Registration No.
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
EQUITABLE RESOURCES, INC.
................................................................................
................................................................................
(Exact name of registrant as specified in its charter)
Pennsylvania 25-0464690
.......................................... ............................
.......................................... ............................
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Oxford Centre, Suite 3300
301 Grant Street
Pittsburgh, Pennsylvania 15219
.......................................... ............................
(Address of Principal Executive Offices) (Zip Code)
1999 Equitable Resources, Inc.
Non-Employee Directors' Stock Incentive Plan
................................................................................
(Full title of the plan)
Johanna G. O'Loughlin, Vice President, General Counsel and Secretary
One Oxford Centre, Suite 3300, 301 Grant Street
Pittsburgh, Pennsylvania 15219
................................................................................
(Name and address of agent for service)
Telephone number, including area code,
of agent for service: (412) 553-7760
................................................................................
CALCULATION OF REGISTRATION FEE
- -------------- ----------- --------- ----------- -------------
Proposed Proposed
Title of maximum maximum
securities Amount offering aggregate Amount of
to be to be price offering Registration
registered registered per share price Fee
- -------------- ----------- --------- ----------- -------------
Common Stock 300,000
(No Par Value) shares 36 9/16* $10,968,750 $3,050
- -------------- ----------- --------- ----------- -------------
* Estimated solely for the purpose of calculating the registration fee;
computed on the basis of the high and low prices per share of
common stock sold on June 25, 1999, pursuant to Rule 457(h).
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed with the Securities and
Exchange Commission are incorporated in this Registration Statement by
reference:
(1) The Annual Report on Form 10-K for the year ended December 31, 1998.
(2) Amendment Number 1 filed March 30, 1999 to the Annual Report on Form 10-K
for year ended December 31, 1998.
(3) Proxy Statement for the Company's Annual Meeting of Shareholders held May
26, 1999.
(4) Quarterly Report on Form 10-Q for the first quarter ended March 31, 1999.
(5) Current Report on Form 8-K dated January 4, 1999.
(6) Current Report on Form 8-K dated June 1, 1999.
(7) Description of the Company's Common Stock set forth in
the Prospectus contained in the Company's Registration
Statement on Form S-3, Registration No. 33-49905, filed
August 4, 1993, and Pre-Effective Amendment to said
Registration Statement filed August 25, 1993.
All documents subsequently filed by Equitable Resources,
Inc. pursuant to Section 13(a), 13(c), 14 and 15(d) of the Securities Exchange
Act of 1934, prior to the filing of a post-effective amendment which indicates
that all securities offered have been sold or which deregisters all securities
then remaining unsold, shall be deemed to be incorporated by reference in this
Registration Statement and to be a part hereof from the date of filing of such
documents. Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Registration Statement to the extent that a statement
contained herein or in any other subsequently filed document which also is or is
deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Registration
Statement.
Item 4. DESCRIPTION OF SECURITIES.
Not Applicable.
Item 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Certain legal matters in connection with the sale of the
shares of Common Stock offered hereby will be passed upon for
the Company by Johanna G. O'Loughlin, employed by the Company as its Vice
President, General Counsel and Secretary. On June 25, 1999, Ms. O'Loughlin
beneficially owned 2066 shares of the Company's Common Stock, held options to
purchase an additional 43,000 shares of Common Stock, and held restricted Common
Stock awards of 3,998 shares.
Item 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Sections 1741 and 1742 of the Pennsylvania Business
Corporation Law (the "PBCL") provide that a business corporation shall have the
power to indemnify any person who was or is a party, or is threatened to be made
a party, to any proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that such person is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of another
corporation or other enterprise, against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred
by such person in connection with such proceeding, if such person acted in, good
faith and in a manner he reasonably believed to be in, or not opposed to, the
best interests of the corporation, and, with respect to any criminal proceeding,
had no reasonable cause to believe his conduct was unlawful. In the case of an
action by or in the right of the corporation, such indemnification is limited to
expenses (including attorneys, fees) actually and reasonably incurred by such
person in connection with the defense or settlement of such action, except that
no indemnification shall be made in respect of any claim, issue or matter as to
which such person has been adjudged to be liable to the corporation unless, and
only to the extent that, a court determines upon application that, despite the
adjudication of liability but in view of all the circumstances, such persons is
fairly and reasonably entitled to indemnity for the expenses that the court
deems proper.
PBCL Section 1744 provides that, unless ordered by a court,
any indemnification referred to above shall be made by the corporation only as
authorized in the specific case upon a determination that indemnification is
proper in the circumstances because the indemnitee has met the applicable
standard of conduct. Such determination shall be made:
(1) by the Board of Directors by a majority vote of a quorum
consisting of directors who were not parties to the
proceeding; or
(2) if such a quorum is not obtainable, or if obtainable and
a majority vote of a quorum of disinterested directors
so directs, by independent legal counsel in a written
opinion; or
(3) by the shareholders.
Notwithstanding the above, PBCL Section 1743 provides that
to the extent that a director, officer, employee or agent of a business
corporation is successful on the merits or otherwise in defense of any
proceeding referred to above, or in defense of any claim, issue or matter
therein, such person shall be indemnified against expenses (including attorneys'
fees) actually and reasonably incurred by such person in connection therewith.
PBCL Section 1745 provides that expenses (including
attorneys' fees) incurred by an officer, director, employee or agent of a
business corporation in defending any such proceeding may be paid by the
corporation in advance of the final disposition of the proceeding upon receipt
of any undertaking to repay the amount advanced if it is ultimately determined
that the indemnitee is not entitled to be indemnified by the corporation.
PBCL Section 1746 provides that the indemnification and
advancement of expenses provided by, or granted pursuant to, the foregoing
provisions is not exclusive of any other rights to which a person seeking
indemnification may be entitled under any bylaw, agreement, vote of shareholders
or disinterested directors or otherwise, and that indemnification may be granted
under any bylaw, agreement, vote of shareholders or directors or otherwise by
any action taken or any failure to take any action whether or not the
corporation would have the power to indemnify the person under any other
provision of law and whether or not the indemnified liability arises or arose
from any action by or in the right of the corporation, provided, however, that
no indemnification may be made in any case where the act or failure to act
giving rise to the claim for indemnification is determined by a court to have
constituted willful misconduct or recklessness.
Article IV of the By-Laws of the Registrant provides that
the directors, officers, agents and employees of the Registrant shall be
indemnified as of right to the fullest extent now or hereafter not prohibited by
law in connection with any actual or threatened action, suit or proceeding,
civil, criminal, administrative, investigative or other (whether brought by or
in the right of the Registrant or otherwise) arising out of their service to the
Registrant or to another enterprise at the request of the Registrant.
PBCL Section 1747 permits a Pennsylvania business
corporation to purchase and maintain insurance on behalf of any person who is or
was a director, officer, employee or agent of the corporation, or is or was
serving at the request of the corporation as a director, officer, employee or
agent of another corporation or other enterprise, against any liability asserted
against such person and incurred by him in any such capacity, or arising out of
his status as such, whether or not the corporation would have the power to
indemnify the person against such liability under the provisions described
above.
Article IV of the By-Laws of the Registrant provides that
the Registrant may purchase and maintain insurance to protect itself and any
director, officer, agent or employee entitled to indemnification under Article
IV against any liability asserted against such person and incurred by such
person in respect of the service of such person to the Registrant whether or not
the Registrant would have the power to indemnify such person against such
liability by law or under the provisions of Article IV.
The Registrant maintains directors' and officers' liability
insurance covering its directors and officers with respect to liabilities,
including liabilities under the Securities Act of 1933, as amended, which they
may incur in connection with their serving as such. Under this insurance, the
Registrant may receive reimbursement for amounts as to which the directors and
officers are indemnified by the Registrant under the foregoing By-Law
indemnification provision. Such insurance also provides certain additional
coverage for the directors and officers against certain liabilities even though
such liabilities may not be covered by the foregoing By-Law indemnification
provision.
As permitted by PBCL Section 1713, the Articles and the
By-Laws of the Registrant provide that no director shall be personally liable
for monetary damages for any action taken, or failure to take any action, unless
such director's breach of duty or failure to perform constituted self-dealing,
willful misconduct or recklessness. The PBCL states that this exculpation from
liability does not apply to the responsibility or liability of a director
pursuant to any criminal statute or the liability of a director for the payment
of taxes pursuant to Federal, state or local law. It may also not apply to
liabilities imposed upon directors by the federal securities laws. PBCL Section
1715(d) creates a presumption, subject to exceptions, that a director acted in
the best interests of the corporation. PBCL Section 1712, in defining the
standard of care a director owes to the corporation, provides that a director
stands in a fiduciary relation to the corporation and must perform his duties as
a director or as a member of any committee of the Board in good faith, in a
manner he reasonably believes to be in the best interests of the corporation and
with such care, including reasonable inquiry, skill and diligence, as a person
of ordinary prudence would use under similar circumstances.
In June, 1987, the Registrant entered into a separate
Indemnity Agreement with each of its then directors and officers. The Registrant
then entered into a separate Indemnity Agreement with each new director or
officer who joined the Board of Directors or Registrant after June, 1987. These
Indemnity Agreements provide a contractual right to indemnification against
expenses and liabilities (subject to certain limitations and exceptions) and a
contractual right to advancement of expenses, and contain additional provisions
regarding the determination of entitlement, settlement of proceedings,
insurance, rights of contribution, and other matters.
Item 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not Applicable.
Item 8. EXHIBITS.
Number Description
4.1 Restated Articles of Incorporation of
Equitable Resources, Inc., filed herewith.
5.1 Opinion of Johanna G. O'Loughlin as to
the legality of the Equitable Resources, Inc.
Common Stock covered by this Registration
Statement, filed herewith.
23.1 Consent of Ernst & Young, LLP
independent auditors, filed
herewith.
23.2 Consent of Johanna G. O'Loughlin to the
use of the Opinion referred to under 5.1
above (such consent to be contained in
such Opinion).
24.1 Power of Attorney.
99.1 Copy of Non-Employee Directors' Stock Incentive
Plan.
Item 9. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) to include any prospectus required by
Section 10(a)(3) of the Securities Act of
1933;
(ii) to reflect in the prospectus any facts or
events arising after the effective date of
the registration statement (or the most
recent post-effective amendment thereof)
which, individually or in the aggregate,
represents a fundamental change in the
information set forth in the registration
statement;
(iii) to include any material information with
respect to the plan of distribution not
previously disclosed in the registration
statement or any material change to such
information in the registration statement;
Provided, however, that paragraphs (a)(1)(i) and
(a)(1)(ii) do not apply if the information required to
be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the
registrant pursuant to Section 13 or Section 15(d) of
the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective
amendment shall be deemed to be a new registration
statement relating to the securities offered therein,
and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which
remain unsold at the termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each
filing of the registrant's annual report pursuant to Section 13(a)
or Section 15(d) of the Securities Exchange Act of 1934 that is
incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing
provisions, or otherwise, the registrant has been advised that in
the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and
is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by
the registrant of expenses incurred or paid by a director, officer
or controlling person of the registrant in the successful defense of
any action, suit or proceeding) is asserted by such director,
officer or controlling person in connection with the securities
being registered, the registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit
to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the
Act and will be governed by the final adjudication of such issue.
SIGNATURES
The Registrant. Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Pittsburgh, Commonwealth of Pennsylvania, on , 1999
(Registrant) EQUITABLE RESOURCES, INC.
By (Signature and Title) /s/Johanna G. O'Loughlin
-----------------------------------------------------
Vice President, General Counsel and Secretary
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the date indicated.
Signature Title
/s/MURRY S. GERBER President, Chief Executive Officer
- --------------------------------------- Officer and Director
Murry S. Gerber
/s/DAVID L. PORGES Chief Financial Officer
- ---------------------------------------
David L. Porges
/s/JOHN BERGONZI Controller and Chief Accounting
- --------------------------------------- Officer
John Bergonzi
/s/PAUL CHRISTIANO
- --------------------------------------- Director
Paul Christiano
/s/PHYLLIS A.DOMM
- --------------------------------------- Director
Phyllis A. Domm
/s/E. LAWRENCE KEYES, JR, Director
- ---------------------------------------
E. Lawrence Keyes, Jr.
/s/THOMAS A. MCCONOMY Director
- ---------------------------------------
Thomas A. McConomy
/s/DONALD I. MORITZ Director
- ---------------------------------------
Donald I. Moritz
/s/GUY W. NICHOLS Director
- ---------------------------------------
Guy W. Nichols
/s/MALCOLM M. PRINE Director
- ---------------------------------------
Malcolm M. Prine
/s/JAMES E. ROHR Director
- ---------------------------------------
James E. Rohr
/s/DAVID S. SHAPIRA Director
- ---------------------------------------
David S. Shapira
/s/J. MICHAEL TALBERT Director
- ---------------------------------------
J. Michael Talbert
EXHIBIT 4.1
RESTATED ARTICLES OF EQUITABLE RESOURCES, INC.
(As Amended Through May 18, 1999)
The following is a Composite Copy of the Articles of Equitable
Resources, Inc., as restated effective August 7, 1981, and as amended effective
June 23, 1982, January 13, 1984, October 1, 1984, June 12, 1987, May 27, 1993,
May 8, 1996, and May 18, 1999.
First: The name of the Company is EQUITABLE RESOURCES, INC.
Second: The location and post office address of its current registered office in
the Commonwealth of Pennsylvania is One Oxford Centre, Suite 3300, 301 Grant
Street, City of Pittsburgh, 15219, County of Allegheny.
Third: The purposes for which the Company is incorporated under the Business
Corporation Law of the Commonwealth of Pennsylvania are to engage in, and to do
any lawful act concerning, any or all lawful business for which corporations may
be incorporated under said Business Corporation Law, including but not limited
to:
A. the supply of heat, light and power to the public by any
means;
B. the production, purchase, generation, manufacture,
transmission, transportation, storage, distribution and supplying of
natural or artificial gas, steam or air conditioning, electricity, or
any combination thereof to or for the public; and
C. manufacturing, processing, owning, using and dealing in
personal property of every class and description, engaging in research
and development, the furnishing of services, and acquiring, owning,
using and disposing of real property of every nature whatsoever.
Fourth: The term of the Company's existence shall be perpetual.
Fifth: The aggregate number of shares which the Company shall have authority to
issue shall be:
(a) 3,000,000 shares of Preferred Stock, without par value; and
(b) 80,000,000 shares of Common Stock, without par value.
The designations, preferences, qualifications, limitations, restrictions, and
the special or relative rights in respect of the Preferred Stock and of the
Common Stock of the Company, and a statement of the authority hereby vested in
the Board of Directors of the Company to fix and determine the designations,
preferences, qualifications, limitations, restrictions, and special or relative
rights in respect of all series of the Preferred Stock shall be as follows:
Division A?THE PREFERRED STOCK
1.1 Preferred Stock. The Preferred Stock may be divided into and issued
in series. The Board of Directors is hereby expressly authorized, at any time or
from time to time, to divide any or all of the shares of the Preferred Stock
into series, and in the resolution or resolutions establishing a particular
series, before issuance of any of the shares thereof, to fix and determine the
designation and the relative rights and preferences of the series so
established, to the fullest extent now or hereafter permitted by the laws of the
Commonwealth of Pennsylvania, including, but not limited to, the variations
between different series in the following respects:
(a) the distinctive serial designation of such series;
(b) the annual dividend rate for such series, and the date or
dates from which dividends shall commence to accrue;
(c) the redemption price or prices, if any, for shares of such
series and the terms and conditions on which such shares may be
redeemed;
(d) the provisions for a sinking, purchase or similar fund, if
any, for the redemption or purchase of shares of such series;
(e) the preferential amount or amounts payable upon shares of
such series in the event of the voluntary or involuntary liquidation of
the Company;
(f) the voting rights, if any, of shares of such series;
(g) the terms and conditions, if any, upon which shares of such
series may be converted and the class or classes or series of securities
of the Company into which such shares may be converted;
(h) the relative seniority, parity or junior rank of such
series with respect to other series of Preferred Stock then or
thereafter to be issued; and
(i) such other terms, limitations and relative rights and
preferences, if any, of shares of such series as the Board of Directors
may, at the time of such resolutions, lawfully fix and determine under
the laws of the Commonwealth of Pennsylvania.
Division B?PROVISIONS APPLICABLE TO BOTH THE
PREFERRED STOCK AND THE COMMON STOCK
2.1 Voting Rights. Except as provided in this Section 2.1, the holders
of the Common Stock shall have exclusive voting rights for the election of
Directors and for all other purposes and shall be entitled to one vote for each
share held.
The holders of the Preferred Stock shall have no voting rights except as
may be provided with respect to any particular series of the Preferred Stock by
the Board of Directors pursuant to Subdivision 1.1 of Division A hereof. On any
matter on which the holders of the Preferred Stock shall be entitled to vote,
they shall be entitled to vote as established by the Board of Directors pursuant
to Subdivision 1.1 of Division A hereof.
In all elections for Directors, every stockholder entitled to vote shall
have the right, in person or by proxy, to multiply the number of votes to which
such stockholder may be entitled by the number of Directors for the election of
whom he is entitled to vote at such meeting, and such stockholder may cast the
whole number of such votes for one candidate or may distribute them among any
two or more candidates. The candidates receiving the highest number of votes up
to the number of Directors to be elected shall be elected. The foregoing
provisions of this paragraph shall not be changed with respect to any class of
stock unless the holders of record of not less than two-thirds of the number of
shares of such class of stock then outstanding shall consent thereto in writing
or by voting therefor in person or by proxy at the meeting of stockholders at
which any such change is considered.
2.2 Pre-emptive Rights. Upon any issue for money or other consideration
of any stock of the Company that may be authorized from time to time, no holder
of stock, irrespective of the kind of such stock, shall have any pre-emptive or
other right to subscribe for, purchase, or receive any proportionate or other
share of the stock so issued, but the Board of Directors may dispose of all or
any portion of such stock as and when it may determine, free of any such rights,
whether by offering the same to stockholders or by sale or other disposition as
said Board may deem advisable; provided, however, that if the Board of Directors
shall determine to offer any new or additional shares of Common Stock, or any
security convertible into Common Stock, for money, other than (i) by a public
offering of all of such shares or offering of all of such shares to or through
underwriters or investment bankers who shall have agreed promptly to make a
public offering of such shares, or (ii) pursuant to any employee compensation,
incentive or other benefit program adopted by the Board of Directors, the same
shall first be offered pro rata to the holders of the then outstanding shares of
Common Stock of the Company at a price not less favorable than the price at
which the Board of Directors issues and disposes of such stock or securities to
other than such holders of Common Stock before deducting reasonable commissions
or compensation that may be paid by the Company in connection with the sale of
any such stock and securities; and provided, further, that the time within which
such pre-emptive rights shall be exercised may be limited by the Board of
Directors to such time as the said Board may deem proper, not less, however,
than ten days after mailing of notice that such stock rights are available and
may be exercised. The foregoing provisions of this Subdivision 2.2 shall not be
changed unless the holders of record of not less than two-thirds of the number
of shares of the Common Stock then outstanding shall consent thereto in writing
or by voting therefor in person or by proxy at the meeting of stockholders at
which any such change is considered.
2.3 Amendments to By-Laws. The Board of Directors may make, amend and
repeal the By-Laws with respect to those matters which are not, by statute,
reserved exclusively to the shareholders, subject always to the power of the
shareholders to change such action as provided herein. No By-Law may be made,
amended or repealed by the shareholders unless such action is approved by the
affirmative vote of the holders of not less than 80% of the voting power of the
then outstanding shares of capital stock of the Company entitled to vote in an
annual election of directors, voting together as a single class, unless such
action has been previously approved by a two-thirds vote of the whole Board of
Directors, in which event (unless otherwise expressly provided in the Articles
or the By-Laws) the affirmative vote of not less than a majority of the votes
which all shareholders are entitled to cast thereon shall be required.
2.4 Amendments to Articles. Subject to the voting rights given to any
particular series of the Preferred Stock by the Board of Directors pursuant to
Subdivision 1.1 of Division A hereof, and except as may be specifically provided
to the contrary in any other provision in the Articles with respect to amendment
or repeal of such provision, the affirmative vote of the holders of not less
than 80% of the voting power of the then outstanding shares of capital stock of
the Company entitled to vote in an annual election of directors, voting together
as a single class, shall be required to amend the Articles of the Company or
repeal any provision thereof, unless such action has been previously approved by
a two-thirds vote of the whole Board of Directors, in which event (unless
otherwise expressly provided in the Articles) the affirmative vote of not less
than a majority of the votes which all shareholders are entitled to cast thereon
shall be required.
2.5 General. The Company may issue and dispose of any of its authorized
shares for such consideration as may be fixed by the Board of Directors subject
to the laws then applicable and to the provisions of Subdivision 2.2 of this
Division B.
Division C?BOARD OF DIRECTORS;
CLASSIFICATION; REMOVAL; VACANCIES
3.1 The business and affairs of the Company shall be managed by a
Board of Directors comprised as follows:
(a) The Board of Directors shall consist of not less than 5 nor
more than 12 persons, the exact number to be fixed from time to time by
the Board of Directors pursuant to a resolution adopted by a majority
vote of the directors then in office.
(b) Directors of the Company shall be classified with respect
to the time for which they shall severally hold office by dividing them
into three classes: Class 1; Class 2; and Class 3, as nearly equal in
number as possible. At the special meeting of shareholders at which the
amendment adding this Division C shall be adopted, the then current
directors shall be assigned to the three classes in accordance with
resolutions adopted by the Board of Directors. Class 1 directors shall
not be elected at such special meeting but shall continue to hold office
until the annual meeting of shareholders in 1984. Class 2 directors
shall be elected by shareholders at such special meeting to extended
terms of office, to serve until the annual meeting in 1985. Class 3
directors shall be elected by shareholders at such special meeting to
extended terms of office, to serve until the annual meeting in 1986.
Each class of directors to be elected at such special meeting shall be
elected in a separate election. At each succeeding annual meeting of
shareholders, the class of directors then being elected shall be elected
to hold office for a term of three years. Each director shall hold
office for the term for which elected and until his or her successor
shall have been elected and qualified.
(c) Any director, any class of directors or the entire Board of
Directors may be removed from office by shareholder vote at any time,
without assigning any cause, but only if shareholders entitled to cast
at least 80% of the votes which all shareholders would be entitled to
cast at an annual election of directors or of such class of directors
shall vote in favor of such removal; provided, however, that no
individual director shall be removed without cause (unless the entire
Board of Directors or any class of directors be removed) in case the
votes cast against such removal would be sufficient, if voted
cumulatively for such director, to elect him or her to the class of
directors of which he or she is a member.
(d) Vacancies in the Board of Directors, including vacancies
resulting from an increase in the number of directors, shall be filled
only by a majority vote of the remaining directors then in office,
though less than a quorum, except that vacancies resulting from removal
from office by a vote of the shareholders may be filled by the
shareholders at the same meeting at which such removal occurs. All
directors elected to fill vacancies shall hold office for a term
expiring at the annual meeting of shareholders at which the term of the
class to which they have been elected expires. No decrease in the number
of directors constituting the Board of Directors shall shorten the term
of any incumbent director.
(e) Whenever the holders of any class or series of preferred
stock shall have the right, voting separately as a class, to elect one
or more directors of the Company, none of the foregoing provisions of
this Section 3.1 shall apply with respect to the director or directors
elected by such holders of preferred stock.
3.2 Notwithstanding any other provisions of law, the Articles or the
By-Laws of the Company, the affirmative vote of the holders of not less than 80%
of the voting power of the then outstanding shares of capital stock of the
Company entitled to vote in an annual election of directors, voting together as
a single class, shall be required to amend, alter, change or repeal, or adopt
any provision inconsistent with, this Division C, unless such action has been
previously approved by a two-thirds vote of the whole Board of Directors.
3.3 No Director shall be personally liable for monetary damages as such
(except to the extent otherwise provided by law) for any action taken, or any
failure to take any action, unless such Director has breached or failed to
perform the duties of his or her office under Title 42, Chapter 83, Subchapter F
of the Pennsylvania Consolidated Statutes (or any successor statute relating to
Directors' standard of care and justifiable reliance); and the breach or failure
to perform constitutes self-dealing, willful misconduct or recklessness.
If the Pennsylvania Consolidated Statutes are amended after May 22,
1987, the date this section received shareholder approval, to further eliminate
or limit the personal liability of Directors, then a Director shall not be
liable, in addition to the circumstances set forth in this section, to the
fullest extent permitted by the Pennsylvania Consolidated Statutes, as so
amended.
The provisions of this section shall not apply to any actions filed
prior to January 27, 1987 nor to any breach of performance of duty, or any
failure of performance of duty, by any Director occurring prior to January 27,
1987.
Division D?PROCEDURES RELATING
TO CERTAIN BUSINESS COMBINATIONS
4.1 Votes Required; Exceptions.
(a) The affirmative vote of the holders of not less than 80% of
the voting power of the then outstanding shares of capital stock of the
Company entitled to vote in an annual election of directors (the "Voting
Stock"), voting together as a single class, shall be required for the
approval or authorization of any "Business Combination" (as hereinafter
defined) involving a "Related Person" (as hereinafter defined);
provided, however, that the 80% voting requirement shall not be
applicable if:
(1) The "Continuing Directors" (as hereinafter defined)
of the Company by a two-thirds vote have expressly approved
such Business Combination either in advance of or subsequent to
such Related Person's having become a Related Person; or
(2) both the following conditions are satisfied:
(A) the aggregate amount of the cash and the
"Fair Market Value" (as hereinafter defined) of the
property, securities and "Other Consideration" (as
hereinafter defined) to be received per share by holders
of capital stock of the Company in the Business
Combination, other than the Related Person, is not less
than the "Highest Equivalent Price" (as hereinafter
defined) of such shares of capital stock; and
(B) a proxy or information statement describing
the proposed Business Combination and complying with the
requirements of the Securities Exchange Act of 1934, as
amended, whether or not the Company is then subject to
such requirements, shall have been mailed to all
shareholders of the Company. The proxy or information
statement shall contain at the front thereof, in a
prominent place, the position of the Continuing
Directors as to the advisability (or inadvisability) of
the Business Combination and, if deemed advisable by a
majority of the Continuing Directors, the opinion of an
investment banking firm selected by the Continuing
Directors as to the fairness of the terms of the
Business Combination, from the point of view of the
holders of the outstanding shares of capital stock of
the Company other than any Related Person.
(b) Such 80% vote shall in any such instance be required
notwithstanding the fact that no vote may be required or that a lesser
percentage may be specified by law or in any agreement with any national
securities exchange or otherwise.
4.2 Definitions. For purposes of this Division D:
(a) A "Person" shall mean any individual, partnership,
corporation or other entity. As used herein, the pronouns "which" and
"it" in relation to Persons which are individuals shall be construed to
mean "who" or "whom", "he" or "she", and "him" or "her", as appropriate.
(b) The terms "Affiliate" and "Associate" shall have the
respective meanings ascribed to such terms in Rule 12b-2 of the General
Rules and Regulations under the Securities Exchange Act of 1934, as in
effect on November 10, 1983 (the term "registrant" in said Rule 12b-2
meaning in this case the Company).
(c) The term "Beneficial Owner" (and variations thereof) shall
have the meaning ascribed to such term in Rule 13d-3 of the General
Rules and Regulations under the Securities Exchange Act of 1934, as in
effect on November 10, 1983; provided, however, that notwithstanding any
provision of Rule 13d-3 to the contrary, an entity shall be deemed to be
the Beneficial Owner of any share of capital stock of the Company that
such entity has the right to acquire at any time pursuant to any
agreement, or upon exercise of conversion rights, warrants or options,
or otherwise.
(d) The term "Voting Stock" shall have the meaning set forth at
the beginning of Section 4.1(a) of this Division D. (e) The term
"Subsidiary" of any Person shall mean any corporation of which a
majority of the capital stock entitled to vote for the election of
directors is Beneficially Owned by such Person directly or indirectly
though other Subsidiaries of such Person.
(f) The term "Substantial Part" of the assets of any person
shall mean more than 10% of the Fair Market Value, as determined by a
two-thirds vote of the Continuing Directors, of the total consolidated
assets of such Person and its Subsidiaries as of the end of its most
recent fiscal year ended prior to the time the determination is being
made.
(g) The term "Other Consideration" shall include, without
limitation, shares of Common Stock or other capital stock of the Company
retained by the holders of such shares in the event of a Business
Combination in which the Company is the surviving corporation.
(h) The term "Continuing Director" shall mean a director of the
Company who is unaffiliated with any Related Person and either (1) was a
director of the Company immediately prior to the time the Related Person
involved in a Business Combination became a Related Person or (2) is a
successor to a Continuing Director and is recommended to succeed a
continuing Director by a majority of the then Continuing Directors.
Where this Division D contains provisions for a determination,
recommendation or approval by the Continuing Directors, if there is at
any particular relevant time no Continuing Director in office, then such
provision shall be deemed to be satisfied if the Board, by a two-thirds
vote of the whole Board of Directors, makes or gives such determination,
recommendation or approval.
(i) The term "Business Combination" shall mean
(1) any merger, consolidation or share exchange of the
Company or a Subsidiary of the Company with a Related Person,
in each case without regard to which entity is the surviving
entity;
(2) any sale, lease, exchange, transfer or other
disposition, including without limitation a mortgage or any
other security device, of all or any Substantial Part of the
assets of the Company (including without limitation any voting
securities of a Subsidiary of the Company) or a Subsidiary of
the Company to or with a Related Person (whether in one
transaction or series of transactions), or of all or any
Substantial Part of the assets of a Related Person to the
Company or a Subsidiary of the Company;
(3) the issuance, transfer or delivery of any securities
of the Company or a Subsidiary of the Company by the Company or
any of its Subsidiaries to a Related Person, or of any
securities of a Related Person to the Company or a Subsidiary
of the Company (other than an issuance or transfer of
securities which is effected on a pro rata basis to all
shareholders of the Company or of the Related Person, as the
case may be);
(4) any recapitalization, reorganization or
reclassification of securities (including any reverse stock
split) or other transaction that would have the effect,
directly or indirectly, of increasing the voting power of a
Related Person;
(5) the adoption of any plan or proposal for the
liquidation or dissolution of the Company proposed by or on
behalf of a Related Person; or
(6) any agreement, plan, contract or other arrangement
providing for any of the transactions described in this
definition of Business Combination.
(j) The term "Related Person" at any particular time shall mean
any Person if such Person, its Affiliates, its Associates, and all
Persons of which it is an Affiliate or Associate Beneficially Own in the
aggregate 10% or more of the outstanding Voting Stock of the Company,
and any Affiliate or Associate of any such Person, and any Person of
which such Person is an Affiliate or Associate. With respect to any
particular Business Combination, the term "Related Person" means the
Related Person involved in such Business Combination, any Affiliate or
Associate of such Related Person, and any Person of which such Related
Person is an Affiliate or Associate. Where in this Division D any
reference is made to a transaction involving, or ownership of securities
by, a Related Person, it shall mean and include one or more transactions
involving different Persons all included within the definition of
"Related Person", or ownership of securities by any or all of such
Persons. Each Person who is an Affiliate or Associate of a Related
Person shall be deemed to have become a Related Person at the earliest
time any of such Persons becomes a Related Person.
(k) The term "highest Equivalent Price" with respect to shares
of capital stock of the Company of any class or series shall mean the
following:
(1) with respect to shares of Common Stock, the highest
price that can be determined to have been paid at any time by a
Related Person for any shares of Common Stock; and
(2) with respect to any class or series of shares of
capital stock other than Common Stock, the higher of the
following:
(A) if any shares of such class or series are
Beneficially Owned by a Related Person, the highest
price that can be determined to have been paid at any
time by a Related Person for such shares; or
(B) the amount determined by the Continuing
Directors, on whatever basis they believe is
appropriate, to be the per share price equivalent of the
highest price that can be determined to have been paid
at any time by a Related Person for any shares of any
other class or series of capital stock of the Company.
In determining the Highest Equivalent Price, all purchases by a Related
Person shall be taken into account regardless of whether the shares were
purchased before or after the Related Person became a Related Person.
Also, the Highest Equivalent Price shall include any brokerage
commissions, transfer taxes, soliciting dealers' fees and other expenses
paid by the Related Person with respect to the shares of capital stock
of the Company acquired by the Related Person. In the case of any
Business Combination with a Related Person, the Continuing Directors by
a two-thirds vote shall determine the Highest Equivalent Price for each
class and series of capital stock of the Company.
(l) The term "Fair Market Value" shall mean (1) in the case of
stock, the highest closing sale price during the 30-day period
immediately preceding the date in question of a share of such stock on
the New York Stock Exchange's consolidated transaction reporting system,
or, if such stock is not listed on such Exchange, on the principal
United States securities exchange registered under the Securities
Exchange Act of 1934 on which such stock is listed, or, if such stock is
not listed on any such exchange, the highest closing bid quotation with
respect to a share of such stock during the 30-day period preceding the
date in question on the National Association of Securities Dealers, Inc.
Automated Quotation System or any system then in use, or if no such
quotations are available, the fair market value on the date in question
of a share of such stock as determined by the Continuing Directors; and
(2) in the case of property other than stock or cash, the fair market
value of such property on the date in question as determined by a
two-thirds vote of the Continuing Directors.
4.3 Miscellaneous.
(a) The Continuing Directors, by a two-thirds vote, are
authorized to determine for purposes of this Division D on the basis of
information known to them after reasonable inquiry: (1) whether a Person
is a Related Person, (2) the number of shares of Voting Stock
Beneficially Owned by any Person, (3) whether a Person is an Affiliate
or Associate of another, (4) whether certain assets constitute a
Substantial Part of the assets of any Person, (5) the amounts of prices
paid, market prices, and other factors relative to fixing the Highest
Equivalent Price of shares of capital stock of the Company and (6) the
Fair Market Value of property, securities and Other Consideration
received in a Business Combination. Any such determination made in good
faith shall be binding and conclusive on all parties.
(b) Nothing contained in this Division D shall be construed to
relieve any Related Person from any fiduciary obligation imposed by law.
(c) The fact that any Business Combination complies with the
conditions set forth in Subsection (a)(2) of Section 4.1 of this
Division D shall not be construed to impose any fiduciary duty,
obligation or responsibility on the Board of Directors, or any member
thereof, to approve such Business Combination or recommend its adoption
or approval to the shareholders of the Company, nor shall such
compliance limit, prohibit or otherwise restrict in any manner the Board
of Directors, or any member thereof, with respect to evaluations of or
actions and responses taken with respect to such Business Combination.
(d) Notwithstanding any other provisions of law, the Articles
or the By-Laws of the Company, the affirmative vote of the holders of
not less than 80% of the voting power of the Voting Stock of the
Company, voting together as a single class, shall be required to amend,
alter, change or repeal, or adopt any provision inconsistent with, this
Division D.
Sixth: Henceforth, these Articles of the Company shall not include any prior
documents.
RESOLUTION ADOPTED BY THE BOARD OF DIRECTORS
OF EQUITABLE RESOURCES, INC. ON MARCH 21, 1996
ESTABLISHING THE SERIES ONE PREFERRED STOCK
RESOLVED, That pursuant to the authority conferred upon
the Board of Directors by Article Fifth, Division A, section
1.1 of the Restated Articles of Incorporation of the Company, as amended, there
is hereby established a series of the Preferred Stock of the Company to consist
initially of 500,000 shares with the designation and relative rights and
preferences thereof to be as follows:
Designation. The shares of such series shall be designated as
"Series One Preferred Stock." Shares of this series shall be issued
pursuant to the exercise of rights to purchase Series One Preferred
Stock distributed to the holders of Common Stock, without par value,
of the Company (the "Common Stock").
Dividends and Distributions. Subject to the rights and preferences
of the holders of any shares of any series of Preferred Stock
ranking senior as to dividends to this Series One Preferred Stock,
as such may be established by the Board of Directors, the holders of
shares of Series One Preferred Stock, in preference to the holders
of Common Stock and shares of stock ranking junior as to dividends
to the Series One Preferred Stock, shall be entitled to receive,
when and if declared by the Board of Directors out of funds legally
available for the purpose, quarterly dividends payable in cash on
the 15th day of March, June, September and December in each year
(each such date being referred to herein as a "Quarterly Dividend
Payment Date"), commencing on the first Quarterly Dividend Payment
Date after the first issuance of a share or fraction of a share of
Series One Preferred Stock, in an amount per share (rounded to the
nearest cent) equal to the greater of (a) $29.50 or (b) subject to
the provision for adjustment hereinafter set forth, 100 times the
aggregate per share amount of all cash dividends plus 100 times the
aggregate per share amount (payable in kind) of all non-cash
dividends or other distributions, other than a dividend payable in
shares of Common Stock, or a subdivision of the outstanding shares
of Common Stock (by reclassification or otherwise), paid on the
Common Stock at any time during the quarter year immediately
preceding the quarter year ending on the day immediately preceding
such Quarterly Dividend Payment Date. In the event the Company shall
at any time after April 1, 1996 (the "Rights Distribution Date")
during any quarter year immediately preceding the quarter year
ending on the day immediately preceding a Quarterly Dividend Payment
Date (i) declare any dividend on Common Stock payable in shares of
Common Stock, or (ii) subdivide the outstanding Common Stock or
combine the outstanding Common Stock into a greater or lesser number
of shares of Common Stock, then in each such case the amounts to
which holders of shares of Series One Preferred Stock were entitled
immediately prior to such event under clause (b) of the preceding
sentence shall be adjusted by multiplying each such amount by a
fraction, the numerator of which is the number of shares of Common
Stock outstanding immediately after such event and the denominator
of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
Dividends shall begin to accrue and be cumulative on outstanding
shares of Series One Preferred Stock from the Quarterly Dividend
Payment Date next preceding the date of issue of such shares of
Series One Preferred Stock, unless the date of issue is a Quarterly
Dividend Payment Date or is a date after the record date for the
determination of holders of shares of Series One Preferred Stock
entitled to receive a quarterly dividend and before such Quarterly
Dividend Payment Date, in either of which events such dividends
shall begin to accrue and be cumulative from such Quarterly Dividend
Payment Date. Accrued but unpaid dividends shall not bear interest.
Dividends paid on the shares of Series One Preferred Stock in an
amount less than the total amount of such dividends at the time
accrued and payable on such shares shall be allocated pro rata on a
share-by-share basis among all such shares at the time outstanding.
The Board of Directors may fix a record date for the determination
of holders of shares of Series One Preferred Stock entitled to
receive payment of a dividend or distribution declared thereon,
which record date shall be no more than 30 days prior to the date
fixed for the payment thereof.
Voting Rights. Except as otherwise provided by law, holders of
shares of Series One Preferred Stock shall have no voting rights.
Certain Restrictions. Whenever quarterly dividends or other
dividends or distributions payable on the Series One Preferred Stock
are in arrears, thereafter and until all accrued and unpaid
dividends and distributions, whether or not declared, on shares of
Series One Preferred Stock outstanding shall have been paid in full,
the Company shall not: (i) declare or pay dividends on, make any
distributions on, or redeem or purchase or otherwise acquire for
consideration any shares of stock ranking junior (either as to
dividends or as to assets) to the Series One Preferred Stock; (ii)
declare or pay dividends on or make any other distributions on any
shares of stock ranking on a parity (either as to dividends or as to
assets) with the Series One Preferred Stock, except dividends paid
ratably on the Series One Preferred Stock and all such parity stock
on which dividends are payable or in arrears in proportion to the
total amounts to which the holders of all such shares are then
entitled; (iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking junior (either as to
dividends or as to assets) to the Series One Preferred Stock,
provided that the Company may at any time redeem, purchase or
otherwise acquire shares of any such junior stock in exchange for
shares of any stock of the Company ranking junior (either as to
dividends or as to assets) to the Series One Preferred Stock; or
(iv) purchase or otherwise acquire for consideration any shares of
Series One Preferred Stock, or any shares of stock ranking on a
parity (either as to dividends or upon liquidation, dissolution or
winding up) with the Series One Preferred Stock, except in
accordance with a purchase offer made in writing or by publication
(as determined by the Board of Directors) to all holders of such
shares upon such terms as the Board of Directors, after
consideration of the respective annual dividend rates and other
relative rights and preferences of the respective series and
classes, shall determine in good faith will result in fair and
equitable treatment among the respective series or classes. The
Company shall not permit any subsidiary of the Company to purchase
or otherwise acquire for consideration any shares of stock of the
Company unless the Company could, under this paragraph, purchase or
otherwise acquire such shares at such time and in such manner.
Reacquired Shares. Any shares of Series One Preferred Stock
purchased or otherwise acquired by the Company in any manner
whatsoever shall be retired and canceled promptly after the
acquisition thereof. All such shares shall upon their cancellation
become authorized but unissued shares of Preferred Stock and may be
reissued as part of a new series of Preferred Stock to be created by
resolution or resolutions of the Board of Directors, subject to the
conditions and restrictions on issuance set forth herein.
Liquidation, Dissolution or Winding Up. Subject to the rights and
preferences of the holders of any shares of any series of Preferred
Stock ranking senior as to assets to this Series One Preferred
Stock, as such may be established by the Board of Directors, upon
any involuntary or voluntary liquidation, dissolution or winding up
of the Company, no distribution shall be made to the holders of
shares of stock ranking junior (either as to dividends or as to
assets) to the Series One Preferred Stock unless, prior thereto, the
holders of shares of Series One Preferred Stock shall have received
an amount per share equal to the Per Share Series One Liquidation
Preference. The Per Share Series One Liquidation Preference shall be
equal to the sum of (x) $100.00 plus an amount equal to accrued and
unpaid dividends and distributions thereon, whether or not declared,
to the date of such payment, plus (y) the Participation Preference.
The "Participation Preference" is an amount per each share of Series
One Preferred Stock outstanding equal to the product of (A) the
Excess Distribution Amount, as hereinafter defined, times (B) a
fraction whose numerator is 100 and whose denominator is the sum of
(i) the product of 100 times the number of outstanding shares of
Series One Preferred Stock, plus (ii) the product of 100 times a
fraction whose numerator is the number of outstanding shares of
Common Stock and whose denominator is the Adjustment Number;
provided, however, if the foregoing computation results in a
negative number, then the Participation Preference shall be 0.
Following the payment of the full amount of the Series One
Liquidation Preference, holders of shares of Common Stock shall
receive the remaining assets to be distributed.
The "Excess Distribution Amount" is an amount equal to the amount
available for distribution to shareholders of the Company after
payment of all debts and liabilities less the sum of (i) the
liquidation preferences in respect of all shares of preferred stock
of the Company other than the Series One Preferred Stock, (ii) the
product of 100 times the number of outstanding shares of Series One
Preferred Stock, and (iii) the product of the number of outstanding
shares of Common Stock times a fraction whose numerator is 100 and
whose denominator is the Adjustment Number.
The Adjustment Number shall initially be 100 and shall be subject to
adjustment as provided below. In the event the Company shall at any
time after the Rights Distribution Date (i) declare any dividend on
Common Stock payable in shares of Common Stock, (ii) subdivide the
outstanding Common Stock, or (iii) combine the outstanding Common
Stock into a smaller number of shares, then in each such case the
Adjustment Number in effect immediately prior to such event shall be
adjusted by multiplying such Adjustment Number by a fraction, the
numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were outstanding
immediately prior to such event. Consolidation, Merger, etc. In case
the Company shall enter into any consolidation, merger, combination
or other transaction in which the shares of Common Stock are
exchanged for or changed into other stock or securities, cash and/or
any other property, then in any such case the shares of Series One
Preferred Stock shall at the same time be similarly exchanged or
changed in an amount per share (subject to the provision for
adjustment hereinafter set forth) equal to 100 times the aggregate
amount of stock, securities, cash and/or any other property (payable
in kind), as the case may be, into which or for which each share of
Common Stock is changed or exchanged. In the event the Company shall
at any time (i) declare any dividend on Common Stock payable in
shares of Common Stock, or (ii) subdivide the outstanding Common
Stock or combine the outstanding Common Stock into a greater or
lesser number of shares of Common Stock, then in each such case the
amount set forth in the preceding sentence with respect to the
exchange or change of shares of Series One Preferred Stock shall be
adjusted by multiplying such amount by a fraction, the numerator of
which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the
number of shares of Common Stock that were outstanding immediately
prior to such event.
Redemption. The outstanding shares of Series One Preferred Stock may
be redeemed at the option of the Board of Directors as a whole, but
not in part, at ny time or from time to time, at a cash price per
share equal to (i) the product of the Adjustment Number times the
Average Market Value, as such term is hereinafter defined, of the
Common Stock, plus (ii) all dividends which on the redemption date
have accrued on the shares to be redeemed and have not been paid or
declared and a sum sufficient for the payment thereof set apart,
without interest; provided, however, that if and whenever any
quarter-yearly dividend shall have accrued on the Series One
Preferred Stock which has not been paid or declared and a sum
sufficient for the payment thereof set apart, the Company may not
purchase or otherwise acquire any shares of Series One Preferred
Stock unless all shares of such stock at the time outstanding are so
purchased or otherwise acquired. The "Average Market Value" is the
average of the closing sale prices of the Common Stock during the
30-day period immediately preceding the date before the redemption
date on the Composite Tape for New York Stock Exchange-Listed
Stocks, or, if such stock is not quoted on the Composite Tape, on
the New York Stock Exchange, or, if such stock is not listed on such
Exchange, on the principal United States securities exchange
registered under the Securities Exchange Act of 1934, as amended, on
which such stock is listed, or, if such stock is not listed on any
such exchange, the average of the closing bid quotations with
respect to a share of Common Stock during such 30-day period on the
National Association of Securities Dealers, Inc. Automated
Quotations System or any system then in use, or, if no such
quotations are available, the fair market value of the Common Stock
as determined by the Board of Directors in good faith.
Fractional Shares. Series One Preferred Stock may be issued in
fractions of a share which shall entitle the holder, in proportion
to such holder's fractional shares, to exercise voting rights, if
applicable, receive dividends, participate in distributions and to
have the benefit of all other rights of holders of Series One
Preferred Stock.
EXHIBIT 5.1
June 25, 1999
Equitable Resources, Inc.
One Oxford Centre, Suite 3300
301 Grant Street
Pittsburgh, PA 15219
Gentlemen:
I am the Vice President, General Counsel and Secretary to Equitable
Resources, Inc., a Pennsylvania corporation (the "Company"), and I have acted in
such capacity in connection with the Registration Statement on Form S-8 being
filed with the Securities and Exchange Commission (the "Registration Statement")
for the purpose of registering under the Securities Act of 1933, as amended,
300,000 shares of Common Stock, no par value, which may be issued upon the
exercise of stock options and other stock awards under the 1999 Equitable
Resources, Inc. Non-Employee Directors' Stock Incentive Plan (the "Plan"). In
such connection, I have examined the originals, or copies thereof identified to
my satisfaction, of such corporate records of the Company and such other
documents, records, opinions and papers as I have deemed necessary or
appropriate in order to give the opinions hereinafter set forth.
I understand that, prior to any sale or distribution of Common Stock
under the Plan, the Registration Statement will have become effective under the
Securities Act of 1933, the Company's shareholders will have approved the
implementation of the Plan and the Pennsylvania Public Utility Commission shall
have issued an order approving the Company's issuance of the Common Stock under
the Plan.
Based on the foregoing, I advised you that in my opinion:
1. The Company has been duly organized and is a validly existing
corporation under the laws of the Commonwealth of Pennsylvania;
2. The 300,000 shares of Common Stock which are being registered and which have
been authorized for issuance in accordance with the Plan, are, or will be, when
sold in accordance with the provisions of the Plan, legally issued, fully paid
and non-assessable.
I hereby consent to the filing of my opinion as Exhibit 5.1 to the
Registration Statement.
Very truly yours,
/s/ JOHANNA G. O'LOUGHLIN
Johanna G. O'Loughlin
Vice President, General Counsel
and Secretary
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement (Form
S-8) pertaining to the 1999 Equitable Resources, Inc. Non-Employee Directors'
Stock Incentive Plan of our report dated February 25, 1999, with respect to the
consolidated financial statements and schedule of Equitable Resources, Inc.
included in its Annual Report (Form 10-K) for the Year ended December 31, 1998,
filed with the Securities and Exchange Commission.
/s/Ernst & Young LLP
Ernst & Young LLP
Pittsburgh, Pennsylvania
June 25, 1999
EXHIBIT 24.1
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose
signature appears below constitutes and appoints MURRY S. GERBER, DAVID L.
PORGES and JOHANNA G. O'LOUGHLIN, and each of them, his or her true and lawful
attorneys-in-fact and agents, with full power of substitution and revocation,
for him or her and in his or her name, place and stead, in any and all
capacities, to sign any and all amendments to this Registration Statement, and
to file the same with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to do
and perform each and every act and thing requisite and necessary to be done, as
fully to all intents and purposes as he or she might or could do in person,
hereby ratifying and confirming all that said attorneys-in-fact and agents, or
any of them, or their or his or her substitute, may lawfully 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 by the following persons in the
capacities indicated on , 1999:
Signature Title
/s/MURRY S. GERBER President, Chief Executive Officer
- ----------------------------------- Officer and Director
Murry S. Gerber
/s/DAVID L. PORGES Chief Financial Officer
- -----------------------------------
David L. Porges
/s/JOHN BERGONZI Controller and Chief Accounting
- ----------------------------------- Officer
John Bergonzi
/s/PAUL CHRISTIANO
- ----------------------------------- Director
Paul Christiano
/s/PHYLLIS A.DOMM
- ----------------------------------- Director
Phyllis A. Domm
/s/E. LAWRENCE KEYES, JR, Director
- -----------------------------------
E. Lawrence Keyes, Jr.
/s/THOMAS A. MCCONOMY Director
- -----------------------------------
Thomas A. McConomy
/s/DONALD I. MORITZ Director
- -----------------------------------
Donald I Moritz
/s/GUY W. NICHOLS Director
- -----------------------------------
Guy W. Nichols
/s/MALCOLM M. PRINE Director
- -----------------------------------
Malcolm M. Prine
/s/JAMES E. ROHR Director
- -----------------------------------
James E. Rohr
/s/DAVID S. SHAPIRA Director
- -----------------------------------
David S. Shapira
/s/J. MICHAEL TALBERT Director
- -----------------------------------
J. Michael Talbert
EXHIBIT 99.1
1999 EQUITABLE RESOURCES, INC.
NON-EMPLOYEE DIRECTORS' STOCK INCENTIVE PLAN
(As amended May 26, 1999)
SECTION 1. PURPOSE
1.01 The purpose of the 1999 Equitable Resources, Inc. Non-Employee
Directors' Stock Incentive Plan (the "Plan") is to assist the Company in
attracting and retaining the services of non-employee directors who exhibit a
high degree of business responsibility, personal integrity and professionalism.
SECTION 2. DEFINITIONS; CONSTRUCTION
2.01 Definitions. In addition to the terms defined elsewhere in the
Plan, the following terms as used in the Plan shall have the following meanings
when used with initial capital letters:
2.01.1 "Award" means any Option or Other Stock-Based
Award granted under the Plan.
2.01.2 "Award Agreement" means any written agreement,
contract or other instrument or document evidencing an Award.
2.01.3 "Board" means the Company's Board of Directors.
2.01.4 "Code" means the Internal Revenue Code of 1986,
as amended from time to time, together with rules, regulations and
interpretations promulgated thereunder. References to particular
sections of the Code shall include any successor provisions.
2.01.5 "Change of Control" has the meaning provided in
Section 9.03.
2.01.6 "Committee" means the Compensation Committee or
such other Committee of the Board as may be designated by the Board
to administer the Plan, as referred to in Section 3.01 hereof;
provided however, that any member of the Committee participating in
the taking of any action under the Plan shall qualify as a
"non-employee director" as then defined under Rule 16b-3.
2.01.7 "Common Stock" means shares of the common stock,
without par value, and such other securities of the Company as may
be substituted for Shares pursuant to Section 8.01 hereof.
2.01.8 "Disability" means that a Participant is disabled
within the meaning of Section 422(c)(6) of the Code.
2.01.9 "Exchange Act" means the Securities Exchange Act
of 1934, as amended.
2.01.10 "Fair Market Value" of shares of any stock,
including but not limited to Common Stock, or units of any other
securities (herein "shares"), shall be the closing price for the
date as of which Fair Market Value is to be determined in the
principal market in which such shares are traded, as quoted in The
Wall Street Journal (or in such other reliable publication as the
Committee, in its discretion, may determine to rely upon). If the
Fair Market Value of shares on any date cannot be determined on the
basis set forth in the preceding sentence, or if a determination is
required as to the Fair Market Value on any date of property other
than shares, the Committee shall in good faith determine the Fair
Market Value of such shares or other property on such date. Fair
Market Value shall be determined without regard to any restriction
other than a restriction which, by its terms, will never lapse.
2.01.11 "Option" means a right granted under Section
6.02 hereof to purchase Shares at a specified price during specified
time periods as provided in Section 6.02. Each Option shall be a
nonstatutory stock option, which is an Option not intended to meet
the requirements of Section 422 of the Code.
2.01.12 "Other Stock-Based Award" means an Award,
granted under Section 6.04 hereof, that is denominated or payable
in, valued in whole or in part by reference to, or otherwise based
on, or related to, Shares.
2.01.13 "Participant" means at any time any person who
is a member of the Board, but who is not at the time a full-time
employee of the Company or any Subsidiary nor has been a full-time
employee during the preceding 12-month period. The term
"Participant" does not include advisory, emeritus or honorary
directors.
2.01.14 "Reload Option Rights" and "Reload Option" have
the meanings provided in Section 6.02.2(v).
2.01.15 "Retirement" means that a Participant ceases to
be a member of the Board for any reason on or after reaching the age
of fifty-eight (58) years with at least sixty (60) months of service
as a director. Service shall include the time a director was an
employee director.
2.01.16 "Rule 16b-3" means Rule 16b-3 under the Exchange
Act, as amended from time to time, or any successor to such Rule
promulgated by the Securities and Exchange Commission under Section
16 of the Exchange Act.
2.01.17 "Shares" means the common stock of the Company,
without par value, and such other securities of the Company as may
be substituted for Shares pursuant to Section 8.01 hereof.
2.01.18 "Subsidiary" means any corporation in an
unbroken chain of corporations beginning with the Company, if each
of the corporations other than the last corporation in the chain
owns stock possessing at least 50% of the total combined voting
power of all classes of stock in one of the other corporations in
the chain.
2.02 Construction. For purposes of the Plan, the following rules of
construction shall apply:
2.02.1 The word "or" is disjunctive but not necessarily
exclusive.
2.02.2 Words in the singular include the plural; words
in the plural include the singular; words in the neuter gender
include the masculine and feminine genders, and words in the
masculine or feminine gender include the other and neuter genders.
SECTION 3. ADMINISTRATION
3.01 The Plan shall be administered by the Committee. The Committee
shall have full and final authority to take the following actions, in each case
subject to and consistent with the provisions of the Plan:
(i) to interpret and administer the Plan and any
instrument or agreement relating to, or Award granted under, the
Plan;
(ii) to adopt, amend, suspend, waive and rescind such
rules and regulations as the Committee may deem necessary or
advisable to administer the Plan;
(iii) to correct any defect or supply any omission or
reconcile any inconsistency, and to construe and interpret the Plan,
the rules and regulations, any Award Agreement or other instrument
entered into or Award granted under the Plan;
(iv) to determine the type or types of Other Stock-Based
Awards to be granted to each Participant;
(v) to determine the number of Other Stock-Based Awards
to be granted, the number of Shares or amount of cash or other
property to which an Other Stock-Based Award will relate, the terms
and conditions of any Other Stock-Based Award (including, but not
limited to, any exercise price, grant price or purchase price, any
limitation or restriction, any schedule for lapse of limitations,
forfeiture restrictions or restrictions on exercisability or
transferability, and accelerations or waivers thereof, based in each
case on such considerations as the Committee shall determine), and
all other matters to be determined in connection with an Other
Stock-Based Award;
(vi) to determine whether, to what extent and under what
circumstances an Other Stock-Based Award may be settled in, or the
exercise price of an Other Stock-Based Award may be paid in cash,
Shares, other Awards or other property, or an Other Stock-Based
Award may be accelerated, vested, canceled, forfeited, exchanged or
surrendered;
(vii) to determine whether, to what extent and under
what circumstances cash, Shares, other Awards, other property and
other amounts payable with respect to an Other Stock-Based Award
shall be deferred, whether automatically or at the election of the
Committee or at the election of the Participant;
(viii) to prescribe the form of each Award Agreement,
which need not be identical for each Participant;
(ix) to make all other decisions and determinations as
may be required under the terms of the Plan or as the Committee may
deem necessary or advisable for the administration of the Plan; and
(x) to make such filings and take such actions as may be
required from time to time by appropriate state, regulatory and
governmental agencies.
Any action of the Committee with respect to the Plan shall be final,
conclusive and binding on all Persons, including the Company, Participants, any
Person claiming any rights under the Plan from or through any Participant and
shareholders. The express grant of any specific power to the Committee, and the
taking of any action by the Committee, shall not be construed as limiting any
power or authority of the Committee. The Committee may delegate to officers or
managers of the Company the authority, subject to such terms as the Committee
shall determine, to perform administrative functions under the Plan. Each member
of the Committee shall be entitled to, in good faith, rely or act upon any
report or other information furnished to him by any officer, manager or other
employee of the Company, the Company's independent certified public accountants,
or any executive compensation consultant or other professional retained by the
Company to assist in the administration of the Plan. Any and all powers,
authorizations and discretions granted by the Plan to the Committee shall
likewise be exercisable at any time by the Board.
SECTION 4. SHARES SUBJECT TO THE PLAN
4.01 The maximum net number of Shares which may be issued and in
respect of which Awards may be granted under the Plan shall be limited to
300,000 shares of Common Stock, subject to adjustment as provided in Section
8.01.
For purposes of this Section 4.01, the number of Shares to which an
Award relates shall be counted against the number of Shares available under the
Plan at the time of grant of the Award, unless such number of Shares cannot be
determined at that time, in which case the number of Shares actually distributed
pursuant to the Award shall be counted against the number of Shares available
under the Plan at the time of distribution; provided, however, that Awards
related to or retroactively added to, or granted in tandem with, substituted for
or converted into, other Awards shall be counted or not counted against the
number of Shares reserved and available under the Plan in accordance with
procedures adopted by the Committee so as to ensure appropriate counting but
avoid double counting.
If any Shares to which an Award relates are forfeited, or payment is
made to the Participant in the form of cash, cash equivalents or other property
other than Shares, or the Award otherwise terminates without payment being made
to the Participant in the form of Shares, any Shares counted against the number
of Shares available under the Plan with respect to such Award shall, to the
extent of any such forfeiture, alternative payment or termination, again be
available for Awards under the Plan. If the exercise price of an Award is paid
by delivering to the Company Shares previously owned by the Participant, the
Shares covered by the Award equal to the number of Shares so delivered shall
again be available for Awards under the Plan. Any Shares distributed pursuant to
an Award may consist, in whole or part, of authorized and unissued Shares or of
treasury Shares, including Shares repurchased by the Company for purposes of the
Plan.
SECTION 5. ELIGIBILITY
5.01 Awards shall be granted only to Participants as defined in
Section 2.01.13.
SECTION 6. SPECIFIC TERMS OF AWARDS
6.01 General. Subject to the terms of the Plan and any applicable
Award Agreement, Awards may be granted as set forth in this Section 6. In
addition, the Committee may impose on any Award or the exercise thereof, at the
date of grant or thereafter (subject to the terms of Section 10.01), such
additional terms and conditions, not inconsistent with the provisions of the
Plan, as the Committee shall determine. Except as required by applicable law,
Awards may be granted for no consideration other than prior and/or future
services.
6.02 Automatic Option Grants.
6.02.1 Annual Option Grants. Subject to Section 12.01
hereof, on the first day of June (or if not a day on which the New
York Stock Exchange is open for trading, then on the first such
trading day thereafter) in each year during the term of the Plan,
each Person who is then a Participant shall automatically be granted
an Option for 500 Shares.
6.02.2 Terms of Options. The Options granted under
Section 6.02.1 shall be granted to Participants on the following
terms and conditions:
(i) Exercise Price. The exercise price per
Share of an Option shall be 100% of the Fair Market
Value of a Share on the date of grant of such Option.
(ii) Option Term. The term of each Option
shall be five (5) years from the date of grant, provided
however, that the Option shall expire upon the
Participant's termination of service as a director of
the Company for any reason other than Retirement,
Disability or death.
(iii) Exercisability. The Option shall
become exercisable upon the expiration of three years
from the date of grant or, if earlier, upon the
Participant's termination of service as a director of
the Company by reason of Retirement, Disability or
death.
(iv) Methods of Exercise. The exercise price
of any Option may be paid in cash or Shares, or any
combination thereof, having a Fair Market Value on the
date of exercise equal to the exercise price, provided,
however, that (1) any portion of the exercise price
representing a fraction of a Share shall in any event be
paid in cash and (2) no Shares which have been held for
less than six months may be delivered in payment of the
exercise price of an Option. Delivery of Shares in
payment of the exercise price of an Option may be
accomplished through the effective transfer to the
Company of Shares held by a broker or other agent. The
Company will also cooperate with any person exercising
an Option who participates in a cashless exercise
program of a broker or other agent under which all or
part of the Shares received upon exercise of the Option
are sold through the broker or other agent, or under
which the broker or other agent makes a loan to such
person, for the purpose of paying the exercise price of
an Option. Notwithstanding the preceding sentence, the
exercise of the Option shall not be deemed to occur, and
no Shares will be issued by the Company upon exercise of
an Option, until the Company has received payment in
full of the exercise price.
(v) Reload Option Rights. Options granted
under this Section 6.02 shall have Reload Option Rights
which shall entitle the holder of the Option, upon
exercise of the Option or any portion thereof through
delivery of previously owned Shares, to automatically be
granted on the date of such exercise a new nonstatutory
stock option (a "Reload Option") (1) for a number of
Shares equal to the number of full Shares delivered in
payment of the option price of the original Option, (2)
having an option price equal to 100% of the Fair Market
Value per Share of the Common Stock on such date of
grant, (3) becoming exercisable six months from such
date of grant, (4) having the same expiration date as
the original Option so exercised and (5) having the same
other terms and conditions as apply to an Option granted
under Section 6.02.1. Subject to the preceding sentence
and the other provisions of the Plan, Reload Option
Rights and Reload Options shall have such additional
terms and be subject to such additional restrictions and
conditions, if any, as shall be determined, in its
discretion, by the Committee. The Committee may, in its
discretion, provide in an Award Agreement for such
limitations on the number or frequency of exercises of
Reload Option Rights, or the minimum numbers of Shares
for which such rights may be exercised, as the Committee
may deem advisable for the efficient administration of
the Plan. Reload Option Rights granted under this
Section 6.02 shall entitle the holder of an Option to be
granted a Reload Option only if the underlying Option to
which they relate is exercised during service as a
director of the Company of the original grantee of the
underlying Option. Except as otherwise specifically
provided herein or required by the context, the term
Option as used in this Plan shall include Reload Options
granted under this paragraph.
6.02.3 Allocation of Shares. If on any date on which
Options would otherwise be granted under this Section 6.02 the
number of Shares remaining available under Section 4.01 is not
sufficient for each Participant otherwise entitled to the grant of
an Option to be granted an Option for the full number of Shares
provided in this Section 6.02, then each such Participant shall
automatically be granted an Option for the number of whole Shares
(if any) equal to (a) the number of Shares then remaining available
under the Plan, multiplied by (b) a fraction of which (1) the
numerator is the number of Shares for which such Participant would
otherwise be granted an Option on such date and (2) the denominator
is the number of Shares for which all Participants would otherwise
be granted Options on such date, with any fractional shares being
disregarded.
6.03. Nature of Automatic Award Grants; Award Agreements. The grant
of the Awards provided for in Section 6.02 shall be automatic and not subject to
the discretion of the Committee or any other Person. However, the Committee may
condition the right of a Participant to be granted any such Award upon the
execution and delivery by the Participant of an Award Agreement setting forth
the terms and conditions of the Award as provided herein and such other terms,
conditions and restrictions, not inconsistent with the provisions of the Plan,
as the Committee in its discretion may determine.
6.04 Other Stock-Based Awards. In addition to the automatic Awards
provided for in Section 6.02, the Committee is authorized, subject to
limitations under applicable law, to grant to Participants such other Awards
that are denominated or payable in, valued in whole or in part by reference to,
or otherwise based on, or related to, Shares, as deemed by the Committee to be
consistent with the purposes of the Plan, including, without limitation, stock
options or purchase rights having terms and conditions similar to or different
from Options granted under 6.02, Shares awarded subject to restrictions, Shares
awarded which are not subject to any restrictions or conditions, convertible
securities, exchangeable securities or other rights convertible or exchangeable
into Shares, as the Committee in its discretion may determine. In the discretion
of the Committee, such Other Stock-Based Awards, including Shares, or other
types of Awards authorized under the Plan, may be used in connection with, or to
satisfy obligations of the Company under, other compensation or incentive plans,
programs or arrangements of the Company for eligible Participants.
The Committee shall determine the terms and conditions of Other
Stock-Based Awards. Except as provided in the next paragraph, Shares or
securities delivered pursuant to a stock option or other purchase right granted
under this Section 6.04 shall be purchased for such consideration, paid for by
such methods and in such forms, including, without limitation, cash, Shares,
outstanding Awards or other property or any combination thereof, as the
Committee shall determine, but the value of such consideration shall not be less
than the Fair Market Value of such Shares or other securities on the date of
grant of such purchase right. Delivery of Shares or other securities in payment
of a purchase right, if authorized by the Committee, may be accomplished through
the effective transfer to the Company of Shares or other securities held by a
broker or other agent. Unless otherwise determined by the Committee, the Company
will also cooperate with any person exercising a purchase right who participates
in a cashless exercise program of a broker or other agent under which all or
part of the Shares or securities received upon exercise of a purchase right are
sold through the broker or other agent, or under which the broker or other agent
makes a loan to such person, for the purpose of paying the exercise price of a
purchase right. Notwithstanding the preceding sentence, unless the Committee, in
its discretion, shall otherwise determine, the exercise of the purchase right
shall not be deemed to occur, and no Shares or other securities will be issued
by the Company upon exercise of a purchase right, until the Company has received
payment in full of the exercise price.
Awards granted under this Section 6.04 may, in the discretion of the
Committee, be granted either alone or in addition to, in tandem with or in
substitution for, any other Award granted under the Plan or any award granted
under any other plan, program or arrangement of the Company (subject to the
terms of Section 10.01) or any business entity acquired or to be acquired by the
Company or a Subsidiary. If an Award is granted in substitution for another
Award or award, the Committee shall require the surrender of such other Award or
award in consideration for the grant of the new Award. Awards granted in
addition to or in tandem with other Awards or awards may be granted either at
the same time as or at a different time from the grant of such other Awards or
awards. The exercise price of an Award conferring a right to purchase Shares:
(i) granted in substitution for an outstanding Award or
award shall be not less than the Fair Market Value of Shares at the
date such substitute Award is granted; provided, however, that (1)
the exercise, grant or purchase price per share of the substituted
Award may be reduced to reflect the Fair Market Value of the Award
or award required to be surrendered by the Participant as a
condition to receipt of such substitute Award, and (2) in the case
of any Participant, the Committee may, in lieu of such price
reduction, make an additional Award or payment to the Participant
reflecting the Fair Market Value of the Award or award required to
be surrendered; or
(ii) retroactively granted in tandem with an outstanding
Award or award shall be not less than the lesser of the Fair Market
Value of Shares at the date of grant of the later Award or the Fair
Market Value of Shares at the date of grant of the earlier Award.
6.05 Exchange Provisions. The Committee may at any time offer to
exchange or buy out any previously granted Award for a payment in cash, Shares,
another Award or other property, based on such terms and conditions as the
Committee shall determine and communicate to the Participant at the time that
such offer is made.
SECTION 7. GENERAL TERMS OF AWARDS
7.01 Certain Restrictions Under Rule 16b-3. Upon the effectiveness
of any amendment to Rule 16b-3, this Plan and any Award Agreement for an
outstanding Award held by a Participant then subject to Section 16 of the
Exchange Act shall be deemed to be amended, without further action on the part
of the Committee, the Board or the Participant, to the extent necessary for
Awards under the Plan or such Award Agreement to qualify for the exemption
provided by Rule 16b-3, as so amended, except to the extent any such amendment
requires shareholder approval.
7.02 Decisions Required to be Made by the Committee. Other
provisions of the Plan and any Award Agreement notwithstanding, if any decision
regarding an Award or the exercise of any right by a Participant, at any time
such Participant is subject to Section 16 of the Exchange Act, is required to be
made or approved by the Committee in order that a transaction by such
Participant will be exempt under Rule 16b-3, then the Committee shall retain
full and exclusive power and authority to make such decision or to approve or
disapprove any such decision by the Participant.
7.03 Limits on Transfer of Awards; Beneficiaries. No right or
interest of a Participant in any Award shall be pledged, encumbered or
hypothecated to or in favor of any Person other than the Company, or shall be
subject to any lien, obligation or liability of such Participant to any Person
other than the Company or a Subsidiary. Except to the extent otherwise
determined by the Committee, no Award and no rights or interests therein shall
be assignable or transferable by a Participant otherwise than by will or the
laws of descent and distribution, and any Option or other right to purchase or
acquire Shares granted to a Participant under the Plan shall be exercisable
during the Participant's lifetime only by such Participant. A beneficiary,
guardian, legal representative or other Person claiming any rights under the
Plan from or through any Participant shall be subject to all the terms and
conditions of the Plan and any Award Agreement applicable to such Participant as
well as any additional restrictions or limitations deemed necessary or
appropriate by the Committee.
7.04 Registration and Listing Compliance. No Award shall be paid and
no Shares shall be distributed with respect to any Award in a transaction
subject to the registration requirements of the Securities Act of 1933, as
amended, or any state securities law or subject to a listing requirement under
any listing agreement between the Company and any national securities exchange,
and no Award shall confer upon any Participant rights to such payment or
distribution until such laws and contractual obligations of the Company have
been complied with in all material respects. Neither the grant of any Award nor
anything else contained herein shall obligate the Company to take any action to
comply with any requirements of any such securities laws or contractual
obligations relating to the registration (or exemption therefrom) or listing of
any Shares or other securities, whether or not necessary in order to permit any
such delivery or distribution.
7.05 Stock Certificates. All certificates for Shares delivered under
the terms of the Plan shall be subject to such stop-transfer orders and other
restrictions as the Committee may deem advisable under federal or state
securities laws, rules and regulations thereunder, and the rules of any national
securities exchange or automated quotation system on which Shares are listed or
quoted. The Committee may cause a legend or legends to be placed on any such
certificates to make appropriate reference to such restrictions or any other
restrictions or limitations that may be applicable to Shares.
SECTION 8. ADJUSTMENT PROVISIONS
8.01 In the event that the Committee shall determine that any
dividend or other distribution (whether in the form of cash, Shares, other
securities or other property), recapitalization, stock split, reverse stock
split, reorganization, merger, consolidation, split-up, spin-off, combination,
repurchase, exchange of Shares or other securities of the Company, or other
similar corporate transaction or event affects the Shares such that an
adjustment is determined by the Committee to be appropriate in order to prevent
dilution or enlargement of Participants' rights under the Plan, then the
Committee shall, in such manner as it may deem equitable, adjust any or all of
(i) the number and kind of Shares which may thereafter be issued in connection
with Awards; (ii) the number and kind of Shares issued or issuable in respect of
outstanding Awards; and (iii) the exercise price, grant price or purchase price
relating to any Award or, if deemed appropriate, make provision for a cash
payment with respect to any outstanding Award.
SECTION 9. CHANGE OF CONTROL PROVISIONS
9.01 Acceleration of Exercisability and Lapse of Restrictions.
Unless otherwise determined by the Committee at the time of grant of an Award or
unless otherwise provided in the applicable Award Agreement, if the shareholders
of the Company shall approve a transaction which upon consummation would
constitute a Change of Control of the Company, or if any Change of Control of
the Company not subject to shareholder approval shall occur:
(i) all outstanding Awards pursuant to which the
Participant may have rights, the exercise of which is restricted or
limited, shall become fully exercisable;
(ii) all restrictions or limitations (including risks of
forfeiture and deferrals) on outstanding Awards subject to
restrictions or limitations under the Plan shall lapse unless prior
to such lapse the right to lapse of restrictions or limitations is
waived or deferred by the Participant; and
(iii) all conditions to payment of Awards under which
payments of cash, Shares or other property are subject to conditions
shall be deemed to be achieved or fulfilled and shall be waived by
the Company.
9.02 Termination of Service Following Change of Control. If within
three years following the date of any Change of Control the service of a
Participant as a director of the Company shall be terminated voluntarily or
involuntarily for any reason, then unless otherwise provided in the applicable
Award Agreement, and in addition to any other rights of post-termination
exercise which the Participant (or other holder of the Award) may have under the
Plan or the applicable Award Agreement, any Option or other Award granted to the
Participant and outstanding on the date of the Change of Control, the payment or
receipt of which is dependent upon exercise by the Participant (or other holder
of the Award) shall be exercisable for a period of 90 days following the date of
such termination of service but not later than the expiration date of the Award.
9.03 Definition of Change of Control. For purposes of this Section
9, a "Change of Control" of the Company shall mean any of the following events:
(a) The sale or other disposition by the Company of all
or substantially all of its assets to a single purchaser or to a
group of purchasers, other than to a corporation with respect to
which, following such sale or disposition, more than eighty percent
of, respectively, the then outstanding shares of Common Stock and
the combined voting power of the then outstanding voting securities
entitled to vote generally in the election of the Board is then
owned beneficially, directly or indirectly, by all or substantially
all of the individuals and entities who were the beneficial owners,
respectively of the outstanding Common Stock and the combined voting
power of the then outstanding voting securities immediately prior to
such sale or disposition in substantially the same proportion as
their ownership of the outstanding Common Stock and voting power
immediately prior to such sale or disposition;
(b) The acquisition in one or more transactions by any
person or group, directly or indirectly, of beneficial ownership of
twenty percent or more of the outstanding shares of Common Stock or
the combined voting power of the then outstanding voting securities
of the Company entitled to vote generally in the election of the
Board; provided, however, that any acquisition by (x) the Company or
any of its Subsidiaries, or any employee benefit plan (or related
trust) sponsored or maintained by the Company or any of its
Subsidiaries or (y) any person that is eligible, pursuant to Rule
13d-1(b) under the Exchange Act (as in effect on the effective date
of the Plan) to file a statement on Schedule 13G with respect to its
beneficial ownership of Common Stock and other voting securities,
whether or not such person shall have filed a statement on Schedule
13G, unless such person shall have filed a statement on Schedule 13D
with respect to beneficial ownership of fifteen percent or more of
the Company's voting securities, shall not constitute a Change of
Control;
(c) The Company's termination of its business and
liquidation of its assets;
(d) There is consummated a merger, consolidation,
reorganization, share exchange, or similar transaction involving the
Company (including a triangular merger), in any case, unless
immediately following such transaction: (i) all or substantially all
of the persons who were the beneficial owners of the outstanding
Commons Stock and outstanding voting securities of the Company
immediately prior to the transaction beneficially own, directly or
indirectly, more than 60% of the outstanding shares of Commons Stock
and the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of directors
of the corporation resulting from such transaction (including a
corporation or other person which as a result of such transaction
owns the Company or all or substantially all of the Company's assets
through one or more subsidiaries (a "Parent Company")) in
substantially the same proportion as their ownership of the Common
Stock and other voting securities of the Company immediately prior
to the consummation of the transaction, (ii) no person (other than
the Company, any employee benefit plan sponsored or maintained by
the Company or, if reference was made to equity ownership of any
Parent Company for purposes of determining whether clause (i) above
is satisfied in connection with the transaction, such Parent
Company) beneficially owns, directly or indirectly, 20% or more of
the outstanding shares of Common Stock or the combined voting power
of the voting securities entitled to vote generally in the election
of directors of the corporation resulting from such transaction and
(iii) individuals who were members of the Board immediately prior to
the consummation of the transaction constitute at least a majority
of the members of the board of directors resulting from such
transaction (or, if reference was made to equity ownership of any
Parent Company for purposes of determining whether clause (i) above
is satisfied in connection with the transaction, such Parent
Company); or
(e) The following individuals cease for any reason to
constitute a majority of the number of directors then serving:
individuals who, on the date hereof, constitute the entire Board and
any new director (other than a director whose initial assumption of
office is in connection with an actual or threatened election
contest, including but not limited to a consent solicitation,
relating to the election of directors of the Company) whose
appointment or election by the Board or nomination for election by
the Company's shareholders was approved by a vote of at least
two-thirds (2/3) of the directors then still in office who either
were directors on the effective date of the Plan or whose
appointment, election or nomination for election was previously so
approved.
SECTION 10. AMENDMENTS TO AND TERMINATION OF THE PLAN
10.01 The Board may amend, alter, suspend, discontinue or terminate
the Plan without the consent of shareholders or Participants, except that,
without the approval of the shareholders of the Company, no amendment,
alteration, suspension, discontinuation or termination shall be made if
shareholder approval is required by any federal or state law or regulation or by
the rules of any stock exchange on which the Shares may then be listed, or if
the Board determines that obtaining such shareholder approval is for any reason
advisable; provided, however, that except as provided in Section 7.01, without
the consent of the Participant, no amendment, alteration, suspension,
discontinuation or termination of the Plan may materially and adversely affect
the rights of such Participant under any Award theretofore granted to him.
10.02 Notwithstanding any of the provision of this Plan to the
contrary, except as provided in Section 8.01 of the Plan, the exercise price of
any outstanding Option or the exercise price or minimum purchase price of any
Other Stock-Based Award may not be reduced, whether through amendment,
cancellation or replacement, unless such reduction is approved by the
shareholders of the Company.
SECTION 11. GENERAL PROVISIONS
11.01 No Shareholder Rights. No Award shall confer on any
Participant any of the rights of a shareholder of the Company unless and until
Shares are in fact issued to such Participant in connection with such Award.
11.02 No Right to Directorship. Nothing contained in the Plan or any
Award Agreement shall confer, and no grant of an Award shall be construed as
conferring, upon any Participant any right to continue as a director of the
Company or interfere in any way with the rights of the shareholders of the
Company or the Board to elect and remove directors.
11.03 Unfunded Status of Awards; Creation of Trusts. The Plan is
intended to constitute an "unfunded" plan for incentive compensation. With
respect to any Shares not yet issued or payments not yet made to a Participant
pursuant to an Award, nothing contained in the Plan or any Award Agreement shall
give any such Participant any rights that are greater than those of a general
unsecured creditor of the Company; provided, however, that the Committee may
authorize the creation of trusts or make other arrangements to meet the
Company's obligations under the Plan to deliver cash, Shares or other property
pursuant to any Award, which trusts or other arrangements shall be consistent
with the "unfunded" status of the Plan unless the Committee otherwise
determines.
11.04 No Limit on Other Compensatory Arrangements. Nothing contained
in the Plan shall prevent the Company from adopting other or additional
compensation arrangements, and such arrangements may be either generally
applicable or applicable only in specific cases. To the extent consistent with
the Plan, the terms of each Award shall be construed so as to be consistent with
such other arrangements in effect at the time the Award is granted.
11.05 No Fractional Shares. No fractional Shares shall be issued or
delivered pursuant to the Plan or any Award. The Committee shall determine
whether cash, other Awards or other property shall be issued or paid in lieu of
fractional Shares or whether such fractional Shares or any rights thereto shall
be forfeited or otherwise eliminated.
11.06 Governing Law. The validity, interpretation, construction and
effect of the Plan and any rules and regulations relating to the Plan shall be
governed by the laws of the Commonwealth of Pennsylvania (without regard to the
conflicts of laws thereof), and applicable federal law.
11.07 Severability. If any provision of the Plan or any Award is or
becomes or is deemed invalid, illegal or unenforceable in any jurisdiction, or
would disqualify the Plan or any Award under any law deemed applicable by the
Committee, such provision shall be construed or deemed amended to conform to
applicable laws or if it cannot be construed or deemed amended without, in the
determination of the Committee, materially altering the intent of the Plan or
Award, it shall be deleted and the remainder of the Plan or Award shall remain
in full force and effect; provided, however, that, unless otherwise determined
by the Committee, the provision shall not be construed or deemed amended or
deleted with respect to any Participant whose rights and obligations under the
Plan are not subject to the law of such jurisdiction or the law deemed
applicable by the Committee.
SECTION 12. EFFECTIVE DATE AND TERM OF THE PLAN
12.01 The effective date and date of adoption of the Plan shall be
March 17, 1999, the date of adoption of the Plan by the Board, provided that
such adoption of the Plan is approved by a majority of the votes cast at a duly
held meeting of shareholders held on or prior to March 16, 2000 at which a
quorum representing a majority of the outstanding voting stock of the Company
is, either in person or by proxy, present and voting. Notwithstanding anything
else contained in the Plan or in any Award Agreement, no Option or other
purchase right granted under the Plan may be exercised, and no certificates for
Shares may be delivered pursuant to any Award granted under the Plan, prior to
such shareholder approval or prior to any required approval or consent from
those governmental agencies having jurisdiction in these matters. In the event
such shareholder or regulatory approval is not obtained, all Awards granted
under the Plan shall automatically be deemed void and of no effect.
