<PAGE> 1
As filed with the Securities and Exchange Commission on June 24, 1998.
Registration No. 333-_____
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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VERITAS DGC INC.
(Exact name of registrant as specified in its charter)
DELAWARE 76-0343152
(State or Other Jurisdiction (I.R.S. Employer
of Incorporation or Organization) Identification No.)
3701 KIRBY DRIVE, SUITE 112
HOUSTON, TEXAS 77098
(713) 512-8300
(Address, including Zip Code, of Registrant's Principal Executive Offices)
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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
(Full Title of Plan)
------------------------------------
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
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<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
====================================================================================================================
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. $45.250 $2,262,500.00 $668.00
====================================================================================================================
</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 the Plan.
(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 June 19, 1998, which was $45.250. 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. 2 TO
REGISTRANT'S REGISTRATION STATEMENT NO. 333-41829 AND POST-EFFECTIVE AMENDMENT
NO. 3 TO REGISTRANT'S REGISTRATION STATEMENT NO. 333-09679, WHICH RELATE TO AN
AGGREGATE OF 2,823,025 SHARES OF COMMON STOCK. THE $22,403.09 AGGREGATE
REGISTRATION FEE WITH RESPECT TO SUCH 2,823,025 SHARES OF COMMON STOCK
PREVIOUSLY REGISTERED HAS BEEN PAID.
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<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 Restricted Stock Plan, 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 provisions, as set
forth in the resolutions adopted by the Board of Directors providing for the
issuance of such stock and
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<PAGE> 3
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 transferred (in each case other than
certain consolidations with, mergers with and into, or sales of assets or
earning
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<PAGE> 4
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 brought.
In any other type of proceeding, the indemnification may extend to judgments,
fines and amounts paid in
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<PAGE> 5
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.
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 referenced 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).
5.1* Opinion of Porter & Hedges, L.L.P., with respect to the
legality of the securities filed herewith.
23.1* Consent of Price Waterhouse LLP.
23.2* Consent of Price Waterhouse, 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).
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*Filed herewith
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<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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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 June 24, 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 24th day of June, 1998.
SIGNATURE TITLE
/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
Anthony Tripodo (principal financial and accounting officer)
/s/ Clayton P. Cormier Director
- -----------------------------------
Clayton P. Cormier
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<PAGE> 8
SIGNATURE TITLE
/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
/s/ Jack C. Threet Director
- -----------------------------------
Jack C. Threet
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INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT DESCRIPTION
NO. -----------
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4.1* Restricted Stock Plan.
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 referenced 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).
5.1* Opinion of Porter & Hedges, L.L.P., with respect to the
legality of the securities filed herewith.
23.1* Consent of Price Waterhouse LLP.
23.2* Consent of Price Waterhouse, 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>
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*Filed herewith
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<PAGE> 1
EXHIBIT 4.1
VERITAS DGC INC.
RESTRICTED STOCK PLAN
(AS EFFECTIVE JUNE 9, 1998)
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
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PAGE
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<S> <C> <C>
SECTION 1. GENERAL PROVISIONS RELATING TO PLAN GOVERNANCE, COVERAGE
AND BENEFITS....................................................................................1
1.1 Purpose.........................................................................................1
1.2 Definitions.....................................................................................1
(a) Authorized Officer.....................................................................1
(b) Board..................................................................................2
(c) Cause..................................................................................2
(d) Change in Control......................................................................2
(e) Code...................................................................................2
(f) Committee..............................................................................2
(g) Common Stock...........................................................................2
(h) Company................................................................................2
(i) Disability.............................................................................3
(j) Employee...............................................................................3
(k) Employment.............................................................................3
(l) Exchange Act...........................................................................3
(m) Fair Market Value......................................................................3
(n) Grantee................................................................................4
(o) Incentive Award........................................................................4
(p) Insider................................................................................4
(q) Parent.................................................................................4
(r) Performance-Based Exception............................................................4
(s) Plan...................................................................................4
(t) Restricted Stock.......................................................................4
(u) Restricted Stock Agreement.............................................................4
(v) Restricted Stock Award.................................................................4
(w) Restriction Period.....................................................................5
(x) Retirement.............................................................................5
(y) Share..................................................................................5
(z) Share Pool.............................................................................5
(aa) Subsidiary.............................................................................5
(bb) Supplemental Payment...................................................................5
1.3 Plan Administration.............................................................................5
(a) Authority of the Committee.............................................................5
(b) Meetings...............................................................................5
(c) Decisions Binding......................................................................6
</TABLE>
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(d) Modification of Outstanding Incentive Awards...........................................6
(e) Delegation of Authority................................................................6
(f) Expenses of Committee..................................................................6
(g) Surrender of Previous Incentive Awards.................................................7
(h) Indemnification........................................................................7
1.4 Shares of Common Stock Available for Incentive Awards...........................................7
1.5 Share Pool Adjustments for Awards and Payouts...................................................8
1.6 Common Stock Available. .......................................................................8
1.7 Eligibility for Participation...................................................................8
SECTION 2. RESTRICTED STOCK................................................................................9
2.1 Award of Restricted Stock.......................................................................9
(a) Grant..................................................................................9
(b) Immediate Transfer Without Immediate Delivery of Restricted
Stock..................................................................................9
2.2 Restrictions...................................................................................10
(a) Forfeiture of Restricted Stock........................................................10
(b) Issuance of Certificates..............................................................10
(c) Removal of Restrictions...............................................................11
2.3 Delivery of Shares of Common Stock.............................................................11
2.4 Supplemental Payment on Vesting of Restricted Stock............................................11
SECTION 3. PROVISIONS RELATING TO PLAN PARTICIPATION......................................................12
3.1 Plan Conditions................................................................................12
(a) Restricted Stock Agreement............................................................12
(b) No Right to Employment................................................................12
(c) Securities Requirements...............................................................12
3.2 Transferability................................................................................13
(a) Non-Transferable Awards...............................................................13
(b) Ability to Exercise Rights............................................................13
3.3 Rights as a Stockholder........................................................................13
(a) Stockholder Rights....................................................................13
(b) Representation of Ownership...........................................................13
3.4 Listing and Registration of Shares of Common Stock.............................................14
3.5 Change in Stock and Adjustments................................................................14
(a) Changes in Law or Circumstances.......................................................13
(b) Exercise of Corporate Powers..........................................................14
(c) Recapitalization of the Company.......................................................15
(d) Reorganization of the Company.........................................................15
(e) Issue of Common Stock by the Company..................................................15
</TABLE>
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<TABLE>
<S> <C> <C> <C>
(f) Acquisition of the Company............................................................16
(h) Assumption of Incentive Awards by a Successor.........................................16
3.6 Termination of Employment, Death and Disability ...............................................17
(a) Termination of Employment.............................................................17
(b) Disability or Death...................................................................17
(c) Continuation of Incentive Award.......................................................17
3.7 Change in Control..............................................................................18
3.8 Exchange of Incentive Awards...................................................................20
3.9 Financing......................................................................................20
SECTION 4. GENERAL........................................................................................20
4.1 Effective Date and Grant Period................................................................20
4.2 Funding and Liability of Company...............................................................20
4.3 Withholding Taxes..............................................................................21
(a) Tax Withholding.......................................................................21
(b) Share Withholding.....................................................................21
(c) Loans.................................................................................21
4.4 No Guarantee of Tax Consequences...............................................................21
4.5 Designation of Beneficiary by Participant......................................................21
4.6 Deferrals......................................................................................22
4.7 Amendment and Termination......................................................................22
4.8 Requirements of Law............................................................................23
4.9 Rule 16b-3 Securities Law Compliance...........................................................23
4.10 Successors.....................................................................................23
4.11 Miscellaneous Provisions.......................................................................23
4.12 Severability...................................................................................24
4.13 Gender, Tense and Headings.....................................................................24
4.14 Governing Law..................................................................................24
</TABLE>
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VERITAS DGC INC.
RESTRICTED STOCK PLAN
SECTION 1.
GENERAL PROVISIONS RELATING TO
PLAN GOVERNANCE, COVERAGE AND BENEFITS
1.1 PURPOSE
The purpose of the Plan is to foster and promote the long-term
financial success of Veritas DGC Inc. (the "Company") and its Subsidiaries and
to increase Stockholder value by: (a) encouraging the commitment of selected key
Employees (b) motivating superior performance of such Employees by means of
long-term performance related incentives, (c) encouraging and providing such
Employees with a program for obtaining ownership interests in the Company which
link and align their personal interests to those of the Company's Stockholders,
(d) attracting and retaining key Employees by providing competitive incentive
compensation opportunities, and (e) enabling key Employees to share in the
long-term growth and success of the Company.
The Plan provides for the payment of restricted stock incentive
compensation and it is not intended to be a plan that is subject to the Employee
Retirement Income Security Act of 1974, as amended (ERISA). The Plan shall be
interpreted, construed and administered consistent with its status as a plan
that is not subject to ERISA.
The Plan shall become effective as of June 9, 1998 (the "EFFECTIVE
DATE"). The Plan shall commence on the Effective Date, and shall remain in
effect, subject to the right of the Board to amend or terminate the Plan at any
time pursuant to Section 4.7, until all Shares subject to the Plan have been
purchased or acquired according to its provisions. However, in no event may an
Incentive Award be granted under the Plan after the expiration of ten (10) years
from the Effective Date.
1.2 DEFINITIONS
The following terms shall have the meanings set forth below:
(a) AUTHORIZED OFFICER. The Chairman of the Board, the
Chief Executive Officer of the Company, an Executive Vice President of
the Company, the Corporate Vice President of Human Resources, and any
other officer of the Company who has been delegated the
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authority by the Committee to execute a Restricted Stock Agreement for
and on behalf of the Company. No officer shall be an Authorized Officer
with respect to any Restricted Stock Agreement for himself.
(b) BOARD. The Board of Directors of the Company.
(c) CAUSE. When used in connection with termination of
Employment, "Cause" shall mean the termination of the Grantee's
Employment by the Company by reason of (i) the conviction of the
Grantee by a court of competent jurisdiction as to which no further
appeal can be taken of a crime involving moral turpitude or a felony;
(ii) the proven commission by the Grantee of an act of fraud upon the
Company; (iii) the willful and proven misappropriation of any funds or
property of the Company by the Grantee; (iv) the willful, continued and
unreasonable failure by the Grantee to perform the material duties
assigned to him; (v) the knowing engagement by the Grantee in any
direct, material conflict of interest with the Company without
compliance with the Company's conflict of interest policy, if any, then
in effect; or (vi) the knowing engagement by the Grantee, without the
written approval of the Board, in any activity which competes with the
business of the Company or which would result in a material injury to
the business, reputation or goodwill of the Company.
(d) CHANGE IN CONTROL. Any of the events described in and
subject to Section 4.7.
(e) CODE. The Internal Revenue Code of 1986, as amended,
and the regulations and other authority promulgated thereunder by the
appropriate governmental authority. References herein to any provision
of the Code shall refer to any successor provision thereto.
(f) COMMITTEE. The Compensation Committee of the Board as
such Committee is comprised from time to time. The Board shall have the
power to fill vacancies on the Committee arising by resignation, death,
removal or otherwise. The Board, in its sole discretion, may bifurcate
the powers and duties of the Committee among one or more separate
committees, or retain all powers and duties of the Committee in a
single Committee. The members of the Committee shall serve at the
discretion of the Board.
(g) COMMON STOCK. The common stock of the Company, $.01
par value per share, and any class of common stock into which such
common shares may hereafter be converted, reclassified or
recapitalized.
(h) COMPANY. Veritas DGC Inc., a corporation organized
under the laws of the State of Delaware, and any successor in interest
thereto.
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(i) DISABILITY. As determined by the Committee in its
discretion exercised in good faith, a physical or mental condition of
the Employee that would entitle him to payment of disability income
payments under the Company's long term disability insurance policy or
plan for employees as then effective; or in the event that the Grantee
is not covered, for whatever reason, under the Company's long-term
disability insurance policy or plan, "Disability" means a permanent and
total disability as defined in Section 22(e)(3) of the Code. A
determination of Disability may be made by a physician selected or
approved by the Committee and, in this respect, the Grantee shall
submit to an examination by such physician upon request.
(j) EMPLOYEE. Any employee of the Company (or any Parent
or Subsidiary) within the meaning of Section 3401(c) of the Code who,
in the opinion of the Committee, is (i) one of a group of officers or
any other key employee of the Company (or any Parent or Subsidiary) and
(ii) in a position to contribute materially to the growth and
development and to the financial success of the Company (or any Parent
or Subsidiary), including, without limitation, officers who are members
of the Board.
(k) EMPLOYMENT. Employment by the Company (or any Parent
or Subsidiary), or by any corporation issuing or assuming an Incentive
Award in any transaction described in Section 424(a) of the Code, or by
a parent corporation or a subsidiary corporation of such corporation
issuing or assuming such Incentive Award, as the parent-subsidiary
relationship shall be determined at the time of the corporate action
described in Section 424(a) of the Code. In this regard, neither the
transfer of a Grantee from Employment by the Company to Employment by
any Parent or Subsidiary, nor the transfer of a Grantee from Employment
by any Parent or Subsidiary to Employment by the Company, shall be
deemed to be a termination of Employment of the Grantee. Moreover, the
Employment of a Grantee shall not be deemed to have been terminated
because of an approved leave of absence from active Employment on
account of temporary illness, authorized vacation or granted for
reasons of professional advancement, education, health, or government
service, or during military leave for any period (if the Grantee
returns to active Employment within 90 days after the termination of
military leave), or during any period required to be treated as a leave
of absence by virtue of any applicable statute, Company personnel
policy or agreement. Whether an authorized leave of absence shall
constitute termination of Employment hereunder shall be determined by
the Committee in its discretion.
(l) EXCHANGE ACT. The Securities Exchange Act of 1934, as
amended.
(m) FAIR MARKET VALUE. The Fair Market Value of one share
of Common Stock on the date in question is deemed to be (i) the closing
sales price on the immediately preceding business day of a share of
Common Stock as reported on the New York Stock
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<PAGE> 8
Exchange or other principal securities exchange on which Shares are
then listed or admitted to trading, or (ii) if not so reported, the
average of the closing bid and asked prices for a Share on the
immediately preceding business day as quoted on the National
Association of Securities Dealers Automated Quotation System
("NASDAQ"). If there was no public trade of Common Stock on the date in
question, Fair Market Value shall be determined by reference to the
last preceding date on which such a trade was so reported.
(n) GRANTEE. Any Employee who is granted an Incentive
Award under the Plan.
(o) INCENTIVE AWARD. A grant of any Restricted Stock
Award, as well as any Supplemental Payment provided therein, that is
made to a Grantee under the Plan.
(p) INSIDER. An individual who is, on the relevant date,
an officer, director or ten percent (10%) beneficial owner of any class
of the Company's equity securities that is registered pursuant to
Section 12 of the Exchange Act, all as defined under Section 16 of the
Exchange Act.
(q) PARENT. Any corporation (whether now or hereafter
existing) which constitutes a "parent" of the Company, as defined in
Section 424(e) of the Code.
(r) PERFORMANCE-BASED EXCEPTION. The Performance-Based
Exception from the tax deductibility limitations of Section 162(m) of
the Code, as prescribed in Code ss. 162(m) and Treasury Regulation ss.
1.162-27(e) (or its successor).
(s) PLAN. The Veritas DGC Inc. Restricted Stock Plan as
set forth herein and as it may be amended from time to time.
(t) RESTRICTED STOCK. Shares of Common Stock issued or
transferred to a Grantee pursuant to Section 2.1.
(u) RESTRICTED STOCK AGREEMENT. The written agreement
entered into between the Company and the Grantee setting forth the
terms and conditions pursuant to which a Restricted Stock Award is
granted under the Plan, as such agreement is further defined in Section
3.1(a).
(v) RESTRICTED STOCK AWARD. An authorization by the
Committee to issue or transfer Restricted Stock to a Grantee.
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<PAGE> 9
(w) RESTRICTION PERIOD. The period of time determined by
the Committee and set forth in the Restricted Stock Agreement during
which the transfer of Restricted Stock by the Grantee is restricted.
(x) RETIREMENT. The voluntary termination of Employment
from the Company or any Parent or Subsidiary constituting retirement
for age on any date after the Employee attains the normal retirement
age of 65 years, or such other age as may be designated in the
Grantee's Restricted Stock Agreement by the Committee in its
discretion.
(y) SHARE. A share of the Common Stock of the Company.
(z) SHARE POOL. The number of shares authorized for
issuance under Section 1.4, as adjusted for awards and payouts under
Section 1.5 and as adjusted for changes in corporate capitalization
under Section 3.5.
(aa) SUBSIDIARY. Any corporation (whether now or
hereafter existing) which constitutes a "subsidiary" of the Company, as
defined in Section 424(f) of the Code.
(bb) SUPPLEMENTAL PAYMENT. Any amount, as described in
Section 2.4, dedicated to payment of income taxes that are payable by
the Grantee on an Incentive Award.
1.3 PLAN ADMINISTRATION
(a) AUTHORITY OF THE COMMITTEE. Except as may be limited
by law and subject to the provisions herein, the Committee shall have
full power to (i) select Grantees who shall participate in the Plan;
(ii) determine the sizes, duration and types of Incentive Awards; (iii)
determine the terms and conditions of Incentive Awards and Restricted
Stock Agreements; (iv) determine whether any Shares subject to
Incentive Awards will be subject to any restrictions on transfer; (v)
construe and interpret the Plan and any Restricted Stock Agreement or
other agreement entered into under the Plan; and (vi) establish, amend,
or waive rules for the Plan's administration. Further, the Committee
shall make all other determinations which may be necessary or advisable
for the administration of the Plan.
The Committee may grant an Incentive Award to an individual
who it expects to become an Employee within the next six months, with
such Incentive Award being subject to such individual actually becoming
an Employee within such time period, and subject to such other terms
and conditions as may be established by the Committee in its
discretion.
(b) MEETINGS. The Committee shall designate a chairman
from among its members who shall preside at all of its meetings, and
shall designate a secretary, without
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<PAGE> 10
regard to whether that person is a member of the Committee, who shall
keep the minutes of the proceedings and all records, documents, and
data pertaining to its administration of the Plan. Meetings shall be
held at such times and places as shall be determined by the Committee
and the Committee may hold telephonic meetings. The Committee may take
any action otherwise proper under the Plan by the affirmative vote,
taken with or without a meeting, of a majority of its members. The
Committee may authorize any one or more of their members or any officer
of the Company to execute and deliver documents on behalf of the
Committee.
(c) DECISIONS BINDING. All determinations and decisions
made by the Committee shall be made in its discretion pursuant to the
provisions of the Plan, and shall be final, conclusive and binding on
all persons including the Company, its shareholders, Employees,
Grantees, and their estates and beneficiaries. The Committee's
decisions and determinations with respect to any Incentive Award need
not be uniform and may be made selectively among Incentive Awards and
Grantees, whether or not such Incentive Awards are similar or such
Grantees are similarly situated.
(d) MODIFICATION OF OUTSTANDING INCENTIVE AWARDS. Subject
to any required stockholder approval requirements, if applicable, the
Committee may, in its discretion, provide for the extension of the
exercisability of an Incentive Award, accelerate the vesting or
exercisability of an Incentive Award, eliminate or make less
restrictive any restrictions contained in an Incentive Award, waive any
restriction or other provisions of an Incentive Award, or otherwise
amend or modify an Incentive Award in any manner that is either (i) not
adverse to the Grantee to whom such Incentive Award was granted or (ii)
consented to by such Grantee.
(e) DELEGATION OF AUTHORITY. The Committee may delegate
to any Authorized Officer certain of its duties under the Plan pursuant
to such conditions or limitations as the Committee may establish from
time to time, except that the Committee may not delegate to any person
the authority to (i) grant Incentive Awards to any Insider or (ii) take
any action that would contravene the requirements of Rule 16b-3 under
the Exchange Act or the Performance-Based Exception under Section
162(m) of the Code to the extent that Rule 16b-3 or the
Performance-Based Exemption is applicable to the Grantee as determined
by the Committee; provided, however, any such action if taken by an
Authorized Officer may be subsequently ratified by the Committee, in
its discretion, before the Incentive Award becomes vested and, in such
event, any Incentive Award that is granted to the Insider shall be
subject to such subsequent ratification by the Committee.
(f) EXPENSES OF COMMITTEE. The Committee may employ legal
counsel, including, without limitation, independent legal counsel and
counsel regularly employed by
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<PAGE> 11
the Company, and other agents as the Committee may deem appropriate for
the administration of the Plan. The Committee may rely upon any opinion
or computation received from any such counsel or agent. All expenses
incurred by the Committee in interpreting and administering the Plan,
including, without limitation, meeting expenses and professional fees,
shall be paid by the Company.
(g) SURRENDER OF PREVIOUS INCENTIVE AWARDS. The Committee
may, in its absolute discretion, grant Incentive Awards to Grantees on
the condition that such Grantees surrender to the Committee for
cancellation such other Incentive Awards as the Committee directs.
Incentive Awards granted on the condition precedent of surrender of
outstanding Incentive Awards shall not count against the limits set
forth in Section 1.4 until such time as such previous Incentive Awards
are surrendered and canceled.
(h) INDEMNIFICATION. Each person who is or was a member
of the Committee shall be indemnified by the Company against and from
any damage, loss, liability, cost and expense that may be imposed upon
or reasonably incurred by him in connection with or resulting from any
claim, action, suit, or proceeding to which he may be a party or in
which he may be involved by reason of any action taken or failure to
act under the Plan, except for any such act or omission constituting
willful misconduct or gross negligence. Such person shall be
indemnified by the Company for all amounts paid by him in settlement
thereof, with the Company's approval, or paid by him in satisfaction of
any judgment in any such action, suit, or proceeding against him,
provided he shall give the Company an opportunity, at its own expense,
to handle and defend the same before he undertakes to handle and defend
it on his own behalf. The foregoing right of indemnification shall not
be exclusive of any other rights of indemnification to which such
persons may be entitled under the Company's Articles of Incorporation
or Bylaws, as a matter of law, or otherwise, or any power that the
Company may have to indemnify them or hold them harmless.
1.4 SHARES OF COMMON STOCK AVAILABLE FOR INCENTIVE AWARDS
Subject to adjustment under Section 3.5, there shall be available for
Incentive Awards under the Plan an aggregate of Fifty Thousand (50,000) Shares
of Common Stock. The number of Shares of Common Stock subject of Incentive
Awards that are forfeited or terminated, or are settled in a manner such that
all or some of the Shares covered by the Incentive Award are not issued to a
Grantee, shall again immediately become available for Incentive Awards
hereunder. The Committee may from time to time adopt and observe such procedures
concerning the counting of Shares against the Plan maximum as it may deem
appropriate.
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<PAGE> 12
Unless the Committee determines that a particular Incentive Award
granted to a Covered Employee is not intended to comply with the
Performance-Based Exception, then subject to adjustment as provided in Section
3.5, the maximum aggregate number of Shares of Common Stock that may be granted
or that may vest, as applicable, in any calendar year pursuant to any Incentive
Award held by any individual Covered Employee shall be 50,000 Shares.
1.5 SHARE POOL ADJUSTMENTS FOR AWARDS AND PAYOUTS.
A grant of Shares of Restricted Stock shall reduce, on a one Share for
one Share basis, the number of Shares authorized for issuance under the Share
Pool.
The following transactions shall restore, on a one Share for one Share
basis, the number of Shares authorized for issuance under the Share Pool:
(a) A cancellation, termination, expiration, forfeiture,
or lapse for any reason of any Shares subject to an Incentive Award;
and
(b) The payment of any purchase price for Shares by the
Grantee with previously acquired Shares, or by withholding Shares which
otherwise would be acquired on purchase (i.e., the Share Pool shall be
increased by the number of Shares turned in or withheld as payment of
the purchase price, if any, for an Incentive Award).
1.6 COMMON STOCK AVAILABLE.
The Common Stock available for issuance or transfer under the Plan
shall be made available from Shares now or hereafter (a) held in the treasury of
the Company, (b) authorized but unissued shares, or (c) shares to be purchased
or acquired by the Company. No fractional shares shall be issued under the Plan;
payment for fractional shares shall be made in cash.
1.7 ELIGIBILITY FOR PARTICIPATION.
In its discretion, the Committee shall from time to time designate
those Employees to be granted Incentive Awards under the Plan, the number of
Shares subject to the Incentive Award, and the other terms or conditions
relating to the Incentive Award as it deems appropriate to the extent not
inconsistent with the provisions of the Plan. A Grantee who has been granted an
Incentive Award may, if otherwise eligible, be granted additional Incentive
Awards at any time.
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<PAGE> 13
SECTION 2.
RESTRICTED STOCK
2.1 AWARD OF RESTRICTED STOCK
(a) GRANT. In consideration for Employment by the
Grantee, Shares of Restricted Stock may be awarded under the Plan by
the Committee with such restrictions during the Restriction Period as
the Committee designates in its discretion, any of which restrictions
may differ with respect to a particular Grantee. Restricted Stock shall
be awarded for no additional consideration or such additional
consideration as the Committee may determine, which consideration may
be less than, equal to or more than the Fair Market Value of the shares
of Restricted Stock on the grant date. The terms and conditions of each
grant of Restricted Stock shall be evidenced by a Restricted Stock
Agreement.
(b) IMMEDIATE TRANSFER WITHOUT IMMEDIATE DELIVERY OF
RESTRICTED STOCK. Unless otherwise specified in the Grantee's
Restricted Stock Agreement, each Restricted Stock Award shall
constitute an immediate transfer of the record and beneficial ownership
of the Shares of Restricted Stock to the Grantee in consideration of
the performance of services as an Employee, entitling such Grantee to
all voting and other ownership rights in such Shares subject to any
restrictions thereon.
As specified in the Restricted Stock Agreement, a Restricted
Stock Award may limit the Grantee's dividend rights during the
Restriction Period in which the Shares of Restricted Stock are subject
to a "substantial risk of forfeiture" (within the meaning given to such
term under Code Section 83) and restrictions on transfer. In the
Restricted Stock Agreement, the Committee may apply any restrictions to
the dividends that the Committee deems appropriate. Without limiting
the generality of the preceding sentence, if the grant or vesting of
Shares of Restricted Stock for a Covered Employee is designed to comply
with the requirements of the Performance-Based Exception, the Committee
may apply any restrictions that it deems appropriate to the payment of
dividends declared with respect to such Shares of Restricted Stock,
such that the dividends and/or the Shares of Restricted Stock maintain
eligibility for the Performance-Based Exception. In the event that any
dividend constitutes a derivative security or an equity security
pursuant to the rules under Section 16 of the Exchange Act, if
applicable, such dividend shall be subject to a vesting period equal to
the remaining vesting period of the Shares of Restricted Stock with
respect to which the dividend is paid.
As determined by the Committee, Shares awarded pursuant to a
grant of Restricted Stock may be issued in the name of the Grantee and
held, together with a stock powers
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<PAGE> 14
endorsed by the Grantee in blank, by the Committee or the Secretary of
the Company (or their delegates) as a depository for safekeeping until
such time as the forfeiture restrictions and restrictions on transfer
have lapsed. All such terms and conditions shall be set forth in the
particular Grantee's Restricted Stock Agreement. The Company or
Committee shall issue to the Grantee a receipt evidencing the
certificates held by it which are registered in the name of the
Grantee.
2.2 RESTRICTIONS
(a) FORFEITURE OF RESTRICTED STOCK. Restricted Stock
awarded to a Grantee may be subject to the following restrictions until
the expiration of the Restriction Period: (i) a restriction that
constitutes a "substantial risk of forfeiture" (as defined in Code
Section 83), or a restriction on transferability under Code Section 83,
and (ii) any other restrictions that the Committee determines are
appropriate, including, without limitation, rights of repurchase or
first refusal in the Company or provisions subjecting the Restricted
Stock to a continuing substantial risk of forfeiture in the hands of
any transferee. Any such restrictions shall be set forth in the
particular Grantee's Restricted Stock Agreement.
(b) ISSUANCE OF CERTIFICATES. Coincident with or promptly
after the grant date with respect to Shares of Restricted Stock, the
Company shall cause to be issued a stock certificate, registered in the
name of the Grantee to whom such Restricted Stock was granted,
evidencing such Shares; provided, however, that the Company shall not
cause to be issued such a stock certificate unless it has received a
stock power duly endorsed in blank by the Grantee with respect to such
Shares. Each such stock certificate shall bear the following legend or
any other legend approved by the Company:
THE TRANSFERABILITY OF THIS CERTIFICATE AND THE SHARES OF
STOCK REPRESENTED HEREBY ARE SUBJECT TO THE RESTRICTIONS,
TERMS AND CONDITIONS (INCLUDING FORFEITURE AND RESTRICTIONS
AGAINST TRANSFER) CONTAINED IN THE VERITAS DGC INC. RESTRICTED
STOCK PLAN AND A RESTRICTED STOCK AGREEMENT DATED
_______________, ____ BETWEEN THE REGISTERED OWNER OF SUCH
SHARES AND VERITAS DGC INC. RESTRICTIONS ON THE RIGHT TO OWN
OR TRANSFER THE SHARES OF STOCK REPRESENTED BY THIS
CERTIFICATE HAVE BEEN IMPOSED PURSUANT TO SAID RESTRICTED
STOCK AGREEMENT. A COPY OF THE RESTRICTED STOCK AGREEMENT IS
ON FILE AT THE PRINCIPAL OFFICE OF THE COMPANY AND WILL BE
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<PAGE> 15
FURNISHED WITHOUT CHARGE TO THE HOLDER OF THIS CERTIFICATE
UPON RECEIPT BY THE COMPANY AT ITS PRINCIPAL PLACE OF BUSINESS
OR REGISTERED OFFICE OF A WRITTEN REQUEST FROM THE HOLDER
REQUESTING SUCH COPY.
Such legend shall not be removed from the certificate evidencing such
Shares of Restricted Stock until such Shares vest pursuant to the terms
of the Restricted Stock Agreement.
(c) REMOVAL OF RESTRICTIONS. The Committee, in its
discretion, shall have the authority to remove any or all of the
restrictions on the Restricted Stock if it determines that, by reason
of a change in applicable law or another change in circumstance arising
after the grant date of the Restricted Stock, such action is
appropriate.
2.3 DELIVERY OF SHARES OF COMMON STOCK
Subject to withholding taxes under Section 4.3 and to the terms of the
Restricted Stock Agreement, a stock certificate evidencing the Shares of
Restricted Stock with respect to which the restrictions in the Restricted Stock
Agreement have lapsed or otherwise been satisfied shall be delivered to the
Grantee or other appropriate recipient free of restrictions. Such delivery shall
be effected for all purposes when the Company shall have deposited such
certificate in the United States mail, addressed to the Grantee or other
appropriate recipient.
2.4 SUPPLEMENTAL PAYMENT ON VESTING OF RESTRICTED STOCK
The Committee, either at the time of grant or vesting of Restricted
Stock, may provide for a Supplemental Payment by the Company to the holder in an
amount specified by the Committee, which amount shall not exceed the amount
necessary to pay the federal and state income tax payable with respect to both
the vesting of the Restricted Stock and receipt of the Supplemental Payment,
(assuming the Grantee is taxed at either the maximum effective income tax rate
applicable thereto) or at a lower tax rate deemed appropriate by the Committee.
The Committee shall have the discretion to grant Supplemental Payments that are
payable solely in cash or Supplemental Payments that are payable in cash, Common
Stock, or a combination of both, as determined by the Committee at the time of
payment.
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SECTION 3.
PROVISIONS RELATING TO PLAN PARTICIPATION
3.1 PLAN CONDITIONS
(a) RESTRICTED STOCK AGREEMENT. Each Grantee to whom an
Incentive Award is granted shall be required to enter into a Restricted
Stock Agreement with the Company, in such a form as is provided by the
Committee. The Restricted Stock Agreement shall contain specific terms
as determined by the Committee, in its discretion, with respect to the
Grantee's particular Incentive Award. Such terms need not be uniform
among all Grantees or any similarly-situated Grantees. The Restricted
Stock Agreement may include, without limitation, vesting, forfeiture
and other provisions particular to the particular Grantee's Incentive
Award, as well as, for example, provisions to the effect that the
Grantee (i) shall not disclose any confidential information acquired
during Employment with the Company, (ii) shall abide by all the terms
and conditions of the Plan and such other terms and conditions as may
be imposed by the Committee, (iii) shall not interfere with the
employment or other service of any employee, (iv) shall not compete
with the Company or become involved in a conflict of interest with the
interests of the Company, (v) shall forfeit an Incentive Award if
terminated for Cause, (vi) shall not be permitted to make an election
under Section 83(b) of the Code when applicable, and (vii) shall be
subject to any other agreement between the Grantee and the Company
regarding Shares that may be acquired under an Incentive Award
including, without limitation, an agreement restricting the
transferability of Shares by Grantee. A Restricted Stock Agreement
shall include such terms and conditions as are determined by the
Committee, in its discretion, to be appropriate with respect to any
individual Grantee. The Restricted Stock Agreement shall be signed by
the Grantee to whom the Incentive Award is made and by an Authorized
Officer.
(b) NO RIGHT TO EMPLOYMENT. Nothing in the Plan or any
instrument executed pursuant to the Plan shall create any Employment
rights (including without limitation, rights to continued Employment)
in any Grantee or affect the right of the Company to terminate the
Employment of any Grantee at any time without regard to the existence
of the Plan.
(c) SECURITIES REQUIREMENTS. The Company shall be under
no obligation to effect the registration pursuant to the Securities Act
of 1933 of any Shares of Common Stock to be issued hereunder or to
effect similar compliance under any state laws. Notwithstanding
anything herein to the contrary, the Company shall not be obligated to
cause to be issued or delivered any certificates evidencing Shares
pursuant to the Plan unless and until the Company is advised by its
legal counsel that the issuance and delivery of such certificates is in
compliance with all applicable laws, regulations of governmental
authorities, and the
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requirements of any securities exchange on which Shares are traded. The
Committee may require, as a condition of the issuance and delivery of
certificates evidencing Shares pursuant to the terms hereof, that the
recipient of such Shares make such covenants, agreements and
representations, and that such certificates bear such legends, as the
Committee, in its discretion, deems to be necessary or desirable.
3.2 TRANSFERABILITY
(a) NON-TRANSFERABLE AWARDS. No Incentive Award and no
right under the Plan, contingent or otherwise, will be (i) assignable,
saleable, or otherwise transferable by a Grantee except by will or by
the laws of descent and distribution, or (ii) subject to any
encumbrance, pledge, lien, assignment or charge of any nature.
No transfer by will or by the laws of descent and distribution
shall be effective to bind the Company unless the Committee has been
furnished with a copy of the deceased Grantee's enforceable will or
such other evidence as the Committee deems necessary to establish the
validity of the transfer. Any attempted transfer in violation of this
Section 3.2(a) shall be void and ineffective.
(b) ABILITY TO EXERCISE RIGHTS. Subject to a valid
beneficiary designation pursuant to Section 4.5, only the Grantee (or
his legal guardian in the event of Grantee's Disability), or in the
event of his death, his estate, may assume any rights of the Grantee
hereunder.
3.3 RIGHTS AS A STOCKHOLDER
(a) STOCKHOLDER RIGHTS. Except as otherwise provided in
his Restricted Stock Agreement for the grant of Restricted Stock, the
Grantee (or a permitted transferee of such Grantee) shall have voting
and other rights as a stockholder with respect to such Shares of
Restricted Stock prior to the lapse of any restrictions thereon.
(b) REPRESENTATION OF OWNERSHIP. In the case of the
exercise of an Incentive Award by a person or estate acquiring the
right to exercise such Incentive Award by reason of the death or
Disability of a Grantee, the Committee may require evidence as to the
ownership of such Incentive Award, or the authority of such person, and
may require such consents and releases of taxing authorities as the
Committee deems advisable.
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3.4 LISTING AND REGISTRATION OF SHARES OF COMMON STOCK
The exercise of any Incentive Award granted hereunder shall only be
effective at such time as legal counsel to the Company shall have determined
that the issuance and delivery of Shares of Common Stock pursuant to such
exercise is in compliance with all applicable laws, regulations of governmental
authorities and the requirements of any securities exchange on which Shares are
traded. The Committee may, in its discretion, defer the effectiveness of any
exercise of an Incentive Award in order to allow the issuance of Shares to be
made pursuant to registration or an exemption from registration or other methods
for compliance available under federal or state securities laws. The Committee
shall inform the Grantee in writing of its decision to defer the effectiveness
of the exercise of an Incentive Award. During the period that the effectiveness
of an Incentive Award has been deferred, the Grantee may, by written notice to
the Committee, withdraw such exercise and obtain the refund of any amount paid
with respect thereto.
3.5 CHANGE IN STOCK AND ADJUSTMENTS
(a) CHANGES IN LAW OR CIRCUMSTANCES. Subject to Section
3.7 (which only applies in the event of a Change in Control), in the
event of any change in applicable laws or any change in circumstances
which results in or would result in any dilution of the rights granted
under the Plan, or which otherwise warrants equitable adjustment
because it interferes with the intended operation of the Plan, then, if
the Committee should determine, in its absolute discretion, that such
change equitably requires an adjustment in the number or kind of shares
of stock or other securities or property theretofore subject, or which
may become subject, to issuance or transfer under the Plan or in the
terms and conditions of outstanding Incentive Awards, such adjustment
shall be made in accordance with such determination. Such adjustments
may include changes with respect to (i) the aggregate number of Shares
that may be issued under the Plan, (ii) the number of Shares subject to
Incentive Awards, and (iii) the price per Share for outstanding
Incentive Awards.
(b) EXERCISE OF CORPORATE POWERS. The existence of the
Plan or outstanding Incentive Awards hereunder shall not affect in any
way the right or power of the Company or its stockholders to make or
authorize any or all adjustments, recapitalization, reorganization or
other changes in the Company's capital structure or its business or any
merger or consolidation of the Company, or any issue of bonds,
debentures, preferred or prior preference stocks ahead of or affecting
the Common Stock or the rights thereof, or the dissolution or
liquidation of the Company, or any sale or transfer of all or any part
of its assets or business, or any other corporate act or proceeding
whether of a similar character or otherwise.
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(c) RECAPITALIZATION OF THE COMPANY. Subject to Section
3.7, if while there are Incentive Awards outstanding, the Company shall
effect any subdivision or consolidation of Shares of Common Stock or
other capital readjustment, the payment of a stock dividend, stock
split, combination of Shares, recapitalization or other increase or
reduction in the number of Shares outstanding, without receiving
compensation therefor in money, services or property, then the number
of Shares available under the Plan and the number of Incentive Awards
which may thereafter be exercised shall (i) in the event of an increase
in the number of Shares outstanding, be proportionately increased and
the Fair Market Value of the Incentive Awards awarded shall be
proportionately reduced; and (ii) in the event of a reduction in the
number of Shares outstanding, be proportionately reduced, and the Fair
Market Value of the Incentive Awards awarded shall be proportionately
increased. The Committee shall take such action and whatever other
action it deems appropriate, in its discretion, so that the value of
each outstanding Incentive Award to the Grantee shall not be adversely
affected by a corporate event described in this subsection (c).
(d) REORGANIZATION OF THE COMPANY. Subject to Section
3.7, if the Company is reorganized, merged or consolidated, or is a
party to a plan of exchange with another corporation, pursuant to which
reorganization, merger, consolidation or exchange, stockholders of the
Company receive any Shares of Common Stock or other securities or
property, or if the Company should distribute securities of another
corporation to its stockholders, each Grantee shall be entitled to
receive, in lieu of the number of Restricted Stock shares, with a
corresponding adjustment to the Fair Market Value of said Incentive
Awards, to which he would have been entitled if, immediately prior to
such corporate action, such Grantee had been the holder of record of a
number of Shares equal to the number of the outstanding Incentive
Awards payable in Shares that were previously awarded to him. For this
purpose, Shares of Restricted Stock shall be treated the same as
unrestricted outstanding Shares of Common Stock. In this regard, the
Committee shall take whatever other action it deems appropriate to
preserve the rights of Grantees holding outstanding Incentive Awards.
(e) ISSUE OF COMMON STOCK BY THE COMPANY. Except as
hereinabove expressly provided in this Section 4.5 and subject to
Section 3.7, the issue by the Company of shares of stock of any class,
or securities convertible into shares of stock of any class, for cash
or property, or for labor or services, either upon direct sale or upon
the exercise of rights or warrants to subscribe therefor, or upon any
conversion of shares or obligations of the Company convertible into
such shares or other securities, shall not affect, and no adjustment by
reason thereof shall be made with respect to, the number of, or Fair
Market Value of, any Incentive Awards then outstanding under previously
granted Incentive Awards; provided, however, in such event, outstanding
Shares of Restricted Stock shall be treated the same as outstanding
unrestricted Shares of Common Stock.
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<PAGE> 20
(f) ACQUISITION OF THE COMPANY. Subject to Section 3.7,
in the case of any sale of assets, merger, consolidation or combination
of the Company with or into another corporation other than a
transaction in which the Company is the continuing or surviving
corporation and which does not result in the outstanding Shares being
converted into or exchanged for different securities, cash or other
property, or any combination thereof (an "Acquisition"), in the
absolute discretion of the Committee, any Grantee who holds an
outstanding Incentive Award shall have the right (subject to any
limitation applicable to the Incentive Award) thereafter and during the
term of the Incentive Award, to receive upon exercise thereof the
Acquisition Consideration (as defined below) receivable upon the
Acquisition by a holder of the number of Shares which would have been
obtained upon exercise of the Incentive Award immediately prior to the
Acquisition. The term "Acquisition Consideration" shall mean the kind
and amount of shares of the surviving or new corporation, cash,
securities, evidence of indebtedness, other property or any combination
thereof receivable in respect of one Share upon consummation of an
Acquisition. The Committee, in its discretion, shall have the authority
to take whatever action it deems appropriate to effectuate the
provisions of this subsection (f).
(g) ASSUMPTION UNDER THE PLAN OF OTHER RESTRICTED STOCK
AWARDS. The Committee, in its absolute discretion, may authorize the
assumption and continuation under the Plan of outstanding stock-based
incentive awards that were granted under a plan or agreement that is or
was maintained by a corporation or other entity that was merged into,
consolidated with, or whose stock or assets were acquired by, the
Company as the surviving corporation. Any such action shall be upon
such terms and conditions as the Committee, in its discretion, may deem
appropriate, including provisions to preserve the holder's rights under
the previously granted stock-based restricted stock award. Any such
assumption and continuation of any such previously granted and
unexercised restricted stock award shall be treated as an outstanding
Incentive Award under the Plan and shall thus count against the number
of Shares reserved for issuance pursuant to Section 1.4.
(h) ASSUMPTION OF INCENTIVE AWARDS BY A SUCCESSOR. In the
event of a dissolution or liquidation of the Company, a sale of all or
substantially all of the Company's assets, a merger or consolidation
involving the Company in which the Company is not the surviving
corporation, or a merger or consolidation involving the Company in
which the Company is the surviving corporation but the holders of
Shares of Common Stock receive securities of another corporation and/or
other property, including cash, the Committee shall, in its absolute
discretion, have the right and power to:
(i) cancel, effective immediately prior to the
occurrence of such corporate event, each outstanding Incentive
Award (whether or not then exercisable), and, in full
consideration of such cancellation, pay to the Grantee to whom
such Incentive
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Award was granted an amount in cash equal to the excess of (A)
the value, as determined by the Committee, of the property
(including cash) received by the holder of a Share of Common
Stock as a result of such event over (B) the Grantee's
purchase price, if any, under such Incentive Award; or
(ii) provide for the exchange of each Incentive
Award outstanding immediately prior to such corporate event
(whether or not then exercisable) for another award on some or
all of the property for which such Incentive Award is
exchanged and, incident thereto, make an equitable adjustment
as determined by the Committee, in its discretion, in the
purchase price of the Incentive Award, or the number of Shares
or amount of cash subject to the Incentive Award or, if deemed
appropriate, provide for a cash payment to the Grantee in
consideration for the exchange of his Incentive Award.
The Committee, in its discretion, shall have the authority to take
whatever action it deems appropriate to effectuate the provisions of
this subsection (h).
3.6 TERMINATION OF EMPLOYMENT, DEATH AND DISABILITY
(a) TERMINATION OF EMPLOYMENT. Unless otherwise expressly
provided in his Restricted Stock Agreement, if the Grantee's Employment
is terminated for Retirement or any other reason except due to his
death or Disability, any non-vested portion of his outstanding
Incentive Award at the time of such termination shall automatically
expire and terminate and no further vesting shall occur.
(b) DISABILITY OR DEATH. Unless otherwise expressly
provided in his Restricted Stock Agreement, upon termination of
Employment as a result of the Grantee's Disability or death, any
nonvested portion of his Incentive Award shall become 100% vested upon
termination of Employment.
(c) CONTINUATION OF INCENTIVE AWARD. Subject to
applicable law, in the event that a Grantee ceases to be an Employee,
for whatever reason, the Committee and Grantee may mutually agree with
respect to any outstanding Incentive Award then held by the Grantee (i)
for an acceleration or other adjustment in any vesting schedule
applicable to the Incentive Award or (ii) to any other change in the
terms and conditions of the Incentive Award. In the event of any such
change to an outstanding Incentive Award, a written amendment to the
Grantee's Restricted Stock Agreement shall be required.
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3.7 CHANGE IN CONTROL
Notwithstanding any contrary provision in the Plan, in the event of a
Change in Control (as defined below), the following actions shall automatically
occur as of the day immediately preceding the Change in Control date unless
otherwise expressly provided in the Grantee's Restricted Stock Agreement:
(a) all of the restrictions and conditions of any
Incentive Award then outstanding shall be deemed satisfied, and the
Restriction Period with respect thereto shall be deemed to have lapsed
and expired; and
(b) all Restricted Stock shall be 100% vested and deemed
earned in full.
Notwithstanding any other provision of this Plan, unless expressly
provided otherwise in the Grantee's Restricted Stock Agreement, the provisions
of this Section 3.7 may not be terminated, amended, or modified to adversely
affect any Incentive Award theretofore granted under the Plan without the prior
written consent of the Grantee with respect to his outstanding Incentive Award
subject, however, to the last paragraph of this Section 3.7.
For all purposes of the Plan, a "CHANGE IN CONTROL" of the Company
shall mean:
(a) The acquisition by an individual, entity or group
(within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act
(a "PERSON") of beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of thirty percent (30%) or more of
the total voting power of all the Company's then outstanding securities
entitled to vote generally in the election of directors to the Board;
provided, however, that for purposes of this subsection (a), the
following acquisitions shall not constitute a Change in Control: (i)
any acquisition by the Company or its Parent or Subsidiaries, (ii) any
acquisition by any employee benefit plan (or related trust) sponsored
or maintained by the Company or its Parent or Subsidiaries, or (iii)
any acquisition consummated with the prior approval of the Board; or
(b) During the period of two consecutive calendar years,
individuals who at the beginning of such period constitute the Board,
and any new director(s) whose election by the Board or nomination for
election by the Company's shareholders was approved by a vote of at
least two-thirds of the directors then still in office, who either were
directors at the beginning of the two-year period or whose election or
nomination for election was previously so approved, cease for any
reason to constitute a majority of the Board; or
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(c) The Company becomes a party to a merger, plan of
reorganization, consolidation or share exchange in which either (i) the
Company will not be the surviving corporation or (ii) the Company will
be the surviving corporation and any outstanding shares of the
Company's common stock will be converted into shares of any other
company (other than a reincorporation or the establishment of a holding
company involving no change of ownership of the Company) or other
securities, cash or other property (excluding payments made solely for
fractional shares); or
(d) The shareholders of the Company approve a merger,
plan of reorganization, consolidation or share exchange with any other
corporation, and immediately following such merger, plan of
reorganization, consolidation or share exchange the holders of the
voting securities of the Company outstanding immediately prior thereto
hold securities representing fifty percent (50%) or less of the
combined voting power of the voting securities of the Company or such
surviving entity outstanding immediately after such merger, plan of
reorganization, consolidation or share exchange; provided, however,
that notwithstanding the foregoing, no Change in Control shall be
deemed to have occurred if one-half (1/2) or more of the members of the
Board of the Company or such surviving entity immediately after such
merger, plan of reorganization, consolidation or share exchange is
comprised of persons who served as directors of the Company immediately
prior to such merger, plan of reorganization, consolidation or share
exchange or who are otherwise designees of the Company; or
(e) Upon approval by the Company's shareholders of a
complete liquidation and dissolution of the Company or the sale or
other disposition of all or substantially all of the assets of the
Company other than to a Parent or Subsidiary; or
(f) Any other event that a majority of the Board, in its
sole discretion, shall determine constitutes a Change in Control.
Notwithstanding the occurrence of any of the foregoing events of this
Section 3.7 which would otherwise result in a Change in Control, the Board may
determine in its complete discretion, if it deems it to be in the best interest
of the Company, that an event or events otherwise constituting a Change in
Control shall not be considered a Change in Control. Such determination shall be
effective only if it is made by the Board prior to the occurrence of an event
that otherwise would be a Change in Control, or after such event if made by the
Board a majority of which is composed of directors who were members of the Board
immediately prior to the event that otherwise would be a Change in Control.
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3.8 EXCHANGE OF INCENTIVE AWARDS
The Committee may, in its discretion, permit any Grantee to surrender
outstanding Incentive Awards in order to exercise or realize his rights under
other Incentive Awards or in exchange for the grant of new Incentive Awards, or
require holders of Incentive Awards to surrender outstanding Incentive Awards
(or comparable rights under other plans or arrangements) as a condition
precedent to the grant of new Incentive Awards.
3.9 FINANCING
The Company may extend and maintain, or arrange for and guarantee, the
extension and maintenance of financing to any Grantee to purchase Shares
pursuant to exercise of an Incentive Award upon such terms as are approved by
the Committee in its discretion.
SECTION 4.
GENERAL
4.1 EFFECTIVE DATE AND GRANT PERIOD
This Plan is adopted by the Board effective as of the Effective Date.
Unless sooner terminated by the Board, no Incentive Award shall be granted under
the Plan after ten (10) years from the Effective Date.
4.2 FUNDING AND LIABILITY OF COMPANY
No provision of the Plan shall require the Company, for the purpose of
satisfying any obligations under the Plan, to purchase assets or place any
assets in a trust or other entity to which contributions are made, or otherwise
to segregate any assets. In addition, the Company shall not be required to
maintain separate bank accounts, books, records or other evidence of the
existence of a segregated or separately maintained or administered fund for
purposes of the Plan. The Company shall not be required to segregate any assets
that may at any time be represented by cash, Common Stock or rights thereto. The
Plan shall not be construed as providing for such segregation, nor shall the
Company, the Board or the Committee be deemed to be a trustee of any cash,
Common Stock or rights thereto. Any liability or obligation of the Company to
any Grantee with respect to an Incentive Award shall be based solely upon any
contractual obligations that may be created by this Plan and any Restricted
Stock Agreement, and no such liability or obligation of the Company shall be
deemed to be secured by any pledge or other encumbrance on any property of the
Company.
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Neither the Company, the Board nor the Committee shall be required to give any
security or bond for the performance of any obligation that may be created by
the Plan.
4.3 WITHHOLDING TAXES
(a) TAX WITHHOLDING. The Company shall have the power and
the right to deduct or withhold, or require a Grantee to remit to the
Company, an amount sufficient to satisfy federal, state, and local
taxes, domestic or foreign, required by law or regulation to be
withheld with respect to any taxable event arising as a result of an
Incentive Award.
(b) SHARE WITHHOLDING. With respect to tax withholding
required upon the lapse of restrictions on Shares of Restricted Stock,
or upon any other taxable event arising as a result of any Incentive
Awards, Grantees may elect, subject to the approval of the Committee in
its discretion, to satisfy the withholding requirement, in whole or in
part, by having the Company withhold Shares having a Fair Market Value
on the date the tax is to be determined equal to the minimum statutory
total tax which could be imposed on the transaction. All such elections
shall be made in writing, signed by the Grantee, and shall be subject
to any restrictions or limitations that the Committee, in its
discretion, deems appropriate.
(c) LOANS. The Committee, in its discretion, may provide
for loans, on either a short term or demand basis, from the Company to
a Grantee to permit the payment of taxes required by law.
4.4 NO GUARANTEE OF TAX CONSEQUENCES
Neither the Company nor the Committee makes any commitment or guarantee
that any federal, state or local tax treatment will apply or be available to any
person participating or eligible to participate hereunder.
4.5 DESIGNATION OF BENEFICIARY BY PARTICIPANT
Each Grantee may, from time to time, name any beneficiary or
beneficiaries (who may be named contingently or successively) to whom any
benefit under any Incentive Award is to be paid in case of his death before he
receives any or all of such benefit. Each such designation shall revoke all
prior designations by the same Grantee, shall be in a form prescribed by the
Committee, and will be effective only when filed by the Grantee in writing with
the Committee during the Grantee's lifetime.
A Grantee may, from time to time, revoke or change his beneficiary
designation by filing a new designation form with the Committee (or its
delegate). The last valid designation received shall
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be controlling; provided, however, that no beneficiary designation, or change or
revocation thereof, shall be effective unless received prior to the Grantee's
death and in no event shall it be effective as of a date prior to its receipt.
Notwithstanding any contrary provision of this Section 4.5, no beneficiary
designation made by a married Grantee, other than one under which the surviving
lawful spouse of such Grantee is designated as the sole beneficiary, shall be
valid and effective without the written consent of such spouse.
If no valid and effective beneficiary designation exists at the time of
the Grantee's death, or if no designated beneficiary survives the Grantee, or if
such designation conflicts with applicable law, the payment of the Grantee's
Incentive Award, if earned and payable hereunder, shall be made to the Grantee's
surviving lawful spouse, if any, of if there is no such surviving spouse, to the
executor or administrator of his estate. If the Committee is in doubt as to the
right of any person to receive such amount, the Committee may direct that the
amount be paid into any court of competent jurisdiction in an interpleader
action, and such payment shall be a full and complete discharge of any liability
or obligation of the Plan, Company, Committee or Board therefor.
4.6 DEFERRALS
The Committee, in its discretion, may permit a Grantee to defer his
receipt of the payment of cash or the delivery of Shares that would otherwise be
due to such Grantee by virtue of the lapse or waiver of restrictions with
respect to Restricted Stock. If any such deferral election is permitted, the
Committee shall, in its discretion, establish rules and procedures for such
payment deferrals to the extent consistent with the Code and upon advice of
counsel.
4.7 AMENDMENT AND TERMINATION
The Board shall have the plenary power and authority to terminate or
amend the Plan at any time. No termination, amendment, or modification of the
Plan shall adversely affect in any material way any outstanding Incentive Award
previously granted to a Grantee under the Plan, without the written consent of
such Grantee or other designated holder of such Incentive Award.
To the extent that the Committee determines that (a) the listing for
qualification requirements of any national securities exchange or quotation
system on which the Company's Common Stock is then listed or quoted, if
applicable, (b) Rule 16b-3 under the Exchange Act or other requirements of
applicable securities laws, regulations or rules, or (c) the Code (or
regulations promulgated thereunder), require stockholder approval in order to
maintain compliance with such listing or securities requirements or to maintain
any favorable tax advantages or qualifications, then the Plan shall not be
amended in such respect without approval of the Company's stockholders.
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4.8 REQUIREMENTS OF LAW
The granting of Incentive Awards and the issuance of Shares under the
Plan shall be subject to all applicable laws, rules, and regulations, and to
such approvals by any governmental agencies or national securities exchanges as
may be required. Certificates evidencing shares of Common Stock delivered under
this Plan (to the extent that such shares are so evidenced) may be subject to
such stop transfer orders and other restrictions as the Committee may deem
advisable under the rules and regulations of the Securities and Exchange
Commission, any securities exchange or transaction reporting system upon which
the Common Stock is then listed or to which it is admitted for quotation, and
any applicable federal or state securities law. The Committee may cause a legend
or legends to be placed upon such certificates to make appropriate reference to
such restrictions.
4.9 RULE 16B-3 SECURITIES LAW COMPLIANCE
With respect to Insiders, to the extent applicable, as determined by
the Committee, transactions under the Plan are intended to comply with all
applicable conditions of Rule 16b-3 under the Exchange Act. Any ambiguities or
inconsistencies in the construction of an Incentive Award or the Plan shall be
interpreted to give effect to such intention. However, to the extent any
provision of the Plan or action by the Committee fails to so comply, it shall be
deemed null and void to the extent permitted by law and deemed advisable by the
Committee in its discretion.
4.10 SUCCESSORS
All obligations of the Company under the Plan with respect to Incentive
Awards granted hereunder shall be binding on any successor to the Company,
whether the existence of such successor is the result of a direct or indirect
purchase, merger, consolidation, or otherwise, of all or substantially all of
the business and/or assets of the Company.
4.11 MISCELLANEOUS PROVISIONS
(a) No Employee shall have any claim or right to be
granted an Incentive Award under the Plan. Neither the Plan, nor any
action taken hereunder, shall be construed as giving any Employee any
right to be retained in Employment.
(b) No Shares of Common Stock shall be issued hereunder
unless counsel for the Company is then satisfied that such issuance
will be in compliance with federal and state securities laws.
(c) The expenses of the Plan shall be borne by the
Company.
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(d) By accepting any Incentive Award, each Grantee and
each person claiming by or through him shall be deemed to have
indicated his acceptance of the Plan.
4.12 SEVERABILITY
In the event that any provision of this Plan shall be held illegal,
invalid or unenforceable for any reason, such provision shall be fully
severable, but shall not affect the remaining provisions of the Plan, and the
Plan shall be construed and enforced as if the illegal, invalid, or
unenforceable provision was not included herein.
4.13 GENDER, TENSE AND HEADINGS
Whenever the context so requires, words of the masculine gender used
herein shall include the feminine and neuter, and words used in the singular
shall include the plural. Section headings as used herein are inserted solely
for convenience and reference and constitute no part of the interpretation or
construction of the Plan.
4.14 GOVERNING LAW
The Plan shall be interpreted, construed and constructed in accordance
with the laws of the State of Texas without regard to its conflicts of law
provisions, except as may be superseded by applicable laws of the United States.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, Veritas DGC Inc. has caused this Plan to be duly
executed in its name and on its behalf by its duly authorized officer.
VERITAS DGC INC.
By: /s/ Anthony Tripodo
-------------------------------------------
Name: Anthony Tripodo
-----------------------------------------
Title: Executive Vice President and Chief
Financial Officer
----------------------------------------
25
<PAGE> 30
June 24, 1998
Veritas DGC Inc.
3701 Kirby Drive, Suite 112
Houston, Texas 77098
Re: VERITAS DGC INC. REGISTRATION STATEMENT ON FORM S-8:
RESTRICTED STOCK PLAN
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"), issuable pursuant to the Restricted Stock Plan 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 issuance 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
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/ PRICE WATERHOUSE LLP
PRICE WATERHOUSE LLP
Houston, Texas
June 24, 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/ PRICE WATERHOUSE
PRICE WATERHOUSE
Chartered Accountants
Calgary, Alberta
June 24, 1998
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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
June 24, 1998
