<PAGE> 1
As filed with the Securities and Exchange Commission on September 30, 1998.
Registration No. _________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------------------------
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
------------------------------------
VERITAS DGC INC.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
DELAWARE 76-0343152
(State or Other Jurisdiction (I.R.S. Employer
of Incorporation or Organization) Identification No.)
</TABLE>
3701 KIRBY DRIVE, SUITE 112
HOUSTON, TEXAS 77098
(713) 512-8300
(Address, including Zip Code, of Registrant's Principal Executive Offices)
------------------------------------
VERITAS DGC INC.
SECOND AMENDED AND RESTATED 1992 EMPLOYEE NONQUALIFIED STOCK OPTION PLAN
VERITAS DGC INC.
AMENDED AND RESTATED 1992 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
VERITAS DGC INC. RESTRICTED STOCK AGREEMENTS
VERITAS DGC INC. RESTRICTED STOCK PLAN
VERITAS DGC INC. KEY CONTRIBUTOR INCENTIVE PLAN FOR FISCAL YEAR 1998
(AS AMENDED AND RESTATED SEPTEMBER 29, 1998)
(Full Title of Plan)
------------------------------------
<TABLE>
<S> <C>
Name, Address, Telephone and Copy of Communications to:
Number of Agent for Service:
T. WILLIAM PORTER
ANTHONY TRIPODO PORTER & HEDGES, L.L.P.
3701 KIRBY DRIVE, SUITE 112 700 LOUISIANA, 35TH FLOOR
HOUSTON, TEXAS 77098 HOUSTON, TEXAS 77002
(713) 512-8300 (713) 226-0600
</TABLE>
------------------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
====================================================================================================================
PROPOSED MAXIMUM PROPOSED
AMOUNT TO OFFERING MAXIMUM AGGREGATE AMOUNT OF
TITLE OF SECURITIES TO BE REGISTERED BE REGISTERED PRICE PER SHARE (1) OFFERING PRICE (2) REGISTRATION FEE
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value $.01 per share 50,000 shs. $16.906 $845,300 $250.00
====================================================================================================================
</TABLE>
(1) Pursuant to Rule 416(a), also registered hereunder is an indeterminate
number of shares of Common Stock issuable as a result of the anti-dilution
provisions of certain of the Plans.
(2) Pursuant to Rule 457(c), the registration fee is calculated on the basis of
the average of the high and low sale prices for the Common Stock on the New
York Stock Exchange on September 29, 1998, which was $16.906. Pursuant to
Rule 457(h), the registration fee is calculated with respect to the maximum
number of the registrant's securities issuable under the Plan.
THIS REGISTRATION STATEMENT ALSO CONSTITUTES POST-EFFECTIVE AMENDMENT NO. 1 TO
REGISTRANT'S REGISTRATION STATEMENT NO. 333-57603, POST-EFFECTIVE AMENDMENT NO.
2 TO REGISTRANT'S REGISTRATION STATEMENT NO. 333-48953, POST-EFFECTIVE AMENDMENT
NO. 3 TO REGISTRANT'S REGISTRATION STATEMENT NO. 333-41829 AND POST-EFFECTIVE
AMENDMENT NO. 4 TO REGISTRANT'S REGISTRATION STATEMENT NO. 333-09679, WHICH
RELATE TO AN AGGREGATE OF 2,896,050 SHARES OF COMMON STOCK. THE $23,444.67
AGGREGATE REGISTRATION FEE WITH RESPECT TO SUCH 2,896,050 SHARES OF COMMON STOCK
PREVIOUSLY REGISTERED HAS BEEN PAID.
================================================================================
<PAGE> 2
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The contents of the following documents filed by Veritas DGC Inc., a
Delaware corporation (the "Company or "Registrant"), with the Securities and
Exchange Commission ("Commission") are incorporated into this registration
statement ("Registration Statement") by reference:
(a) the Company's annual report on Form 10-K for the fiscal year
ended July 31, 1997, filed with the Commission on October 20,
1997;
(b) the description of the Company's Common Stock set forth in the
Company's registration statement on Form 8-A filed with the
Commission on August 14, 1997, and any amendment or report
filed for the purpose of updating any such description.
All documents filed by the Company with the Commission pursuant to
Section 13(a) and 13(c), 14 and 15(d) of the Securities and Exchange Act of
1934, as amended (the "Exchange Act") after the filing date of the Registration
Statement and before the filing of a post-effective amendment to the
Registration Statement 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 the Registration Statement and to be part
hereof from the date of filing such documents.
The Company will provide without charge to each participant in the
Company's Key Contributor Incentive Plan for Fiscal Year 1998 (as Amended and
Restated September 29, 1998), upon written or oral request of such persons, a
copy (without exhibits, unless such exhibits are specifically incorporated by
reference) of any or all of the documents incorporated by reference pursuant to
this Item 3.
ITEM 4. DESCRIPTION OF SECURITIES
COMMON STOCK
The Company is authorized to issue 40,000,000 shares of Common Stock,
par value $.01 per share, and at July 31, 1997, there were 22,349,111 shares
outstanding, and 1,318,364 shares were reserved for issuance upon exercise of
outstanding warrants and options. Included in shares outstanding are 2,367,071
Exchangeable Shares of Veritas Energy Services, Inc., a wholly-owned subsidiary
of the Company, which are exchangeable for, and vote with the Common Stock, and
are identical to, the Common Stock in all material respects. Each share of
Common Stock has one vote on all matters presented to the stockholders. Subject
to the rights and preferences of any Preferred Stock (as defined below) which
may be designated and issued, the holders of Common Stock are entitled to
receive dividends, if and when declared by the board of directors, and are
entitled on liquidation to all assets remaining after the payment of
liabilities. The Common Stock has no preemptive or other subscription rights.
Outstanding shares of Common Stock are and the shares of Common Stock offered by
the Company, when issued and paid for, will be fully paid and nonassessable.
Because the Common Stock does not have cumulative voting rights, the holders of
more than 50% of the shares may, if they choose to do so, elect all of the
directors and, in that event, the holders of the remaining shares will not be
able to elect any directors. ChaseMellon Shareholder Services, L.L.C., Dallas,
Texas, is the transfer agent and registrar for the Common Stock.
PREFERRED STOCK
The board of directors of the Company, without any action by the
stockholders of the Company, is authorized to issue up to 1,000,000 shares of
preferred stock, par value $.01 per share (the "Preferred Stock"). Shares of
Preferred Stock may be issued in one or more series or classes, which will have
such designation, voting powers, preferences and relative, participating,
optional or other rights and such qualifications, limitations or restrictions
thereon, including voting rights, dividends, rights on liquidation, dissolution
or winding up, conversion or exchange rights and redemption
-2-
<PAGE> 3
provisions, as set forth in the resolutions adopted by the Board of Directors
providing for the issuance of such stock and as permitted by the Delaware
General Corporation Law (the "DGCL"). A series of 400,000 shares of Preferred
Stock has been designated for use in connection with the Rights Plan (as defined
below). Although the Company has no other current plans for the possible
issuance of Preferred Stock, the issuance of shares of Preferred Stock, or the
issuance of securities convertible into or exchangeable for such shares, could
be used to discourage an unsolicited acquisition proposal that some or a
majority of the stockholders believe to be in their interests or in which
stockholders are to receive a premium for their stock over the then current
market price. In addition, the issuance of Preferred Stock could adversely
affect the voting power of the holders of Common Stock. The Board of Directors
does not presently intend to seek stockholder approval prior to any issuance of
currently authorized stock, unless otherwise required by law or stock exchange
rules.
RIGHTS PLAN
Pursuant to a Rights Agreement between the Company and ChaseMellon
Shareholder Services, L.L.C., Dallas, Texas (the "Rights Plan"), each share of
Common Stock has attached to it one Right (the "Right"), represented by the
certificate which is also the certificate representing the Common Stock. Each
Right entitles the registered holder to purchase from the Company one
one-thousandth of a share of Series A Junior Participating Preferred Stock, par
value $.01 per share (the "Series A Preferred Stock"), of the Company at a
purchase price of $100, subject to adjustment (the "Purchase Price").
The Rights will separate from the Company's Common Stock and a
"Distribution Date" will occur upon the earlier of (i) 10 business days
following a public announcement that a person or group of affiliated or
associated persons (an "Acquiring Person") has acquired, or obtained the right
to acquire, beneficial ownership of 15% or more of the outstanding shares of
Common Stock (the "Stock Acquisition Date"), or (ii) 10 business days (or such
later date as the Board of Directors of the Company shall determine) following
the commencement of a tender or exchange offer which would result in a person or
group beneficially owning 15% or more of such outstanding shares of Common Stock
(the "Tender Offer Date"). Until the Distribution Date, the Rights will be
transferred with and only with the Common Stock certificates. The Rights are not
exercisable until the Distribution Date and, unless earlier redeemed by the
Company as described below, will expire at the close of business on May 15,
2007.
In the event that, among other things, (i) the Company is the surviving
corporation in a merger or other business combination with an Acquiring Person
or (ii) any person shall become the beneficial owner of more than 15% of the
outstanding shares of the Common Stock (except (A) pursuant to certain
consolidations or mergers involving the Company or sales or transfers of the
combined assets or earning power of the Company and its subsidiaries, or (B)
pursuant to an offer for all outstanding shares of the Common Stock at a price
and upon terms and conditions which a majority of the Continuing Directors (as
defined below) determines to be in the best interests of the Company and its
stockholders) each holder of a Right (other than the Acquiring Person, certain
related parties and transferees) will thereafter have the right to purchase,
upon exercise, a one-thousandth fractional share interest in Series A Preferred
Stock each of which is for all purposes essentially equivalent to a share of
Common Stock (or, in certain circumstances, cash, property or other securities
of the Company) having a value equal to two times the exercise price of the
Right. For example, at the exercise price of $100 per Right, each Right not
owned by an Acquiring Person (or by certain related parties and transferees)
following an event set forth above would entitle its holder to purchase $200
worth of Series A Preferred Stock (or other consideration, as noted above) for
$100. Assuming that the Series A Preferred Stock had a per share market price of
$40 at such time (with each one-thousandth share of Series A Preferred Stock
valued at one share of Common Stock), the holder of each valid Right would be
entitled to purchase 5 shares of the Series A Preferred Stock for $100. Rights
are not exercisable following the occurrence of any of the events described
above until the Rights are no longer redeemable by the Company as described
below. Notwithstanding any of the foregoing, following the occurrence of any of
the events described in this paragraph, all Rights that are, or (under certain
circumstances specified in the Rights Plan) were, beneficially owned by any
Acquiring Person will be null and void.
In the event that, at any time following the Stock Acquisition Date,
(i) the Company is acquired in a merger or other business combination
transaction in which the Company is not the surviving corporation, (ii) the
Company is the surviving corporation in a consolidation or merger pursuant to
which all or part of the outstanding shares of Common Stock are changed into or
exchanged for stock or other securities of any other person or cash or any other
property or (iii) more than 50% of the combined assets or earning power of the
Company and its subsidiaries is sold or
-3-
<PAGE> 4
transferred (in each case other than certain consolidations with, mergers with
and into, or sales of assets or earning power by or to subsidiaries of the
Company as specified in the Rights Agreement), each holder of a Right (except
Rights that previously have been voided as set forth above) shall thereafter
have the right to receive, upon exercise, common stock of the acquiring company
having a value equal to two times the exercise price of the Right. The events
described in this paragraph and in the immediately preceding paragraph are
referred to as the "Triggering Events."
At any time until any person becomes an Acquiring Person, the Company
may redeem the Rights in whole, but not in part, at a price of $.001 per Right
(payable in cash, shares of Common Stock or other consideration deemed
appropriate by the Board of Directors). Rights may not be redeemed during the
180 day period after any person becomes an Acquiring Person unless the
redemption is approved by a majority of Continuing Directors. The term
"Continuing Director" means any member of the Board of Directors of the Company
who was a member of the Board prior to the date of the Rights Agreement, and any
person who is subsequently elected to the Board if such person is recommended or
approved by a majority of at least five Continuing Directors, but shall not
include an Acquiring Person, or an affiliate or associate of an Acquiring
Person, or any representative of the foregoing persons.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a stockholder of the Company, including, without limitation, the right
to vote or to receive dividends.
The Rights have certain anti-takeover effects. They may reduce or
eliminate (i) "two-tiered" or other partial offers that do not offer fair value
for all Common Stock; (ii) the accumulation by a third party of 15% or more of
the Common Stock in open-market or private purchases in order to influence or
control the business and affairs of the Company without paying an appropriate
premium for a controlling position in the Company; and (iii) the accumulation of
shares of Common Stock by third parties in market transactions for the primary
purpose of attempting to cause the Company to be sold. In addition, the Rights
will cause substantial dilution to a person or group that attempts to acquire
the Company in a manner defined as a Triggering Event unless the offer is
conditioned on a substantial number of Rights being acquired. The Rights,
however, should not affect any prospective offeror willing to make an offer for
all outstanding shares of Common Stock and other voting securities at a price
and on other terms that are in the best interests of the Company and its
stockholders as determined by the Board of Directors or affect any prospective
offeror willing to negotiate with the Board of Directors because as part of any
negotiated transaction the Rights would either be redeemed or otherwise made
inapplicable to the transaction. The Rights should not interfere with any merger
or other business combination approved by the Board of Directors since the Board
of Directors may, at its option, at any time until ten business days following
the Stock Acquisition Date, redeem all, but not less than all, of the then
outstanding Rights at the $.001 redemption price.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Not Applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the DGCL permits a corporation to indemnify any person
who was or is a party or is threatened to be made a party to any threatened
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative, by reason of the fact that he is or was a
director, officer, employee or agent of the corporation or is or was serving at
the request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise
against expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred by him in connection with such
action.
In a suit brought to obtain a judgment in the corporation's favor,
whether by the corporation itself or derivatively by a stockholder, the
corporation may only indemnify for expenses, including attorney's fees, actually
and reasonably incurred in connection with the defense or settlement of the
case, and the corporation may not indemnify for amounts paid in satisfaction of
a judgment or in settlement of the claim. In any such action, no indemnification
may be paid in respect of any claim, issue or matter as to which such persons
shall have been adjudged liable to the corporation except as otherwise provided
by the Delaware Court of Chancery or the court in which the claim was
-4-
<PAGE> 5
brought. In any other type of proceeding, the indemnification may extend to
judgments, fines and amounts paid in settlement, actually and reasonably
incurred in connection with such other proceeding, as well as to expenses
(including attorneys' fees).
The statute does not permit indemnification unless the person seeking
indemnification has acted in good faith and in a manner he reasonably believed
to be in, or not opposed to, the best interest of the corporation and, in the
case of criminal actions or proceedings, the person had no reasonable cause to
believe his conduct was unlawful. There are additional limitations applicable to
criminal actions and to actions brought by or in the name of the corporation.
The determination as to whether a person seeking indemnification has met the
required standard of conduct is to be made (i) by a majority vote of a quorum of
disinterested members of the board of directors, or (ii) by independent counsel
in a written opinion, if such a quorum does not exist or if the disinterested
directors so direct, or (iii) by the stockholders.
The Restated Certificate of Incorporation (with Amendments) and Bylaws
of the Company require the Company to indemnify the Company's directors and
officers to the fullest extent permitted under Delaware law. The Company's
Restated Certificate of Incorporation (with Amendments) limits the personal
liability of a director to the Company or its stockholders to damages for breach
of the director's fiduciary duty.
The Company has purchased insurance on behalf of its directors and
officers against certain liabilities that may be asserted against, or incurred
by, such persons in their capacities as directors or officers of the Registrant,
or that may arise out of their status as directors or officers of the
Registrant, including liabilities under the federal and state securities laws.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not Applicable.
ITEM 8. EXHIBITS
Exhibit
No. Description
4.1 Restricted Stock Plan. (Incorporated by reference to Exhibit
4.1 to Veritas DGC, Inc.'s Registration Statement No. 333-
57603, dated June 24, 1998).
4.2 Restated Certificate of Incorporation (with Amendments) of
Digicon Inc. dated August 30, 1996. (Incorporated by reference
to Exhibit 3.1 to Veritas DGC Inc.'s Current Report on Form
8-K dated September 16, 1996).
4.3 Certificate of Ownership and Merger of New Digicon Inc. and
Digicon Inc. (Incorporated by reference to Exhibit 3-B to
Digicon's Registration Statement No. 33-43873, dated November
12, 1991).
4.4 By-laws of New Digicon Inc. dated June 24, 1991. (Incorporated
by reference to Exhibit 3-C to Digicon's Registration
Statement No. 33-43873, dated November 12, 1991).
4.5 Specimen Veritas DGC Inc. Common Stock certificate.
(Incorporated by reference to Exhibit 4-C to Veritas DGC
Inc.'s Annual Report on Form 10-K for the year ended July 31,
1996).
4.6 Rights Agreement between Veritas DGC Inc. and ChaseMellon
Shareholder Services, L.L.C. dated as of May 15, 1997.
(Incorporated by reference to Exhibit 4.1 of Veritas DGC
Inc.'s Current Report on Form 8-K filed May 27, 1997).
4.7* Key Contributor Incentive Plan for Fiscal Year 1998 (as
Amended and Restated September 29, 1998).
5.1* Opinion of Porter & Hedges, L.L.P., with respect to the
legality of the securities filed herewith.
23.1* Consent of PricewaterhouseCoopers LLP.
23.2* Consent of PricewaterhouseCoopers, Chartered Accountants.
23.3* Consent of Deloitte & Touche LLP.
23.4* Consent of Porter & Hedges, L.L.P. (included in Exhibit 5.1
Opinion).
24.1* Power of Attorney (included on signature page).
- ---------------
*Filed herewith
-5-
<PAGE> 6
ITEM 9. UNDERTAKINGS
A. Undertaking to Update
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to the Registration Statement to:
(i) include any prospectus required by section 10(a)(3) of
the Securities Act of 1933, as amended (the "Securities Act");
(ii) reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or most recent
post-effective amendment thereof) which, individually or in the
aggregate represent a fundamental change in the information in the
Registration Statement; and
(iii) include any material information with respect to the
plan for distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement.
Provided, however, that paragraph (A)(1)(i) and (A)(1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Registrant pursuant to
Section 13 or 15(d) of the Exchange Act that are incorporated by reference in
the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
B. Undertaking With Respect to Documents Incorporated by
Reference
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Exchange
Act (and where applicable, each filing of an employee benefit plan's annual
report pursuant to section 15(d) of the Exchange Act) that is incorporated by
reference in 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. Undertaking With Respect to Indemnification
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Commission, such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
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<PAGE> 7
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints David B. Robson, Stephen J. Ludlow and
Anthony Tripodo, and each of them, either of whom may act without joinder of the
other, his true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him and his name, place and stead, in any
and all capacities, to sign any or all pre- and post-effective amendments and
supplements to this Registration Statement, and to file the same, or caused to
be filed the same, with all exhibits thereto and all other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
such attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary to be done
in and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, and each of them, or the substitute or substitutes
of either of them, may lawfully do or cause to be done by virtue hereof.
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 Houston, State of Texas on September 29, 1998.
VERITAS DGC INC.
By: /s/ DAVID B. ROBSON
---------------------------------------
David B. Robson
Chairman of the Board,
Chief Executive Officer and Director
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the 29th day of September, 1998.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C>
/s/ DAVID B. ROBSON Chairman of the Board,
- ------------------------------------------------------ Chief Executive Officer and Director
David B. Robson
/s/ STEPHEN J. LUDLOW President,
- ------------------------------------------------------ Chief Operating Officer and Director
Stephen J. Ludlow
/s/ LAWRENCE C. FICHTNER Executive Vice President,
- ------------------------------------------------------ Corporate Communications and Director
Lawrence C. Fichtner
/s/ ANTHONY TRIPODO Executive Vice President,
- ------------------------------------------------------ Chief Financial Officer and Treasurer (principal
Anthony Tripodo financial and accounting officer)
Director
- ------------------------------------------------------
Clayton P. Cormier
</TABLE>
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<PAGE> 8
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C>
/s/ RALPH M. EESON Director
- ------------------------------------------------------
Ralph M. Eeson
Director
/s/ JAMES R. GIBBS
- ------------------------------------------------------
James R. Gibbs
Director
- ------------------------------------------------------
Steven J. Gilbert
/s/ BRIAN F. MACNEILL Director
- ------------------------------------------------------
Brian F. MacNeill
Director
- ------------------------------------------------------
Douglas B. Thompson
Director
- ------------------------------------------------------
Jack C. Threet
</TABLE>
-8-
<PAGE> 9
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit
No. Description
- ------- -----------
<S> <C>
4.1 Restricted Stock Plan (Incorporated by reference to Exhibit
4.1 to Veritas DGC Inc.'s Registration Statement No.
333-57603, dated June 24, 1998).
4.2 Restated Certificate of Incorporation (with Amendments) of
Digicon Inc. dated August 30, 1996. (Incorporated by reference
to Exhibit 3.1 to Veritas DGC Inc.'s Current Report on Form
8-K dated September 16, 1996).
4.3 Certificate of Ownership and Merger of New Digicon Inc. and
Digicon Inc. (Incorporated by reference to Exhibit 3-B to
Digicon's Registration Statement No. 33-43873, dated November
12, 1991).
4.4 By-laws of New Digicon Inc. dated June 24, 1991. (Incorporated
by reference to Exhibit 3-C to Digicon's Registration
Statement No. 33-43873, dated November 12, 1991).
4.5 Specimen Veritas DGC Inc. Common Stock certificate.
(Incorporated by reference to Exhibit 4-C to Veritas DGC
Inc.'s Annual Report on Form 10-K for the year ended July 31,
1996).
4.6 Rights Agreement between Veritas DGC Inc. and ChaseMellon
Shareholder Services, L.L.C. dated as of May 15, 1997.
(Incorporated by reference to Exhibit 4.1 of Veritas DGC
Inc.'s Current Report on Form 8-K filed May 27, 1997).
4.7* Key Contributor Incentive Plan for Fiscal Year 1998 (as
amended and restated September 29, 1998).
5.1* Opinion of Porter & Hedges, L.L.P., with respect to the
legality of the securities filed herewith.
23.1* Consent of PricewaterhouseCoopers LLP.
23.2* Consent of PricewaterhouseCoopers, Chartered Accountants.
23.3* Consent of Deloitte & Touche LLP.
23.4* Consent of Porter & Hedges, L.L.P. (included in Exhibit 5.1
Opinion).
24.1* Power of Attorney (included on signature page).
</TABLE>
- ---------------
*Filed herewith
9
<PAGE> 1
EXHIBIT 4.7
VERITAS DGC INC.
KEY CONTRIBUTOR INCENTIVE PLAN
FOR FISCAL YEAR 1998
(AS AMENDED AND RESTATED SEPTEMBER 29, 1998)
A. PLAN OBJECTIVES
The overall objective of the Key Contributor Incentive Plan (herein after
referred to as the "Plan") is to provide short-term rewards paid as bonuses to
designated Key Contributors. Key Contributors are those individuals who have
the responsibility of leading a diverse or complex team or function. The work
produced from that team or function significantly impacts the operations of the
Company up to and including bottom line results. Within the overall objectives,
the following are the specific goals of the Plan:
o Reward Key Contributors for achieving Veritas DGC Inc.'s business
strategies in the area of net income before taxes (NIBT)
o Focus participants on key business goals that they can directly impact
o Create payout opportunities that balance the appropriate return to the
Company with reward to the participants
B. ELIGIBILITY
Eligibility for participation in the Plan is recommended by the respective
division senior executive management. Participants in the Plan are limited to
those individuals who have a major impact on the accomplishment of Veritas DGC
Inc.'s business strategies and are regular full-time employees.
Variations from the guidelines may be made for individuals as recommended by the
CEO based upon the scope of the incumbent's position, impact of position and
compensation philosophy and strategy.
C. AWARD DISTRIBUTION
Bonuses will be paid semi-annually to reward the achievement of profit
objectives. Seventy-five percent (75%) of the payment will be based upon
performance as measured by published financial results before incentive payout.
Twenty-five percent (25%) of the award will be based on two equally weighted
strategic individual objectives as determined by the participant and approved
by the immediate supervisor. The semi-annual award will be based on profit
measures only, while the award distribution at the end of the fiscal year will
be based on profits and the attainment of individual objectives.
<PAGE> 2
D. PERFORMANCE MEASURES AND PAYOUT TARGETS
PERFORMANCE MEASURES AND WEIGHTS
The performance measure for determining the incentive awards will be net income
before taxes (hereinafter referred to as "NIBT"), and meeting two equally
weighted strategic individual objectives. NIBT is the profit plan for VDGC
Consolidated and for each division that was submitted to and approved by
Veritas DGC Inc.'s Board of Directors. The individual objectives are goals set
by the participant and his/her immediate supervisor. These individual
objectives are to be in addition to the participant's day-to-day
responsibilities, and present a challenge to the participant. Such goals may
improve processes, for example, which add value to their Division.
<TABLE>
<CAPTION>
Basis for
Payout-VDGC Individual
Consolidated Division Objectives
------------ -------- ----------
<S> <C> <C> <C>
Corporate 75% 25%
Division Executive Mgt. 25% 50% 25%
Divisional Key Contributors 25% 50% 25%
</TABLE>
AWARD DISTRIBUTION
Payout is determined by the impact level of the participant's position as
follows:
<TABLE>
<CAPTION>
Impact Target
Base Salary (in thousands) Level Payout*
- -------------------------- ------ -------
<S> <C> <C>
$150+(Corporate Leadership and A 40%
Division Sr. Exec. Mgt. Only)
$100+ B 30%
$75-$99 C 20%
$50-$74 D 10%
</TABLE>
*Payout is a target percentage of the participant's base salary that the Plan
intends to pay to the participant assuming that the profit and strategic
individual objectives are met for his/her division. The payout will be
calculated as close to the target percentage as possible assuming that the
division's profit goals are met. In addition, bonus amounts will
increase/decrease as dictated by NIBT results without minimum or cap.
E. AWARD CALCULATION
The participant's base salary at the close of each fiscal half-year will be
used for purposes of this calculation.
Page 2 For Distribution 9/97
<PAGE> 3
PAYOUT SCENARIO
John Doe is a Key Contributor whose annual salary is $70,000, which would put
him at Impact Level D with a Target Payout of 10%. We have made the following
assumptions for fiscal year 1998:
o VDGC Consolidated meets 80% of its goal
o Division meets 100% of its goal
o One of the two individual objectives are met
The calculation would be something like this:
Target Payout: $70,000 * 10% = $7,000
Of that, VDGC Consolidated's portion of the total payout is 25%, so:
$7,000 * 25% = $1,750
VDGC Consolidated made 80% of its goal for 1998, so VDGC Consolidated's portion
of the actual payout would be $1,750 * 80% = $1,400
Division's portion of the total payout is 50%, so: $7,000 * 50% = $3,500
The Division met its goal for the year, so the Division's portion of the actual
payout would be 100% of its portion, or: $3,500 * 100% = $3,500
Individual Goals' portion of the total payout is 25%, so: $7,000 * 25% = $1,750
One of two individual objectives were met, so the Individual Goals' portion of
the actual payout would be: $1,750 * 50% = $875
Therefore, the total Incentive Payout would be: $1,400 + $3,500 + $875= $5,775
With respect to the year-end distribution only, the Compensation Committee may,
if it so elects, offer by written notice to some or all participants in the Plan
(the "Offered Participants") prior to payment of the year-end bonus the
opportunity to receive all or a portion of his or her annual bonus distribution
in shares of Veritas DGC common stock ("Common Stock") and if so offered, the
Offered Participants who elect to receive all or a specified portion of the
bonus in Common Stock rather than cash ("Electing Participants") shall receive
on the date of the year-end bonus payment a number of whole shares equal to (x)
the amount designated for the purpose of Common Stock, divided by (y) 100% of
"fair market value" for a share of Common Stock on the date of the year-end
bonus payment. As used in this paragraph, "fair market value" for a share of
Common Stock shall be the closing price for the Common Stock on the New York
Stock Exchange on the date of year-end bonus payment. Only treasury shares will
be used for the payment of annual bonus distributions in Common Stock. If the
number of shares of Common Stock necessary to fund the requests of Electing
Participants in any year shall exceed the number of shares then held in
treasury, all
Page 3 For Distribution 9/97
<PAGE> 4
Electing Participant's requests shall be pro-rated to the extent necessary,
and the balance of year end bonus distributions shall be made in cash.
F. LONG-TERM COMPENSATION
o There is an additional long-term compensation component for Key
Contributors.
o Plan provides stock option grants every two years beginning in March 1997,
based on the following:
<TABLE>
<CAPTION>
Impact Level Grant Multiple
------------ --------------
<S> <C>
A 2.00
B 1.50
C 0.75
D 0.50
</TABLE>
<TABLE>
<CAPTION>
o Vesting:
Year % Vested
---- --------
<S> <C>
0 0%
1 yr. Anniversary 25%
2 yr. Anniversary 50%
3 yr. Anniversary 75%
4 yr. Anniversary 100%
</TABLE>
FORMULA:
Base Salary X Grant Multiple divided by Share Price = # of Shares
o Stock Value
The stock options will be granted at the per share value, as
designated by the Board of Directors upon approval of the award. The
option shall be for a term of ten years commencing March 11, 1997, and
ending on March 11, 2007.
Employees coming into the Plan after this date may be issued stock
options on a pro-rata basis, with the term ending on March 11, 2007.
Key Contributors coming into the Plan after March 11, 1997, will be
awarded shares based on the share value on the date employee entered
the Plan.
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<PAGE> 5
G. PLAN ADMINISTRATION
PARTICIPATION
Participants in the Plan are recommended by the appropriate Division head and
approved by the CEO.
TERMINATIONS/LEAVE OF ABSENCE
Any participant who terminates for death, disability or retirement will receive
a pro-rata portion of their earned incentive award for the fiscal year based on
the month in which termination occurred. The payment will be made at the same
time as the payout for the other participants.
Any participant on leave of absence will not earn incentive award dollars
during the leave period. Awards will be calculated on a pro-rata basis for the
period of time worked for each fiscal half year.
Participants must be actively employed on the dates that the award payments are
made, otherwise the award is forfeited. In addition, if the participant leaves
before the award payment date, all moneys previously paid will be retained by
the participant, however no additional bonuses will be calculated or paid. Any
exceptions to this rule must be approved by the CEO.
NEW HIRES/PROMOTIONS
Participants hired or promoted into positions that would qualify as Key
Contributors will be eligible to participate in the Plan on a pro-rata basis
depending on their month of hire/promotion. A Key Contributor who is hired
after the start of the fiscal year will be eligible to participate in the plan
with the approval of the CEO or COO. The award will be calculated on a pro-rata
basis from the date of hire/promotion. The long-term incentive award may also
be calculated on a pro-rata basis, and will be issued based on the stock price
on date of hire/promotion.
TRANSFERS
Employees who transfer between divisions will automatically participate in the
new Division's Plan if they were a Plan participant in their old division.
Such transferred employees will participate in their old/new division bonus
awards based on the percentage of the fiscal year worked in each Division.
Transferred employees not eligible in their previous Division will be governed
by the rules for new and promoted employees as set out in the preceding
paragraph.
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<PAGE> 6
EXTRAORDINARY CIRCUMSTANCES
The intent of the Plan is to reward for typical, normal operating results of
Veritas DGC Inc. If there are extraordinary circumstances that have a
significant impact on the results of the measures in the Plan, the Board can
elect to exclude them from the calculation of incentive awards both positively
and negatively. Such circumstances could include mergers, acquisitions,
recapitalizations and/or any other substantial changes that could affect the
financial impact of the business plan.
PLAN EXCEPTIONS, AMENDMENTS AND TERMINATION
Any exceptions to the Plan must be approved by the Board of Directors of
Veritas DGC Inc. At any time the Board of Directors (and/or the Compensation
Committee of the Board of Directors) has the right to adjust, amend or
terminate the plan. This Plan in no way is an agreement to employment.
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<PAGE> 1
EXHIBIT 5.1
September 30, 1998
Veritas DGC Inc.
3701 Kirby Drive, Suite 112
Houston, Texas 77098
Re: VERITAS DGC INC. REGISTRATION STATEMENT ON FORM S-8:
KEY CONTRIBUTOR INCENTIVE PLAN FOR FISCAL YEAR 1998 (AS
AMENDED AND RESTATED SEPTEMBER 29, 1998)
Gentlemen:
We have acted as counsel to Veritas DGC Inc., a Delaware corporation
(the "Company"), in connection with the preparation for filing with the
Securities and Exchange Commission of a Registration Statement on Form S-8 (the
"Registration Statement") under the Securities Act of 1933, as amended. The
Registration Statement relates, among other things, to an aggregate of 50,000
shares (the "Shares") of the Company's common stock, par value $.01 per share
(the "Common Stock"), to be transferred pursuant to the Key Contributor
Incentive Plan for Fiscal Year 1998 (as Amended and Restated September 29, 1998)
between the Company and selected key employees as an employment inducement upon
the vesting thereof (the "Plan").
We have examined the Plan and such corporate records, documents,
instruments and certificates of the Company, and have reviewed such questions of
law as we have deemed necessary, relevant or appropriate to enable us to render
the opinion expressed herein. In such examination, we have assumed without
independent investigation the authenticity of all documents submitted to us as
originals, the genuineness of all signatures, the legal capacity of all natural
persons, and the conformity of any documents submitted to us as copies to their
respective originals. As to certain questions of fact material to this opinion,
we have relied without independent investigation upon statements or certificates
of public officials and officers of the Company.
Based upon such examination and review, we are of the opinion that the
Shares will, upon transfer and delivery as contemplated by the Plan be validly
issued, fully paid and nonassessable outstanding shares of Common Stock.
This Firm consents to the filing of this opinion as an exhibit to the
Registration Statement.
This opinion is conditioned upon the Registration Statement being
declared effective and upon compliance by the Company with all applicable
provisions of the Securities Act of 1933, as amended, and such state securities
rules, regulations and laws as may be applicable.
Very truly yours,
/s/ Porter & Hedges, L.L.P.
PORTER & HEDGES, L.L.P.
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated September 24, 1997, appearing on page
16 of Veritas DGC Inc.'s Annual Report on Form 10-K for the year ended July 31,
1997.
/s/ PricewaterhouseCoopers LLP
PRICEWATERHOUSECOOPERS LLP
Houston, Texas
September 30, 1998
<PAGE> 1
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated September 20, 1996, appearing on page
18 of Veritas DGC Inc.'s Annual Report on Form 10-K for the year ended July 31,
1997.
/s/ PricewaterhouseCoopers
PRICEWATERHOUSECOOPERS
Chartered Accountants
September 30, 1998
<PAGE> 1
EXHIBIT 23.3
CONSENT OF INDEPENDENT AUDITORS'
We consent to the incorporation by reference in the Registration Statement on
Form S-8 of our report dated October 10, 1996, on the consolidated balance sheet
of Veritas DGC Inc. and subsidiaries (the "Company") as of July 31, 1996, and
the related consolidated statements of income, cash flows and changes in
stockholder' equity for each of the two years in the period ended July 31 1996,
appearing in the Company's Annual Report on Form 10-K for the year ended July
31, 1997.
/s/ DELOITTE & TOUCHE LLP
DELOITTE & TOUCHE LLP
Houston, Texas
September 30, 1998
