<PAGE> 1
As filed with the Securities and Exchange Commission on April 28, 1995.
- -------------------------------------------------------------------------------
REGISTRATION STATEMENT NO.
---------------
********************************************************************************
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
MANOR CARE, INC.
-------------------------------------------------
(Exact name of issuer as specified in its charter)
Delaware 52-1200376
------------- ------------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
10750 Columbia Pike
Silver Spring, Maryland 20901
(Address of Principal (Zip Code)
Executive Offices)
MANOR CARE, INC.
KEY EXECUTIVE STOCK OPTION PLAN of 1993
---------------------------------------
(Full title of the plan)
James H. Rempe, Esq.
Senior Vice President, General Counsel and Secretary
10750 Columbia Pike
Silver Spring, MD 20901
--------------------------
(Name and address of agent for service)
(301) 905-4265
----------------
(Telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
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<TABLE>
<CAPTION>
* Proposed Proposed
Title of Maximum Maximum Amount
Each Class of Amount Offering Aggregate Of
Securities To Be Price Per Offering Registration
To Be Registered Registered Share* Price* Fee*
- ---------------- ----------- ------ ------ ----
<S> <C> <C> <C> <C>
Common Stock, 2,000,000 Shs. $30.56 $61,120,000 $21,075.86
par value of $.10
per share
</TABLE>
********************************************************************************
(*) Estimated pursuant to Rule 457 solely for the purpose of calculating
the registration fee. Estimate based on the average of the high and
low share prices reported on the New York Stock Exchange for April 27,
1995.
<PAGE> 2
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Except as set forth below with respect to Items 4, 7, 8 and 9 of Form
S-8, the contents of the registration statements on Registrant's Annual Report
and Form 10-K for fiscal year ended May 31, 1994 containing audited financial
statements for the fiscal year ended May 31, 1994, Form 10-Q for the fiscal
quarters ended May 31, 1994, August 31, 1994, November 30, 1994, and February
28, 1995, and the description of the Registrant's common stock appearing in the
Registrant's registration statement on Form 8-A filed pursuant to Section 12(b)
of the Exchange Act of 1934 on July 30, 1981, are incorporated by reference
into this registration statement.
Item 4. Description of Securities. Not Applicable.
Item 6. Indemnification of Officers and Directors.
Section 145 of the General Corporation Law of the State of Delaware
(the "DGCL") provides, in summary, that directors and officers of Delaware
corporations such as the Registrant are entitled, under certain circumstances,
to be indemnified against all expenses and liabilities (including attorneys'
fees) incurred by them as a result of suits brought against them in their
capacity as a director or officer, if they acted in good faith and in a manner
they reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, if they
had no reasonable cause to believe their conduct was unlawful; provided, that
no indemnification may be made against expenses in respect of any claim, issue
or matter as to which they shall have been adjudged to be liable to the
corporation, unless and only to the extent that the court in which such action
or suit was brought shall determine upon application that despite the
adjudication of liability but in view of all the circumstances of the case,
they are fairly and reasonably entitled to indemnity for such expenses which
such court shall deem proper. Any such indemnification may be made by the
corporation only as authorized in each specific case upon a determination by
the stockholders or disinterested directors that indemnification is proper
because the indemnitee has met the applicable standard of conduct. Article VII
of the Registrant's By-Laws entitles officers, directors and controlling
persons of the Registrant to indemnification to the full extent permitted by
Section 145 of DGCL, as the same may be supplemented or amended from time to
time.
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<PAGE> 3
Article VII of the Bylaws of Manor Care, Inc. provides:
INDEMNIFICATION OF
OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS
Section 1. Action, Other Than by or in the Right of the Corporation.
The Corporation shall indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding or investigation, whether civil, criminal or administrative,
and whether external or internal to the Corporation (other than a judicial
action or suit brought by or in the right of the Corporation) by reason of the
fact that he is or was a director, officer, employee or trustee of the
Corporation, or that, being or having been such a director, officer, employee or
trustee, he is or was serving at the request of the Corporation as a director,
officer, employee, trustee or agent of another corporation, partnership, joint
venture, trust or other enterprise (all such persons being referred to hereafter
as an "Agent"), against expenses (including attorneys' fees), judgements, fines
and amounts paid in settlement actually and reasonably incurred by him in
connection with such action, suit or proceeding, or any appeal therein, if he
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 action or proceeding, had no reasonable cause to believe his conduct
was unlawful. The termination of any action, suit or proceeding -- whether by
judgment, order, settlement, conviction, or upon a plea of nolo contendere or
its equivalent -- shall not, of itself, create a presumption that the person did
not act in good faith and in a manner which he reasonably believed to be in or
not opposed to the best interests of the Corporation, and, with respect to any
criminal action or proceeding, that he had reasonable cause to believe that his
conduct was unlawful.
Section 2. Action, by or in the Right of the Corporation. The
Corporation shall indemnify any person who was or is a party or is threatened to
be made a party to any threatened, pending or completed judicial action or suit
brought by or in the right of the Corporation to procure a judgement in its
favor by reason of the fact that he is or was an Agent (as defined above)
against expenses (including attorneys' fees) actually and reasonably incurred by
him in connection with the defense, settlement or appeal of such action or suit
if he acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the Corporation, except that no indemnification
shall be made in respect of any claim, issue or matter as to which such person
shall have been adjudged to be liable for gross negligence or misconduct in the
performance of the duty of the Corporation unless and only to the extent that
the Court of Chancery or the court in which such action or suit was brought
shall determine upon application that, despite the adjudication of liability but
in view of all the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses which the Court of Chancery
or other such court shall deem proper.
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<PAGE> 4
Section 3. Determination of Right of Indemnification. Any
indemnification under Section 1 or 2 (unless ordered by a court) shall be made
by the Corporation unless a determination is reasonably and promptly made (i) by
the Board by a majority vote or a quorum consisting of directors who were not
parties to such action, suit or proceeding, or (ii) if such a quorum is not
obtainable, or, even if obtainable, if a quorum of disinterested directors so
directs, by independent legal counsel in a written opinion, or (iii) by the
stockholders, that such person acted in bad faith and in a manner that such
person did not believe to be in or not opposed to the best interests of the
Corporation, or, with respect to any criminal proceeding, that such person
believed or had reasonable cause to believe that his conduct was unlawful.
Section 4. Indemnification Against Expenses of Successful Party.
Notwithstanding the other provisions of this Article, to the extent that an
Agent has been successful on the merits or otherwise, including the dismissal of
an action without admission of liability, in defense of any proceeding or in
defense of any claim, issue or matter therein, or on appeal from any such
proceeding, action, claim or matter, such Agent shall be indemnified against all
expenses incurred in connection therewith.
Section 5. Advances of Expenses. Except as limited by Section 6 of
this Article, expenses incurred in any action, suit, proceeding or investigation
or any appeal therein shall be paid by the Corporation in advance of the final
disposition of such matter, if the Agent shall undertake to repay such amount in
the event that it is ultimately determined, as provided herein, that such person
is not entitled to indemnification. Notwithstanding the foregoing, no advance
shall be made by the Corporation if a determination is reasonably and promptly
made by the Board of Directors by a majority vote of a quorum of disinterested
directors, or (if such a quorum is not obtainable or, even if obtainable, a
quorum of disinterested directors so directs) by independent legal counsel in a
written opinion, that, based upon the facts known to the Board or counsel at the
time such determination is made, such person acted in bad faith and in a manner
that such person did not believe to be in or not opposed to the best interests
of the Corporation, or, with respect to any criminal proceeding, that such
person believed or had reasonable cause to believe his conduct was unlawful. In
no event shall any advance be made in instances where the Board or independent
legal counsel reasonably determines that such person deliberately breached his
duty to the Corporation or its shareholders.
Section 6. Right of Agent to Indemnification Upon Application;
Procedure Upon Application. Any indemnification under Sections 1, 2, and 4, or
advance under Section 5 of this Article, shall be made promptly, and in any
event within ninety days, upon the written request of the Agent, unless with
respect to applications under Sections 1, 2, and 5, a determination is
reasonably and promptly made by the Board of Directors by a majority vote of a
quorum of disinterested directors that such Agent acted in a manner set forth in
such Sections as to justify the Corporation's not indemnifying or making an
4
<PAGE> 5
advance to the Agent. In the event no quorum of disinterested directors is
obtainable, the Board of Directors shall promptly direct that independent legal
counsel shall decide whether the Agent acted in the manner set forth in such
Sections as to justify the Corporation's not indemnifying or making an advance
to the Agent. The right to indemnification or advances as granted by this
Article shall be enforceable by the Agent in any court of competent
jurisdiction, if the Board or independent legal counsel denies the claim, in
whole or in part, or if no disposition of such claim is made within ninety
days. The Agent's expenses incurred in connection with successfully
establishing his right to indemnification, in whole or in part, in any such
proceeding shall also be indemnified by the Corporation.
Section 7. Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnification provided for in this
Article is held by a court of competent jurisdiction to be unavailable to an
indemnitee in whole or in part, the Corporation shall, in such an event, after
taking into account, among other things, contributions by other directors and
officers of the Corporation pursuant to indemnification agreements or otherwise,
and in the absence of personal enrichment, acts of intentional fraud or
dishonesty or criminal conduct on the part of the agent, contribute to the
payment of Agent's losses to the extent that, after other contributions are
taken into account, such losses exceed: (i) in the case of a director of the
Corporation or any of its subsidiaries who is not an officer of the Corporation
or any of such subsidiaries, the amount of fees paid to him for serving as a
director during the 12 months preceding the commencement of the suit, proceeding
or investigation; or (ii) in the case of a director of the Corporation or any of
its subsidiaries who is also an officer of the Corporation or any of such
subsidiaries, the amount set forth in clause (i) plus 5% of the aggregate cash
compensation paid to said director for service in such office(s) during the 12
months preceding the commencement of the suit, proceeding or investigation; or
(iii) in the case of an officer of the Corporation or any of the subsidiaries,
5% of the aggregate cash compensation paid to such officer for service in such
office(s) during the 12 months preceding the commencement of such suit,
proceeding or investigation.
Section 8. Other Rights and Remedies. The indemnification provided
by this Article shall not be deemed exclusive of, and shall not affect, any
other rights to which an Agent seeking indemnification may be entitled under any
Bylaws, agreement, vote of stockholders or disinterested directors or otherwise,
both as to action in his official capacity and as to action in another capacity
while holding such office, and shall continue as to a person who has ceased to
be an Agent and shall inure to the benefit of the heirs, executors and
administrators of such a person. All rights to indemnification under this
Article shall be deemed to be provided by a contract between the Corporation and
the Agent who serves in such capacity at any time while these bylaws and other
relevant provisions of the general corporation law and other modification
thereof shall not affect any rights or obligations then existing.
5
<PAGE> 6
Section 9. Insurance. Upon resolution passed by the Board, the
Corporation may purchase and maintain insurance on behalf of any person who is
or was an Agent against any liability asserted against him 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 him against such liability under
the provisions of this Article. The Corporation may create a trust fund, grant
a security interest or use other means (including, without limitation, a letter
of credit) to ensure the payment of such sums as may become necessary to effect
indemnification as provided herein.
Section 10. Constituent Corporations. For the purposes of this
Article, references to "the Corporation" include all constituent corporations
absorbed in a consolidation or merger as well as the resulting or surviving
corporation, so that any person who is or was a director, officer, employees,
or trustee of such a constituent corporation or who, being or having been such
a director, officer employee or trustee, is or was serving at the request of
such constituent corporation as a director, officer, employee, trustee of
another corporation, partnership, joint venture, trust or other enterprise
shall stand in the same position under the provisions of this Article with
respect to the resulting or surviving corporation as he would if he had served
the resulting or surviving corporation in the same capacity.
Section 11. Other Enterprises, Fines, and Serving at Corporation's
Request. For purposes of this Article, references to "other enterprises" in
Sections 1 and 7 shall include employee benefit plans; references to "fines"
shall include any excise taxes assessed on a person with respect to any
employee benefit plan; and references to "serving at the request of the
Corporation" shall include any service by Agent as director, officer, employee,
trustee or agent of the Corporation which imposes duties on, or involves
services by, such Agent with respect to any employee benefit plan, its
participants, or beneficiaries; and a person who acted in good faith and in a
manner he reasonably believed to be in the interests of the participants and
beneficiaries of an employee benefit plan shall be deemed to have acted in a
manner "not opposed to the best interests of the Corporation" as referred to in
this Article.
Section 12. Savings Clause. If this Article or any portion hereof
shall be invalidated on any ground by any court of competent jurisdiction, then
the Corporation shall nevertheless indemnify each Agent as to expenses
(including attorneys' fees), judgements, fines and amounts paid in settlement
with respect to any action, suit, appeal, proceeding or investigation, whether
civil, criminal or administrative, and whether internal or external, including
a grand jury proceeding and an action or suit brought by or in the right of the
Corporation, to the full extent permitted by any applicable portion of this
Article that shall not have been invalidated, or by any other applicable law.
6
<PAGE> 7
The Registrant has entered into separate indemnification agreements
with directors and officers of the Registrant, pursuant to which the Registrant
will indemnify such directors and officers to the fullest extent permitted by
Delaware law, as the same may be amended from time to time.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers or persons
controlling the Registrant pursuant to the foregoing provisions, the Registrant
has been informed 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.
Item 7. Exemptions from Registration Claimed. None.
Item 8. Exhibits.
4 Key Executive Stock Option Plan of 1993 of Registrant.
5 Opinion regarding legality of shares to be offered.
23(i) Consent of Arthur Andersen LLP.
23(ii) Consent of James H. Rempe, Esq. (included in Exhibit 5)
24 Powers of Attorney authorizing execution of registration
statement of Form S-8 on behalf of certain directors of
Registrant.
Item 9. Undertaking.
(a) Rule 415 Offering.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this
registration statement;
(i) To include any prospectus required by Section 10 (a)
(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration
statement (or the most recent post-effective
amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the
information set forth in the registration statement;
7
<PAGE> 8
(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 registration statement is on Form S-3 or Form S-8, and 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) 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 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 at that time shall be deemed to be the initial bona
fide offering thereof.
(c) Request for acceleration of effectiveness or 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 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.
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<PAGE> 9
SIGNATURES
The Registrant. Pursuant to the requirements of the Securities
Act of 1933, the Registrant certifies 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
Silver Spring, State of Maryland, on this 28th day of April, 1995.
MANOR CARE, INC.
By: /s/ James H. Rempe
-----------------------------------
James H. Rempe
Secretary
Pursuant to the requirements of the Securities Act of 1933, as
amended, this Registration Statement has been signed by the following persons
in the capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
* Chairman, President, April 28, 1995
- -------------------------------- Chief Executive Officer
Stewart Bainum, Jr. and Director
* Vice Chairman and April 28, 1995
- -------------------------------- Director
Stewart Bainum
* Director April 28, 1995
- --------------------------------
Jack R. Anderson
* Director April 28, 1995
- --------------------------------
Regina E. Herzlinger
</TABLE>
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<TABLE>
<S> <C> <C>
* Director April 28, 1995
- --------------------------------
William H. Longfield
* Director April 28, 1995
- --------------------------------
Frederick V. Malek
* Director April 28, 1995
- --------------------------------
Jerry E. Robertson
/s/ James A. MacCutcheon Senior Vice President, April 28, 1995
- -------------------------------- Chief Financial Officer,
James A. MacCutcheon and Treasurer (Principal
Financial Officer)
/s/ Margarita A. Schoendorfer Vice President and Controller April 28, 1995
- -------------------------------- (Principal Accounting Officer)
Margarita A. Schoendorfer
</TABLE>
* By: /s/ James H. Rempe
------------------------
James H. Rempe
Attorney-in-fact
10
<PAGE> 11
EXHIBIT INDEX
4 Key Executive Stock Option Plan of 1993 of Registrant.
5 Opinion regarding legality of shares to be offered.
23(i) Consent of Arthur Andersen LLP.
23(ii) Consent of James H. Rempe, Esq. (included in Exhibit 5)
24 Powers of Attorney authorizing execution of registration
statement of Form S-8 on behalf of certain directors of
Registrant.
<PAGE> 1
EXHIBIT 4
MANOR CARE, INC.
KEY EXECUTIVE STOCK OPTION PLAN OF 1993
Manor Care, Inc. has adopted and established a non-qualified stock
option plan for its management and professional employees in accordance with
the following terms and conditions.
SECTION ONE
DESIGNATION AND PURPOSE OF THE PLAN
A. DESIGNATION. This Plan is designated the "Manor Care, Inc. Key
Executive Stock Option Plan of 1993."
B. PURPOSE. The purpose of this Plan is to advance the growth and
development of the Company by affording an opportunity to its officers,
professional staff and other key personnel to purchase shares of the Company's
Stock. The acquisition of such Stock by employees who are primarily
responsible for the Company's success provides a continuing incentive for them
to promote the best interests of the Company. Such stock ownership gives such
employees a proprietary interest in the Company which induces them to continue
in its employ. The Plan also enables the Company to attract competent
personnel to enter its employ.
SECTION TWO
DEFINITIONS
As used in this Plan, the following terms mean:
A. "COMMITTEE" means the Key Executive Stock Option Plan Committee
appointed to administer the Plan pursuant to Section Four.
B. "COMPANY" means Manor Care, Inc., including any present or future
"subsidiary corporation" as such term is defined in Section 424(f) of the 1986
Internal Revenue Code, as amended.
C. "ELIGIBLE EMPLOYEE" means any employee of the Company, including
any officer or director of the Company, who is employed in an executive,
supervisory, administrative or professional capacity. Options are to be
granted under this Plan only to such employees of the Company. Employees on
leave of absence or in military service are not Eligible Employees while on a
leave of absence or in military service.
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<PAGE> 2
D. "OPTION" means a non-qualified stock option granted to a
Participant by the Committee under this Plan. It also means any Option which
remains after a Participant has exercised his Option with respect to part of
the shares covered by an Option agreement.
E. "PARTICIPANT" means any Eligible Employee who is granted a
non-qualified Stock Option as provided in this Plan.
F. "PLAN" means this Key Executive Stock Option Plan.
G. "STOCK" and "COMPANY STOCK" mean the common stock of Manor
Care, Inc.
H. Wherever appropriate, words used in this Plan in the singular may
mean the plural, the plural may mean the singular and the masculine may mean
the feminine.
SECTION THREE
STOCK SUBJECT TO OPTION
A. TOTAL NUMBER OF SHARES. The total number of shares of Stock which
may be included in all Options granted to all Participants under this Plan is
2,000,000 shares. The total number of shares of Stock which may be granted may
be increased by a resolution adopted by the Company's Board of Directors and
approved by the Company's stockholders. Such Stock may be either authorized
and unissued Stock or reacquired Stock.
B. EXPIRED OPTIONS. If any Option granted under this Plan (i) is
unexercisable, or (ii) is terminated, or (iii) expires or is canceled for any
other reason, in whole or in part, the shares (or remaining shares) of Stock
subject to that particular Option shall again be available for grant under this
Plan.
SECTION FOUR
ADMINISTRATION OF THE PLAN
A. APPOINTMENT OF COMMITTEE. The Company's Board of Directors shall
appoint a Key Executive Stock Option Plan Committee which shall consist of not
less than two (2) members of such Board of Directors and which members shall be
disinterested persons as defined in Rule 16b-3 under the Securities Exchange
Act of 1934, as amended (or such greater number of members which may be
required by said Rule 16b-3). In addition, such Board of Directors shall
designate a member of the Committee to act as Chairman of the Committee, and
such Board of Directors may remove any member of the Committee at any time and
appoint any director to fill any vacancy on the Committee.
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<PAGE> 3
B. COMMITTEE MEETINGS. The Committee shall hold its meetings at such
times and places as specified by the Committee Chairman. A majority of the
Committee shall constitute a quorum. All actions of the Committee shall be
taken by all of the members of the meeting duly called by its Chairman;
provided, however, any action taken by a written document signed by a majority
of the members of the Committee shall be as effective as action taken by the
Committee at a meeting duly called and held.
C. COMMITTEE POWERS. Subject to the provisions of this Plan, the
Committee shall have full authority in its discretion to (i) designate the
Participants to whom Options shall be granted, (ii) determine the number of
shares to be made available under each such Option, (iii) determine the period
or periods in which the Participant may exercise such Option (iv) determine the
date when such Option expires, and (v) determine the price for Stock under such
Option. The Committee shall have all powers necessary to administer the Plan
in accordance with its terms, including the power to interpret this Plan and
resolve all questions arising thereunder. The Committee may prescribe such
rules and regulations for administering this Plan as the Committee deems
appropriate.
SECTION FIVE
SELECTION OF PARTICIPANTS
DISCRETION OF COMMITTEE. In determining which Eligible Employees
should be offered Options, as well as the terms thereof, the Committee shall
evaluate the duties and responsibilities of Eligible Employees, their past and
prospective contributions to the success of the Company, the extent to which
they are performing and will continue to perform outstanding services for the
benefit of the Company, and such other factors as the Committee deems relevant.
A member of the Committee shall not participate in any determination of the
Committee with respect to any Option granted to him.
SECTION SIX
OPTION AGREEMENTS
A. FORM OF OPTIONS. Subject to the provisions of this Plan, the
Options granted to Participants shall be set forth in written agreements upon
such terms and conditions as the Committee determines. Such agreements shall
incorporate the provisions of this Plan by reference.
B. DATE OF GRANTING OPTIONS. The date of granting an Option is the
date specified in the written option agreement which is signed by the
Participant and the Company.
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<PAGE> 4
SECTION SEVEN
OPTION PRICES
A. DETERMINATION OF OPTION PRICE. The Option price for Stock shall
be not less than 100% of the fair market value of the Stock on the date of
grant.
B. DETERMINATION OF FAIR MARKET VALUE. The fair market value of the
Stock on the date of granting an Option shall be the mean of the high and low
prices at which the Stock was sold on the market on such date. In the event no
such sales of Stock occurred on such date, the fair market value of the Stock
shall be determined by the Committee in accordance with applicable Regulations
of the Internal Revenue Service.
SECTION EIGHT
TERM OF OPTION
The term of an Option may vary within the Committee's discretion;
provided, however, that the term of an Option shall not exceed ten years from
the date of granting the Option to the Participant and, to this end, all
Options granted pursuant to this Plan must provide that each such Option cannot
be exercised after the expiration of ten years from the date each such Option
is granted.
SECTION NINE
EXERCISE OF OPTION
A. LIMITATION ON EXERCISE OF OPTION. The Committee may limit an
Option by restricting its exercise in whole or in part for specified periods.
B. METHOD OF EXERCISING AN OPTION. Subject to the terms of a
particular Option, a Participant may exercise it in whole or in part by written
notice to the Company's President or Secretary stating in such written notice
the number of shares of Stock such Participant elects to purchase under his
Option.
C. NO OBLIGATION TO EXERCISE OPTION. A Participant is under no
obligation to exercise an Option or any part thereof.
D. PAYMENT FOR OPTION STOCK. Stock purchased pursuant to an Option
agreement shall be paid in full at the time of purchase. Payment may be made
(a) in cash, (b) with the approval of the Committee, by delivery to the Company
of shares of Stock of the Company having an aggregate fair market value equal
to the exercise price, or (c) a combination of (a) and (b). Upon receipt of
payment and subject to paragraph E of this Section Nine, the Company shall,
without transfer or issue tax to the Participant or other person entitled to
exercise the option, deliver to the Participant (or other person entitled to
exercise the option) a certificate or certificates for such shares.
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<PAGE> 5
E. DELIVERY OF STOCK TO PARTICIPANT. The Company shall undertake and
follow all necessary procedures to make prompt delivery of the number of shares
of Stock which the Participant elects to purchase upon exercise of an Option
granted under this Plan. Such delivery, however, may be postponed, at the sole
discretion of the Company, to enable the Company to comply with any applicable
procedures, regulations or listing requirements of any government agency, stock
exchange or regulatory authority.
F. FAILURE TO ACCEPT DELIVERY OF STOCK. If a Participant refuses to
pay for Stock which he has elected to purchase under his Option, in accordance
with the terms of payment, which had previously been agreed upon, his Option
shall thereupon, at the sole discretion of the Committee, terminate, and such
funds previously paid for unissued Stock shall be refunded. Stock which has
been previously issued to the Participant and been fully paid for shall remain
the property of the Participant and shall be unaffected by such termination.
SECTION TEN
NON-TRANSFERABILITY OF OPTIONS
During a Participant's lifetime, an Option granted to him may be
exercised only by him. It may not be sold, assigned, pledged or otherwise
transferred except by will or by the laws of descent and distribution. No
Option or any right thereunder shall be subject to execution, attachment or
similar process. Upon any attempt by a Participant to so sell, assign, pledge
or otherwise transfer any Option, or any right thereunder, contrary to the
provisions hereof, the Option and all rights thereunder shall immediately
become null and void.
SECTION ELEVEN
PURCHASE FOR INVESTMENT
A. WRITTEN AGREEMENT BY PARTICIPANTS. Unless a registration
statement under the Securities Act of 1933 is then in effect with respect to
the Stock a Participant receives upon exercise of his Option, a Participant
shall acquire the Stock he receives upon exercise of his Option for investment
and not for resale or distribution and he shall furnish the Company with a
written statement to that effect when he exercises his Option and a reference
to such investment warranty shall be inscribed on the Stock certificate(s).
B. REGISTRATION REQUIREMENT. Each Option shall be subject to the
requirement that, if at any time the Company's Board of Directors determines
that the listing, registration or qualification of the shares subject to the
Option upon any securities exchange or under any state or Federal law is
necessary or desirable as a condition of, or in connection with, the issuance
of shares thereunder, the Option may not be
5
<PAGE> 6
exercised in whole or in part unless such listing, registration or
qualification shall have been effected or obtained (and the same shall have
been free of any conditions not acceptable to the Company's Board of
Directors).
SECTION TWELVE
CHANGES IN CAPITAL STRUCTURE
In the event of a change in the capital structure of the Company, the
number of shares specified in Section Three of this Plan, the number of shares
covered by each outstanding Option and the price per share shall be
proportionately adjusted for any increase or decrease in the number of issued
shares of Stock resulting from the splitting or consolidation of shares, or the
payment of a stock dividend, or effected in any other manner without receipt of
additional or further consideration by the Company.
SECTION THIRTEEN
CORPORATE REORGANIZATION OR DISSOLUTION
A. In the event of the dissolution or liquidation of the Company, any
Option granted under the Plan shall terminate as of a date to be fixed by the
Committee, provided that not less than 15 days written notice of the date so
fixed shall be given to each Participant and each such Participant shall have
the right during such period to exercise his Option as to all or any part of
the Stock covered thereby including Stock as to which such Option would not
otherwise be exercisable by reason of an insufficient lapse of time.
B. In the event of a Reorganization (as hereinafter defined) in which
the Company is not the surviving or acquiring company, or in which the Company
is or becomes a wholly owned subsidiary of another company after the effective
date of the Reorganization, then:
1) If there is no plan or agreement respecting the Reorganization
("Reorganization Agreement") or if the Reorganization
Agreement does not specifically provide for the change,
conversion, or exchange of the Stock under outstanding and
unexercised Options for securities of another corporation,
then the Committee shall take such action, and the Options
shall terminate, as provided in paragraph A of this Section
Thirteen, or
2) If there is a Reorganization Agreement and if the
Reorganization Agreement specifically provides for the change,
conversion, or exchange of the Stock under outstanding and
unexercised Options for securities of another corporation,
then the Committee shall adjust the shares under such
outstanding and unexercised Options (and shall adjust the
shares remaining under the Plan which are then to be available
for grant under
6
<PAGE> 7
the Plan, if the Reorganization Agreement makes specific
provisions therefor) in a manner not inconsistent with the
provisions of the Reorganization Agreement for the adjustment,
change, conversion, or exchange of such Options.
The term "Reorganization" as used in this paragraph B of this Section Thirteen
shall mean any statutory merger, statutory consolidation, sale of all or
substantially all of the assets of the Company, or sale, pursuant to an
agreement with the Company, of securities of the Company pursuant to which the
Company is or becomes a wholly owned subsidiary of another company after the
effective date of the Reorganization.
C. Adjustments and determinations under this Section Thirteen shall
be made by the Committee, whose decisions as to what adjustments or
determinations shall be made, and the extent thereof, shall be final, binding,
and conclusive.
SECTION FOURTEEN
EMPLOYMENT AGREEMENT
Each Participant shall agree to remain with and render services to the
Company for a period of not less than eighteen months from the date of granting
the Option. Such agreement, however, does not impose any obligation upon the
Company to retain the Participant in its employ for any period. The Company
reserves the same right to terminate employment of any Participant as existed
prior to the date of granting the Option.
SECTION FIFTEEN
TERMINATION OF EMPLOYMENT
A. SEVERANCE. Subject to the provision of Paragraph B of this
Section Fifteen, in the event a Participant's employment with the Company
terminates, his Option terminates one month from the earlier of (i) the giving
of notice of such termination or (ii) the date of such termination of
employment in the absence of such notice. Such Option shall be exercisable
only to the extent the Participant was entitled to exercise the Option on the
earlier of the date of such termination of employment or the giving of notice
thereof.
B. DEATH. If a Participant dies prior to the full exercise of his
Option, his Option to purchase Stock under such Option may be exercised to the
extent, if any, that Participant would be entitled to exercise it at the date
of Participant's death by the person to whom the Option shall pass by will or
by the laws of descent and distribution within twelve months of Participant's
death or the expiration of the term of the Option whichever date is sooner.
7
<PAGE> 8
C. LIMITATION. In no event may an Option be exercised by anyone
after the expiration date provided for in Section Eight of the Plan.
SECTION SIXTEEN
APPLICATION OF FUNDS
All proceeds received by the Company from the exercise of Options
shall be paid into its treasury and such proceeds shall be used for general
corporate purposes.
SECTION SEVENTEEN
PARTICIPANT'S RIGHTS AS A STOCKHOLDER
A Participant has no rights as a stockholder with respect to any
shares of Stock covered by his Option until the date a stock certificate is
issued to him for such shares. Except as otherwise provided for in Section
Twelve of this Plan, no adjustment shall be made for dividends or other rights
for which the record date is prior to the date such stock certificate is
issued.
SECTION EIGHTEEN
AMENDMENT AND TERMINATION OF THE PLAN
A. DISCRETION OF THE BOARD OF DIRECTORS. The Company's Board of
Directors may amend or terminate this Plan at any time provided that such
amendment or termination does not adversely affect the rights of Participants
who were granted Options prior thereto. The Board of Directors may not amend
this Plan to provide for an increase in the total number of shares covered by
this Plan or for a change in the definition of Eligible Employee without the
prior approval of the Company's stockholders.
B. AUTOMATIC TERMINATION. This Plan shall terminate on August 31,
2003. Options may be granted under this Plan at any time and from time to time
prior to the Plan's termination. Any Option outstanding at the time the Plan
is terminated shall remain in effect until said Option is exercised or expires.
8
<PAGE> 1
EXHIBIT 5
April 24, 1995
Securities and Exchange Commission
450 5th Street, N.W.
Washington, D.C. 20549
RE: Manor Care, Inc.
Registration Statement on Form S-8
Gentlemen:
I am General Counsel of Manor Care, Inc. (the "Company") and have
acted for the Company in connection with the preparation of the Company's
Registration Statement on Form S-8 filed with the Securities and Exchange
Commission (the "Commission") under the Securities Act of 1933, as amended.
The Registration Statement covers shares of the Company's Common Stock, $.10
par value, offered under the Company's Key Executive Stock Option Plan of 1993
(the "Plan").
In connection with the rendering of the opinion set forth below, I
have reviewed the records of the Company, the minutes of the meetings of the
stockholders and directors of the Company and such other records and documents
as was necessary in my judgment to so render the following opinion.
Based on the foregoing, I am of the opinion that:
1. The Company is a corporation duly incorporated and existing
under the laws of the State of Delaware; and
2. The shares of Common Stock of the Company offered to the
holders under the exercise of options under the Plan, have been or will be
legally issued, fully paid and nonassessable.
I hereby consent to the filing of a copy of this opinion with the
Commission as an exhibit to the Registration Statement referred to above.
Very truly yours,
James H. Rempe
Senior Vice President
and General Counsel
<PAGE> 1
EXHIBIT 23(i)
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our report dated June 22, 1994,
incorporated by reference in Manor Care, Inc.'s Form 10-K for the year ended
May 31, 1994 and to all references to our Firm included in this registration
statement.
/s/ ARTHUR ANDERSEN LLP
----------------------------------------
ARTHUR ANDERSEN LLP
Washington, D.C.
April 27, 1995
<PAGE> 1
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned constitutes and
appoints JAMES H. REMPE his true and lawful attorney-in-fact and agent, with
full power of substitution and resubstitution, for his and in his name, place
and stead, in any and all capacities, to sign Registration Statements or
amendments (including post-effective amendments) thereto with respect to the
registration under the Securities Act of 1933, as amended, of shares of Common
Stock, $.10 par value, of Manor Care, Inc. (the "Company") issuable or issued
pursuant to the Company's Key Executive Stock Option Plan of 1993 and to file
the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorney-in-fact and agent full power and authority to do and perform each and
every act and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent for any of them, or their
or his substitute may lawfully do or cause to be done by virtue thereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand this
27th day of April, 1995.
/s/ Stewart Bainum, Jr.
----------------------------------------
Stewart Bainum, Jr.
Chief Executive Officer and
Director
<PAGE> 2
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned constitutes and
appoints JAMES H. REMPE his true and lawful attorney-in-fact and agent, with
full power of substitution and resubstitution, for his and in his name, place
and stead, in any and all capacities, to sign Registration Statements or
amendments (including post-effective amendments) thereto with respect to the
registration under the Securities Act of 1933, as amended, of shares of Common
Stock, $.10 par value, of Manor Care, Inc.(the "Company") issuable or issued
pursuant to the Company's Key Executive Stock Option Plan of 1993 and to file
the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorney-in-fact and agent full power and authority to do and perform each and
every act and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent for any of them, or their
or his substitute may lawfully do or cause to be done by virtue thereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand this
27th day of April, 1995
/s/ Stewart Bainum
----------------------------------------
Stewart Bainum
Director
<PAGE> 3
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned constitutes and
appoints JAMES H. REMPE his true and lawful attorney-in-fact and agent, with
full power of substitution and resubstitution, for his and in his name, place
and stead, in any and all capacities, to sign Registration Statements or
amendments (including post-effective amendments) thereto with respect to the
registration under the Securities Act of 1933, as amended, of shares of Common
Stock, $.10 par value, of Manor Care, Inc. (the "Company") issuable or issued
pursuant to the Company's Key Executive Stock Option Plan of 1993 and to file
the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorney-in-fact and agent full power and authority to do and perform each and
every act and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent for any of them, or their
or his substitute may lawfully do or cause to be done by virtue thereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand this
27th day of April, 1995
/s/ Jack R. Anderson
----------------------------------------
Jack R. Anderson
Director
<PAGE> 4
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned constitutes and
appoints JAMES H. REMPE her true and lawful attorney-in-fact and agent, with
full power of substitution and resubstitution, for her and in her name, place
and stead, in any and all capacities, to sign Registration Statements or
amendments (including post-effective amendments) thereto with respect to the
registration under the Securities Act of 1933, as amended, of shares of Common
Stock, $.10 par value, of Manor Care, Inc. (the "Company") issuable or issued
pursuant to the Company's Key Executive Stock Option Plan of 1993 and to file
the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorney-in-fact and agent full power and authority to do and perform each and
every act and purposes as she might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent for any of them, or their
or her substitute may lawfully do or cause to be done by virtue thereof.
IN WITNESS WHEREOF, the undersigned has hereunto set her hand this
27th day of April, 1995
/s/ Regina E. Herzlinger
----------------------------------------
Regina E. Herzlinger
Director
<PAGE> 5
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned constitutes and
appoints JAMES H. REMPE his true and lawful attorney-in-fact and agent, with
full power of substitution and resubstitution, for his and in his name, place
and stead, in any and all capacities, to sign Registration Statements or
amendments (including post-effective amendments) thereto with respect to the
registration under the Securities Act of 1933, as amended, of shares of Common
Stock, $.10 par value, of Manor Care, Inc. (the "Company") issuable or issued
pursuant to the Company's Key Executive Stock Option Plan of 1993 and to file
the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorney-in-fact and agent full power and authority to do and perform each and
every act and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent for any of them, or their
or his substitute may lawfully do or cause to be done by virtue thereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand this
27th day of April, 1995.
/s/ William H. Longfield
----------------------------------------
William H. Longfield
Director
<PAGE> 6
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned constitutes and
appoints JAMES H. REMPE his true and lawful attorney-in-fact and agent, with
full power of substitution and resubstitution, for his and in his name, place
and stead, in any and all capacities, to sign Registration Statements or
amendments (including post-effective amendments) thereto with respect to the
registration under the Securities Act of 1933, as amended, of shares of Common
Stock, $.10 par value, of Manor Care, Inc. (the "Company") issuable or issued
pursuant to the Company's Key Executive Stock Option Plan of 1993 and to file
the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorney-in-fact and agent full power and authority to do and perform each and
every act and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent for any of them, or their
or his substitute may lawfully do or cause to be done by virtue thereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand this
27th day of April, 1995.
/s/ Frederick V. Malek
----------------------------------------
Frederick V. Malek
Director
<PAGE> 7
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned constitutes and
appoints JAMES H. REMPE his true and lawful attorney-in-fact and agent, with
full power of substitution and resubstitution, for his and in his name, place
and stead, in any and all capacities, to sign Registration Statements or
amendments (including post-effective amendments) thereto with respect to the
registration under the Securities Act of 1933, as amended, of shares of Common
Stock, $.10 par value, of Manor Care, Inc. (the "Company") issuable or issued
pursuant to the Company's Key Executive Stock Option Plan of 1993 and to file
the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorney-in-fact and agent full power and authority to do and perform each and
every act and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent for any of them, or their
or his substitute may lawfully do or cause to be done by virtue thereof.
IN WITNESS WHEREOF, the undersigned has hereunto set his hand this
27th day of April, 1995.
/s/ Jerry E. Robertson
----------------------------------------
Jerry E. Robertson
Director
