This document contains 28 pages
Exhibit Index appears at page 8.
The Registrant requests that the
Registration Statement become effective
immediately upon filing pursuant to
Securities Act Rule 462.
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
CPAC, INC.
(Exact Name of issuer as specified in its charter)
NEW YORK 16-0961040
(State or other jurisdiction (IRS Employer ID Number)
of incorporation or organization)
2364 LEICESTER ROAD, LEICESTER, NEW YORK 14481
(Address of Principal Executive Offices) (Zip Code)
CPAC, INC. 1996 NONEMPLOYEE DIRECTORS STOCK OPTION PLAN
(Full Title of the Plan)
ROBERT OPPENHEIMER, ESQ.
CHAMBERLAIN, D'AMANDA, OPPENHEIMER & GREENFIELD
1600 Crossroads Office Building
Rochester, New York 14614
(Name and Address of agent for service)
716/232-3730
(Telephone Number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
PROPOSED
TITLE OF PROPOSED MAXIMUM
SECURITIES MAXIMUM AGGREGATE AMOUNT OF
TO BE AMOUNT TO BE OFFERING PRICE OFFERING REGISTRATION
REGISTERED REGISTERED PER SHARE PRICE FEE
- --------------------------------------------------------------------------------
Common Stock 39,000 (1) (2) (1) (2) $120.00 (3)
Par Value shares
$0.01 per share
- --------------------------------------------------------------------------------
1) The Shares registered pursuant to this Registration Statement will not be
sold to members of the general public but solely to nonemployee directors
of CPAC, Inc., in accordance with the terms of the CPAC, Inc. 1996
Nonemployee Directors Stock Option Plan, pursuant to the exercise of
options granted automatically under the Plan.
2) Under the terms of the CPAC, Inc. 1996 Nonemployee Directors Stock
Option Plan, a one-time option to purchase 10,000 shares was granted to
nonemployee directors at an exercise price equal to the fair market
value of the Company's common stock on the date of the 1996 annual
meeting of shareholders (August 7, 1996). On an ongoing basis, an
option to purchase 3,000 shares is granted to each nonemployee director
elected or reelected at the annual meeting of shareholders with the
exercise price equal to the fair market value of the Company's common
stock on the Friday succeeding such meeting (August 9, 1996 in the
current year). Fair market value is the closing price for the
Company's common stock on such dates as quoted on the National Over-
The-Counter Market in the NASDAQ National Market System.
(3) Statutory Fee: Section 6(b) of the Securities Act of 1933 and Rule
457(h)(1), based upon exercise prices of the options granted as of
August 7 and 9, 1996. The total offering price for 39,000 shares based
upon such exercise prices was $396,000. Based upon the statutory
formula contained in Section 6(b), the Registration Fee is $120.00.
(4) Also registered hereunder pursuant to Rule 416(a) are an indeterminate
number of shares of common stock which may be issued pursuant to the
anti-dilution provisions of the Plan.
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
TABLE OF CONTENTS
ITEMS PAGE
Item 3. Incorporation of Documents by Reference 3
Item 4. Description of Securities N/A
Item 5. Interests of Named Experts and Counsel 3
Item 6. Indemnification of Directors and Officers 4
Item 7. Exemption from Registration Claimed N/A
Item 8. Undertakings 4
Item 9. Exhibits 6
Signatures 7
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Registrant hereby states that the following documents, listed in
subparagraphs (a) through (c) below are incorporated by reference in this
Registration Statement:
(a) The Registrant's latest Annual Report (Form 10-K/A) filed pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of 1934;
(b) All other Reports, including Quarterly and Current Reports (Forms 10-Q
and 8-K, respectively), filed pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 since the end of the fiscal year
covered by the Registrant's latest Annual Report; and
(c) A description of the class of securities to be offered as registered
under Section 12 of the Securities Exchange Act of 1934 and as
contained in the Form 10 Registration Statement filed under such Act,
including any amendment or report filed for the purpose of updating
such description.
All documents subsequently filed by the Registrant pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of l934, 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 the filing of such documents.
INTERESTS OF NAMED EXPERTS AND COUNSEL
1. Mr. Robert Oppenheimer is a Director and Secretary of the Registrant
and is a member of the law firm of Chamberlain, D'Amanda, Oppenheimer &
Greenfield which firm serves as general counsel to the Company and which firm
has rendered an opinion upon the validity of the securities being registered.
Mr. Oppenheimer owns directly 65,625 shares of the Registrant's $.01 par value
common stock. For the fiscal year of the Registrant ended March 31, 1996,
Mr. Oppenheimer's firm was paid $216,580 by the Registrant in legal fees for
legal services rendered to the Registrant.
Since Mr. Oppenheimer is a nonemployee director of the Company, he is
eligible to participate in the Plan.
2. The financial statement and schedules contained in the Company's
Annual Report on Form 10-K/A incorporated by reference herein have been examined
by Coopers & Lybrand, independent certified public accountants, as indicated in
their reports with respect thereto and are included herein in reliance upon the
authority of said firm as experts in accounting and auditing, in giving said
reports.
3. No expert named in the Registration Statement as having prepared or
certified any part thereof or is named as having prepared or certified a report
for use in connection with the Registration Statement or incorporated by
reference therein has received, or is to receive in connection with the offering
to which the Registration Statement pertains, a substantial interest, direct or
indirect, in the Registrant or any of its subsidiaries.
INDEMNIFICATION OF DIRECTORS AND OFFICERS
The By-Laws of the Registrant, in Article X thereof, provide for the
indemnification of the Registrant's Officers and Directors in certain
circumstances as follows:
Subject only to the exception that no indemnification may be made to or on
behalf of any director or officer if a judgment or other final adjudication
adverse to the director or officer that establishes that his acts were committed
in bad faith or were the result of active and deliberate dishonesty and were
material to the cause of action so adjudicated, or that he personally gained in
fact a financial profit or other advantage to which he was not legally entitled,
the company shall indemnify any person who was or is threatened to be made a
party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative by reason of the fact
that he is or was a director, officer, employee or agent of the company, or is
or was serving at the request of the company as a director, officer, employee or
agent of another company, partnership, joint venture, trust or other enterprise
against expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding, to the fullest extent under the circumstances
permitted by the Sections 721-726 of said Business Corporation Law. Such
indemnification (unless ordered by a court) shall be made as authorized in a
specific case upon a determination that indemnification of the director,
officer, employee or agent is proper in the circumstances because there is no
judgment or other final adjudication adverse to the director or officer that
establishes that his acts were committed in bad faith or were the result of
active and deliberate dishonesty and were material to the cause of action so
adjudicated, or that he personally gained in fact a financial profit or other
advantage to which he was not legally entitled. 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 such action, suit, or proceeding, or (2) if
such quorum is not obtainable, or even if obtainable a quorum of disinterested
directors so directs, (a) by independent legal counsel in a written opinion that
indemnification is proper, or (b) by the stockholders. The foregoing right of
indemnification shall not be deemed exclusive of any other rights to which those
seeking indemnification may be entitled under any by-law, agreement, vote of
stockholders or disinterested directors or otherwise, and shall continue as to a
person who has ceased to be a director, officer, employee or agent and shall
inure to the benefit of the heirs, executors and administrators of such a
person.
UNDERTAKINGS
(a) Rule 415 Offering
The undersigned Registrant hereby undertakes to file, during any
period in which offers or sales are being made, a post-effective amendment to
this Registration Statement 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 pursuant to Section 229.512(a) of Regulation S-K, such
post-effective amendment may be made by setting forth the information required
by such Section in periodic reports filed by the Registrant pursuant to Section
13 or Section 15 (d) of the Securities Exchange Act incorporated by reference as
set forth in subsection (b) and (c) of this Item.
The undersigned Registrant hereby undertakes that for the purpose of
determining any liability under the Securities Act of 1933, each post-effective
amendment shall be deemed to be a 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.
The undersigned Registrant hereby undertakes 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) Filings Incorporating Subsequent Exchange Act Documents by Reference
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each Annual Report
filed pursuant to Section 13 (a) or Section 15 (d) of the Securities Exchange
Act of 1934 is hereby incorporated by reference herein and each such Annual
Report shall be deemed to be a new Registration Statement, and the offering of
such securities at that time shall be deemed to be the initial bona fide
offering thereof.
(c) Incorporated Annual and Quarterly Reports
The undersigned Registrant hereby undertakes to deliver or cause to
be delivered with the Prospectus, to each person to whom the Prospectus is sent
or given, proxy statements and all other shareholder reports and communications,
including the latest annual report to security holders pursuant to and meeting
the requirements of Rule 14 a-3 or Rule 14 c-3 under the Securities Exchange Act
of 1934; and, where interim financial information required to be presented by
Article 3 of Regulation S-X is not set forth in the Prospectus, to deliver, or
cause to be delivered to each person to whom the Prospectus is sent or given,
the latest quarterly report that is hereby specifically incorporated by
reference in the Prospectus to provide such interim financial information.
(d) Filing of Registration Statement on Form S-8.
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 any indemnification provisions as found in
the Registrant's Bylaws, or otherwise, the Registrant has been advised that in
the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other
than payment by the Registrant of expenses incurred or paid 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, 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 of 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.
EXHIBITS
Exhibit
Number Description Page
4 Instruments defining the rights of security
holders N/A
Incorporated By Reference to Form 10-K, as
updated by Annual, Quarterly and Current
Reports and Exhibits filed therewith
5 Opinion of Counsel
5.1 Opinion of Counsel re: legality 9
15 Letter re: Unaudited interim financial
information N/A
23 Consents of Experts and Counsel
23.1 Consent of Independent Accountants 11
23.2 Consent of Counsel 9
24 Power of Attorney N/A
25 Statement of Eligibility of Trustee N/A
27 Financial Data Schedule N/A
99 Additional Exhibits
99.1 CPAC, Inc. 1996 Nonemployee Directors
Stock Option Plan 12
99.2 Form of Stock Option Agreement for
10,000 Shares 17
99.3 Form of Stock Option Agreement for 3,000
Shares 23
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Leicester, State of New York on October 3, 1996.
CPAC, INC.
BY: /s/ Thomas N. Hendrickson
----------------------------------
THOMAS N. HENDRICKSON, President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
Date: October 3, 1996 /s/ Thomas N. Hendrickson
----------------------------------
THOMAS N. HENDRICKSON
President, Chief Executive Officer,
Treasurer and Director
Date: October 3, 1996 /s/ Robert C. Isaacs
----------------------------------
ROBERT C. ISAACS
Senior Vice President and Director
Date: October 3, 1996 /s/ Robert Oppenheimer
----------------------------------
ROBERT OPPENHEIMER
Secretary and Director
Date: October 3, 1996 /s/ Seldon T. James, Jr.
----------------------------------
SELDON T. JAMES, JR., Director
Date: October 3, 1996 /s/ John C. Burton
----------------------------------
JOHN C. BURTON, Director
Date: October 3, 1996 /s/ Thomas J. Weldgen
----------------------------------
THOMAS J. WELDGEN, Chief Financial
Officer
EXHIBIT INDEX
Exhibit
Number Description Page
4 Instruments defining the rights of security
holders N/A
Incorporated By Reference to Form 10-K, as
updated by Annual, Quarterly and Current
Reports and Exhibits filed therewith
5 Opinion of Counsel
5.1 Opinion of Counsel re: legality 9
15 Letter re: Unaudited interim financial
information N/A
23 Consents of Experts and Counsel
23.1 Consent of Coopers & Lybrand, L.L.P. 11
23.2 Consent of Counsel 9
24 Power of Attorney N/A
25 Statement of Eligibility of Trustee N/A
27 Financial Data Schedule N/A
99 Additional Exhibits
99.1 CPAC, Inc. 1996 Nonemployee Directors
Stock Option Plan 12
99.2 Form of Stock Option Agreement for
10,000 Shares 17
99.3 Form of Stock Option Agreement for 3,000
Shares 23
EXHIBIT 5.1 AND 23.2
October 3, 1996
CPAC, Inc.
2364 Leicester Road
Leicester, New York 14481
Dear Sirs:
We have examined the corporate records and proceedings of CPAC, Inc., a New
York business corporation (hereinafter referred to as "Company"), with respect
to:
1. The organization of the Company;
2. The legal sufficiency of all corporate proceedings of the Company taken
in connection with the creation, issuance, all of the presently outstanding and
issued stock of the Company; and
3. The legal sufficiency of all corporate proceedings of the Company taken
in connection with the creation, issuance, form and validity, and full payment
and nonassessability when issued, of the 39,000 shares (hereinafter referred to
as the "Company's Registered Shares") of Common Stock of the Company covered by
the Registration Statement (hereinafter referred to as the "Registration
Statement") and Prospectus dated as of October 3, 1996.
Based upon such examination, we are of the opinion that:
(a) CPAC, Inc. is duly organized and validly existing under the laws of the
State of New York;
(b) The Company is authorized to issue 20,000,000 shares of Common Stock of
the par value of $.01 per share, of which 7,038,503 shares of Common Stock have
been issued and are presently outstanding;
(c) The Company has taken all necessary and required corporate proceedings
in connection with the creation and issuance of the said presently issued stock
of the Company, and all of said stock so issued has been validly issued, is
fully paid and nonassessable, and in all respects is in proper form; and
(d) When the Registration Statement shall have become effective and the
Registered Shares shall have been issued and sold upon the terms and conditions
set forth in the Registration Statement, the Company's shares will be validly
authorized and legally issued, fully paid and nonassessable and in all respects
in proper form.
We hereby consent:
(1) To be named in the Registration Statement, as the attorneys who will
pass upon legal matters in connection with an issuance of the Company's shares;
and
(2) To the filing of the opinion as Exhibits 5.1 and 23.2 to the
Registration Statement.
Very truly yours,
CHAMBERLAIN, D'AMANDA,
OPPENHEIMER & GREENFIELD
By: /s/ Richard B. Sullivan
----------------------------
Richard B. Sullivan
RBS:tw
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
----------------------------------
We consent to the incorporation by reference in the Registration Statement on
Form S-8 to be filed by CPAC, Inc. with respect to the CPAC, Inc. 1996
Nonemployee Directors Stock Option Plan of our report dated May 30, 1996, on our
audits of the consolidated financial statements and the financial statement
schedule of CPAC, Inc. and Subsidiaries as of March 31, 1996, and 1995, and for
each of the three years in the period ended March 31, 1996, which report is
included in the Annual Report on Form 10-K/A. We also consent to the reference
to our firm under the caption "Experts."
/s/ Coopers & Lybrand, L.L.P.
--------------------------------
COOPERS & LYBRAND, L.L.P.
Rochester, New York
October 3, 1996
EXHIBIT 99.1
------------
CPAC, INC.
1996 NONEMPLOYEE DIRECTORS STOCK OPTION PLAN
PURPOSES
- --------
The purposes of the 1996 Nonemployee Directors Stock Option Plan
(hereinafter referred to as the "Plan") are to attract, retain and compensate
for service as members of the Board of Directors of CPAC, Inc. (hereinafter
referred to as the "Company") highly qualified individuals who are not current
or former employees of the Company by enabling them to acquire and/or increase
their ownership of the Company's common stock. This Plan is designed and adopted
by the Board of Directors of the Company in order to closely associate the
financial interests of nonemployee directors with those of the Company's
shareholders by providing such directors with the opportunity to acquire a
greater equity ownership interest in the Company and thus, reinforce nonemployee
director rewards with shareholder gains.
ELIGIBILITY
- -----------
All members of the Board of Directors of the Company who are not current or
former employees of the Company or of any of its subsidiaries are eligible to
participate in the Plan. A director may be an officer of the Company and/or any
of its subsidiaries provided that, under the common law of the State of New
York, he is not properly classified as an employee of any of such entities.
GRANT OF STOCK OPTIONS
- ----------------------
INITIAL, ONE TIME GRANT
-----------------------
Initially, on a one-time basis, there is hereby granted under this
Plan to the current directors of the Company identified herein, an option to
purchase ten thousand (10,000) shares of the Company's $.01 par value common
stock in recognition of the past service rendered by such directors to the Board
of Directors. The right to exercise the ten thousand (10,000) option in full
shall vest upon this Plan's approval by the shareholders of the Company at the
annual meeting of shareholders to be held on August 7, 1996 and the exercise
price shall be the fair market value of the Company's common stock on the date
of such meeting. Fair market value for this purpose shall be the closing price
for the Company's common stock on August 7, 1996 as quoted on the national Over-
The-Counter market in the NASDAQ National Market System. The term of the option
is for a ten year period from August 7, 1996.
The directors eligible for this one time stock option grant are John
C. Burton, Seldon T. James, Jr. and Robert Oppenheimer.
ANNUAL GRANTS
-------------
There is hereby granted under this Plan an option for three thousand
(3,000) shares of the $.01 par value common stock of the Company to each
individual elected, reelected or continuing as a nonemployee director of the
Company at the annual meeting of shareholders held on August 7, 1996 and, on an
annual basis thereafter, to each individual elected, reelected or continuing as
a nonemployee director at each annual meeting of shareholders subsequent to the
August 7, 1996 annual meeting. The granting of the first option for three
thousand shares shall be effective and shall vest in full upon the Friday
immediately succeeding this Plan's approval by the shareholders of the Company
at the annual meeting of shareholders held on August 7, 1996, and thereafter,
each annual grant shall vest in full on the first Friday subsequent to each
annual meeting of shareholders. However, if the Company's Chief Financial
Officer determines, in his sole discretion, that the Company, its management
and/or members of its Board of Directors is in possession of material,
undisclosed information concerning the Company on a given first Friday, then the
grant of that year's options shall be suspended until the second day after
public dissemination of such material information.
The term of each option granted annually under this Plan is for a ten
year period, commencing on the first Friday after the each annual meeting of
shareholders or such later date if the grant of this option is suspended in
accordance with the paragraph above. The exercise price for each annual grant
shall be the fair market value of the Company's common stock on the first Friday
after the annual meeting of shareholders or such later date as determined above.
Fair market value for this purpose shall be the closing price for the Company's
common stock as quoted on the national Over-The-Counter market in the NASDAQ
National Market System.
VESTING AND EXERCISE RIGHTS
- ---------------------------
The initial option granted under this Plan to nonemployee directors for ten
thousand shares vests in full immediately upon the approval of this Plan by the
Company's shareholders at the annual meeting on August 7, 1996 and is excisable
immediately, in whole or in part, by the individual to whom the option is
granted and from time to time thereafter during the option term, even if he is
not a director at the time of exercise.
The options for three thousand shares granted annually under this Plan vest
in full on the first Friday after each annual meeting of shareholders or such
later date as determined above, but is exercisable only in cumulative
installments equal to one thousand (1,000) shares per year and may be exercised
from time to time during the option term, either in whole or in part, even if
the individual to whom it is granted is no longer a director at the time of
exercise.
PAYMENT FOR SHARES
- ------------------
In order to exercise his option, each nonemployee director shall tender to
the Company full payment of the exercise price, together with an additional
amount equal to the amount of any taxes required to be collected or withheld by
the Company in connection with the exercise of his stock option. Payment shall
be made in cash, a certified check, cashier's check or bank draft approved by
the Company. Alternatively, provided the Board of Directors shall approve the
specific transfer, payment may be made by tendering to the Company shares of
Company stock already owned by the optionee, except that in no case shall
shares acquired pursuant to this or any other stock option plan of the Company
be used as payment for shares to be issued pursuant to the exercise of options
granted under this Plan. Any shares so tendered shall be valued based upon the
fair market value of the shares on the date the option is exercised. Fair market
value shall be the closing price of the Company's common stock as quoted on the
national Over-The-Counter market in the NASDAQ National Market System.
CERTAIN MATERIAL RESTRICTIONS
- -----------------------------
Stock options granted under this Plan are exercisable during his lifetime
only by the optionee to whom the options were granted and may not be sold,
transferred, assigned or be made subject to the rights of any other party
acquiring rights therein. Upon the death of the optionee prior to the complete
exercise of any option granted to him under this Plan, the balance of the
unexercised option may be exercised by his estate or on behalf of any person(s)
to whom the optionee's rights pass under the optionee's Will or by operation of
law.
An optionee has no rights as a shareholder with respect to the shares
subject to options granted under this Plan, including voting, dividend and/or
liquidation rights, until the Company has received full payment therefor, and
has issued a stock certificate to the optionee representing the shares purchased
upon exercise.
Shares of common stock issued upon the exercise of any option granted under
the Plan may not be sold, transferred, assigned, pledged or otherwise disposed
of by the optionee for a period of six months from the date of the grant of the
option.
The shares acquired through exercise of options granted under this Plan
shall constitute "restricted stock" in the hands of the optionee and may not be
sold, transferred, assigned, pledged or otherwise disposed of for value for a
period of two years from the date of exercise under Rule 144 promulgated by the
Securities and Exchange Commission. If the shares to be issued upon the exercise
of options granted hereunder are registered with the Securities and Exchange
Commission, the two year holding period will no longer apply. However, since in
the Commission's view, each nonemployee director is an "affiliate" of the
Company, certain limitations set forth in Rule 144 restricting the number of
shares a nonemployee director may sell in any quarterly period consistent with
the Rule are hereby made applicable to the shares to be issued upon the exercise
of options granted under this Plan.
The Company has established certain policies and procedures governing
trading in the Company's securities, including any shares acquired upon the
exercise of options granted under this Plan, while the optionee is in possession
of material, inside information regarding the Company and/or any of its
subsidiaries. Under certain conditions, the policies and procedures require that
permission be obtained from a "Clearinghouse Committee" established by the
Company prior to an insider's effectuating any sale of the Company's stock and
this requirement is expressly made applicable to the sale, assignment, transfer,
pledge or other transfer for value of any shares acquired pursuant to the
exercise of options granted under this Plan.
Each option granted under the Plan shall be subject to the requirement
that, if at any time the Board shall determine that the consent or approval of
any governmental regulatory body or an agreement by the optionee with respect to
the disposition of the shares is necessary or desirable as a condition of, or in
connection with, the granting of an option, such option may not be exercised, in
whole or in part, unless such consent, approval or agreement shall have been
effected or obtained free of any conditions not acceptable to the Board.
ANTI-DILUTION PROVISIONS
- ------------------------
The aggregate number and kind of securities that may be purchased pursuant
to the grant of any option under this Plan shall be proportionately adjusted for
any increase, decrease or change in the total number of shares of Company common
stock outstanding resulting from a stock dividend, stock-split, corporate
reorganization or other corporate adjustment which would result in or have the
effect of the optionees being treated differently, but for the stock dividend,
stock-split or other corporate reorganization or adjustment, had the optionees
been the beneficial owners of the number of shares subject to outstanding
options granted under this Plan.
ACCELERATION OF OPTIONS IN CERTAIN EVENTS
- -----------------------------------------
Notwithstanding any provisions to the contrary in this Plan or in any Stock
Option Agreement evidencing stock options granted hereunder, all stock options
then currently outstanding shall become immediately exercisable in full and
remain exercisable in full until their expiration in accordance with their
respective terms upon the occurrence of any of the following events:
(1) the first purchase of the Company's common stock pursuant to a
tender or exchange offer, other than a tender or exchange offer
made by the Company;
(2) approval by the Company's shareholders of a merger or
consolidation of the Company with or into another corporation
unless the Company is the surviving corporation and there is no
reclassification , reorganization or adjustment of the Company's
common stock;
(3) approval by the Company's shareholders of a sale or disposition
of all or substantially all of the Company's assets; or
(4) approval by the Company's shareholders of a plan of liquidation
and/or dissolution of the Company
ADMINISTRATION, AMENDMENT AND TERMINATION
- -----------------------------------------
The Plan shall be administered by the Board of Directors of the Company.
The Board may amend or terminate the Plan, except that no amendment or
termination may revoke, alter or cancel the rights of any nonemployee director
with respect to options which, as of the effective date of the amendment or
termination, have vested. No amendment to the Plan revising the method to
calculate the exercise price, option terms and conditions, eligibility for
participation or number of shares granted annually shall be made to the Plan
without the approval of the shareholders.
RESERVATION OF SHARES
- ---------------------
The Company shall be under no obligation to reserve shares of its $.01 par
value common stock to meet its obligations under the Plan but it may do so. The
grant of options or the issuance of shares to nonemployee directors shall not
constitute the establishment of a trust with respect to options or shares. The
Company shall be deemed to have complied with the terms of the Plan if, at the
time of issuance and delivery of shares pursuant to the Plan, it has a
sufficient number of shares of its $.01 par value common stock authorized and
unissued or in its treasury which may then be appropriated and issued for
purposes of the Plan, irrespective of the date when such shares were authorized.
APPLICATION OF PROCEEDS
- -----------------------
The proceeds of the issuance of shares by the Company under the Plan will
constitute general funds of the Company and may be used by the Company for any
business purpose.
AGREEMENTS
- ----------
The grant of an option shall be evidenced by a written agreement, executed
by the Company and by the optionee, stating the number of shares subject to the
option evidenced thereby, the exercise price, the term, the salient provisions
of this Plan governing the option and any other term and/or condition consistent
with the terms of this Plan.
EXHIBIT 99.2
------------
STOCK OPTION AGREEMENT
----------------------
THIS STOCK OPTION AGREEMENT MADE as of this 7th day of August, 1996 between
CPAC, INC., a New York business corporation (herein referred to as the
"Company"), and SELDON T. JAMES, JR. (herein referred to as the "Optionee");
WITNESSETH:
----------
1. The Company hereby grants to the Optionee an Option (herein referred
to as the "Option") to purchase an aggregate of 10,000 shares of the $.01 par
value Common Stock of the Company (herein referred to as the "Shares") at a
price of $10.125 per Share to be paid by the Optionee with cash, a certified
check, a cashier's check or bank draft check made payable to the order of the
Company. Alternatively, provided the Company's Board of Directors shall approve
the specific transfer, the Optionee may pay for the Shares, either in whole or
in part, by the delivery of Common Stock of the Company already owned by him as
payment for the Shares, based upon such Common Stock's fair market value on the
date of exercise. However, payment for the Shares by means of Common Stock
obtained by the Optionee pursuant to this Agreement or any other stock option
plan of the Company is prohibited. Fair market value shall be the closing price
for the Company's Common Stock on the National Over-The-Counter Market in the
NASDAQ National Market System on the date of exercise.
2. The term during which the Option shall be exercisable shall commence
on August 7, 1996 and shall expire on the close of business on August 7, 2006,
subject to earlier termination as provided in the CPAC, Inc. 1996 Nonemployee
Directors Stock Option Plan (herein referred to as the "Plan"). The Option to
purchase the number of Shares granted under this Agreement may be exercised,
either in whole or in part, by the Optionee at any time and from time to time
during the Option Term. This Option may be exercised by the Optionee even
though, at the time of such exercise, whether in whole or in part, the Optionee
is no longer a Director of the Company.
3. This Option is not transferable by the Optionee other than by Will or
the laws of descent and distribution and is exercisable, during his lifetime,
only by the Optionee. In the event that the right to exercise the Option passes
to the Optionee's estate, or to a person to whom such right devolves by reason
of the Optionee's death, then the Option shall be nontransferable in the hands
of the Optionee's executor or administrator or of such person, except that the
Option may be distributed by the Optionee's executor or administrator to the
distributees of the Optionee's estate as a part thereof.
4. In order for the Option to be exercised, in whole or in part, the
notice by the Optionee to the Company in the form attached hereto must be
accompanied by payment in full of the option price for the Shares being
purchased. In addition, the Optionee agrees to tender to the Company an
additional amount, in cash, certified check, cashier's check or bank draft,
equal to the amount of any taxes required to be collected or withheld by the
Company in connection with the exercise of his Option.
5. The Company agrees that it will use its best efforts to register the
sale of the Shares to be issued upon the exercise of the Option with the
Securities and Exchange Commission under the Securities Act of 1933. Upon the
effectiveness of the Registration Statement covering the Shares, the Optionee
shall be able to sell the Shares in "open market transactions" free of Federal
Securities Law restrictions, provided that at the time of sale, or within the
three month period immediately prior to such sale, he is not nor has he been an
"affiliate" of the Company. The Optionee further understands that, in
accordance with applicable Commission rules governing controlling persons of
public companies, members of the board of directors of a public company, such as
the Company, are deemed to be "affiliates" during their term of office. The
Optionee, therefore, agrees that he will consult with the Company's counsel as
to any Securities Law restrictions, including a limitation on the number of
Shares which may be sold at any one time, on his ability to sell the Shares
prior to any sale thereof.
6. The Company agrees to provide the Optionee with a copy of the
Prospectus prepared by the Company in connection with the Registration Statement
filed to register the Shares, together with its exhibits, and the Company hereby
acknowledges its obligation to provide the Optionee with all proxy and other
shareholder communications, including the annual report to security holders, for
the most recently completed fiscal year of the Company and all updates thereof.
The Optionee agrees that prior to exercise, either in whole or in part of the
Option granted to him hereunder, he shall have read such materials, including
the most recent annual and quarterly reports to shareholders, and shall have
received, if requested, and read all the documents incorporated by reference in
the Prospectus and Registration Statement filed with the Securities and Exchange
Commission.
7. The Optionee understands that except as provided in Paragraph 5 above,
the Company has not agreed to register either the issuance or the resale of the
Shares in accordance with the provisions of the Securities Act of 1933 or to
register either the issuance or the resale of the Shares under any applicable
State Securities Laws. Hence, the Optionee agrees that by virtue of the
provision of certain rules respecting "restricted securities" promulgated under
such Federal and/or State Laws, unless the resale of the Shares is registered as
provided in Paragraph 5 above, and until the registration of such Shares in
accordance with Paragraph 5 above shall have been declared effective by order of
the Commission, the Shares which the Optionee shall purchase upon the exercise
of this Option must be held indefinitely and may not be sold, transferred,
pledged, hypothecated, or otherwise encumbered for value, unless and until a
secondary distribution and/or resale of such Shares is subsequently registered
under such Federal and/or State Securities Laws, or unless an exemption from
registration is available, in which case the Optionee still may be limited as to
the amount of the Shares that may be sold, transferred, pledged and/or
encumbered for value. The Optionee therefore agrees that, until the
registration of such Shares shall have been declared effective by order of the
Commission, the Company may affix upon any certificate representing the Shares,
a legend that such Shares may not be transferred in violation of Section 5 of
the Securities Act of 1933.
8. The Optionee understands and agrees that the Shares to be acquired
upon the exercise of the Option may not be sold, transferred, exchanged,
hypothecated, encumbered, pledged or otherwise disposed of for value for a
period of six (6) months from the date of the grant of this Option.
9. The Optionee understands that the Company has established certain
policies and procedures governing trading in the Company's securities, including
the Shares to be acquired upon the exercise of this Option, while in possession
of material, inside information regarding the Company and/or any of its
subsidiaries, receipt of which is hereby acknowledged. The Optionee agrees that
upon exercise of this Option, either in whole or in part, he will comply with
all of the terms and conditions of such policy, including the procedures and
guidelines established for its implementation. In particular, the Optionee
agrees that where required under such guidelines and procedures, he will obtain
permission of the Company's Clearinghouse Committee composed of senior
management prior to effectuating any sale or other transfer for value of the
Shares to be acquired by virtue of the exercise of this Option.
10. All the terms and provisions of the Plan, duly adopted at a meeting of
the Company's Board of Directors on June 5, 1996 and approved by a majority vote
of the Company's shareholders either in person or by proxy at a duly called
meeting of such shareholders held on August 7, 1996 and as amended to date, are
hereby expressly incorporated into this Stock Option Agreement and made a part
hereof as if printed herein and the Optionee, by the Optionee's signature
hereon, acknowledges receipt of a certified copy of said Plan. If there shall
be any conflict between this Agreement and the Plan, the provisions of the Plan
shall control.
11. In accordance with certain terms and conditions of the Plan, the
aggregate number and kind of shares that may be purchased pursuant to the grant
of the Option under this Agreement shall be proportionately adjusted for any
increase, decrease or change in the total number of the outstanding shares of
the Company resulting from a stock dividend, stock-split or other corporate
reorganization which would result in or have the effect of the Optionee being
treated differently (but for the adjustment) than he would be treated had he
been the beneficial owner of the Shares subject to the Option on the record date
for such dividend, split or reorganization, as the case may be.
12. The Optionee understands that the Option granted hereunder constitutes
a "nonqualified stock option" for federal, and if applicable, state income tax
purposes. Consequently, the Optionee understands that under current provisions
of federal tax law, for regular as well as for purposes to the federal
alternative minimum income tax, no gain or loss generally is recognized to the
Optionee upon the grant of the Option. In addition, the Company will receive no
business expense deduction as a result of the grant of the Option.
For federal income tax purposes, upon the exercise of the Option, the
difference between the exercise price and the fair market value of the Shares on
the date of exercise constitutes ordinary income to the Optionee and is taxed to
the Optionee at normal, ordinary tax rates, except to the extent the Shares are
not transferable and are subject to a substantial risk of forfeiture. To the
extent such difference is required to be included as income by the Optionee, the
Company is entitled to a business expense deduction. Upon the later sale of the
Shares, long or short term capital gain or loss will be recognized by the
Optionee, depending upon the holding period (one year for long term capital gain
or loss) and the extent to which the selling price exceeds or is less than the
Optionee's basis in the stock. The amount of gain will be taxed at normal,
ordinary tax rates, with a maximum rate of 28% in the case of long term capital
gain.
The Optionee also understands that the provisions of federal tax law
described herein are subject to change and, consequently, the Optionee agrees to
consult with his or her own tax advisor with respect to the tax treatment to be
accorded the grant of the Option herein, the exercise of such Option, and the
disposition of the Shares.
13. Consistent with the provisions of the Plan, this Agreement shall be
binding upon and inure to the benefit of any successor or assignee of the
Company and to any executor, administrator, legal representative, legatee, or
distributee entitled by law to the Optionee's right hereunder.
14. Except insofar as an interpretation of federal securities law
otherwise is required, or is controlling, this Agreement shall be governed by
and construed in accordance with the laws of the State of New York.
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed on
its behalf by its duly authorized officer and the Optionee has hereunto set his
hand, as of the day and year first above written.
CPAC, INC.
By:
--------------------------------
--------------------------------
Seldon T. James, Jr., Optionee
NOTICE OF EXERCISE OF STOCK OPTION
AND
RECORD OF STOCK TRANSFER
CPAC, Inc.
2364 Leicester Road
Leicester, New York 14481
Gentlemen:
I hereby exercise my Stock Option granted to me by CPAC, Inc. under an
Stock Option Agreement dated as of August 7, 1996, subject to all the terms and
provisions thereof and of the CPAC, Inc. 1996 Nonemployee Directors Stock Option
Plan referred to therein and notify you of my desire to purchase Shares
------
of the $.01 par value Common Stock of the Company which were offered to me
pursuant to the Stock Option Agreement. Enclosed is my payment in the sum of
in full payment of such Shares.
- -------
I also understand that under the Plan, and in accordance with the terms of
the Stock Option Agreement, I may not sell, assign, alienate, pledge, encumber
or otherwise transfer for value the Shares unless a period of six (6) months has
elapsed from the date of the grant of the Option to me.
I acknowledge that I have received, read and understand the Company's
policies and procedures with respect to trading in its securities while in
possession of material inside information regarding the Company and/or its
subsidiaries, and that, in accordance with certain guidelines and procedures
designed to implement such policies, I may be required to obtain permission from
a Clearinghouse Committee, composed of Senior Management, prior to any sale or
other transfer for value of the Shares hereby acquired.
I also acknowledge that I have received and have read all proxy and other
shareholder communications, including the annual report to security holders, for
the most recently completed fiscal year and all quarterly and current updates
thereof. I acknowledge that I have had the opportunity to ask questions of and
receive answers from the Company's management concerning the information set
forth in such proxy, reports and updates and have been satisfied with the
answers provided regarding the same.
Finally, I acknowledge that there are significant federal income tax
consequences resulting from my exercise of this Option, that I have consulted
with and received advice from qualified tax counsel both as to the nature of
such tax consequences and their impact upon my own personal income tax situation
as the result of such exercise, and that I fully understand such impact and have
planned accordingly.
DATED:
----------------------------- ------------------------------
Receipt is hereby acknowledged of the delivery to me by CPAC, Inc. on
, 19 of stock certificates for shares of $.01 par value
- --------- --- ---------
common stock purchased by me pursuant to the terms and conditions of the CPAC,
Inc. 1996 Nonemployee Directors Stock Option Plan referred to above.
DATED:
----------------------------- ------------------------------
EXHIBIT 99.3
------------
STOCK OPTION AGREEMENT
----------------------
THIS STOCK OPTION AGREEMENT MADE as of this 9th day of August, 1996 between
CPAC, INC., a New York business corporation (herein referred to as the
"Company"), and SELDON T. JAMES, JR. (herein referred to as the "Optionee");
WITNESSETH:
----------
1. The Company hereby grants to the Optionee an Option (herein referred
to as the "Option") to purchase an aggregate of 3,000 shares of the $.01 par
value Common Stock of the Company (herein referred to as the "Shares") at a
price of $10.25 per share to be paid by the Optionee with cash, a certified
check a cashier's check or bank draft made payable to the order of the Company.
Alternatively, provided the Company's Board of Directors shall approve the
specific transfer, the Optionee may pay for the Shares, either in whole or in
part, by the delivery of Common Stock of the Company already owned by him as
payment for the Shares, based upon such Common Stock's fair market value on the
date of exercise. However, payment for the Shares by means of Common Stock
obtained by the Optionee pursuant to this Agreement or any other stock option
plan of the Company is prohibited. Fair market value shall be the closing price
for the Company's Common Stock on the National Over-The-Counter Market in the
NASDAQ National Market System on the date of exercise.
2. The term during which the Option shall be exercisable shall commence
on August 9, 1996 and shall expire on the close of business on August 9, 2006,
subject to earlier termination as provided in the CPAC, Inc. 1996 Nonemployee
Directors Stock Option Plan (herein referred to as the "Plan"). This Option
shall vest immediately in full and may be exercised by the Optionee during the
Option Term even though at the time of such exercise, whether in whole or in
part, the Optionee is no longer a Director of the Company. Notwithstanding the
foregoing, this Option shall be exercisable during the first three years of the
Option Term only in increments of 1,000 Shares per year on a cumulative basis,
such that to the extent the Optionee shall fail to exercise or, due to the
limitation contained in this paragraph, be prohibited from exercising his Option
in any year during the Option Term for the total number of Shares granted, such
right to exercise this Option shall not expire but shall carry over into and be
exercisable in any subsequent year during which the Option is outstanding.
3. The Option is not transferable by the Optionee other than by Will or
the laws of descent and distribution and is exercisable, during his lifetime,
only by the Optionee. In the event that the right to exercise the Option passes
to the Optionee's estate, or to a person to whom such right devolves by reason
of the Optionee's death, then the Option shall be non transferable in the hands
of the Optionee's Executor or Administrator or of such person, except that the
Option may be distributed by the Optionee's Executor or Administrator to the
distributees of the Optionee's estate as a part thereof.
4. In order for the Option to be exercised, in whole or in part, the
notice by the Optionee to the Company in the form attached hereto must be
accompanied by payment in full of the option price for the Shares being
purchased. In addition, the Optionee agrees to tender to the Company an
additional amount, in cash, certified check, cashier's check or bank draft,
equal to the amount of any taxes required to be collected or withheld by the
company in connection with the exercise of his Option.
5. The Company agrees that it will use its best efforts to register the
sale of the Shares to be issued upon the exercise of the Option with the
Securities and Exchange Commission under the Securities Act of 1933. Upon the
effectiveness of the Registration Statement covering the Shares, the Optionee
shall be able to sell the Shares in "open market transactions" free of Federal
Securities Law restrictions, provided that at the time of sale, or within the
three month period immediately prior to such sale, he is not nor has he been an
"affiliate" of the Company. The Optionee further understands that, in
accordance with applicable Commission rules governing controlling persons of
public companies, members of the board of directors of a public company, such as
the Company, are deemed to be "affiliates" during their term of office. The
Optionee, therefore, agrees that he will consult with the Company's counsel as
to any Securities Law restrictions, including a limitation on the number of
Shares which may be sold at any one time, on his ability to sell the Shares
prior to any sale thereof.
6. The Company agrees to provide the Optionee with a copy of the
Prospectus prepared by the Company in connection with the Registration Statement
filed to register the Shares, together with its exhibits, and the Company hereby
acknowledges its obligation to provide the Optionee with all proxy and other
shareholder communications, including the annual report to security holders, for
the most recently completed fiscal year of the Company and all updates thereof.
The Optionee agrees that prior to exercise, either in whole or in part of the
Option granted to him hereunder, he shall have read such materials, including
the most recent annual and quarterly reports to shareholders, and shall have
received, if requested, and read all the documents incorporated by reference in
the Prospectus and Registration Statement filed with the Securities and Exchange
Commission.
7. The Optionee understands that except as provided in Paragraph 5 above,
the Company has not agreed to register either the issuance or the resale of the
Shares in accordance with the provisions of the Securities Act of 1933 or to
register either the issuance or the resale of the Shares under any applicable
State Securities Laws. Hence, the Optionee agrees that by virtue of the
provision of certain rules respecting "restricted securities" promulgated under
such Federal and/or State Laws, unless the resale of the Shares is registered as
provided in Paragraph 5 above, and until the registration of such Shares in
accordance with Paragraph 5 above shall have been declared effective by order of
the Commission, the Shares which the Optionee shall purchase upon the exercise
of this Option must be held indefinitely and may not be sold, transferred,
pledged, hypothecated, or otherwise encumbered for value, unless and until a
secondary distribution and/or resale of such Shares is subsequently registered
under such Federal and/or State Securities Laws, or unless an exemption from
registration is available, in which case the Optionee still may be limited as to
the amount of the Shares that may be sold, transferred, pledged and/or
encumbered for value. The Optionee therefore agrees that, until the
registration of such Shares shall have been declared effective by order of the
Commission, the Company may affix upon any certificate representing the Shares,
a legend that such Shares may not be transferred in violation of Section 5 of
the Securities Act of 1933.
8. The Optionee understands and agrees that the Shares to be acquired
upon the exercise of the Option may not be sold, transferred, exchanged,
hypothecated, encumbered, pledged or otherwise disposed of for value for a
period of six (6) months from the date of the grant of this Option.
9. The Optionee understands that the Company has established certain
policies and procedures governing trading in the Company's securities, including
the Shares to be acquired upon the exercise of this Option, while in possession
of material, inside information regarding the Company and/or any of its
subsidiaries, receipt of which is hereby acknowledged. The Optionee agrees that
upon exercise of this Option, either in whole or in part, he will comply with
all of the terms and conditions of such policy, including the procedures and
guidelines established for its implementation. In particular, the Optionee
agrees that where required under such guidelines and procedures, he will obtain
permission of the Company's Clearinghouse Committee composed of senior
management prior to effectuating any sale or other transfer for value of the
Shares to be acquired by virtue of the exercise of this Option.
10. All the terms and provisions of the Plan, duly adopted at a meeting of
the Company's Board of Directors on June 5, 1996 and approved by a majority vote
of the Company's shareholders either in person or by proxy at a duly called
meeting of such shareholders held on August 7, 1996 and as amended to date, are
hereby expressly incorporated into this Stock Option Agreement and made a part
hereof as if printed herein and the Optionee, by the Optionee's signature
hereon, acknowledges receipt of a certified copy of said Plan. If there shall
be any conflict between this Agreement and the Plan, the provisions of the Plan
shall control.
11. In accordance with certain terms and conditions of the Plan, the
aggregate number and kind of shares that may be purchased pursuant to the grant
of the Option under this Agreement shall be proportionately adjusted for any
increase, decrease or change in the total number of the outstanding shares of
the Company resulting from a stock dividend, stock-split or other corporate
reorganization which would result in or have the effect of the Optionee being
treated differently (but for the adjustment) than he would be treated had he
been the beneficial owner of the Shares subject to the Option on the record date
for such dividend, split or reorganization, as the case may be.
12. The Optionee understands that the Option granted hereunder constitutes
a "nonqualified stock option" for federal, and if applicable, state income tax
purposes. Consequently, the Optionee understands that under current provisions
of federal tax law, for regular as well as for purposes to the federal
alternative minimum income tax, no gain or loss generally is recognized to the
Optionee upon the grant of the Option. In addition, the Company will receive no
business expense deduction as a result of the grant of the Option.
For federal income tax purposes, upon the exercise of the Option, the
difference between the exercise price and the fair market value of the Shares on
the date of exercise constitutes ordinary income to the Optionee and is taxed to
the Optionee at normal, ordinary tax rates, except to the extent the Shares are
not transferable and are subject to a substantial risk of forfeiture. To the
extent such difference is required to be included as income by the Optionee, the
Company is entitled to a business expense deduction. Upon the later sale of the
Shares, long or short term capital gain or loss will be recognized by the
Optionee, depending upon the holding period (one year for long term capital gain
or loss) and the extent to which the selling price exceeds or is less than the
Optionee's basis in the stock. The amount of gain will be taxed at normal,
ordinary tax rates, with a maximum rate of 28% in the case of long term capital
gain.
The Optionee also understands that the provisions of federal tax law
described herein are subject to change and, consequently, the Optionee agrees to
consult with his or her own tax advisor with respect to the tax treatment to be
accorded the grant of the Option herein, the exercise of such Option, and the
disposition of the Shares.
13. Consistent with the provisions of the Plan, this Agreement shall be
binding upon and inure to the benefit of any successor or assignee of the
Company and to any executor, administrator, legal representative, legatee, or
distributee entitled by law to the Optionee's right hereunder.
14. Except insofar as an interpretation of federal securities law
otherwise is required, or is controlling, this Agreement shall be governed by
and construed in accordance with the laws of the State of New York.
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed on
its behalf by its duly authorized officer and the Optionee has hereunto set his
hand, as of the day and year first above written.
CPAC, INC.
By:
--------------------------------
--------------------------------
Seldon T. James, Jr., Optionee
NOTICE OF EXERCISE OF STOCK OPTION
AND
RECORD OF STOCK TRANSFER
CPAC, Inc.
2364 Leicester Road
Leicester, New York 14481
Gentlemen:
I hereby exercise my Stock Option granted to me by CPAC, Inc. under an
Stock Option Agreement dated as of August 9, 1996, subject to all the terms and
provisions thereof and of the CPAC, Inc. 1996 Nonemployee Directors Stock Option
Plan referred to therein and notify you of my desire to purchase Shares
------
of the $.01 par value Common Stock of the Company which were offered to me
pursuant to the Stock Option Agreement. Enclosed is my payment in the sum of
in full payment of such Shares.
- -----------
I also understand that under the Plan, and in accordance with the terms of
the Stock Option Agreement, I may not sell, assign, alienate, pledge, encumber
or otherwise transfer for value the Shares unless a period of six (6) months has
elapsed from the date of the grant of the Option to me.
I acknowledge that I have received, read and understand the Company's
policies and procedures with respect to trading in its securities while in
possession of material inside information regarding the Company and/or its
subsidiaries, and that, in accordance with certain guidelines and procedures
designed to implement such policies, I may be required to obtain permission from
a Clearinghouse Committee, composed of Senior Management, prior to any sale or
other transfer for value of the Shares hereby acquired.
I also acknowledge that I have received and have read all proxy and other
shareholder communications, including the annual report to security holders, for
the most recently completed fiscal year and all quarterly and current updates
thereof. I acknowledge that I have had the opportunity to ask questions of and
receive answers from the Company's management concerning the information set
forth in such proxy, reports and updates and have been satisfied with the
answers provided regarding the same.
Finally, I acknowledge that there are significant federal income tax
consequences resulting from my exercise of this Option, that I have consulted
with and received advice from qualified tax counsel both as to the nature of
such tax consequences and their impact upon my own personal income tax situation
as the result of such exercise, and that I fully understand such impact and have
planned accordingly.
DATED:
----------------------------- ------------------------------
Receipt is hereby acknowledged of the delivery to me by CPAC, Inc. on
, 19 of stock certificates for shares of $.01 par value
- ---------- --- --------
common stock purchased by me pursuant to the terms and conditions of the CPAC,
Inc. 1996 Nonemployee Directors Stock Option Plan referred to above.
DATED:
----------------------------- ------------------------------
EXHIBIT 5.1 AND 23.2
October 3, 1996
CPAC, Inc.
2364 Leicester Road
Leicester, New York 14481
Dear Sirs:
We have examined the corporate records and proceedings of CPAC, Inc., a New
York business corporation (hereinafter referred to as "Company"), with respect
to:
1. The organization of the Company;
2. The legal sufficiency of all corporate proceedings of the Company taken
in connection with the creation, issuance, all of the presently outstanding and
issued stock of the Company; and
3. The legal sufficiency of all corporate proceedings of the Company taken
in connection with the creation, issuance, form and validity, and full payment
and nonassessability when issued, of the 39,000 shares (hereinafter referred to
as the "Company's Registered Shares") of Common Stock of the Company covered by
the Registration Statement (hereinafter referred to as the "Registration
Statement") and Prospectus dated as of October 3, 1996.
Based upon such examination, we are of the opinion that:
(a) CPAC, Inc. is duly organized and validly existing under the laws of the
State of New York;
(b) The Company is authorized to issue 20,000,000 shares of Common Stock of
the par value of $.01 per share, of which 7,038,503 shares of Common Stock have
been issued and are presently outstanding;
(c) The Company has taken all necessary and required corporate proceedings
in connection with the creation and issuance of the said presently issued stock
of the Company, and all of said stock so issued has been validly issued, is
fully paid and nonassessable, and in all respects is in proper form; and
(d) When the Registration Statement shall have become effective and the
Registered Shares shall have been issued and sold upon the terms and conditions
set forth in the Registration Statement, the Company's shares will be validly
authorized and legally issued, fully paid and nonassessable and in all respects
in proper form.
We hereby consent:
(1) To be named in the Registration Statement, as the attorneys who will
pass upon legal matters in connection with an issuance of the Company's shares;
and
(2) To the filing of the opinion as Exhibits 5.1 and 23.2 to the
Registration Statement.
Very truly yours,
CHAMBERLAIN, D'AMANDA,
OPPENHEIMER & GREENFIELD
By: /s/ Richard B. Sullivan
----------------------------
Richard B. Sullivan
RBS:tw
