made part of the option
agreement between the Company and the optionee. Any provision
for the lapse of the restrictions against disposition and the
obligation of resale shall apply with respect to shares subject
to an option whether or not the option has been exercised in
whole or in part on the date of lapse. Upon the occurrence of
the earlier of the death of the employee or the employee's
retirement with the consent of the Company or the attainment by
the employee of the age 65 whether or not the employee retires,
the restrictions against disposition and obligation of resale to
the Company of shares as to which such restrictions and
obligation have not otherwise lapsed under the Plan shall
immediately lapse. In the event of the employee's termination of
employment for any reason except death or retirement with the
consent of the Company, shares issued to the optionee pursuant to
the exercise of an option under the Plan which have not, as of
the date of termination, become free shares, as defined above,
shall become subject to an obligation of immediate resale to the
Company. Shares subject to such obligation of resale shall
be delivered to the Company within 30 days following the
optionee's termination of employment. Within 60 days following a
timely delivery of shares, the Company will compensate the
employee (at the original acquisition price) for such number of
shares as the Company elects to purchase and will return to the
employee any shares not so purchased. In the event the Company
declines to repurchase any or all of such shares, the shares
shall remain the property of the employee and all remaining
restrictions shall lapse at the rate set forth in the Plan.
Restricted shares which are not delivered to the Company within
30 days following the termination of employment shall remain
subject to the restrictions against disposition and such
restrictions shall not lapse as otherwise provided in the Plan
and in the employee's option agreement. The Company is not
required to repurchase shares issued to employees under the Plan.
Notwithstanding any of the foregoing restrictions, any free or
restricted shares acquired under the Plan may at any time be
pledged or otherwise hypothecated to secure borrowings by the
employee to obtain the acquisition price to be paid by the
employee for such shares; provided, however, that the amount of
such borrowing may not exceed the acquisition price of such
shares.
Resale of Shares by Affiliates
Shares of the Company's Common Stock purchased upon exercise of
options granted under the Plan may be resold freely, except that
any optionee deemed to be an "affiliate" of the Company, within
the meaning of the 1933 Act and the rules and regulations
promulgated thereunder, may not sell shares acquired upon
exercise of options granted under the Plan unless such shares
have been registered by the Company under the 1933 Act for resale
by such optionee or an exemption from registration under the 1933
Act is available. Rule 144, promulgated under the 1933 Act,
which contains limitations on the manner of sale and the amount
of shares that may be sold, provides an exemption from
registration under the 1933 Act. An employee who is not an
officer or a director of the Company generally would not be
deemed an "affiliate" of the Company.
Directors-Section 16(b) Liability
Section 16(b) of the 1934 Act provides, generally, that any
profit realized by a director of the Company from the purchase
and sale or sale and purchase of any equity security of the
Company within any six-month period is recoverable by the
Company. With respect to options granted under the Plan, the
grant of the option will generally constitute a "purchase" and
the sale of shares received pursuant to the Plan will generally
constitute a sale for purposes of Section 16(b). The surrender of
shares of Common Stock previously owned to acquire additional
shares by exercise of an option will not constitute a "sale."
The Company believes that the Plan meets the requirements of
Section 16(b)(3) of the 1934 Act and, accordingly, the
acquisition of an option by a director of the Company will be
exempt from the operations of Section 16(b).
Death, Termination of Employment, Transferability
The individual option agreements provide that options must,
except in cases involving an employee's death, unless designated
by the Committee as a transferable option, be exercised by the
employee while an employee of the Company. If an employee dies
while in the employ of the Company prior to the expiration of his
option, his executor, personal representative or beneficiary, as
the case may be, has the right to exercise the option to the
extent the employee could have exercised the option at the
time of his death, at any time within twelve months from the date
of death. If the employee shall retire with the consent of the
Company before his option shall have terminated, he must exercise
the option within three months after the date on which he
retires. If an employee ceases to be employed by the Company as
the result of his disability, then any options that are
exercisable by him at the time he ceases to be employed by the
Company, and only to the extent such options are exercisable as
of such time, may be exercised by him within twelve months after
such time.
If an employee shall cease to be employed by the Company for any
reason other than death, disability or retirement with the
consent of the Company, then any option granted to such employee
shall terminate immediately.
Neither the Plan nor any option agreement shall impose any
obligation on the Company or any subsidiary to continue to employ
any employee.
QUESTIONS AND ANSWERS ABOUT THE PLAN
In order to further help you in understanding the Plan, some
typical questions and answers are set forth below.
The following statements are merely a summary and do not purport
to be a complete statement of the Plan. The full text of the
Plan appears as Appendix A to this Prospectus. In case of any
conflict or apparent conflict between the summary and the
full text of the Plan, the full text will control.
1. What terms govern your option?
In general, your option is governed by the terms and provisions
described in the Plan, as approved by the Committee. Certain
additional terms, relating to your specific grant, may be set
forth in your option agreement which you must sign and return to
the Company. However, each option must state the whole number of
shares to which it relates and not permit exercise of the option
more than ten (10) years from the date the option was granted.
Incentive stock options must have an option price which is no
less than 100% of the fair market value per share on the date of
grant and, for incentive stock options granted before January 1,
1987, not permit exercise of the option while there is
outstanding another incentive stock option which was granted
before that particular incentive stock option. Non-qualified
stock options must have an exercise price which is not less than
the lower of (i) 50% of the book value per share as of the end of
the fiscal year immediately preceding the date of grant or (ii)
25% of the fair market value per share on the date of grant. For
option purposes, "fair market value" is the closing price of the
Company's Common Stock in "N.Y.S.E.-Composite Transactions" on
any given day.
2. What is meant by the option price?
The option price (or the purchase price or exercise price per
share, as it is sometimes referred to), is the per share price at
which you may purchase Common Stock of the Company offered to you
under the Plan. Shares of Common Stock offered to you
under the Plan shall be referred to in this summary as "Option
Shares."
3. When may the option be exercised?
A. You may exercise your option in whole or in part, at any
time during the term of your particular option, as specified in
your agreement, but for incentive stock options granted before
January 1, 1987 you may not exercise a particular incentive stock
option so long as there is another incentive stock option
outstanding which was granted to you prior to this particular
option.
B. If you retire with the consent of the Company, you may
exercise your option within three months from the date of
retirement to the extent the options were exercisable at the time
of retirement. If you retire with the consent of the Company or
attain the age of 65 without retiring from the employ of the
Company any restrictions against disposition and obligation of
resale to the Company of shares as to which such restrictions and
obligation have not otherwise lapsed, shall immediately lapse.
C. If you cease to be employed by the Company as a result of
disability, you have twelve months from the date of your
termination of employment to exercise your option to the extent
the options were exercisable at the time of the disability.
D. If you die while you are an employee of the Company, then
the executor or the administrator of your estate may exercise any
option or portion of an option which was exercisable by you at
the time of your death at any time within twelve (12) months
after your death. Upon your death any restrictions against
disposition and obligation of resale to the Company of shares as
to which such restrictions and obligation have not otherwise
lapsed, shall immediately lapse.
4. How is the stock option exercised?
A. You may exercise your option by purchasing some or all of
the shares granted as specified in your option agreement. To
exercise you must give written notice to the Company of the
number of shares you wish to purchase, exactly how you wish the
shares to be registered, and your current home address. A stock
option exercise form for this purpose is provided in your option
package at the time of grant.
B. You must convey to the Company in cash, certified personal
check, cashier's check, or in shares of the Common Stock of the
Company, the full price of the Option Shares being purchased.
You may also use the Smith Barney Program described above
to buy/sell your Option Shares. If shares of Common Stock are
tendered as payment of the option price, the value of such shares
shall be their fair market value on the date of exercise.
C. Within a few weeks following exercise, you will receive your
stock certificate(s) from the Company.
5. What restrictions can there be on your use of the stock
received under the Plan?
There are two basic restrictions which could affect your use of
the Option Shares:
(1) The first restriction would prevent you from selling,
transferring, pledging or disposing of Option Shares.
(2) The second restriction would require that if you leave the
employ of the Company, all those shares which you have purchased
under the Plan must be offered for resale to the Company at the
option price.
These restrictions would lapse in accordance with the terms of
your specific option agreement.
6. What happens to your shares if you leave the Company?
A. In the event that you leave the Company for reasons other
than retirement with the consent of the Company or death or
disability, the Option Shares which you have paid for but on
which the restrictions have not lapsed must be offered for resale
to the Company at the price at which you purchased them. In the
event the Company declines, in writing, to repurchase the shares,
the shares shall remain your property and all remaining
restrictions shall lapse at the rate stated in your option
agreement.
B. All restrictions on the sale or pledge of Option Shares, as
well as the obligation to resell Option Shares to the Company,
shall automatically lapse when you retire with the consent of the
Company, reach age 65 or die.
C. Nothing in the Plan requires the Company to repurchase
shares sold to you under the Plan.
D. If you leave the Company for any reason other than
disability, retirement with the consent of the Company or death,
any unexercised options held by you shall terminate immediately.
7. May your options be transferred?
Only if they are designated as "transferable options" by
the Committee. Otherwise the options are non-transferable except
by will or the laws of descent and distribution if you die.
8. What should you do about taxes?
Stock options are very technical and complicated. Since the tax
consequences of the exercise of your option and the sale of the
option shares depend on all of your other tax circumstances, tax
choices which may be "right" for one person may be "wrong"
for another; therefore, Company personnel can give only general
tax information and urge you to discuss your own particular
circumstances with your own tax advisor. In general, if the
option granted to you is "non-qualified" you will not recognize
taxable income when the option is granted to you. If the shares
are free of restrictions when you exercise the option, you will
recognize as ordinary income the difference between the market
price and the exercise price on the date you exercise the option.
Any gain between the date you exercised the option and the date
you sell the shares will be a capital gain and the amount of gain
is the difference between the market price on the date of
exercise and the market price on the date of sale. If the shares
are held for more than one year, the gain is a long-term capital
gain, if the shares are not held for more than one year the gain
is a short-term capital gain. (See the discussion on pages 4-7
above.)
OPTIONS OUTSTANDING
For information regarding outstanding options as of a recent
date, see Appendix B.
REPORTS TO STOCKHOLDERS AND OPTIONHOLDERS
The Company will furnish its stockholders and persons holding
options under the Plan with annual reports containing audited
consolidated financial statements and with quarterly reports for
the first three quarters of its fiscal year containing unaudited
condensed consolidated statements of operations.
LEGAL MATTERS
Legal matters in connection with the sale of the shares of
Common Stock offered hereby are being passed upon for the Company
by Fulbright & Jaworski L.L.P., 666 Fifth Avenue, New York, New
York.
For information regarding the ownership of Common Stock by
certain partners and associates of Fulbright & Jaworski L.L.P. as
of a recent date, see Appendix B.
EXPERTS
The consolidated financial statements incorporated in this
Prospectus by reference to the Annual Report on Form 10-K of Data
General Corporation for the fiscal year ended September 24, l994,
have been so incorporated in reliance on the report of Price
Waterhouse LLP, independent accountants, given on the authority
of said firm as experts in auditing and accounting.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission
are incorporated in and made a part of this Prospectus by
reference as of their respective dates:
(1) The Company's Annual Report on Form 10-K for the fiscal year
ended September 24, 1994.
(2) The Company's Quarterly Report on Form 10-Q for the thirteen
weeks ended December 24, 1994.
(3) The description of the Company's Common Stock in Item 1 of
the Company's Registration Statement on Form 8-A under the '34
Act, dated November 7, 1973.
In addition to the foregoing documents, all documents
subsequently filed by the Company with the Commission pursuant to
Sections 13, 14 or 15(d) of the '34 Act, 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
and to be a part hereof from the date of filing of such
documents.
SECURITIES AND EXCHANGE COMMISSION POSITION ON
INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
Section 145 of the General Corporation Law of Delaware permits
indemnification of directors, officers and employees of a
corporation under certain conditions and subject to certain
limitations. Article VI of the Company's By-Laws contains
provisions for the indemnification of directors, officers and
employees of the Company within the limitations permitted by
Section 145.
The Company carries a directors' and officers' liability
insurance policy which provides for payment of certain
liabilities and related expenses of the Company's directors and
officers in connection with threatened, pending or completed
actions, suits or proceedings against them in their capacities as
directors and officers, in accordance with the Company's By-Laws
and the General Corporation Law of Delaware.
Insofar as indemnification for liabilities arising under the
1933 Act may be permitted to directors, officers, or persons
controlling the Company pursuant to the foregoing provisions, the
Company has been informed that in the opinion of the Securities
and Exchange Commission such indemnification is against public
policy as expressed in the 1933 Act and is therefore
unenforceable.
APPENDIX A
DATA GENERAL CORPORATION
EMPLOYEE STOCK OPTION PLAN
1. Purpose
The Data General Corporation Employee Stock Option Plan (the
"Plan") is intended to provide a method whereby employees
(including officers and directors) of Data General Corporation
(the "Company") and its subsidiaries who are making and are
expected to continue making substantial contributions to the
successful management and growth of the Company and its
subsidiaries, may be offered an opportunity to acquire
Common Stock, $.01 par value per share (the "Common Stock"), of
the Company in order to increase their proprietary interests in
the Company and their incentive to remain and advance in the
employ of the Company and its subsidiaries. It is also the
purpose of the Plan to strengthen the ability of the Company and
its subsidiaries to attract and retain personnel of experience
and ability by granting such persons an opportunity to acquire a
proprietary interest in the Company. Accordingly, the Company
may, from time to time, grant to such employees as may be
selected in the manner hereinafter provided, incentive stock
options as defined in Section 422 of the Internal Revenue Code of
1986 (the "Code") or non-qualified options which are not intended
to meet the requirements of Section 422 of the Code, to purchase
shares of Common Stock (collectively referred to as "Stock
Options") on the terms and conditions hereinafter established.
2. Administration of the Plan
The Plan shall be administered by an Employee Stock Option Plan
Committee (the "Committee") appointed by the Board of Directors
of the Company. The Committee shall consist of not fewer than
three "disinterested persons", as that term is defined in
subparagraph (c)(2)(i) of Rule 16b-3, as in effect from time to
time, under the Securities Exchange Act of 1934, as amended.
Subject to the terms and conditions of the Plan, the Committee
shall have exclusive authority to select the times when and
employees to whom incentive stock options or non-qualified stock
options may be granted, to determine whether Stock Options
granted under the Plan shall be incentive stock options
or non-qualified stock options, to determine the terms and
conditions of the option agreements (as hereinafter defined), the
number of shares of Common Stock to be acquired by the exercise
of Stock Options, the option price (as hereinafter defined) and
the term during which the Stock Options may be exercised.
The Board of Directors may at any time appoint or remove members
of the Committee and may fill vacancies however caused in the
Committee. The Committee shall select one of its members as
Chairman and shall hold meetings at such times and places as it
shall deem advisable. All acts by a majority of the Committee or
acts approved in writing by a majority of the Committee shall be
valid acts of the Committee. The Committee shall keep records of
its meetings and shall make such rules and regulations for the
conduct of its business as it shall deem advisable.
3. Interpretation and Amendment
The interpretation and construction of any terms or conditions
of the Plan or of any option agreement or other matters related
to the Plan by the Committee shall be final and conclusive. No
member of the Board of Directors or the Committee shall be liable
for any action or determination made in good faith with respect
to the Plan.
The Board of Directors may at any time terminate or from time to
time modify or suspend the Plan; provided, however, that no such
action shall impair any Stock Option theretofore granted; and
provided further, that without the approval of the holders of at
least a majority of the voting stock of the Company voting at a
duly held meeting: (a)shall not modify the total number of shares
of Common Stock which may be issued under the Plan (except as
permitted by Paragraph 9), and (b) the term of the Plan shall
not be extended.
4. Participants
Stock Options may be granted to employees of the Company or its
subsidiaries. No Stock Options shall be granted to an employee
who, at the time the Stock Option is granted, owns capital stock
having more than ten percent (10%) of the total combined voting
power of all classes of capital stock of the Company. The number
of shares granted to any one employee pursuant to Stock Options
shall not exceed 400,000 shares in any calendar year. The term
"employees" shall include both officers and directors who are
full-time or part-time employees of the Company or its
subsidiaries. The term "subsidiary" shall mean "subsidiary
corporation" as defined in Section 424 of the Code.
Subject to the preceding paragraph, receipt of stock options
under any other stock option plan maintained by the Company or
any subsidiary shall not, for that reason, preclude an employee
from receiving Stock Options under the Plan.
5. Common Stock
Subject to Paragraph 9, no more than an aggregate of seven
million (7,000,000) shares of Common Stock may be issued and sold
pursuant to the Plan. The shares of Common Stock issued and sold
under the Plan may be authorized but unissued shares of Common
Stock, or shares of Common Stock acquired by the Company,
including shares of Common Stock purchased in the open market.
6. Terms and Conditions of Options
Stock Options shall be in such form and on such terms and
conditions as the Committee shall from time to time approve,
subject to the following terms and conditions:
(a) A Stock Option shall state the number of shares of Common
Stock to which it relates and no fractional shares of Common
Stock shall be issued.
(b) The option price per share of Common Stock issuable upon
exercise of an incentive stock option shall not be less than one
hundred percent (100%) of the fair market value per share of
Common Stock on the date of such grant.
(c) The option price per share of Common Stock issuable upon the
exercise of a non-qualified stock option shall be determined by
the Committee; provided, however, that in no event shall such
price be less than the lower of (i) fifty percent (50%) of the
book value per share of the Common Stock as of the end of the
fiscal year immediately preceding the date of grant or (ii)
twenty-five percent (25%) of the fair market value per share of
Common Stock on the date of such grant.
(d) Notwithstanding any other provisions of the Plan, the term
of a Stock Option shall not be more than ten (10) years from the
date such option is granted.
(e) An incentive stock option, if granted prior to January 1,
1987, may not be exercised while there is outstanding (within the
meaning of Section 422A(c)(7) of the Code) any incentive stock
option which was granted before the granting of such option
to the holder thereof to purchase any capital stock of the
Company.
7. Restrictions on Disposition and Obligation of Resale
Shares of Common Stock acquired by an employee pursuant to the
exercise of a stock option under the Plan shall not be sold,
transferred, or otherwise disposed of and shall not be pledged or
otherwise hypothecated, except as provided below. (Any such
sale, transfer or other disposition, or any pledge or other
hypothecation shall hereinafter be referred to as a
"disposition.") In the event of the termination of employment
for any reason except death or retirement with the consent of the
Company, such shares shall, except as provided below, be offered
for resale to the Company at their original acquisition price.
Shares as to which the restrictions against disposition and the
obligation of resale to the Company have lapsed in accordance
with the provisions set forth below shall be referred to as "free
shares." Shares as to which the restrictions against disposition
and the obligation of resale to the Company have not lapsed as
provided below shall be referred to as "restricted shares."
(a) The restrictions against disposition and the obligation of
resale to the Company of shares acquired pursuant to the Plan
shall lapse as Board of Directors or the Committee shall
determine, and such terms shall be incorporated into and be made
a part of the option agreement between the Company and the
employee. Any provision for the lapse of the restrictions
against disposition and the obligation of resale shall apply
with respect to shares subject to an Option whether or not the
Option has been exercised in whole or part on the date of lapse.
(b) Upon the occurrence of the earlier of the death of the
employee, the retirement of the employee with the consent of the
Company or the attainment by the employee of the age of 65
whether or not the employee retires, the restrictions against
disposition and the obligation of resale to the Company of shares
as to which such restrictions and obligation have not otherwise
lapsed under the Plan shall immediately lapse.
(c) In the event of the termination of employment for any
reason except death or retirement with the consent of the
Company, shares issued to the employee pursuant to the exercise
of an option under the Plan, which shares have not, as of the
date of termination of employment, become free shares as defined
above, shall become subject to an obligation of immediate resale
to the Company. Shares subject to such obligation of resale
shall be delivered to the Company within 30 days following the
termination of employment. Within 60 days following a timely
delivery of shares, the Company will compensate the employee (at
the original acquisition price) for such number of shares as the
Company elects to purchase and will return to the employee any
shares not so purchased. Restricted shares which are not
delivered to the Company within 30 days following the termination
of employment shall remain subject to the restrictions against
disposition and such restrictions shall not lapse as otherwise
provided in this Section 7 and in the employee's option
agreement. Nothing in this Section 7 shall require the
Company to repurchase shares issued to employees under the Plan.
(d) Notwithstanding any of the foregoing restrictions, any
shares acquired under the Plan may at any time be pledged or
otherwise hypothecated to secure borrowing by the employee to
obtain the acquisition price to be paid by the employee for such
shares; provided, however, that the amount of such borrowing may
not exceed the acquisition price of such shares.
(e) The provisions of this Section 7 and the provisions of any
option agreement between the Company and an employee relating to
the restrictions against disposition and the obligation of resale
to the Company shall be applied according to their terms or
according to such other terms and conditions, or at such times
and dates, as the Board of Directors or the Committee may from
time to time establish.
Any questions as to whether and when there has been a
termination of employment, and (subject to Sections 6(b) and 6(c)
of the Plan) any questions as to the acquisition price of shares,
shall be determined by the Committee and its determination of
such questions shall be final.
8. Notice of Election under Section 83(b)
Each employee exercising a non-qualified option and making an
election under Section 83(b) of the Code and the Regulations and
Rulings promulgated thereunder will provide a copy thereof to the
Company within 30 days of the filing of such election with
the Internal Revenue Service.
9. Termination of Employment
If an employee shall cease to be employed by the Company or any
subsidiary for any reason other than disability, retirement with
the consent of the Company or death, then any Stock Option
granted pursuant to the Plan shall terminate immediately.
If an employee shall cease to be employed by the Company or any
subsidiary as the result of his disability, or retirement with
the consent of the Company, then any Stock Option that is
exercisable by him at the time he ceases to be employed by the
Company or its subsidiaries, and only to the extent that such
Stock Options are exercisable as of such time, may be exercised
by him within twelve (12) months or three (3) months,
respectively, after such time.
Solely for the purposes of the Stock Option Plan, the transfer of an
employee from the employ of the Company to a subsidiary, or
vice-versa, or from one subsidiary to another shall not be deemed a
termination of employment.
10. Death
If an employee shall die while employed by the Company or any
subsidiary, only the appointed personal representative of such
employee's estate shall have the right to exercise those Stock
Options granted to the employee that were exercisable by him at
the time of his death at any time within twelve (12) months from
the date of his death (or within such shorter period as may be
specified by the Company in the option agreement).
11. Changes in Capital Stock
Upon any readjustment or recapitalization of the Company's
capital stock whereby the character of the Common Stock shall be
changed, appropriate adjustments shall be made so that the
capital stock to be purchased under the Stock Option Plan after
such readjustment or recapitalization shall be the substantial
equivalent of the Common Stock. In the event of a subdivision or
combination of the shares of Common Stock, the number of shares
of Common Stock as to which Stock Options may be granted under
the Plan shall be proportionately increased or decreased,
respectively, and the Option Price shall be proportionately
adjusted by the Board of Directors, and in the case of a
reclassification or other change in the shares of the Common
Stock such action shall be taken as in the opinion of the Board
of Directors shall be appropriate under the circumstances.
12. Transferability
Stock Options shall not be assignable or transferable and during
an employees lifetime may be exercised only by him, except by
will or the laws of descent and distribution or as the Committee
shall determine.
13. Exercise of Options
An employee electing to exercise a Stock Option shall give
written notice to the Company of such election and of the number
of shares of Common Stock that he has elected to acquire. An
employee shall have no rights of a stockholder with respect to
shares of Common Stock to be acquired by the exercise of a Stock
Option until the issuance to him of a certificate representing
said shares.
14 Option Agreements
Agreements granting Stock Options under the Plan ("Option
Agreements") shall be in writing, duly executed and delivered by
or on behalf of the Company to the employee and shall contain
such terms and conditions as the Committee deems advisable. If
there is any conflict between the terms and conditions of any
Option Agreement and of the Plan, the terms and conditions of the
Plan shall control.
15. Payment
The option price shall be payable upon the exercise of the Stock
Option and shall be paid in cash, by certified check, by
cashier's check or in shares of Common Stock. If shares of Common
Stock are tendered as payment of the option price, the value of
such shares shall be their fair market value as of the date of
exercise. If such tender would result in the issuance of
fractional shares of Common Stock, the Company shall require an
additional amount which will result in the issuance of another
whole share.
16. Term of Plan
The Plan shall terminate on November 2, 2004.
17. Continuance of Employment
Neither the Plan nor any Option Agreement shall impose any
obligation on the Company or any subsidiary to continue to employ
any employee.
18. Effectiveness of Plan
The Plan shall become effective on the date of its adoption by
the Board of Directors, subject to the approval, within twelve
(12) months thereof, by the holders of at least a majority of the
voting stock of the Company voting at a duly held meeting, or by
such greater percentage of such stockholders so voting as may
from time to time be required under the laws of the State of
Delaware, and further subject to approvals, if required, of any
public authorities.
APPENDIX B
CURRENT INFORMATION CONCERNING THE PLAN
1. Employee Stock Option Committee:
As of January 31, 1995, the Employee Stock Option Plan
Committee was comprised of Messrs. Ferdinand Colloredo-Mansfeld,
John G. McElwee, Donald H. Trautlein and Richard L. Tucker.
2. Securities Subject to the Plan:
As of January 25, 1995, of an aggregate of 7,000,000 shares of
Common Stock authorized under the Plan, 1,147,746 shares had been
issued, options with respect to 2,746,939 shares had been granted
and were outstanding, and 3,105,315 shares of Common Stock were
reserved for issuance and available for the grant of additional
options under the Plan.
3. Extent of Participation:
As of January 25, 1995, 5,775 employees were eligible to
participate in the Plan and 1,400 employees were participating in
the Plan.
4. Options Outstanding:
The following table sets forth information, as of January 25,
1995, regarding all options outstanding under the Plan:
Average Per
Number of Shares Share Option Range of
Subject to Option Exercise Price Expiration Dates
2,746,939 $7.01 5/2/95-11/2/2004
5. Legal Matters:
Frederick R. Adler, a director and officer of the Company, and
is a partner in Fulbright & Jaworski,L.L.P. Mr. Adler and
certain partners and associates of Fulbright & Jaworski,L.L.P.
beneficially owned an aggregate of 394,981 shares of Common Stock
as of December 31, 1994.
________________________________
TABLE OF CONTENTS
Page
Available Information . .. 2
Introduction . . . . . . . 3
The Plan . . . . . . . . . . 3
Nature and Purposes of the Plan
Duration and Modification . . 4
Administration of the Plan . . . 4
Federal Income Tax Status . . . 4
Securities Subject to the Plan 7
Adjustment of Option Shares. . 7
Eligibility and Participation. 8
Non-Transferability of Options 8
Terms, Conditions and Exercise
of Options . . . . . . . . . 8
Restrictions on Disposition. 9
Questions and Answers. . . . . 11
Reports to Stockholders and
Optionholders. . . . . . . 13
Legal Matters. . . . . . . . 13
Experts. . . . . . . . . . . 13
Appendix A--Copy of Plan . . 1-A
Appendix B
- Additional Information. . B-1
________________________________
________________________________
7,000,000 Shares
DATA GENERAL CORPORATION
Common Stock
($.01 Par Value)
___________________
Employee
Stock Option Plan
________________________________
PROSPECTUS
March 24, 1995
________________________________
PART II - INFORMATION NOT REQUIRED IN THE PROSPECTUS
Item 6. Indemnification of Directors and Officers.
Section 145 of the General Corporation Law of Delaware permits
indemnification of directors, officers and employees of a
corporation under certain conditions and subject to certain
limitations. Article TENTH of the Restated Certificate of
Incorporation and Article VI of the Company's By-Laws contain
provisions for the indemnification of directors, officers and
employees within the limitations permitted by Section 145. The
Company has also entered into indemnification agreements with its
directors and officers based on the indemnification provisions in
Section 145.
The Company carries a directors' and officers' liability
insurance policy which provides for payment of certain liability
claims and related expenses of the Company's directors and
officers in connection with threatened, pending, or completed
actions, suits or proceedings against them in their capacities as
directors and officers, in accordance with the Company's By-laws
and the General Corporation Law of Delaware.
Item 8. Exhibits.
3(a) -The Data General Corporation Employee Stock Option Plan is
set forth in this Registration Statement as Appendix A to the
Prospectus.
3(b) -Restated Certificate of Incorporation of the Company, as
amended, including the Company's Certificate of Designation dated
October 17, 1986, previously filed as Exhibit 3(a) to the
Company's Annual Report on Form 10-K for the fiscal year ended
September 27, 1986, such certificate of Designation is
incorporated herein by reference and the amendment to the
Restated Certificate of Incorporation of the Company previously
filed as Exhibit 3 to the Company's Quarterly Report on
Form 10-Q for the quarter ended March 28, 1987, which is
incorporated herein by reference.
3(c) By-Laws of the Company, as amended, previously filed as
Exhibit 3 to the Company's Quarterly Report on Form 10-Q for the
quarter ended December 30, 1989, which is incorporated herein by
reference.
5 Opinion of Fulbright & Jaworski L.L.P.
24(a) Consent of Price Waterhouse LLP.
24(b) Consent of Fulbright & Jaworski L.L.P. (included in
Exhibit 5).
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; and
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in 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.
(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 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.
(e) The undersigned registrant hereby undertakes to deliver or
cause to be delivered with the prospectus, to each person to whom
the prospectus is sent or given, the latest annual report to
security holders that is incorporated by reference in the
prospectus and furnish pursuant to and meeting the requirements
of Rule 14a-3 or 14c-3 under the Securities Exchange Act of 1934;
and, where interim financial information required to be presented
by Article 3 of Regulation S-X are not set forth in the
prospectus, to deliver, or cause to be delivered to each person
to whom the prospectus is sent or given, the latest quarterly
report that is specifically incorporated by reference in the
prospectus to provide such interim financial information.
(h) 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 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 the
issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
Data General Corporation, as employer and issuer, 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 Boston, Massachusetts,
on the 25th day of January, 1995.
DATA GENERAL CORPORATION
By
Ronald L. Skates, President
Pursuant to the requirements of the Securities Act of
1933, this Registration Statement has been signed by the
following persons in the capacities
and on the dates indicated.
Signature Title Date
Ronald L. Skates President & Director January 25, 1995
Frederick R. Adler Director January 25, 1995
Arthur W. DeMelle Chief Financial Officer January 25, 1995
Principal Financial &
Accounting Officer
Ferdinand Colloredo-Mansfeld Director January 25, 1995
John G. McElwee Director January 25, 1995
Donald H. Trautlein Director January 25, 1995
Richard L. Tucker Director January 25, 1995
W. Nicholas Thorndike Director January 25, 1995
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the
Prospectus constituting part of this Registration Statement on
Form S-8 of our report dated October 26, 1994, which appears on
page 30 of the 1994 Annual Report to Stockholders of Data General
Corporation, which is incorporated by reference in Data General
Corporation's Annual Report on Form 10-K for the year ended
September 24, 1994. We also consent to the incorporation by
reference of our report on the Financial Statement Schedules,
which appears on page 18 of such Annual Report on Form 10-K. We
also consent to the reference to us under the heading "Experts"
in such Prospectus.
Price Waterhouse LLP
Boston, Massachusetts
March 24, 1995
FULBRIGHT & JAWORSKI L.L.P.
A REGISTERED LIMITED LIABILITY PARTNERSHIP
666 Fifth Avenue
New York, New York 10103
Data General Corporation March 24 , 1995
4400 Computer Drive
Westboro, Massachusetts 01580
Dear Sirs:
We refer to the registration statement on Form S-8 (the
"Registration Statement"), to be filed by Data General
Corporation (the "Company") with the Securities and Exchange
Commission under the Securities Act of 1933, as amended, relating
to 3,000,000 shares (the "Shares") of the Company's Common Stock,
$.01 par value (the "Common Stock"), to be issued by the Company
pursuant to the Company's Employee Stock Option Plan (the
"Plan").
As counsel for the Company, we have examined such corporate
records, documents and such questions of law as we have
considered necessary or appropriate for the purposes of this
opinion and, upon the basis of such examination, advise you that
in our opinion the Company has taken all necessary corporate
action to authorize the issuance of the Shares pursuant to
the Plan and, when issued and paid for under the Plan in
accordance with the Plan, such shares will be validly issued,
fully paid and non-assessable.
We consent to the filing of this opinion as an exhibit to the
Registration Statement and the reference to this firm under the
caption "Legal Matters" in the prospectus contained therein.
This consent is not to be construed as an admission that we are a
party whose consent is required to be filed with the Registration
Statement under the provisions of the Securities Act of 1933, as
amended.
Very truly yours,
Fulbright & Jaworski L.L.P.
