As filed with the Securities and Exchange Commission on June 20, 1995
Registration No. 33-________
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
PSC INC.
(Exact name of Registrant as specified in its charter)
New York 16-0969362
(State or other jurisdiction of (IRS Employer Identification Number)
incorporation or organization)
675 Basket Road, Webster, New York 14580
(716) 265-1600
(Address, including zip code, and telephone number, including
area code, of Registrant's principal executive office)
PSC Inc.
1994 Stock Option Plan
(Full title of plan)
L. Michael Hone
President and Chief Executive Officer
PSC Inc.
675 Basket Road
Webster, NY 14580
Telephone: (716) 265-1600
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copy to:
Martin S. Weingarten, Esq.
Boylan, Brown, Code, Fowler, Vigdor & Wilson, LLP
900 Midtown Tower
Rochester, NY 14604
Page 1 of 45 Pages
Exhibit Index at Page 9
<PAGE>
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Maximum Maximum
Title of Offering Aggregate Amount of
Securities to Amount to be Price Per Offering Registration
be Registered Registered (1) Share (2) Price (2) Fee
- ------------- -------------- ----------- ---------- ----------
Common Shares, 1,750,000 shares $12.50 $21,875,000 $7,543.10
$.01 par value
(1) The number of Common Shares to be registered may be adjusted in
accordance with the provisions of the 1994 Stock Option Plan in the event that,
during the period the 1994 Stock Option Plan is in effect, there is effected any
increase or decrease in the number of issued Common Shares resulting from a
subdivision or consolidation of shares or the payment of a stock dividend or any
other increase or decrease in the number of shares or the payment of a stock
dividend or any other increase or decrease in the number of such shares effected
without receipt of consideration by the Company. Accordingly, this Registration
Statement covers, in addition to the number of Common Shares stated above, an
indeterminate number of shares which by reason of any such events may be issued
in accordance with the provisions of the 1994 Stock Option Plan.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457 under the Securities Act of 1933 and based upon the average
of the high and low sales prices for the Common Shares as reported on the Nasdaq
National Market on June 15, 1995.
<PAGE>
PART II
Information Not Required in Prospectus
Item 3. Incorporation of Documents by Reference.
PSC Inc. (the "Company") hereby incorporates by reference in this
Registration Statement the following documents:
(a) The Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1994.
(b) The Company's Quarterly Report on Form 10-Q for the quarter ended March
31, 1995.
(c) The Company's Current Report on Form 8-K dated December 21, 1994, as
amended on March 2, 1995.
(d) The description of the Company's Common Shares contained in the
Company's Registration Statement on Form 8-A filed by the Company with the
Securities and Exchange Commission on August 31, 1981.
All documents subsequently filed by the Company pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), prior to the filing of a post-effective amendment to this
Registration Statement which indicates that all securities offered hereby have
been sold or which deregisters all securities remaining unsold, shall be deemed
to be incorporated by reference in this Registration Statement and to be a part
hereof from the date of filing of such documents.
Item 4. Description of Securities
The class of securities to be offered is registered under Section 12 of the
Exchange Act.
Item 5. Interests of Named Experts and Counsel.
Legal matters in connection with options under the 1994 Stock Option Plan
and the Common Shares offered thereunder will be passed upon by Messrs. Boylan,
Brown, Code, Fowler, Vigdor & Wilson, LLP, 900 Midtown Tower, Rochester, NY
14604. Justin L. Vigdor, a partner of this firm, is a director of the Company,
and Martin S. Weingarten, counsel to this firm, is Secretary of the Company.
Members of Boylan, Brown, Code, Fowler, Vigdor & Wilson, LLP beneficially own
14,555 Common Shares of the Company.
<PAGE>
Item 6. Indemnification of Directors and Officers
The Company's Certificate of Incorporation (the "Certificate") provides
that no director of the Company shall be liable to the Company or its
shareholders for monetary damages for any breach of fiduciary duty as a director
except that such liability is not eliminated or limited to breaches of such duty
that result (as established by a judgment or other final adjudication adverse to
the director) from acts or omissions in bad faith or in violation of Section 719
of the New York Business Corporation Law (the "BCL") or involving intentional
misconduct or a knowing violation of law or from which (as so established) such
advantage to which he was not legally entitled. Section 719 of the BCL specifies
certain corporate transactions, such as certain dividend declarations and
dispositions of assets, as unlawful. The effect of this provision of the
Certificate is to eliminate the rights of the Company and its shareholders
(through shareholders' derivative suits on behalf of the Company) to recover
monetary damages against a director for breach of a fiduciary duty of care as a
director. This provision does not limit or eliminate the rights of the Company
or any shareholder to seek non-monetary relief, such as an injunction or
rescission in the event of a breach of a director's duty of care.
Pursuant to the BCL, the Company has adopted provisions in its by-laws
which require the Company to indemnify its directors and officers to the fullest
extent permitted by New York law, as from time to time in effect. The Company
has also entered into indemnity agreements with each of its executive officers
and directors providing for such indemnification. In addition, the Company
maintains an officers' and directors' liability insurance policy insuring the
covered individuals against acts or omissions taken by such persons in their
capacities as officers or directors.
The following summary describes the principal provisions of the Company's
bylaws concerning indemnification of directors. The indemnification provided by
the by-laws is not exclusive of any other rights to which the indemnified party
may be entitled to under law.
The Company is required, to the full extent authorized or permitted by law,
to indemnify against all judgments, fines, penalties, amounts paid in settlement
and reasonable expenses incurred in connection with actual or threatened
litigation or proceeding, any person made or threatened to be made a party to
any action or proceeding by reason of the fact that he, his testator or
intestate (the "Responsible Person") (i) is or was a director or officer of the
Company, (ii) if a director or officer of the Company, is serving or served, in
any capacity, at the request of the Company, any other corporation or entity, or
(iii) if not a director or officer of the Company, is serving or served, at the
request of the Company, as a director or officer of any other corporation or
entity. The acts of the Responsible Person which were material to the cause of
action must not have been committed in bad faith or have been the result of
active and deliberate dishonesty, and the Responsible Person shall not have
gained a financial profit or other advantage to which he was not legally
entitled. If the acts of the Responsible Person fail to meet the above standard
of conduct, no indemnification will be made.
<PAGE>
The expenses incurred by an indemnified person will be advanced or
reimbursed by the Company if the person provides the Company with an undertaking
to repay the Company if he is ultimately found not to be entitled to
indemnification or if the advances exceed the indemnifications to which he is
entitled.
The by-laws establish the procedures pursuant to which the Board of
Directors will determine, if indemnification has not been ordered by a court,
whether the indemnified person has met the standard of conduct necessary for
indemnification and resolve any dispute over the reasonableness of
indemnification expenses. In addition, if the standard of conduct is met, the
Company is authorized to provide such persons rights to indemnification or
advancement of expenses in addition to those provided for in the by-laws
pursuant to a resolution of the shareholders, a resolution of directors or an
agreement providing for such indemnification.
Any repeal or amendment of the by-laws reducing the extent of the
indemnification of any person who could be a Responsible Person shall not,
without his written consent, apply to any event, act or omission occurring or
allegedly occurring prior to (i) the date of repeal or amendment if on such date
he is not serving in any capacity for which he could be a Responsible Person, or
(ii) the 30th day following delivery of a notice of repeal or amendment as to
any capacity to which he is serving on the date of such repeal or amendment
other than as director or officer of the Company, for which he could be a
Responsible Person, or (iii) the later of the 30th day following the delivery to
him of notice of such repeal or amendment or the end of the term of office, if
he is serving as a director or officer of the Company on the date of such repeal
or amendment, with respect to being a Responsible Person in such capacity. No
amendment of the BCL reducing the extent of permissible indemnification of a
Responsible Person shall be effective as to such person with respect to any
event, act or omission occurring prior to the effective date of the amendment.
Item 7. Exemption from Registration Claimed
Inapplicable.
Item 8. Exhibits
See Exhibit Index.
Item 9. Undertakings
(a) Rule 415 Offering
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
<PAGE>
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in the registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(b) Incorporating Subsequent Exchange Act Documents by Reference
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Indemification for Liabilities arising under the Securities Act of 1933
Insofar as indemnification for liabilities arises under the Securities Act
of 1933 (the "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 Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
<PAGE>
SIGNATURES
Pursuant to the requirement 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 had duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized in the City of Rochester, State of New York on June 19, 1995.
PSC Inc.
By: /s/ L. Michael Hone
L. Michael Hone, President
and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints L. MICHAEL HONE and JUSTIN L. VIGDOR, or either
one of them, as true and lawful attorneys-in-fact, each with full power and
authority to act as such without the other, and with full power of substitution,
for him and in any and all capacities, to sign any amendments to this
Registration Statement, and to file, the same, with exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange Commission,
the undersigned hereby ratifying and confirming all that said attorneys-in-fact,
or either of them or his substitute or substitutes, shall do or cause to be done
by virtue hereof.
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 dates indicated.
Signature Title Date
/s/ L. Michael Hone Director, Chairman of the June 19, 1995
L. Michael Hone Board, President, and
Chief Executive Officer
/s/ William J. Woodard Vice President, Finance June 19, 1995
William J. Woodard and Treasurer
<PAGE>
Controller (Principal
/s/ Scott D. Deverell Accounting Officer) June 19, 1995
Scott D. Deverell
/s/ Milton P. Axelrod Director June 19, 1995
Milton P. Axelrod
/s/ Robert S. Ehrlich Director June 19, 1995
Robert S. Ehrlich
/s/ James W. Henry Director June 19, 1995
James W. Henry
/s/ Donald K. Hess Director June 19, 1995
Donald K. Hess
/s/ James O'Shea Director June 19, 1995
James O'Shea
Director
Jack E. Rosenfeld
/s/ Abby R. Solomon Director June 19, 1995
Abby R. Solomon
/s/ Justin L. Vigdor Director June 19, 1995
Justin L. Vigdor
<PAGE>
EXHIBIT INDEX
Exhibit Sequentially
Number Description Numbered Page
4.1 PSC Inc. 1994 Stock Option Plan 11
4.2 Form of Stock Option Agreement - 24
Incentive Stock Option
4.3 Form of Stock Option Agreement - 30
Nonstatutory Stock Option
4.4 Form of Stock Option Agreement - 36
Non-Employee Director Stock Option
5.1 Opinion and consent of Boylan, 41
Brown, Code, Fowler, Vigdor &
Wilson, LLP, counsel for the
Registrant as to the legality of the
Common Shares being registered
24.1 Consent of Arthur Andersen LLP, 42
Independent Public Accountants
24.2 Consent of Boylan, Brown, Code, 41
Fowler, Vigdor & Wilson, LLP is
contained in their opinion filed as
Exhibit 5.1 to this Registration Statement
PSC INC.
1994 STOCK OPTION PLAN
1. Title and Purpose. The plan described herein shall be known as the
"PSC Inc. 1994 Stock Option Plan" (the "Plan"). The purpose of the Plan is to
advance the interests of PSC Inc. (the "Company") and its shareholders by
strengthening the Company's ability to attract and retain individuals of
training, experience, and ability as officers, key employees, directors and
consultants and to furnish additional incentive to such key individuals to
promote the Company's financial success by providing them with an equity
ownership in the Company commensurate with Company performance, as reflected in
increased shareholder value. It is the intent of the Company that such
individuals be encouraged to obtain and retain an equity interest in the Company
and each Participant will be specifically apprised of said intent.
2. Definitions. As used herein, the following words or terms have the
meaning set forth below.
2.1 "Award" means an award granted to any key employee, officer,
consultant, or Non-Employee Director in accordance with the provisions of the
Plan in the form of Options or Restricted Stock.
2.2 "Award Agreement" means the written agreement evidencing each Award of
Restricted Stock granted under the Plan.
2.3 "Board" means the Board of Directors of the Company, except that,
whenever action is to be taken under the Plan with respect to a Reporting
Person, "Board" shall mean only such directors who are disinterested persons
within the meaning of Rule 16b-3 under the Exchange Act or any successor rule.
2.4 "Code" means the Internal Revenue Code of 1986, as amended from time to
time, or any successor statute.
2.5 "Committee" means the Compensation Committee of the Board or such other
committee as may be designated by the Board to administer the Plan. To the
extent that the Committee delegates its power to grant Options as permitted by
Section 4.2, all references in the Plan to the Committee's authority to grant
Options and determinations with respect thereto shall be deemed to include the
Committee's delegate or delegates.
2.6 "Common Stock" or "Stock" means the Company's $.01 par value Common
Shares.
2.7 "Company" means PSC Inc., a corporation established under the laws of
the State of New York, and its subsidiaries.
2.8 "Designated Beneficiary" means the beneficiary designated by a
Participant, in a manner determined by the Committee, to receive amounts due or
to exercise rights of the Participant in the event of the Participant's death.
In the absence of an effective designation by a Participant, Designated
Beneficiary shall mean the Participant's estate.
<PAGE>
2.9 "Disability" means a physical or mental condition of such a nature that
it would qualify a Participant for benefits under the Company's long-term
disability insurance plan.
2.10 "Disinterested Person" shall have the same meaning as defined in Rule
16b-3(c)(2) promulgated by the Securities and Exchange Commission pursuant to
its authority under the Exchange Act.
2.11 "Exchange Act" means the Securities Exchange Act of 1934, as amended,
or any successor statute.
2.12 "Fair Market Value" in the case of a share of Common Stock on a
particular day, means the closing price per share of the Common Stock on the
Nasdaq National Market for that day, provided at least one sale of said Stock
took place on such exchange on such date, and, if not, then on the basis of the
closing price on the last preceding date on which at least one sale on such
exchange did occur. If the Stock of the Company is not admitted to trading on
any of the aforesaid dates for which closing prices of the Stock are to be
determined, then reference shall be made to the fair market value of the Stock
on that date, as determined on such basis as shall be established or specified
for the purpose by the Committee.
2.13 "Incentive Stock Option" ("ISO") means an Option which is intended to
satisfy the requirements of Section 422 of the Code or any successor provision.
2.14 "Non-Employee Director" means a member of the Board who is not an
employee of the Company or a management consultant to the Company.
2.15 "Non-Employee Director Stock Option" ("NEDSO") means a Nonstatutory
Stock Option granted to a Non-Employee Director of the Company.
2.16 "Nonstatutory Stock Option" ("NSO") means an Option which is not
intended to qualify as an Incentive Stock Option.
2.17 "Option" means any Option granted under the Plan and includes an
Incentive Stock Option, a Nonstatutory Stock Option and a Non-Employee Director
Stock Option.
2.18 "Option Agreement" means the written agreement evidencing each Option
granted under the Plan.
2.19 "Option Price" means the purchase price per share of Common Stock upon
the exercise of an Option.
2.20 "Outside Director" shall have the same meaning as defined or
interpreted for purposes of Section 162(m) of the Code.
<PAGE>
2.21 "Participant" means an individual who has been granted an Award under
the Plan.
2.22 "Reporting Person" means a person required to file reports under
Section 16(a) of the Exchange Act or any successor statute.
2.23 "Restricted Stock" means Stock awarded under Section 9 of the Plan
which is subject to certain forfeiture provisions or restrictions on transfer.
2.24 "Retirement" means termination of employment with the Company if such
termination of employment constitutes normal retirement, early retirement,
disability retirement or other retirement as provided for at the time of such
termination of employment under the applicable retirement program then
maintained by the Company, provided that the Participant does not continue in
the employment of the Company.
3. Shares Subject to the Plan. Subject to adjustment as provided in Section
12 below, an aggregate of 1,750,000 shares of Common Stock shall be available
for Awards under the Plan. Such shares may be authorized but previously unissued
shares or shares reacquired by the Company, including shares purchased in the
open market. In the event that any outstanding Option granted under the Plan for
any reason expires or is terminated without having been exercised in full, or
any shares of Restricted Stock are forfeited, the shares allocable to the
unexercised portion of such Option or the forfeited portion of such Restricted
Stock shall (unless the Plan shall have been terminated) become available for
subsequent Awards under the Plan; provided that in no event may the number of
shares issued hereunder exceed the total number of shares reserved for issuance.
4. Administration of the Plan.
4.1 The Plan shall be administered by the Committee. No individual may be
appointed to the Committee who is not both a Disinterested Person and an Outside
Director. Grants of NEDSOs and the amounts and nature of such Options shall be
automatic as described in Section 8. Subject to the preceding sentence and the
provisions set forth herein, the Committee shall have full authority to
determine the time or times at which, and the officers and key employees of the
Company to whom, Awards shall be granted under the Plan, to determine the
provisions of Awards, to interpret the terms of the Plan and of Awards made
under the Plan, to adopt, amend and rescind rules and guidelines for the
administration of the Plan and for its own acts and proceedings and to decide
all questions and settle all controversies and disputes which may arise in
connection with the Plan. The Committee shall report any action taken by it to
the meeting of the Board next following such action.
4.2 To the extent permitted by applicable law, the Committee may delegate
to one or more executive officers who are also directors of the Company the
power to grant Options to Participants who are not Reporting Persons at the time
of such Options and all determinations under the Plan with respect thereto,
provided that the Committee shall fix the maximum amount of Options for such
Participants as a group. Such delegate or delegates shall report any action
taken by it or them to the meeting of the Committee next following such action.
4.3 The decision of the Committee on any matter as to which the Committee
is given authority shall be final and binding on all persons concerned. No
member of the Committee shall be liable for any action or determination made in
good faith with respect to the Plan or any Option granted under it.
<PAGE>
5. Indemnification of the Committee. In addition to such other rights of
indemnification as they may have as directors of the Company or as members of
the Committee or otherwise, the members of the Committee shall be indemnified by
the Company as and to the fullest extent permitted by law, including without
limitation, indemnification against the reasonable expenses, including
attorneys' fees, actually and necessarily incurred in connection with the
defense of any action, suit or proceeding, or in connection with any appeal
therein, to which they or any of them may be a party by reason of any action
taken or failure to act under or in connection with the Plan or any Awards
granted hereunder, and against all amounts paid by them in settlement thereof
(provided such settlement is approved by independent legal counsel selected by
the Company) or paid by them in satisfaction of a judgment in any such action,
suit or proceeding except in relation to matters as to which it shall be
adjudged in such action, suit or proceeding that such Committee member is liable
for negligence, bad faith or misconduct in the performance of his duties;
provided that within 60 days after institution of such action, suit or
proceeding a Committee member shall, in writing, offer the Company the
opportunity, at its own expense, to handle and defend the same.
6. Types of Awards Under the Plan. Awards under the Plan may be in the form
of any one or more of the following:
Incentive Stock Options (ISOs)
Nonstatutory Stock Options (NSOs)
Non-Employee Director Stock Options (NEDSOs)
Restricted Stock
All Awards shall be subject to the terms and conditions set forth herein
and to such other terms and conditions as may be established by the Committee.
Determinations by the Committee under the Plan including without limitation,
determinations of the Participants, the form, amount and timing of Awards , the
terms and provisions of Awards, and the agreements evidencing Awards, need not
be uniform and may be made selectively among Participants who receive, or are
eligible to receive, Awards hereunder, whether or not such Participants are
similarly situated. Except as otherwise provided by the Plan or a particular
Award, any determination with respect to an Award may be made by the Committee
at the time of grant of the Award or any time thereafter.
7. Incentive Stock Options and Nonstatutory Stock Options.
7.1 Eligibility. Any officer or key employee of the Company shall be
eligible to receive an ISO or NSO under the Plan. In addition, any consultant to
the Company, who, in the opinion of the Committee, is in a position to have a
significant effect upon the Company's business, shall be eligible to receive a
NSO under the Plan. No ISO or NSO may be granted to an individual under this
Plan at a time when such individual is serving as a member of the Committee. An
<PAGE>
employee owning stock possessing more than 10 percent of the total combined
voting power or value of all classes of stock of the Company or any parent or
subsidiary corporation ("Ten Percent Stockholder") is not eligible to receive an
ISO unless the option price is at least 110 percent of the fair market value of
the Common Stock at the time the ISO is granted and the ISO option by its terms
is not exercisable more than 5 years from the date it is granted. Restricted
Stock and Common Stock which a grantee may purchase under outstanding Options
shall be treated as stock owned by such grantee for purposes of this
calculation. The Committee also may authorize the granting of ISOs and NSOs to
prospective employees. In the case of a prospective employee, the grant of an
ISO or NSO shall be the on condition of employment by the Company in a key
position, and the date of the grant of the ISO or NSO shall be the date such
employment begins or such later date as the Committee may have specified when
authorizing the grant.
7.2 Grant of ISOs and NSOs
7.2.1 From time to time while the Plan is in effect, the Committee may, in
its absolute discretion, select from among persons eligible to receive ISOs and
NSOs (including persons to whom ISOs and NSOs were previously granted) those
persons to whom ISOs and NSOs are to be granted.
7.2.2 The Committee shall, in its absolute discretion, determine the number
of share of Common Stock to be subject to each ISO and NSO made by it under the
Plan, provided, however, that the maximum number of shares of Common Stock with
respect to which ISOs and NSOs may be granted to any individual in any one
taxable year of the Company shall not exceed 525,000 shares (the "Maximum Annual
Grant").
7.2.3 The Committee shall determine at the time of each grant hereunder
whether the option is an ISO or NSO. The terms and conditions of ISOs shall be
subject to and comply with Section 422 of the Code or any successor provision,
and any regulations thereunder.
7.3 Option Price. The option price per share of Common Stock with respect
to each ISO and NSO, shall not be less than 100% of the Fair Market Value per
share at the time the ISO or NSO is granted.
7.4 Period of Options. An ISO and NSO shall be exercisable during such
period of time as the Committee may specify, subject, in the case of ISOs, to
any limitation required by the Code. No ISO or NSO shall be exercisable after
the expiration of ten years from the date the ISO or NSO is granted.
7.5 Vesting of Options. Each ISO and NSO shall be made exercisable at such
time or times as the Committee shall determine. In the case of an ISO or NSO
made exercisable in installments, the Committee may later determine to
accelerate the time at which one or more of such installments may be exercised.
The Committee may impose such conditions with respect to the exercise of ISOs
and NSOs, including conditions relating to the attainment of specific
pre-determined stock price goals or other performance criteria or conditions
relating to applicable federal or state tax or securities laws, as it considers
necessary or advisable and such conditions may differ with respect to each
Participant.
<PAGE>
7.6 Limitation on Grant of ISOs. The aggregate fair market value
(determined as of the time the ISO is granted) of the shares with respect to
which ISOs are exercisable for the first time by a grantee during any calendar
year (under all such plans of the Company) shall not exceed $100,000.
7.7 Options Non-Transferable. No ISO or NSO granted under the Plan shall be
transferable other than by will or by the laws of descent and distribution. No
interest of a Participant under an ISO or NSO or the Plan shall be subject to
the attachment, execution, garnishment, sequestration, the laws of bankruptcy or
any other legal equitable process. During the lifetime of the Participant, ISOs
and NSOs shall be exercisable only by the Participant who received them.
7.8 Termination of Employment.
7.8.1 Death During or After Employment. If a Participant dies during
employment or within three (3) months after terminating employment, and at a
time when the Participant is entitled to exercise an ISO or NSO, then at any
time or times within one year after death (or such greater or lesser period
after death as may be specified in the documentation evidencing the ISO or NSO)
such ISO or NSO may be exercised, but only as to any or all of those shares
which the Participant was entitled to purchase immediately prior to the
Participant's death (unless the Committee within thirty (30) days after the
Participant's death shall have accelerated the vesting of the ISO or NSO). ISOs
or NSOs exercisable after death may be exercised by the Participant's Designated
Beneficiary, and except as so exercised, shall expire at the end of the
specified post-death exercise period. In no event, however, may any ISO or NSO
granted under the Plan be exercised after the expiration of the ISO or NSO
exercise period established at the time of grant.
7.8.2 Retirement or Disability. In the event of a Participant's Retirement
or Disability at a time when the Participant is entitled to exercise an ISO or
NSO, then within three months after Retirement or one year after Disability (or
such greater or lesser period after Retirement or Disability as may be specified
in the documentation evidencing the ISO or NSO) the Participant may exercise
such ISO or NSO only as to those shares which the Participant was entitled to
purchase immediately prior to such Retirement or Disability (unless the
Committee within thirty (30) days after the Participant's Retirement or
Disability shall have accelerated the vesting of the ISO or NSO). If the
Participant dies within the specified post-Retirement or post-Disability
exercise period, the Participant's ISO or NSO may be exercised by the
Participant's Designated Beneficiary, to the same extent as if the deceased
Participant had survived, during the greater of one year from the date of his
death or, if a post-Retirement or post-Disability exercise period greater than
three months or one year was specified in the ISO or NSO documentation, the
remainder of such longer period.
Except as exercised within the applicable period described above, each ISO
or NSO shall expire at the end of such period. In no event, however, may any ISO
or NSO granted under the Plan be exercised after the expiration of the ISO or
NSO exercise period established at the time of grant.
<PAGE>
7.8.3 Other Terminations of Employment. If the employment of a Participant
is terminated for cause, the Participant's option rights, both accrued and
future, under any then outstanding ISO or NSO shall be forfeited and terminated
immediately and may not thereafter be exercised to any extent.
If the employment of a Participant is terminated for any reason other than
cause, death, Retirement or Disability at a time when the Participant is
entitled to exercise an ISO or NSO, then within three months after such
termination of employment (or such greater or lesser period after termination of
employment as may be specified in the documentation evidencing the ISO or NSO),
the Participant may exercise such ISO or NSO only as to those shares which the
Participant was entitled to purchase immediately prior to such termination of
employment (unless the Committee within thirty (30) days after the Participant's
termination of employment shall have accelerated the vesting of the ISO or NSO).
If the Participant dies within the specified post-termination of employment
exercise period, the Participant's ISO or NSO may be exercised by the
Participant's Designated Beneficiary, to the same extent as if the deceased
Participant had survived, during a period equal to the greater of one year from
the date of the Participant's death or the remainder of such specified
post-termination of employment exercise period.
If the Committee so decides, an ISO or NSO may provide that a leave of
absence granted by the Company is not a termination of employment for the
purpose of this subsection 7.8.3 and, in the absence of such a provision, the
Committee may, in any particular case, determine that such a leave of absence is
not a termination of employment for such purpose.
8. Non-Employee Director Stock Options.
8.1 Eligibility. Each Non-Employee Director of the Board shall receive a
NEDSO as determined hereunder without further action by the Board or Committee.
8.2 Option Grant Dates. Subject to the approval of the Plan by the
shareholders at the 1995 Annual Meeting, a NEDSO shall be granted to each
Non-Employee Director automatically every year on the date of the Annual Meeting
of Shareholders, commencing on the date of the 1995 Annual Meeting of
Shareholders. Non-Employee Directors elected by the Board to fill vacancies and
newly created directorships in the interim between grant dates will receive a
pro rated NEDSO based upon the number of full months such Non-Employee Director
will serve between his election and the next grant date.
8.3 Option Formula. Each Non-Employee Director shall receive a NEDSO to
purchase 3,167 shares of Stock on each grant date, without further action by the
Board or Committee. Notwithstanding the forgoing sentence and without further
action by the Board or Committee, each Non-Employee Director shall receive a
NEDSO to purchase 6,500 shares of Stock on each grant date commencing on the
first grant date on which a Non-Employee Director does not receive a stock
option under the Company's 1987 Stock Option Plan.
8.4 Period of Options. Except as otherwise provided herein, each NEDSO will
be exercisable as follows: 50% one year from the date of grant and 100% two
years from the date of grant. All NEDSOs shall terminate upon the expiration of
five years from the date upon which such NEDSOs were granted (subject to prior
termination as hereinafter provided).
8.5 Option Price. The price per share of Stock at which a NEDSO may be
exercised shall be equal to 100% of the Fair Market Value of the price per share
of Stock on the date the NEDSO is granted.
<PAGE>
8.6 Options Non-Transferable. No NEDSO granted under the Plan shall be
transferable other than by will or by the laws of descent and distribution. No
interest of a Non-Employee Director under a NEDSO or the Plan shall be subject
to attachment, execution, garnishment, sequestration, the laws of bankruptcy or
any other legal or equitable process. During the lifetime of the Non-Employee
Director, NEDSOs shall be exercisable only by the Non-Employee Director who
received them.
8.7 Death or Disability of Non-Employee Director. If a Non-Employee
Director shall terminate performance of services for the Company because of
death or Disability, or shall die after termination of performance of services
for the Company but while the Non-Employee Director could have exercised a
NEDSO, that NEDSO may be exercised, to the extent that the Non-Employee Director
was entitled to do so at the date of termination of performance of services, at
any time, or from time to time, within one year after the date of death or
termination of performance of services because of Disability, but in no event
later than the expiration date specified pursuant to Section 8.4. In the case of
death, exercise may be made by the Non-Employee Director's Designated
Beneficiary.
8.8 Termination of Services as Non-Employee Director. If a Non-Employee
Director's performance of services for the Company shall terminate for any
reason other than death or Disability, the Non-Employee Director must exercise
such NEDSO, to the extent the Non-Employee Director was entitled to do so at the
date of termination of performance of services, at any time, or from time to
time, within three months after the date of termination of performance of
services, but in no event later than the expiration date specified pursuant to
Section 8.4; provided, however, in the case of termination of performance of
services for cause, the NEDSO shall cease to be exercisable on the date of such
termination.
9. General Provisions Applicable to All Options.
9.1 Exercise of Options; Payment of Option Price. Options may be exercised
(in full or in part) only by written notice of exercise delivered to the Company
at its principal executive office, accompanied by payment equal to the full
Option Price for the shares of Stock which are exercised. The Option Price of
each share of Common Stock purchased upon exercise of an Option shall be paid in
full in cash at the time of exercise, with shares of Common Stock owned by the
Participant, by delivering to the Company (i) irrevocable instructions to
deliver the stock certificates representing the shares of Stock for which the
Option is being exercised, directly to a broker, and (ii) instructions to the
broker to sell such shares of Stock and promptly deliver to the Company the
portion of the proceeds equal to the total Option Price, or in any combination
thereof. For purposes of making payment in shares of Common Stock, such shares
shall be valued at their Fair Market Value on the date of exercise of the Option
and shall have been held by the Participant for a period of at least six (6)
months.
9.2 Documentation of Options. Neither anything contained in the Plan nor in
any resolutions adopted or to be adopted by the Board or the Shareholders nor
any action taken by the Committee shall constitute the granting of any Option.
The granting of an Option shall take place only when a written Option Agreement
<PAGE>
shall have been duly executed and delivered by the Company and the Participant.
Each Option Agreement shall specify the terms and conditions of the Option and
contain such other terms and conditions not inconsistent with the provisions of
the Plan as the Committee considers necessary or advisable to achieve the
purposes of the Plan or comply with applicable tax and regulatory laws and
accounting principles. The Option Agreement with respect to ISOs shall provide,
among other things, that the Participant shall advise the Company immediately
upon any sale or transfer of shares of Common Stock received upon exercise of
the Option to the extent such sale or transfer takes place prior to the later of
two (2) years from the date of grant or one (1) year from the date of exercise.
9.3 Tax Withholding. The Committee shall require, on such terms as it deems
necessary, that the Participant pay to the Company or make other satisfactory
provision for payment of, any federal, state or local taxes required by law to
be withheld in respect to Options under the Plan. In the Committee's discretion,
such tax obligations may be paid in whole or in part in shares of Common Stock,
including shares retained from the Option creating the tax obligation, valued at
their Fair Market Value on the date of delivery. The Company may, to the extent
permitted by law, deduct any such tax obligations from any payment of any kind
otherwise due to the Participant.
9.4 Amendment of Options. The Committee may modify or amend any outstanding
Option if it determines, in its sole discretion, that amendment is necessary or
advisable in the light of any addition to or change in the Code or in the
regulations issued thereunder, or any federal or state securities laws or other
law or regulation, which change occurs after the date of grant of the Option and
by its terms applies to the Option. In addition, subject to the terms and
conditions and within the limitations of the Plan, the Committee may modify,
amend, extend or renew outstanding Options granted under the Plan, or accept the
surrender of outstanding Options under the Plan or under any other stock option
plan of the Company (to the extent not theretofore exercised) and authorize the
granting of new Options under the Plan in substitution therefor (to the extent
not theretofore exercised). No amendment of an outstanding Option, however, may,
without the consent of the Participant, make any changes which would adversely
effect the rights of such Participant.
10 Financing. In the discretion of the Committee, the Company may guarantee
bank loans or make loans to a Participant to finance the Option Price of the
shares purchased upon the exercise of an Option and also to finance payment by
the Participant of income taxes incurred with such exercise upon the following
terms and conditions:
10.1 Term of Loan. Each loan or guaranty will extend for a period of not
more than five (5) years.
10.2 Promissory Note. Each loan will be evidenced by a promissory note
given by the Participant and for which the Participant shall have full personal
liability. Each such note shall bear interest at such rate per annum as
determined by the Committee which interest shall be not less than the rate in
effect for the Company's senior indebtedness to a financial institution and
shall be payable at such times as determined by the Committee but at least no
less frequently then annually. Payments of principal, or installments thereof,
need not be required by the terms of the notes, but may be required thereby if
so determined by the Committee. Principal and interest may be prepaid in whole
or in part, from time to time, without penalty. Each such note shall in all
<PAGE>
events become due and payable without demand on the fifth anniversary of the
date of the note, or upon the Participant's failure to pay any installment of
principal and interest when due or within 30 days thereafter, or immediately
upon the insolvency or bankruptcy of the Participant, or within 30 days from the
date of termination of the Participant's employment or directorship or office
for whatever cause, excepting only death, Disability and Retirement. In the
event of the death of a Participant, such note shall become due and payable
without demand nine months from the date of such death. In the event of the
Disability or Retirement of a Participant his note shall become due and payable
without demand three months from the date of such permanent disability or
approved retirement.
10.3 Pledge of Shares. Each note or guaranty will be secured by a pledge of
the shares purchased with the proceeds of the loan which shall be deposited with
the Company. Dividends paid on shares subject to the pledge shall be first
applied against interest charges due upon the bank loan, or the note secured,
with any balance applied to reduce the principal thereof. Regardless of any
other provision of this Plan, shares pledged to secure the guaranty or note may
not be withdrawn from the pledge unless the proportionate amount of the
guaranteed bank loan or the note secured thereby shall be immediately repaid.
10.4 Other Terms and Conditions. All such notes, guaranty and pledges may
contain such further terms and conditions consistent with this Plan, including
provisions for additional collateral security, as may be determined by the
Committee from time to time.
10.5 Approval by Shareholders. Approval and adoption of this Plan by the
shareholders of the Company shall constitute full and complete authorization for
any guaranty, loan, or interest reimbursement made to or on behalf of
Participant hereunder.
10.6 Loans to Non-Employee Directors and Consultants. Notwithstanding
anything contained herein to the contrary, each note or guaranty representing a
loan or guaranty to a Non-Employee Director or Consultant shall be secured by a
pledge of shares equal to twice their maximum loan value as defined in Federal
Reserve Regulation G (12 CFR Part 207) or by such other or additional collateral
security as the Committee deems appropriate and in the best interests of the
Company.
11. Restricted Stock.
11.1 The Committee may, in its discretion, make Awards of Restricted Stock
to such officers and key employees as may be selected in the manner provided in
Section 6 of this Plan. Such Awards shall be evidenced by an Award Agreement in
such form, and containing such terms and conditions as are not inconsistent with
this Plan, as the Committee, shall, from time to time, determine. Restricted
Stock awarded hereunder shall be subject to such restrictions as may be
determined by the Committee and set out in the Award Agreement.
11.2 Restricted Stock shall be subject to a restriction period (after which
restrictions will lapse) which shall mean a period commencing on the date the
Award is granted and ending on such date as the Committee shall determine (the
"Restriction Period"). The Committee may provide for the lapse of restrictions
in installments where deemed appropriate.
<PAGE>
11.3 Except when the Committee determines otherwise pursuant to Section
11.5, if a Participant terminates employment with the Company for any reason
before the expiration of the Restriction Period, all shares of Restricted Stock
still subject to the restriction shall be forfeited by the Participant and shall
be reacquired by the Company.
11.4 Except as otherwise provided in this Section 11, no shares of
Restricted Stock received by a Participant shall be sold, exchanged,
transferred, pledged, hypothecated or otherwise disposed of during the
Restriction Period.
11.5 In cases of death, Disability or Retirement or in cases of special
circumstances, the Committee may, in its sole discretion when it finds that a
waiver would be in the best interests of the Company, elect to waive any or all
remaining restrictions with respect to such Participant's Restricted Stock.
11.6 The Committee may require, under such terms and conditions as it deems
appropriate or desirable, that the certificates of Stock delivered under the
Plan may be held in custody by a bank or other institution, or that the Company
may itself hold such shares in custody until the Restriction Period expires or
until restrictions thereon otherwise lapse, and may require, as a condition of
any Award of Restricted Stock that the Participant shall have delivered a stock
power endorsed in blank relating to the Restricted Stock.
11.7 Subject to Section 11.6, each Participant entitled to receive
Restricted Stock under the Plan shall be issued a certificate for the shares of
Stock. Such certificate shall be registered in the name of the Participant and
shall bear an appropriate legend reciting the terms, conditions and
restrictions, if any, applicable to such Award and shall be subject to
appropriate stop-transfer orders.
11.8 The restrictions imposed under this Section 11 shall apply as well to
all shares or other securities issued in respect of the Restricted Stock in
connection with any stock split, stock dividend, recapitalization,
reclassification, merger, consolidation or reorganization, but such restrictions
shall expire or terminate at such time or times as may be specified therefor in
the Award Agreement.
12. Adjustment Upon Changes in Capitalization; Changes in Control.
12.1 If the outstanding shares of Stock of the Company as a whole are
increased, decreased, changed into, or exchanged for, a different number or kind
of shares or securities of the Company, whether through merger, consolidation,
reorganization, recapitalization, reclassification, stock dividend, stock split,
combination of shares, exchange of shares, change in corporate structure, or
amendment to the certificate of incorporation of the Company or otherwise, an
appropriate and proportionate adjustment, as determined by the Committee shall
be made to the number and kind of shares subject to this Plan, and to the
number, kind, and per share Option Price of shares subject to unexercised
Options granted prior to any such change. Any such adjustment shall be made
without a change in the aggregate purchase price of the shares of Stock subject
to the unexercised portion of any Option.
<PAGE>
12.2 In the event of any tender offer or exchange offer (other than an
offer by the Company) for the Company's Stock, or a dissolution or liquidation
of the Company, or a merger or consolidation or similar transaction in which the
Company is not the surviving corporation, or a sale, exchange or other
disposition of all or substantially all of the Company assets, or a "change in
control" of the Company (as such term is defined in Section 12.3 hereinafter),
the Committee, in its sole discretion, may, as to any outstanding Options, make
such substitution or adjustment in the aggregate number of shares reserved for
issuance under the Plan and in the number and per share Option Price (if any) of
shares subject to such Options as it may determine, make outstanding Options
fully exercisable, or amend or terminate such Options upon such terms and
conditions as it shall provide (which, in the case of the termination of the
vested portion of any Option, shall require payment or other consideration which
the Committee deems equitable in the circumstances).
12.3 For the purposes of this Plan, a "change in control" of the Company
shall be deemed to have occurred if (i) any "person" (as that term is used in
Sections 13(d) and 14(d)(2) of the Exchange Act) is or becomes the "beneficial
owner" (as that term is defined by the Securities and Exchange Commission for
purposes of Section 13(d) of the Exchange Act), directly or indirectly, of more
than 20% of the outstanding voting securities of the Company or its successors;
or (ii) during any period of two consecutive years a majority of the Board of
Directors no longer consists of individuals who were members of the Board of
Directors at the beginning of such period, unless the election of each director
who was not a director at the beginning of the period was approved by a vote of
at least two-thirds of the directors still in office who were directors at the
beginning of the period.
12.4 The restrictions applicable to Awards of Restricted Stock issued
pursuant to Section 11 shall lapse upon the occurrence of an event specified in
Section 12.2. and the Company shall issue stock certificates without a
restrictive legend.
13. Miscellaneous.
13.1 No Right to Employment. No person shall have any claim or right to be
granted an Award, and the grant of an Award shall not be construed as giving a
Participant the right to continued employment. The Company expressly reserves
the right at any time to terminate the employment of a Participant free from any
liability or claim under the Plan except as may be expressly provided in the
applicable Award.
13.2 No Right to Continue as a Director. The granting of a NEDSO shall not
constitute or be evidence of any agreement or understanding, express or implied,
that the Company will retain a Non-Employee Director for any period of time.
13.3 No Rights as Shareholder. Subject to the provisions of the applicable
Option, no Participant or Designated Beneficiary shall have any rights as a
shareholder with respect to any shares of Common Stock to be distributed under
the Plan until such person becomes the holder thereof.
13.4 No Fractional Shares. No fractional shares of Common Stock shall be
issued under the Plan, and cash shall be paid in lieu of any fractional shares
in settlement of Options granted under the Plan.
13.5 Unfunded Plan. The Plan shall be unfunded, shall not create (or be
construed to create) a trust or a separate fund or funds, and shall not
establish any fiduciary relationship between the Company and any Participant or
other person.
<PAGE>
13.6 Successors and Assigns. The Plan shall be binding on all successors
and assigns of the Participant, including without limitation the Participant's
Designated Beneficiary or any receiver or trustee in bankruptcy or
representative of the Participant's creditors.
13.7 Compliance With Other Laws and Regulations. The Plan, the grant and
exercise of Awards under the Plan, and the obligation of the Company to transfer
shares under such Awards shall be subject to all applicable federal and state
laws, rules and regulations, including those related to disclosure of financial
and other information to Participants, and to any approvals by any government or
regulatory agency as may be required. The Company shall not be required to issue
or deliver any certificates for shares of Stock prior to (a) the listing of such
shares on any stock exchange on which the Stock may then be listed, where such
listing is required under the rules or regulations of such exchange, and (b) the
compliance with applicable federal and state securities laws and regulations
relating to the issuance and delivery of such certificates; provided, however,
that the Company shall make all reasonable efforts to so list such shares and to
comply with such laws and regulations.
13.8 Compliance with Rule 16b-3. With respect to persons subject to Section
16 of the Exchange Act, transactions under this Plan are intended to comply with
all applicable conditions of Rule 16b-3 or its successors under the Exchange
Act. 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.
13.9 Amendment of Plan. The Board may amend, suspend or terminate the Plan
or any portion thereof at any time, except that it may not amend the Plan
without shareholder approval where the absence of such approval would cause the
Plan to fail to comply with Rule 16b-3 under the Exchange Act, the performance
based compensation requirements under Section 162(m) of the Code, Section 422 of
the Code, the requirements of any securities exchange on which the shares of
Common Stock are then listed, or any other requirement of applicable law or
regulation. The Board may not amend Section 8 more than once every six months,
other than to conform with changes in the Code or the rules and regulations
thereunder. The Committee may make non-material amendments to the Plan. No
amendment shall apply to adversely affect any Participant with respect to whom
an Award shall heretofore have been granted.
13.10 Governing Law. To the extent not superseded by federal law, the
provisions of the Plan shall be governed by and interpreted in accordance with
the laws of the State of New York.
14. Effective Date of Plan; Term of Plan. The Plan shall become effective
as of the date on which the Board adopts the Plan, subject, however, to the
approval by the shareholders at the 1995 Annual Meeting of Shareholders. The
Plan shall terminate on November 7, 2004 and no Awards shall be granted under
the Plan after that date, provided, however, that the Plan and all Awards
granted under the Plan prior to such date shall remain in effect until such
Awards have been satisfied or terminated in accordance with the Plan and the
terms of such Awards.
Date Plan adopted by Board of Directors: November 8, 1994
Date Plan approved by Shareholders:
FORM OF ISO
PSC INC.
OPTION AGREEMENT PURSUANT TO
1994 STOCK OPTION PLAN
(Incentive Stock Option)
OPTION AGREEMENT, executed in duplicate as of the ____ day of_________,
199_, between PSC INC., a New York corporation (the "Company"), and
_______________, an employee of the Company (the "Optionee").
In accordance with the provisions of the 1994 Stock Option Plan of the
Company (the "Plan"), the Compensation Committee of the Board of Directors of
the Company has authorized the execution and delivery of this Agreement on the
terms and conditions herein set forth.
NOW, THEREFORE, in consideration of the mutual covenants hereinafter set
forth and for other good and valuable consideration, the parties hereto agree as
follows:
1. Grant of Option. Subject to all the terms and conditions of the Plan and
this Agreement, the Company has granted to the Optionee on ___________, 199_
(the "Date of Grant") an Incentive Stock Option ("ISO") to purchase _______
common shares of the Company (such number being subject to adjustment as
provided in Section 8), $.01 par value, on the terms and conditions herein set
forth.
2. Purchase Price. The purchase price per common share covered by this ISO
shall be $_____.
3. Exercise. This ISO may be exercised as follows:
This ISO may not be exercised after the expiration of _____ years from the
Date of Grant.
4. Method of Exercising Option. The Optionee may exercise the ISO granted
to Optionee by giving written notice to the Company which shall state the
election to exercise the ISO and the number of shares with respect to which the
ISO is being exercised. The written notice shall be signed by the person
exercising the ISO, shall be delivered to the Company at its principal executive
office, and shall be accompanied by payment equal to the full purchase price for
the shares which are exercised. The purchase price of each share purchased upon
exercise of a ISO shall be paid in full (a) in cash at the time of exercise, (b)
with common shares of the Company owned by the Optionee, (c) by delivering to
the Company (i) irrevocable instructions to deliver the stock certificates
representing the shares for which the ISO is being exercised, directly to a
broker, and (ii) instructions to the broker to sell such shares and promptly
deliver to the Company the portion of the proceeds equal to the total purchase
<PAGE>
price, or (d) in any combination thereof. For purposes of making payment in
common shares of the Company, such shares shall be valued at their fair market
value (as defined in the Plan) on the date of exercise of the ISO and shall have
been held by the Optionee for a period of at least six (6) months. Such notice
shall be given on the form attached hereto and designated as Exhibit A. In the
event the ISO shall be exercised pursuant to Section 6(b) hereof by any person
or persons other than the Optionee, such notice shall be accompanied by
appropriate proof of the right of such person or persons to exercise the ISO.
5. Non-Transferability of Option Rights. This ISO shall not be transferable
by the Optionee except by will or by the laws of descent and distribution.
During the life of the Optionee, the ISO shall be exercisable only by Optionee.
More particularly (but without limiting the generality of the foregoing), the
ISO may not be assigned, transferred (except as provided above), pledged, or
hypothecated in any way, shall not be assignable by operation of law, and shall
not be subject to execution, attachment or similar process. Any attempted
assignment, transfer, pledge, hypothecation, or other disposition of the ISO
contrary to the provisions hereof, and the levy of any execution, attachment, or
similar process upon the ISO, shall be null and void and without effect.
6. Termination of Employment or Death (a) If the employment of Optionee
shall terminate for cause, this ISO shall cease to be exercisable on the date of
such termination.
(b) If Optionee's employment shall terminate performance of services for
the Company because of death or Disability (as defined in the Plan), or if
Optionee shall die after termination of employment but while Optionee could have
exercised this ISO, this ISO may be exercised, to the extent that the Optionee
was entitled to do so at the date of termination of employment, at any time, or
from time to time, within one year after the date of death or termination of
employment because of Disability, but in no event later than the expiration date
specified pursuant to Section 3. In the case of death, exercise may be made by
the Optionee's Designated Beneficiary (as defined in the Plan).
(c) If Optionee's employment for the Company shall terminate for any reason
other than cause, death or Disability, Optionee must exercise this ISO, to the
extent Optionee was entitled to do so at the date of termination of employment,
at any time, or from time to time, within three months after the date of
termination of employment, but in no event later than the expiration date
specified pursuant to Section 3.
7. General Restriction. This ISO shall be subject to the requirement that
if at any time the Board of Directors in its discretion shall determine that the
listing, registration or qualification of the shares subject to such ISO on any
securities exchange or under any state or federal law, or the consent or
approval of any government regulatory body, is necessary or desirable as a
condition of, or in connection with, the granting of such ISO or the issuance or
purchase of shares thereunder, such ISO may not be exercised in whole or in part
unless such listing, registration, qualification, consent or approval shall have
been effected or obtained free of any conditions not acceptable to the Board of
Directors.
<PAGE>
8. ISO Adjustments. In the event of a stock dividend, stock split or other
change in corporate structure or capitalization affecting the common shares or
any other transaction (including, without limitation, an extraordinary cash
dividend) which, in the determination of the Compensation Committee (the
"Committee") of the Board of Directors, affects the common shares such that an
adjustment is required in order to preserve the benefits or potential benefits
intended to be made available under the Plan, then the Committee shall equitably
adjust any or all of (i) the number and kind of shares subject to this ISO, and
(ii) the purchase price with respect to the foregoing, provided that the number
of shares subject to this ISO shall always be a whole number. In the event of
any tender offer or exchange offer (other than an offer by the Company) for the
Company's common shares, or a dissolution or liquidation of the Company, or a
merger or consolidation or similar transaction in which the Company is not the
surviving company, or a sale, exchange or other disposition of all or
substantially all of the Company assets, or a "change in control" of the Company
(as defined in the Plan), the Committee, in its sole discretion, may make such
substitution or adjustment in the number and purchase price of shares subject to
this ISO as it may determine, make this ISO fully exercisable, or amend or
terminate this ISO upon such terms and conditions as it shall provide (which, in
the case of the termination of the vested portion of this ISO, shall require
payment or other consideration which the Committee deems equitable in the
circumstances).
9. Amendment to this Option Agreement. The Committee may modify or amend
this ISO if it determines, in its sole discretion, that amendment is necessary
or advisable in the light of any addition to or change in the Internal Revenue
Code or in the regulations issued thereunder, or any federal or state securities
laws or other law or regulation, which change occurs after the date of grant of
this ISO and by its terms applies to this ISO. No amendment of this ISO,
however, may, without the consent of the Optionee, make any changes which would
adversely effect the rights of such Optionee.
10. Disqualifying Disposition. In the event that Optionee shall sell or
transfer any common shares acquired upon the exercise of the ISO prior to the
later of (a) two (2) years from the Date of Grant or (b) one (1) year from the
date of exercise of this ISO, Optionee agrees to so advise the Company
immediately and to promptly pay to the Company the amount of any Federal, State
of Local taxes that may be required.
11. Right of Employment. Nothing contained herein shall confer upon the
Optionee any right to be continued in the employment of the Company or interfere
in any way with the right of the Company to terminate his employment at any time
for any cause.
12. Definitions. Any terms or provisions used herien which are defined in
Sections 421, 422 or 425 of the Internal Revenue Code of 1986, as amended, or
the regulations thereunder or corresponding provisions of subsequent laws and
regulations in effect at the time these ISOs are granted have the meanings as
therein defined.
<PAGE>
13. Notices. Notices hereunder shall be in writing and if to the Company
shall be delivered personally to the Secretary of the Company or mailed to its
principal office, 675 Basket Road, Webster, New York 14580, addressed to the
attention of the Secretary and, if to the Optionee, shall be delivered
personally or mailed to the Optionee at his address as the same appears on the
records of the Company.
14. Interpretations of this Agreement. All decisions and interpretations
made by the Committee with regard to any question arising hereunder or under the
Plan shall be binding and conclusive on the Company and the Optionee. The ISO
granted hereunder, and the stock which may be issued upon exercise thereof, are
subject to the provisions of the Plan. In the event there is any inconsistency
between the provisions of this Agreement and those of the Plan, the provisions
of the Plan shall govern.
15. Successors and Assigns. This Agreement shall bind and inure to the
benefit of the parties hereto and the successors and assigns of the Company and,
to the extent provided in Section 6, to the personal representatives, legatees
and heirs of the Optionee.
IN WITNESS WHEREOF, the Company has caused this Incentive Stock Option
Agreement to be executed on the day and year first above written.
PSC INC.
By: ___________________________
L. Michael Hone
Its: President and Chief Executive
Officer
ATTEST:
_______________________________
Martin S. Weingarten, Secretary
<PAGE>
ACCEPTANCE
I, __________________, hereby certify that I have read and fully understand
the foregoing Stock Option Agreement. I acknowledge that I have been apprised
that it is the intent of the Company that Optionees obtain and retain an equity
interest in the Company. I hereby execute this Agreement to indicate my
acceptance of this Incentive Stock Option and my intent to comply with the terms
thereof.
______________________________
Optionee
______________________________
Street Address
______________________________
City State Zip Code
<PAGE>
EXHIBIT A
_________________, 19__
PSC Inc.
675 Basket Road
Webster, New York 14580
Attention: Secretary
Dear Sir:
This is to notify you that I hereby elect to exercise my option rights to
_______________ common shares of PSC Inc. (the "Company") granted under the
Option Agreement (the "Agreement"), dated ____________________ 19__, issued to
me pursuant to the 1994 Stock Option Plan (the "Plan"). The purchase price
pursuant to such Agreement, as adjusted, is $____________ per share or
$__________ in the aggregate.
In payment of the full purchase price, I enclose (please complete as
appropriate):
(a) my check in the sum of $__________
(b) __________ common shares of the Company owned by me free of any liens
or encumbrances and having a fair market value of $_________
(c) an authorization letter which gives irrevocable instructions to the
Company to deliver the stock certificates representing the shares or
which the option is being exercised directly to _______________________
(name and address of broker) Together with a copy of the
instructions to _______________ (name of broker) to sell such shares
and promptly deliver to the Company the portion ofhe proceeds equal
to the total purchase price and withholding taxes due, if any.
Very truly yours,
________________________
Optionee's Signature
FORM OF NSO
PSC INC.
OPTION AGREEMENT PURSUANT TO
1994 STOCK OPTION PLAN
(Nonstatutory Stock Option)
OPTION AGREEMENT, executed in duplicate as of the ____ day of_________,
199_, between PSC INC., a New York corporation (the "Company"), and
_______________, an employee of the Company (the "Optionee").
In accordance with the provisions of the 1994 Stock Option Plan of the
Company (the "Plan"), the Compensation Committee of the Board of Directors of
the Company has authorized the execution and delivery of this Agreement on the
terms and conditions herein set forth.
NOW, THEREFORE, in consideration of the mutual covenants hereinafter
set forth and for other good and valuable consideration, the parties hereto
agree as follows:
1. Grant of Option. Subject to all the terms and conditions of the Plan
and this Agreement, the Company has granted to the Optionee on ___________, 199_
(the "Date of Grant") a Nonstatutory Stock Option ("NSO") to purchase _______
common shares of the Company (such number being subject to adjustment as
provided in Section 8), $.01 par value, on the terms and conditions herein set
forth.
2. Purchase Price. The purchase price per common share covered by
this NSO shall be $_____.
3. Exercise. This NSO may be exercised as follows:
This NSO may not be exercised after the expiration of _____ years from the Date
of Grant.
4. Method of Exercising Option. The Optionee may exercise the NSO
granted to Optionee by giving written notice to the Company which shall state
the election to exercise the NSO and the number of shares with respect to which
the NSO is being exercised. The written notice shall be signed by the person
exercising the NSO, shall be delivered to the Company at its principal executive
office, and shall be accompanied by payment equal to the full purchase price for
the shares which are exercised. The purchase price of each share purchased upon
exercise of a NSO shall be paid in full (a) in cash at the time of exercise, (b)
with common shares of the Company owned by the Optionee, (c) by delivering to
the Company (i) irrevocable instructions to deliver the stock certificates
representing the shares for which the NSO is being exercised, directly to a
broker, and (ii) instructions to the broker to sell such shares and promptly
deliver to the Company the portion of the proceeds equal to the total purchase
price, or (d) in any combination thereof. For purposes of making payment in
<PAGE>
common shares of the Company, such shares shall be valued at their fair market
value (as defined in the Plan) on the date of exercise of the NSO and shall have
been held by the Optionee for a period of at least six (6) months. Such notice
shall be given on the form attached hereto and designated as Exhibit A. In the
event the NSO shall be exercised pursuant to Section 6(b) hereof by any person
or persons other than the Optionee, such notice shall be accompanied by
appropriate proof of the right of such person or persons to exercise the NSO.
5. Non-Transferability of Option Rights. This NSO shall not be
transferable by the Optionee except by will or by the laws of descent and
distribution. During the life of the Optionee, the NSO shall be exercisable only
by Optionee. More particularly (but without limiting the generality of the
foregoing), the NSO may not be assigned, transferred (except as provided above),
pledged, or hypothecated in any way, shall not be assignable by operation of
law, and shall not be subject to execution, attachment or similar process. Any
attempted assignment, transfer, pledge, hypothecation, or other disposition of
the NSO contrary to the provisions hereof, and the levy of any execution,
attachment, or similar process upon the NSO, shall be null and void and without
effect.
6. Termination of Employment or Death (a) If the employment of Optionee
shall terminate for cause, this NSO shall cease to be exercisable on the date of
such termination.
(b) If Optionee's employment shall terminate performance of services
for the Company because of death or Disability (as defined in the Plan), or if
Optionee shall die after termination of employment but while Optionee could have
exercised this NSO, this NSO may be exercised, to the extent that the Optionee
was entitled to do so at the date of termination of employment, at any time, or
from time to time, within one year after the date of death or termination of
employment because of Disability, but in no event later than the expiration date
specified pursuant to Section 3. In the case of death, exercise may be made by
the Optionee's Designated Beneficiary (as defined in the Plan).
(c) If Optionee's employment for the Company shall terminate for any
reason other than cause, death or Disability, Optionee must exercise this NSO,
to the extent Optionee was entitled to do so at the date of termination of
employment, at any time, or from time to time, within three months after the
date of termination of employment, but in no event later than the expiration
date specified pursuant to Section 3.
7. General Restriction. This NSO shall be subject to the requirement
that if at any time the Board of Directors in its discretion shall determine
that the listing, registration or qualification of the shares subject to such
NSO on any securities exchange or under any state or federal law, or the consent
or approval of any government regulatory body, is necessary or desirable as a
condition of, or in connection with, the granting of such NSO or the issuance or
purchase of shares thereunder, such NSO may not be exercised in whole or in part
unless such listing, registration, qualification, consent or approval shall have
been effected or obtained free of any conditions not acceptable to the Board of
Directors.
<PAGE>
8. NSO Adjustments. In the event of a stock dividend, stock split or
other change in corporate structure or capitalization affecting the common
shares or any other transaction (including, without limitation, an extraordinary
cash dividend) which, in the determination of the Compensation Committee (the
"Committee") of the Board of Directors, affects the common shares such that an
adjustment is required in order to preserve the benefits or potential benefits
intended to be made available under the Plan, then the Committee shall equitably
adjust any or all of (i) the number and kind of shares subject to this NSO, and
(ii) the purchase price with respect to the foregoing, provided that the number
of shares subject to this NSO shall always be a whole number. In the event of
any tender offer or exchange offer (other than an offer by the Company) for the
Company's common shares, or a dissolution or liquidation of the Company, or a
merger or consolidation or similar transaction in which the Company is not the
surviving company, or a sale, exchange or other disposition of all or
substantially all of the Company assets, or a "change in control" of the Company
(as defined in the Plan), the Committee, in its sole discretion, may make such
substitution or adjustment in the number and purchase price of shares subject to
this NSO as it may determine, make this NSO fully exercisable, or amend or
terminate this NSO upon such terms and conditions as it shall provide (which, in
the case of the termination of the vested portion of this NSO, shall require
payment or other consideration which the Committee deems equitable in the
circumstances).
9. Amendment to this Option Agreement. The Committee may modify or
amend this NSO if it determines, in its sole discretion, that amendment is
necessary or advisable in the light of any addition to or change in the Internal
Revenue Code or in the regulations issued thereunder, or any federal or state
securities laws or other law or regulation, which change occurs after the date
of grant of this NSO and by its terms applies to this NSO. No amendment of this
NSO, however, may, without the consent of the Optionee, make any changes which
would adversely effect the rights of such Optionee.
10. Right of Employment. Nothing contained herein shall confer upon
the Optionee any right to be continued in the employment of the Company or
interfere in any way with the right of the Company to terminate his employment
at any time for any cause.
11. Notices. Notices hereunder shall be in writing and if to the
Company shall be delivered personally to the Secretary of the Company or mailed
to its principal office, 675 Basket Road, Webster, New York 14580, addressed to
the attention of the Secretary and, if to the Optionee, shall be delivered
personally or mailed to the Optionee at his address as the same appears on the
records of the Company.
<PAGE>
12. Interpretations of this Agreement. All decisions and
interpretations made by the Committee with regard to any question arising
hereunder or under the Plan shall be binding and conclusive on the Company and
the Optionee. The NSO granted hereunder, and the stock which may be issued upon
exercise thereof, are subject to the provisions of the Plan. In the event there
is any inconsistency between the provisions of this Agreement and those of the
Plan, the provisions of the Plan shall govern.
13. Successors and Assigns. This Agreement hall bind and inure to
the benefit of the parties hereto and the successors and assigns of the Company
and, to the extent provided in Section 6, to the personal representatives,
legatees and heirs of the Optionee.
IN WITNESS WHEREOF, the Company has caused this Nonstatutory Stock
Option Agreement to be executed on the day and year first above written.
PSC INC.
By: ___________________________
L. Michael Hone
Its: President and Chief Executive
Officer
ATTEST:
- ---------------------------
Martin S. Weingarten, Secretary
<PAGE>
ACCEPTANCE
I, __________________, hereby certify that I have read and fully understand the
foregoing Stock Option Agreement. I acknowledge that I have been apprised that
it is the intent of the Company that Optionees obtain and retain an equity
interest in the Company. I hereby execute this Agreement to indicate my
acceptance of this Nonstatutory Stock Option and my intent to comply with the
terms thereof.
-----------------------------
Optionee
-----------------------------
Street Address
-----------------------------
City State Zip Code
<PAGE>
EXHIBIT A
_________________, 19__
PSC Inc.
675 Basket Road
Webster, New York 14580
Attention: Secretary
Dear Sir:
This is to notify you that I hereby elect to exercise my option rights
to _______________ common shares of PSC Inc. (the "Company") granted under the
Option Agreement (the "Agreement"), dated ____________________ 19__, issued to
me pursuant to the 1994 Stock Option Plan (the "Plan"). The purchase price
pursuant to such Agreement, as adjusted, is $____________ per share or
$__________ in the aggregate.
In payment of the full purchase price, I enclose (please complete as
appropriate):
(a) my check in the sum of $__________
(b) __________ common shares of the Company owned
by me free of any liens or encumbrances and having
a fair market value of $_________
(c) an authorization letter which gives irrevocable
instructions to the Company to deliver the stock
certificates representing the shares for which the
option is being exercised directly to
__________________ (name and address of broker)
together with a copy of the instructions to
_______________ (name of broker) to sell such shares
and promptly deliver to the Company the portion of
the proceeds equal to the total purchase price and
withholding taxes due, if any.
Very truly yours,
----------------------------
Optionee's Signature
FORM OF NEDSO
PSC INC.
OPTION AGREEMENT PURSUANT TO
1994 STOCK OPTION PLAN
(Non-Employee Director Stock Option)
OPTION AGREEMENT, executed in duplicate as of the ____ day of_________,
199_, between PSC INC., a New York corporation (the "Company"), and
_______________, a non-employee director of the Company (the "Optionee").
In accordance with the provisions of the 1994 Stock Option Plan of the
Company (the "Plan"), the Company is authorized to execute and deliver this
Agreement on the terms and conditions herein set forth.
NOW, THEREFORE, in consideration of the mutual covenants hereinafter
set forth and for other good and valuable consideration, the parties hereto
agree as follows:
1. Grant of Option. Subject to all the terms and conditions of the Plan
and this Agreement, the Company has granted to the Optionee on ___________, 199_
(the "Date of Grant") a Non-Employee Director Stock Option ("NEDSO") to purchase
_______ common shares of the Company (such number being subject to adjustment as
provided in Section 8), $.01 par value, on the terms and conditions herein set
forth.
2. Purchase Price. The purchase price per common share covered by
this NEDSO shall be $_____.
3. Exercise. This NEDSO may be exercised (a) with respect to all or
any part of one-half (1/2) of the shares covered hereby at any time on or after
___________________, 199___; and (b) with respect to all or any part of all of
the shares covered hereby at any time on or after ___________, 199_. This NEDSO
may not be exercised after the expiration of five years from the Date of Grant.
4. Method of Exercising Option. The Optionee may exercise the NEDSO
granted to Optionee by giving written notice to the Company which shall state
the election to exercise the NEDSO and the number of shares with respect to
which the NEDSO is being exercised. The written notice shall be signed by the
person exercising the NEDSO, shall be delivered to the Company at its principal
executive office, and shall be accompanied by payment equal to the full purchase
price for the shares which are exercised. The purchase price of each share
purchased upon exercise of a NEDSO shall be paid in full (a) in cash at the time
of exercise, (b) with common shares of the Company owned by the Optionee, (c) by
delivering to the Company (i) irrevocable instructions to deliver the stock
certificates representing the shares for which the NEDSO is being exercised,
directly to a broker, and (ii) instructions to the broker to sell such shares
and promptly deliver to the Company the portion of the proceeds equal to the
total purchase price, or (d) in any combination thereof. For purposes of making
payment in common shares of the Company, such shares shall be valued at their
fair market value (as defined in the Plan) on the date of exercise of the NEDSO
<PAGE>
and shall have been held by the Optionee for a period of at least six (6)
months. Such notice shall be given on the form attached hereto and designated as
Exhibit A. In the event the NEDSO shall be exercised pursuant to Section 6(b)
hereof by any person or persons other than the Optionee, such notice shall be
accompanied by appropriate proof of the right of such person or persons to
exercise the NEDSO.
5. Non-Transferability of Option Rights. This NEDSO shall not be
transferable by the Optionee except by will or by the laws of descent and
distribution. During the life of the Optionee, the NEDSO shall be exercisable
only by Optionee. More particularly (but without limiting the generality of the
foregoing), the NEDSO may not be assigned, transferred (except as provided
above), pledged, or hypothecated in any way, shall not be assignable by
operation of law, and shall not be subject to execution, attachment or similar
process. Any attempted assignment, transfer, pledge, hypothecation, or other
disposition of the NEDSO contrary to the provisions hereof, and the levy of any
execution, attachment, or similar process upon the NEDSO, shall be null and void
and without effect.
6. Termination of Employment or Death (a) If the directorship of
Optionee shall terminate for cause, this NEDSO shall cease to be exercisable on
the date of such termination.
(b) If Optionee shall terminate performance of services for the Company
because of death or Disability (as defined in the Plan), or if Optionee shall
die after termination of performance of services for the Company but while
Optionee could have exercised this NEDSO, this NEDSO may be exercised, to the
extent that the Optionee was entitled to do so at the date of termination of
performance of services, at any time, or from time to time, within one year
after the date of death or termination of performance of services because of
Disability, but in no event later than the expiration date specified pursuant to
Section 3. In the case of death, exercise may be made by the Optionee's
Designated Beneficiary (as defined in the Plan).
(c) If Optionee's performance of services for the Company shall
terminate for any reason other than cause, death or Disability, Optionee must
exercise this NEDSO, to the extent Optionee was entitled to do so at the date of
termination of performance of services, at any time, or from time to time,
within three months after the date of termination of performance of services,
but in no event later than the expiration date specified pursuant to Section 3.
7. General Restriction. This NEDSO shall be subject to the requirement
that if at any time the Board of Directors in its discretion shall determine
that the listing, registration or qualification of the shares subject to such
NEDSO on any securities exchange or under any state or federal law, or the
consent or approval of any government regulatory body, is necessary or desirable
as a condition of, or in connection with, the granting of such NEDSO or the
issuance or purchase of shares thereunder, such NEDSO may not be exercised in
whole or in part unless such listing, registration, qualification, consent or
approval shall have been effected or obtained free of any conditions not
acceptable to the Board of Directors.
8. NEDSO Adjustments. In the event of a stock dividend, stock split or
other change in corporate structure or capitalization affecting the common
shares or any other transaction (including, without limitation, an extraordinary
cash dividend) which, in the determination of the Compensation Committee (the
"Committee") of the Board of Directors, affects the common shares such that an
adjustment is required in order to preserve the benefits or potential benefits
intended to be made available under the Plan, then the Committee shall equitably
<PAGE>
adjust any or all of (i) the number and kind of shares subject to this NEDSO,
and (ii) the purchase price with respect to the foregoing, provided that the
number of shares subject to this NEDSO shall always be a whole number. In the
event of any tender offer or exchange offer (other than an offer by the Company)
for the Company's common shares, or a dissolution or liquidation of the Company,
or a merger or consolidation or similar transaction in which the Company is not
the surviving company, or a sale, exchange or other disposition of all or
substantially all of the Company assets, or a "change in control" of the Company
(as defined in the Plan), the Committee, in its sole discretion, may make such
substitution or adjustment in the number and purchase price of shares subject to
this NEDSO as it may determine, make this NEDSO fully exercisable, or amend or
terminate this NEDSO upon such terms and conditions as it shall provide (which,
in the case of the termination of the vested portion of this NEDSO, shall
require payment or other consideration which the Committee deems equitable in
the circumstances).
9. Amendment to this Option Agreement. The Committee may modify or
amend this NEDSO if it determines, in its sole discretion, that amendment is
necessary or advisable in the light of any addition to or change in the Internal
Revenue Code or in the regulations issued thereunder, or any federal or state
securities laws or other law or regulation, which change occurs after the date
of grant of this NEDSO and by its terms applies to this NEDSO. No amendment of
this NEDSO, however, may, without the consent of the Optionee, make any changes
which would adversely effect the rights of such Optionee.
10. Notices. Notices hereunder shall be in writing and if to the
Company shall be delivered personally to the Secretary of the Company or mailed
to its principal office, 675 Basket Road, Webster, New York 14580, addressed to
the attention of the Secretary and, if to the Optionee, shall be delivered
personally or mailed to the Optionee at his address as the same appears on the
records of the Company.
11. Interpretations of this Agreement. All decisions and
interpretations made by the Committee with regard to any question arising
hereunder or under the Plan shall be binding and conclusive on the Company and
the Optionee. The NEDSO granted hereunder, and the stock which may be issued
upon exercise thereof, are subject to the provisions of the Plan. In the event
there is any inconsistency between the provisions of this Agreement and those of
the Plan, the provisions of the Plan shall govern.
12. Successors and Assigns. This Agreement shall bind and inure
to the benefit of the parties hereto and the successors and assigns of the
Company and, to the extent provided in Section 6, to the personal representa-
tives, legatees and heirs of the Optionee.
IN WITNESS WHEREOF, the Company has caused this Non-Employee Director
Stock Option Agreement to be executed on the day and year first above written.
PSC INC.
By: ___________________________
L. Michael Hone
Its: President and Chief Executive
Officer
ATTEST:
- ---------------------------
Martin S. Weingarten, Secretary
<PAGE>
ACCEPTANCE
I, __________________, hereby certify that I have read and fully understand the
foregoing Stock Option Agreement. I acknowledge that I have been apprised that
it is the intent of the Company that Optionees obtain and retain an equity
interest in the Company. I hereby execute this Agreement to indicate my
acceptance of this Non-Employee Director Stock Option and my intent to comply
with the terms thereof.
-----------------------------
Optionee
------------------------------
Street Address
------------------------------
City State Zip Code
<PAGE>
EXHIBIT A
_________________, 19__
PSC Inc.
675 Basket Road
Webster, New York 14580
Attention: Secretary
Dear Sir:
This is to notify you that I hereby elect to exercise my option rights
to _______________ common shares of PSC Inc. (the "Company") granted under the
Option Agreement (the "Agreement"), dated ____________________ 19__, issued to
me pursuant to the 1994 Stock Option Plan (the "Plan"). The purchase price
pursuant to such Agreement, as adjusted, is $____________ per share or
$__________ in the aggregate.
In payment of the full purchase price, I enclose (please complete as
appropriate):
(a) my check in the sum of $__________
(b) __________ common shares of the Company owned by me
free of any liens or encumbrances and having a fair
market value of $_________
(c) an authorization letter which gives irrevocable
instructions to the Company to deliver the stock
certificates representing the shares for which the
option is being exercised directly to
__________________ (name and address of broker)
together with a copy of the instructions to
_______________ (name of broker) to sell such shares
and promptly deliver to the Company the portion of
the proceeds equal to the total purchase price and
withholding taxes due, if any.
Very truly yours,
----------------------------
Optionee's Signature
June 19, 1995
PSC Inc.
675 Basket Road
Webster, NY 14580
RE: Registration Statement on Form S-8 (No.___________)
Gentlemen:
You have requested our opinion as counsel for PSC Inc., a New York
corporation (the "Company") in connection with the registration under the
Securities Act of 1933, as amended, and the Rules and Regulations promulgated
hereunder, of 1,750,000 common shares of the Company, $.01 par value (the
"Common Stock") which will from time to time be issued to certain employees,
officers, consultants and non-employee directors of the Company and its
subsidiairies upon the exercise of options to purchase such Common Stock granted
or to be granted pursuant to the 1994 Stock Option Plan adopted by the Company
(the "Option Plan").
We have examined the Company's Registration Statement on Form S-8 in the
form to be filed with the Securities and Exchange Commission (the "Registration
Statement"). We further have examined the Restated Certificate of Incorporation,
as amended, of the Company, the by-laws of the Company, as amended, and the
corporate proceedings taken to authorize the Option Plan, the granting of
options to purchase such Common Stock under the Option Plan, and the issuance
and sale of the Common Stock upon exercise of such stock options granted by the
Company.
Based upon the foregoing, we are of the opinion that:
1.The Company has been duly organized and is a validly existing
corporation under the laws of the State of New York.
2.All necessary action has been taken by the Board of Directors and
shareholders of the Company to authorize the Option Plan including the granting
of options to purchase such Common Stock under the Option Plan and the issuance
and sale of the Common Stock upon exercise of such stock options granted by the
Company.
3.When certificates for the Common Stock have been delivered against
payment of the purchase price therefor upon exercise of such stock options, such
Common Stock will be duly authorized and validly issued, fully paid and
non-assessable.
We hereby consent to the filing of this opinion as Exhibit 5.1 to the
Registration Statement and we further consent to the reference made to us under
the heading "Interests of Named Experts and Counsel" in the Registration
Statement.
Very truly yours,
BOYLAN, BROWN, CODE,
FOWLER, VIGDOR & WILSON, LLP
EXHIBIT 24.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference in this registration statement of our records dated January 30,
1995, included in PSC Inc.'s Form 10-K for the year ended December 31, 1994.
ARTHUR ANDERSEN LLP
Rochester, New York
June 19, 1995
