<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MARCH 5, 1996
REGISTRATION NO. 33-
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
CTI GROUP (HOLDINGS) INC.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
DELAWARE 51-0308583
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
</TABLE>
901 S. TROOPER ROAD
VALLEY FORGE, PENNSYLVANIA 19484
(Address of principal executive offices)
STOCK OPTION AND RESTRICTED STOCK PLAN
(Full Title of Plan)
ANTHONY P. JOHNS, PRESIDENT AND CHIEF EXECUTIVE OFFICER
CTI GROUP (HOLDINGS) INC.
901 S. TROOPER ROAD
VALLEY FORGE, PENNSYLVANIA 19484
(Name and address of agent for service)
(610) 666-1700
(Telephone number, including area code, of agent for service)
--------------------------
COPIES TO:
STEPHEN T. BURDUMY, Esquire
WILLIAM W. MATTHEWS, III, Esquire
Klehr, Harrison, Harvey, Branzburg & Ellers
1401 Walnut Street
Philadelphia, Pennsylvania 19102
(215) 568-6060
--------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF SECURITIES AMOUNT TO OFFERING PRICE AGGREGATE AMOUNT OF
TO BE REGISTERED BE REGISTERED PER SHARE (1) OFFERING PRICE REGISTRATION FEE
<S> <C> <C> <C> <C>
Common Stock, par value $.01 per
share............................ 600,000 shares $.30(1) $180,000(1) $62.07
</TABLE>
(1) Based on the average of the bid and asked price of the Registrant's Common
Stock as reported on the National Association of Securities Dealers, Inc.
Over-The-Counter Bulletin Board on March 1, 1996, estimated solely for the
purpose of calculating the registration fee in accordance with Rule 457(c)
under the Securities Act of 1933.
- --------------------------------------------------------------------------------
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<PAGE>
PART I
INFORMATION REQUIRED IN PROSPECTUS
A Reoffer Prospectus prepared in accordance with the requirements of Part I
of Form S-3 is being filed with the Commission as part of this Registration
Statement. The Section 10(a) Reoffer Prospectus is not being filed with the
Commission as part of this Registration Statement.
<PAGE>
REOFFER PROSPECTUS
CTI GROUP (HOLDINGS) INC.
901 S. TROOPER ROAD
VALLEY FORGE, PENNSYLVANIA 19484
(610) 666-1700
---------------------
600,000 SHARES OF COMMON STOCK
----------------
The shares (the "Shares") of Common Stock, par value $.01 per share, of CTI
Group (Holdings) Inc. (formerly Communications Group Inc.) (together with its
subsidiaries, the "Company") which are the subject of this Reoffer Prospectus
and which may be sold from time to time are Shares which (i) have been acquired
by certain employees, employee directors and non-employee directors of the
Company or (ii) may be acquired from time to time by designated officers and
other employees of the Company, members of the Company's Board of Directors and
independent contractors and consultants who perform services for the Company
pursuant to the Company's Stock Option and Restricted Stock Plan (the "Selling
Stockholders"). See "Selling Stockholders".
It is anticipated that the Shares may be offered for sale by one or more of
the Selling Stockholders, in their discretion, on a delayed or continuous basis
from time to time in transactions in the open market at prices prevailing at the
time of sale on the National Association of Securities Dealers, Inc.
Over-The-Counter Bulletin Board under the symbol "CTIG," or in private
transactions at negotiated prices or otherwise. Such transactions may be
effected directly by the Selling Stockholders, each acting as principal for his
own account. Alternatively, such transactions may be effected through brokers,
dealers or other agents designated from time to time by the Selling
Stockholders, and such brokers, dealers or other agents may receive compensation
in the form of customary brokerage commissions or concessions from the Selling
Stockholders or the purchasers of the Shares. The Selling Stockholders, brokers
who execute orders on their behalf and other persons who participate in the
offering of the Shares on their behalf may be deemed to be "underwriters" within
the meaning of Section 2(11) of the Securities Act of 1933, as amended (the
"Securities Act") and a portion of the proceeds of sales and commissions or
concessions therefore may be deemed underwriting compensation for purposes of
the Securities Act. The Company will not receive any part of the proceeds from
the sale of Shares by the Selling Stockholders.
The Company will pay all costs and expenses incurred by it in connection
with the registration of the Shares under the Securities Act. The Selling
Stockholders will pay the costs associated with any sales of Shares, including
any discounts, commissions and applicable transfer taxes.
SEE "SPECIAL CONSIDERATIONS" BEGINNING ON PAGE 4 HEREIN FOR A DISCUSSION OF
CERTAIN FACTORS TO BE CONSIDERED BY PURCHASERS OF THE SHARES.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS REOFFER PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THE DATE OF THIS REOFFER PROSPECTUS IS MARCH 5, 1996.
<PAGE>
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS NOT CONTAINED IN THIS REOFFER PROSPECTUS IN CONNECTION WITH THE
OFFERING MADE BY THIS REOFFER PROSPECTUS, AND IF GIVEN OR MADE, SUCH INFORMATION
OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY OR THE SELLING STOCKHOLDERS. THIS REOFFER PROSPECTUS DOES NOT CONSTITUTE
AN OFFER TO BUY THE SECURITIES TO WHICH THIS REOFFER PROSPECTUS RELATES IN ANY
JURISDICTION TO ANY PERSON TO WHOM IT IS NOT LAWFUL TO MAKE SUCH AN OFFER OR
SOLICITATION IN SUCH JURISDICTION. NEITHER DELIVERY OF THIS REOFFER PROSPECTUS
NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY
IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE
THE DATE HEREOF OR SINCE THE DATE AS OF WHICH INFORMATION IS SET FORTH HEREIN.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") and in accordance
therewith files reports and other information with the Securities and Exchange
Commission (the "Commission"). Such reports, proxy and information statements
and other information can be inspected and copied at prescribed rates at the
Public Reference Section of the Commission at 450 Fifth Street, N.W., Room 1024,
Washington, D.C. 20549, and at the Commission's regional offices located at 7
World Trade Center, New York, New York 10048, and Citicorp Center, 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661-2511. The Common Stock of
the Company is listed on the National Association of Securities Dealers, Inc.
Over-The-Counter Bulletin Board, and reports, proxy and information material and
other information concerning the Company may be inspected at the offices of the
National Association of Securities Dealers, Inc., 1735 "K" Street, Washington,
DC 20006-1506.
This Reoffer Prospectus constitutes a part of a registration statement on
Form S-8 (the "Registration Statement") filed by the Company with the Commission
under the Securities Act with respect to the securities offered hereby. This
Reoffer Prospectus does not contain all the information set forth in the
Registration Statement, certain parts of which are omitted in accordance with
the rules and regulations of the Commission. Reference is hereby made to the
Registration Statement and to the exhibits thereto for further information with
respect to the Company and the securities offered hereby. Copies of the
Registration Statement and the exhibits thereto are on file at the offices of
the Commission and may be obtained upon payment of the prescribed fee or may be
examined without charge at the Public Reference Section of the Commission
described above. Statements contained herein concerning the provisions of
documents are necessarily summaries of such documents, and each statement is
qualified in its entirety by reference to the copy of the applicable document
filed with the Commission.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission are
incorporated herein by reference:
(a) The Company's Annual Report on Form 10-KSB for the fiscal year ended
March 31, 1995;
(b) The Company's Quarterly Report on Form 10-QSB for the quarter ended
June 30, 1995;
(c) The Company's Quarterly Report on Form 10-QSB for the quarter ended
September 30, 1995;
(d) The Company's Quarterly Report on Form 10-QSB for the quarter ended
December 31, 1995; and
2
<PAGE>
(e) The description of the Company's Common Stock contained in the
Company's Registration Statement on Form 8-A, dated June 29, 1982, including
all amendments and reports filed for the purpose of updating such
description.
All documents filed pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act subsequent to the date of this Reoffer Prospectus and prior to the
completion or termination of this offering shall be deemed to be incorporated by
reference in this Reoffer Prospectus and to be part hereof from the date of
filing of such documents. Any statement contained in a document, all or a
portion of which is incorporated or deemed to be incorporated by reference
herein, shall be deemed to be modified or superseded for purposes of this
Reoffer Prospectus to the extent that a statement contained herein or in any
other subsequently filed document, which also is or is deemed to be incorporated
by reference herein, modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Reoffer Prospectus.
The Company will provide without charge to each person, including any
beneficial owner, to whom this Reoffer Prospectus is delivered, upon written or
oral request, a copy of any or all of such documents which are incorporated
herein by reference (other than exhibits to such documents unless such exhibits
are specifically incorporated by reference into the documents that this Reoffer
Prospectus incorporates). Written or oral requests for copies should be directed
to Mary Ann Davis, Corporate Secretary, CTI Group (Holdings) Inc., 901 S.
Trooper Road, Valley Forge, Pennsylvania 19484, (610) 666-1700.
3
<PAGE>
THE COMPANY
The Company is engaged in the sale of telephone management software and
services. The telephone management software and services are designed to assist
customers in the management and control of their business telephone costs
through a variety of allocation, usage, network analysis and other reports. The
Company provides these services on a monthly service bureau basis or by
licensing software whereby customers may perform these functions on-site.
The Company also provides telecommunications billing services to shared
tenant service providers and telephone long distance service resellers who
provide centralized sale and service of telecommunication products and networks
to business customers. This service is available on both a service bureau basis
and on the Company's license software for in-house applications.
The Company is a Delaware corporation, with its principal executive offices
located at 901 S. Trooper Road, Valley Forge, Pennsylvania 19484, and its
telephone number is (610) 666-1700.
SPECIAL CONSIDERATIONS
The securities offered hereby are speculative in nature and involve a high
degree of risk. In addition to the other information set forth in this Reoffer
Prospectus (including the information set forth in the documents incorporated
herein by reference), the following factors should be considered carefully by
prospective investors in evaluating an investment in the shares of Common Stock
offered by this Reoffer Prospectus.
DEFICIENCY OF EARNINGS; NO DIVIDENDS
For the year ended March 31, 1995, the Company experienced a net loss of
approximately $477,000. There can be no assurance that the Company will ever
operate at a profitable level on a consistent basis. Until such times as
sufficient cash flow is generated from operations so as to offset expenses
incurred in connection therewith, the Company will have to utilize its capital
resources or external sources of funding to satisfy its working capital needs.
In addition, the Company has not declared or paid any cash dividends on its
Common Stock since its inception and does not anticipate paying any dividends on
its Common Stock in the foreseeable future.
COMPETITION; RAPID TECHNOLOGICAL CHANGES
The telephone call management industry is highly competitive and
characterized by rapid technological changes and developments which may reduce
or eliminate the utility of some of the Company's products. While the Company
believes that the quality, array and flexibility of the products and services
which it offers materially differentiate it from the products and services
offered by its competitors, the Company still faces competition from telephone
operating companies and communications and data management companies which
possess greater capital resources, more extensive research and development
staffs, better established product lines and greater name recognition. In the
event the Company is unable to produce state-of-the-art products and services
and to market such products and services to the public at competitive prices,
the Company's operations could be materially adversely affected.
INTELLECTUAL PROPERTY
The Company has not applied for patent or copyright protection with respect
to any of its software programs or other technology which it deems proprietary.
The Company believes that available intellectual property protection would not
afford the Company significant protection against competitors developing
non-infringing software or other technology. The Company seeks to protect its
proprietary information by way of confidentiality and non-disclosure agreements
with employees and third parties who may have access to such information and
through continued upgrading and modification of its proprietary products. The
failure of the Company to adequately protect its proprietary products could have
a material adverse effect on the Company's operations. In addition, while the
Company does not believe that its technology infringes on the intellectual
property rights of third parties, there can be no assurance that certain aspects
of the Company's technology will not be
4
<PAGE>
challenged by others in the telecommunications industry or that the Company will
not be required to license or otherwise acquire from third parties the right to
use certain technology. The failure to overcome such challenges or acquire such
rights could have a material adverse effect on the Company's operations.
RISKS OF INTERNATIONAL BUSINESS
The Company operates and sells its products and services to clients in
various countries. Accordingly, the Company is subject to the risks inherent in
conducting business across national boundaries, including, but not limited to,
currency exchange rate fluctuations, international incidents, military
outbreaks, economic downturns, government instability, nationalization of
foreign assets, government protectionism and changes in governmental policy, any
of which risks could have a material adverse effect on the prospects of the
Company.
DEPENDENCE ON KEY PERSONNEL
The success of the Company will depend greatly upon the active participation
and experience of its management. The loss of any of the Company's executive
officers could adversely affect the conduct of the Company's business. In
addition, the future success of the Company's operations will depend, in large
part, upon the ability of the Company's personnel to perfect and improve upon
existing and proposed products. The loss of some or all of such personnel, or
the inability of the Company to attract additional personnel, or the inability
of such personnel to develop efficient telecommunication systems, will inhibit
the Company's ability to sell its products and services and to operate
profitability.
NEED FOR ADDITIONAL FINANCING
While the Company believes its working capital is adequate to fund its
operations for the foreseeable future, the Company will need additional
financing in order to fund expansion of the Company's products and services as
well as to expand the number of markets in which such products and services are
available. There can be no assurance that additional financing will be available
to the Company on desirable terms or at all in order to fund such expansions.
The inability of the Company to obtain adequate financing could have a material
adverse effect on the Company's prospects.
USE OF PROCEEDS
The Company will not receive any proceeds from the sale of the Shares of
Common Stock offered hereby. The Selling Stockholders will receive all of the
net proceeds from the sale of the Shares of Common Stock offered hereby.
SELLING STOCKHOLDERS
The following persons are current employees, employee directors and
non-employee directors of the Company, each of whom is eligible to sell pursuant
to this Reoffer Prospectus the number of Shares set forth opposite their name in
the table below. In addition, certain designated officers,
5
<PAGE>
employees, members of the Board of Directors and independent contractors and
consultants may be granted Shares pursuant to the Stock Option and Restricted
Stock Plan and, upon such issuance, may sell such Shares pursuant to this
Reoffer Prospectus.
<TABLE>
<CAPTION>
PRE-OFFERING POST-OFFERING
------------------------ ------------------------
TOTAL TOTAL
NUMBER OF NUMBER OF
SHARES SHARES
BENEFICIALLY PERCENTAGE SHARES BENEFICIALLY PERCENTAGE
SELLING STOCKHOLDERS OWNED(1) OF CLASS(2) OFFERED (1)(3) OWNED (3) OF CLASS(2)
- --------------------------------------------- ----------- ----------- --------------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Rupert D. Armitage........................... 400,000 7.39% 30,000 370,000 6.84%
Mark H. Daugherty............................ 65,600 1.21% 50,000 15,600 *
Mary Ann Davis............................... 67,225 1.24% 30,000 37,225 *
Alvin B. Gentzler............................ 40,500 * 30,000 10,500 *
Francis O. Hunnewell......................... 181,667 3.36% 30,000 151,667 2.80%
Anthony P. Johns (4)......................... 1,768,302 32.55% 50,000 1,718,302 31.63%
Paul A. Johns................................ 116,000 2.14% 30,000 86,000 1.59%
John D. Mazzuto.............................. 196,667 3.63% 30,000 166,667 3.08%
Robert H. Nielsen............................ 40,300 * 30,000 10,300 *
</TABLE>
- ------------------------
* Less than 1%
(1) Assumes exercise of all options held as of March 5, 1996 to purchase Shares
granted to the Selling Stockholders pursuant to the Plan.
(2) Percentages calculated in accordance with Section 13(d) of the Securities
Exchange Act of 1934, as amended, and the rules promulgated thereunder,
based on 5,381,756 shares of Common Stock outstanding as of March 5, 1996.
(3) Assumes offer and sale of all Shares eligible to be offered and sold hereby
by the Selling Stockholders.
(4) Includes 150,000 shares of Common Stock owned by Asian Oceanic Capital
Corporation over which Mr. Johns holds voting power.
PLAN OF DISTRIBUTION
The Common Stock is listed for trading on the National Association of
Securities Dealers, Inc. Over-The-Counter Bulletin Board (the "Bulletin Board").
The sale of the shares of Common Stock offered hereunder is not being
underwritten. The shares of Common Stock covered by this Reoffer Prospectus may
be offered and sold by the Selling Stockholders from time to time on the
Bulletin Board through broker-dealers selected by the Selling Stockholders at
market prices prevailing at the time of sale, in private transactions at
negotiated prices or otherwise. It is anticipated that such transactions will be
effected without payment of any underwriting commissions or discounts, other
than brokers' commissions or fees customarily paid in connection with such
transactions, which commissions and fees will be borne by the Selling
Stockholders.
The Company has agreed to bear the costs of registering the shares of Common
Stock offered hereby under the Securities Act, but will not receive any of the
proceeds from the sale of the shares of Common Stock.
There is no assurance that the Selling Stockholders will sell any or all of
the shares of Common Stock offered hereby.
LEGAL MATTERS
The legality of the shares of Common Stock offered hereby has been passed
upon for the Company by Klehr, Harrison, Harvey, Branzburg & Ellers,
Philadelphia, Pennsylvania.
6
<PAGE>
EXPERTS
The consolidated financial statements of the Company appearing in the
Company's Annual Report on Form 10-KSB for the year ended March 31, 1995 have
been audited by Zelenkofske, Axelrod & Co., Ltd., independent auditors, as set
forth in their report thereon included therein and incorporated herein by
reference. Such consolidated financial statements are incorporated herein by
reference in reliance upon such report given upon the authority of such firm as
experts in accounting and auditing.
7
<PAGE>
- -------------------------------------------
-------------------------------------------
- -------------------------------------------
-------------------------------------------
NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS NOT CONTAINED IN THIS REOFFER
PROSPECTUS IN CONNECTION WITH THE OFFERING DESCRIBED HEREIN AND, IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE COMPANY OR THE SELLING STOCKHOLDERS. THIS REOFFER PROSPECTUS
DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY A
SECURITY OTHER THAN THE SHARES OF COMMON STOCK OFFERED HEREBY, NOR DOES IT
CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE
SECURITIES OFFERED HEREBY IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS
UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION IN SUCH JURISDICTION. NEITHER THE
DELIVERY OF THIS REOFFER PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED HEREIN IS
CORRECT AS OF ANY DATE SUBSEQUENT TO THE DATE HEREOF.
------------------------
TABLE OF CONTENTS
------------------------
<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
Available Information.......................... 2
Incorporation of Certain Documents by
Reference..................................... 2
The Company.................................... 4
Special Considerations......................... 4
Use of Proceeds................................ 5
Selling Stockholders........................... 5
Plan of Distribution........................... 6
Legal Matters.................................. 6
Experts........................................ 7
</TABLE>
600,000 SHARES
CTI GROUP
(HOLDINGS) INC.
COMMON STOCK
---------------------
REOFFER PROSPECTUS
---------------------
MARCH 5, 1996
- -------------------------------------------
-------------------------------------------
- -------------------------------------------
-------------------------------------------
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed by the Company with the Securities and
Exchange Commission pursuant to the Securities Exchange Act of 1934 (the
"Exchange Act") are incorporated into this Registration Statement by reference:
1. The Company's Annual Report on Form 10-KSB for the fiscal year ended
March 31, 1995;
2. The Company's Quarterly Report on Form 10-QSB for the quarter ended June
30, 1995;
3. The Company's Quarterly Report on Form 10-QSB for the quarter ended
September 30, 1995;
4. The Company's Quarterly Report on Form 10-QSB for the quarter ended
December 31, 1995; and
5. The description of the Company's Common Stock contained in the Company's
Registration Statement on Form 8-A, dated June 29, 1982, including all
amendments and reports filed for the purpose of updating such
description.
All documents filed pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act subsequent to the date of this Reoffer Prospectus and prior to the
completion or termination of this offering shall be deemed to be incorporated by
reference in this Reoffer Prospectus and to be part hereof from the date of
filing of such documents. Any statement contained in a document, all or a
portion of which is incorporated or deemed to be incorporated by reference
herein, shall be deemed to be modified or superseded for purposes of this
Reoffer Prospectus to the extent that a statement contained herein or in any
other subsequently filed document, which also is or is deemed to be incorporated
by reference herein, modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Reoffer Prospectus.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The law firm of Klehr, Harrison, Harvey, Branzburg & Ellers has delivered an
opinion in connection herewith with respect to the legality of the shares of
Common Stock being registered hereunder.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Company has adopted in its Certificate of Incorporation and Bylaws the
provisions of Section 102(b)(7) of the Delaware General Corporation Law which
eliminate or limit the personal liability of a director to the Company or its
stockholders for monetary damages for breach of fiduciary duty as a director,
except that this provision shall not eliminate or limit the liability of a
director for any breach of the director's duty of loyalty to the Company or its
stockholders, for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, under Section 174 of the
Delaware General Corporation Law, or for any transaction from which the director
derived an improper personal benefit.
Further, the Company's Certificate of Incorporation and Bylaws provide that
the Company shall indemnify all persons whom it may indemnify pursuant to
Section 145 of the Delaware Corporation Law to the full extent permitted
therein. Section 145 provides, subject to various exceptions and limitations,
that the Company may indemnify its directors or officers if such director or
officer is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative, by reason of the fact that he is or was a
director or officer of the Company, or is or was serving at the request of the
Company as a director or officer of another corporation, against expenses
(including attorneys' fees), judgments,
II-1
<PAGE>
fines and amounts paid in settlement actually and reasonably incurred by him in
connection with such action, suit or proceeding 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 Company, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The determination of
whether indemnification is proper under the circumstances, unless made by a
court, shall be made by a majority of a quorum of disinterested members of the
Board of Directors, independent legal counsel or the stockholders of the
Company. In addition, the Company shall indemnify its directors or officers to
the extent that they have been successful on the merits or otherwise in defense
of any such action, suit or proceeding, or in the defense of any claim, issue or
matter therein, against expenses (including attorneys' fees) actually and
reasonably incurred by them in connection therewith.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Any restricted securities to be offered or resold pursuant to this
Registration Statement are exempt under Section 4(2) of the Securities Act of
1933, as amended, as a non-public offering of securities.
ITEM 8. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- --------- ---------------------------------------------------------------------------------------------------------
<C> <S>
4.1* Stock Option and Restricted Stock Plan
5 * Opinion of Klehr, Harrison, Harvey, Branzburg & Ellers
23.1* Consent of Zelenkofske, Axelrod & Co., Ltd.
23.2* Consent of Klehr, Harrison, Harvey, Branzburg & Ellers (included in the opinion filed as Exhibit 5
hereto)
24 * Powers of Attorney (included in the signature pages hereto)
</TABLE>
- ------------------------
*Filed Herewith.
ITEM 9. UNDERTAKINGS.
(a) The Company 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 this 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
this Registration Statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in this Registration Statement or
any material change to such information in this Registration Statement;
PROVIDED, HOWEVER, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply
if the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed with or
furnished to the Commission by the Company pursuant to Section 13 or
15(d) of the Securities Exchange Act of 1934 that are incorporated by
reference in this 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.
II-2
<PAGE>
(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.
(4) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the Company's annual report pursuant to Section
13(a) or 15(d) of the Securities Exchange Act of 1934 that is incorporated
by reference in this Registration Statement shall be deemed to be a new
registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(b) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Company pursuant to its Certificate of Incorporation, its bylaws, or
otherwise, the Company has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Securities Act of 1933 and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than the
payment by the Company of expenses incurred or paid by a director, officer or
controlling person of the Company 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 Company 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 Securities
Act of 1933 and will be governed by the final adjudication of such issue.
II-3
<PAGE>
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 Valley Forge, Commonwealth of Pennsylvania, on this 5th day of
March, 1996.
CTI GROUP (HOLDINGS) INC.
By: /s/ ANTHONY P. JOHNS
-----------------------------------
Anthony P. Johns,
PRESIDENT AND CHIEF EXECUTIVE
OFFICER
POWER OF ATTORNEY
Each of the undersigned officers and directors of CTI Group (Holdings) Inc.
whose signature appears below hereby appoints Anthony P. Johns and Mark H.
Daugherty, jointly and each individually, as true and lawful attorneys-in-fact
for the undersigned with full power of substitution, to execute in his name and
on his behalf in each capacity stated below, any and all amendments (including
post-effective amendments) to this Registration Statement as the
attorney-in-fact shall deem appropriate, and to cause to be filed any such
amendment (including exhibits thereto and other documents in connection
therewith) to this Registration Statement with the Securities and Exchange
Commission, as fully and to all intents and purposes as such person might or
could do in person, hereby ratifying and confirming all that said
attorneys-in-fact, or either of them, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on this 5th day of March, 1996.
<TABLE>
<C> <S> <C>
SIGNATURE TITLE(S) DATE
- ------------------------------------------------------ -------------------------------------- -----------------
/s/ JOHN D. MAZZUTO
------------------------------------------- Chairman of the Board and Director March 5, 1996
John D. Mazzuto
/s/ ANTHONY P. JOHNS
------------------------------------------- President, Chief Executive Officer and March 5, 1996
Anthony P. Johns Director
/s/ FRANCIS O. HUNNEWELL
------------------------------------------- Director March 5, 1996
Francis O. Hunnewell
/s/ RUPERT D. ARMITAGE
------------------------------------------- Director March 5, 1996
Rupert D. Armitage
/s/ MARK H. DAUGHERTY Chief Financial Officer and Director
------------------------------------------- (Principal Accounting and Financial March 5, 1996
Mark H. Daugherty Officer)
</TABLE>
II-4
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION PAGE NUMBER
- ----------- ---------------------------------------------------------------------------------------------- -----------
<C> <S> <C>
4.1 Stock Option and Restricted Stock Plan 16
5 Opinion of Klehr, Harrison, Harvey, Branzburg & Ellers 25
23.1 Consent of Zelenkofske, Axelrod & Co., Ltd. 26
23.2 Consent of Klehr, Harrison, Harvey, Branzburg & Ellers (included in Exhibit 5 hereto) 25
24 Powers of Attorney (included in the signature pages hereto) II-4
</TABLE>
<PAGE>
EXHIBIT 4.1
COMMUNICATIONS GROUP INC.
STOCK OPTION AND RESTRICTED STOCK PLAN
The purpose of the Stock Option and Restricted Stock Plan (the "Plan") of
Communications Group Inc. (the "Company") is to promote the interests of the
Company by providing incentives to (i) designated officers and other employees
of the Company or a Subsidiary Corporation (as defined herein), (ii) members of
the Company's Board of Directors (the "Board") and (iii) independent contractors
and consultants (who may be individuals or entities) who perform services for
the Company to enable the Company to attract and retain them and to encourage
them to acquire a proprietary interest, or to increase their proprietary
interest, in the Company. The Company believes that the Plan will cause
participants to contribute materially to the growth of the Company, thereby
benefitting the Company's shareholders. For purposes of the Plan, the terms
"Parent Corporation" and "Subsidiary Corporation" shall have the meanings set
forth in subsections (e) and (f) of Section 424 of the Internal Revenue Code of
1986, as amended (the "Code").
1. ADMINISTRATION
(a) Except with respect to a Director's Grant (as hereinafter defined)
granted pursuant to Section 2(b) hereof, the Plan shall be administered and
interpreted by a committee of the Board (the "Committee") consisting of not less
than two persons, all of whom shall be "outside directors" within the meaning of
Section 162(m) of the Code and each of whom shall be a "disinterested person" as
defined under Rule 16b-3 promulgated under the Securities Exchange Act of 1934,
as amended. With respect to Eligible Participants (as hereinafter defined), the
Committee shall have the sole authority to determine (i) who is eligible to
receive Grants (as defined in Section 2 below) under the Plan, (ii) the type,
size and terms of each Grant under the Plan (subject to Section 4 below), (iii)
the time when each Grant will be made and the duration of any exercise or
restriction period; (iv) any restrictions on resale applicable to the shares to
be issued or transferred pursuant to the Grant; and (v) any other matters
arising under the Plan. The Committee may, if it so desires, base any of the
foregoing determinations upon the recommendations of management of the Company.
The Committee shall have full power and authority to administer and interpret
the Plan with respect to Eligible Participants and to adopt or amend such rules,
regulations, agreements and instruments as it may deem appropriate for the
proper administration of the Plan. The Committee's interpretations of the Plan
and all determinations made by the Committee pursuant to the powers vested in it
hereunder shall be conclusive and binding on all Eligible Participants having
any interests in the Plan or in any Grants under the Plan. No person acting
under this subsection shall be held liable for any action or determination made
in good faith with respect to the Plan or any Grant under the Plan.
(b) Each member of the Committee shall be indemnified and held harmless by
the Company against any cost or expense (including counsel fees) reasonably
incurred by him or her, or liability (including any sum paid in settlement of a
claim with the approval of the Company) arising out of any act or omission to
act in connection with the Plan, unless arising out of such member's own fraud
or bad faith, to the extent permitted by applicable law. Such indemnification
shall be in addition to any rights of indemnification the members may have as
directors or otherwise under the Articles of Incorporation or By-Laws of the
Company, any agreement of shareholders or disinterested directors or otherwise.
2. GRANTS
(a) GRANTS TO ELIGIBLE PARTICIPANTS. With respect to Eligible
Participants, Incentives under the Plan shall consist of Incentive Stock Options
(as defined in Section 5(b) below), Nonqualified Stock Options (as defined in
Section 5(b) below) and Restricted Stock Grants (as defined in Section 6 below),
(hereinafter sometimes collectively referred to as "Grants"). All Grants, except
with respect to
1
<PAGE>
Director's Grants (as hereinafter defined) as specifically provided in Section
2(b) hereof, shall be subject to the terms and conditions set forth herein and
to such other terms and conditions of any nature as long as they are not
inconsistent with the Plan as the Committee deems appropriate and specifies in
writing to the participant (the "Grant Letter"). The Committee shall approve the
form and provisions of each Grant Letter. Grants under any section of the Plan
need not be uniform as among the participants receiving the same type of Grant,
and Grants under two or more sections of the Plan may be combined in one Grant
Letter.
(b) DIRECTOR'S GRANTS. A member of the Board of the Company who is not an
employee of the Company or a Subsidiary Corporation and who serves as a member
of the Committee (a "Committee Member") shall be entitled to receive a
Director's Grant in accordance with this Section 2(b).
i) Committee Members shall receive a Nonqualified Stock Option to
purchase Thirty Thousand (30,000) shares of Common Stock (as hereinafter
defined) of the Company at an exercise price equal to the higher of the fair
market value (as defined herein) or the book value of a share of Common
Stock on the date of grant, subject to adjustment as provided in Section
3(b) of this Plan, at the commencement of and in consideration for their
service to the Company as a director (a "Director's Grant"). One-half of
such Director's Grant shall vest on the first anniversary of the date of
grant and one-quarter shall vest on each of the second and third
anniversaries of the date of grant, provided such Committee Member is then
serving as a director (the "Initial Vesting Period"). If a Committee Member
is not serving as a director on the first, second or third anniversary of
the date of such grant, then any such Director's Grant shall terminate as to
all shares covered by the Director's Grant which have not vested. Director's
Grants shall be exercisable for a period of ten years from the date of
grant.
ii) Upon the expiration of the Initial Vesting Period, and at the
commencement of each succeeding three year period, Committee Members shall
be eligible to receive an additional Director's Grant, which grants shall
vest in accordance with the schedule set forth in Section 2(b)(i) hereof.
iii) Upon the occurrence of (a) a Change In Control (as defined in
Section 7 hereof or (b) a sale or exchange of assets of the Company or (c)
dissolution, liquidation, merger or consolidation of the Company (in which
the Company is not the surviving corporation), all restrictions imposed
under any Director's Grant shall immediately lapse.
iv) Each Committee Member who receives a Director's Grant pursuant to
this Section 2(b) shall receive a written agreement setting forth the terms
and conditions of such grant including, but not limited to, the restrictions
set forth in this Section 2(b) (the "Director's Grant Letter").
v) Except as otherwise provided in this Section 2(b), Director Grants
shall be subject to the provisions of this Plan applicable to Non-Qualified
Stock Options granted to other persons.
vi) Notwithstanding any other provision of the Plan, this Section 2(b)
may not be amended more than once every six months, except for amendments
necessary to conform the plan to changes in the provisions of the Code or
the Employee Retirement Income Security Act of 1974 ("ERISA"), or the rules
promulgated thereunder.
vii) The provisions of this Section 2(b) are intended to operate
automatically and not require administration. To the extent that any
administrative determinations may be required, such determination shall be
made by a member or members of the Board of Directors who is/are not
eligible to be granted Options under this Section 2(b), but in no event
shall such determinations affect the eligibility of Committee Members, the
timing of the grants or the number of shares of Common Stock subject to
Restricted Stock Grants hereunder.
3. SHARES SUBJECT TO THE PLAN
(a) The aggregate number of shares of the Common Stock, par value $.01
("Common Stock"), of the Company that may be issued or transferred under the
Plan is 600,000, subject to adjustment
2
<PAGE>
pursuant to Section 3(b) below. Such shares may be authorized but unissued
shares or reacquired shares. If and to the extent that options granted under the
Plan terminate, expire or are canceled without having been exercised (including
shares canceled as part of an exchange of Grants), or if any shares of
restricted stock are forfeited, the shares subject to such Grant or of such
restricted stock shall again be available for subsequent Grants under the Plan.
(b) If any change is made to the Common Stock (whether by reason of merger,
consolidation, reorganization, recapitalization, stock dividend, stock split,
combination of shares, or exchange of shares or any other change in capital
structure made without receipt of consideration), then unless such event or
change results in the termination of all outstanding Grants and Director's
Grants under the Plan, the Committee shall preserve the value of the outstanding
Grants and Director's Grants by adjusting the maximum number and class of shares
issuable under the Plan to reflect the effect of such event or change in the
Company's capital structure, and by making appropriate adjustments to the number
and class of shares, the exercise price of each outstanding option and
otherwise, except that any fractional shares resulting from such adjustments
shall be eliminated by rounding any portion of a share equal to .500 or greater
up, and any portion of a share equal to less than .500 down, in each case to the
nearest whole number.
4. ELIGIBILITY FOR PARTICIPATION
Committee Members, Officers and other employees of the Company or a
Subsidiary Corporation and independent contractors and consultants who perform
services for the Company (hereinafter referred to individually as an "Eligible
Participant" and collectively as "Eligible Participants") shall be eligible to
participate in the Plan. Only Eligible Participants who are officers or other
employees of the Company or a Subsidiary Corporation shall be eligible to
receive Incentive Stock Options. All Eligible Participants shall be eligible to
receive Nonqualified Stock Options and Restricted Stock Grants. The Committee
shall select from among the Eligible Participants those who will receive Grants
(such Eligible Participants and Committee Members who receive Director's Grants
pursuant to Section 2(b) hereof are hereinafter sometimes collectively referred
to as the "Grantees") and, except in the case of a Director's Grant made
pursuant to Section 2(b) hereof, the Committee shall determine the number of
shares of Common Stock subject to each Grant; provided, however, that the
maximum number of shares of Common Stock which may be subject to Grants awarded
to any Grantee shall not exceed 600,000. The Committee may, if it so desires,
base any such selections or determinations upon the recommendations of
management of the Company. Nothing contained in the Plan shall be construed to
limit in any manner whatsoever the right of the Company to grant rights or
options to acquire Common Stock or awards of Common Stock otherwise than
pursuant to the Plan.
5. STOCK OPTIONS TO ELIGIBLE PARTICIPANTS
(a) NUMBER OF SHARES. The Committee, in its sole discretion, shall
determine the number of shares of Common Stock that will be subject to each
option.
(b) TYPE OF OPTION AND OPTION PRICE.
(1) The Committee may grant options qualifying as incentive stock
options within the meaning of Section 422 of the Code ("Incentive Stock
Options") and other stock options ("Nonqualified Stock Options"), in
accordance with the terms and conditions set forth herein, or may grant any
combination of Incentive Stock Options and Nonqualified Stock Options
(hereinafter referred to collectively as "Stock Options"). The option price
per share of an Incentive Stock Option shall be the higher of the Fair
Market Value or the book value of a share of Common Stock on the date of
grant. If the Grantee of an Incentive Stock Option owns Common Stock (as
determined under section 424(d) of the Code) possessing more than 10% of the
total combined voting power of all classes of stock of the Company or a
Parent Corporation or Subsidiary Corporation, the option price per share in
the case of an Incentive Stock Option shall not be less than 110% of the
fair market value of a share of Common Stock on the date of grant and such
option by its terms is not exercisable after the expiration of five (5)
years from the date of grant.
3
<PAGE>
(2) For all valuation purposes under the Plan, the fair market value of
a share of Common Stock shall be determined in accordance with the following
provisions:
(A) If the Common Stock is not at the time listed or admitted to
trading on any stock exchange but is traded in the over-the-counter
market (but not on the Nasdaq National Market segment of The Nasdaq Stock
Market), the fair market value shall be the mean between the last
reported bid and asked prices of one share of Common Stock on the date in
question in the over-the-counter market, as such prices are reported by
the National Association of Securities Dealers through its Nasdaq system
or any successor system. If there are no reported bid and asked prices on
the date in question, then the mean between the last reported bid and
asked prices on the next preceding date for which such quotations exist
shall be determinative of fair market value. If the Common Stock is
traded over-the-counter on the Nasdaq National Market segment of The
Nasdaq Stock Market, the fair market value shall be the closing selling
price of one share of Common Stock on the date in question as such price
is reported by the National Association of Securities Dealers, Inc.
through such system or any successor system. If there is no reported
closing selling price for the Common Stock on the date in question, then
the closing selling price on the next preceding date for which such
quotation exists shall be determinative of fair market value.
(B) If the Common Stock is at the time listed or admitted to trading
on any stock exchange, then the fair market value shall be the closing
selling price of one share of Common Stock on the date in question on the
stock exchange determined by the Committee to be the primary market for
the Common Stock, as such prices are officially quoted on such exchange.
If there is no reported closing selling price of Common Stock on such
exchange on the date in question, then the fair market value shall be the
closing selling price on the next preceding date for which such quotation
exists.
(C) If the Common Stock is at the time neither listed nor admitted to
trading on any stock exchange nor traded in the over-the-counter market
(or, the Committee determines that the value as determined pursuant to
Section 5(b)(2)(A) or (B) above does not reflect fair market value), then
the Committee shall determine fair market value after taking into account
such factors as it deems appropriate.
(c) EXERCISE PERIOD. The Committee shall determine the option exercise
period of each Stock Option. The exercise period shall not exceed ten years from
the date of grant. Notwithstanding any determinations by the Committee regarding
the exercise period of any Stock Option, all outstanding Stock Options shall be
immediately exercisable upon a Change of Control of the Company (as defined in
Section 7 below).
(d) VESTING OF OPTIONS AND RESTRICTIONS ON SHARES. The vesting period for
Stock Options shall commence on the date of grant and shall end on the date or
dates, determined by the Committee, that shall be specified in the Grant Letter.
The Committee may impose upon the shares of Common Stock issuable upon the
exercise of a Stock Option such restrictions as it deems appropriate and
specifies in the Grant Letter. During any period in which such restrictions
apply a Grantee may not sell, assign, transfer, pledge or otherwise dispose of
the shares of Common Stock issued upon exercise of such stock options except to
a successor Grantee pursuant to Section 7 hereof and the Committee, in such
circumstances as it deems equitable, may determine that all such restrictions
shall lapse. Notwithstanding any other provision of the Plan, all outstanding
Stock Options shall become immediately exercisable upon a Change of Control of
the Company (as defined in Section 7 below).
(e) MANNER OF EXERCISE. A Grantee may exercise a Stock Option by
delivering a duly completed notice of exercise to the Committee, together with
payment of the option price. Such notice may include instructions authorizing
the Company to deliver the certificates representing the shares of Common Stock
issuable upon the exercise of such Stock Option to any designated registered
broker or
4
<PAGE>
dealer ("Designated Broker"). Such instructions shall designate the account into
which the shares are to be deposited. The Grantee may tender such notice of
exercise, which has been properly executed by the Grantee, and the
aforementioned delivery instructions to any Designated Broker.
(f) TERMINATION OF EMPLOYMENT, DISABILITY OR DEATH.
(1) If a Grantee who is an employee ceases to be an employee (in the
case of an Incentive Stock Option) or ceases to be an Eligible Participant
(in the case of a Nonqualified Stock Option) for any reason (other than, in
the case of an individual, the death of such individual) any Stock Option
which is otherwise exercisable by the Grantee shall terminate unless
exercised within three months after the date on which the Grantee ceases to
be an employee or an Eligible Participant, as the case may be (or in the
case of Non-Qualified Stock Options within such other period of time, which
may be longer or shorter than three months, as may be specified in the Grant
Letter), but in any event no later than the date of expiration of the option
exercise period, except that in the case of an individual Grantee who is
disabled within the meaning of Section 22(e)(3) of the Code, such period
shall be one year rather than three months (or in the case of Non-Qualified
Stock Options within such other period of time, which may be longer or
shorter than three months, as may be specified in the Grant Letter).
(2) In the event of the death of an individual Grantee while he or she
is an Eligible Participant or within not more than three months after the
date on which the Grantee ceases to be an Eligible Participant (or within
such other period of time, which may be longer or shorter than three months,
as may be specified in the Grant Letter), any Stock Option which was
otherwise exercisable by the Grantee at the date of death may be exercised
by the Grantee's personal representative at any time prior to the expiration
of one year from the date of death, but in any event no later than the date
of expiration of the option exercise period.
(g) SATISFACTION OF OPTION PRICE. The Grantee shall pay the option price
in full at the time of exercise in cash, or, with the consent of the Committee
in its sole discretion, by delivering shares of Common Stock already owned by
the Grantee and having a fair market value on the date of exercise equal to the
option price or a combination of cash and shares of Common Stock. The Grantee
shall also pay the amount of withholding tax due, if any, at the time of
exercise. Shares of Common Stock shall not be issued or transferred upon any
purported exercise of a Stock Option until the option price and the withholding
obligation are fully paid.
(h) LIMITS ON INCENTIVE STOCK OPTIONS. Each Option Grant of an Incentive
Stock Option shall provide that:
(1) the Stock Option is not transferable by the Grantee, except, in the
case of an individual Grantee, by will or the laws of descent and
distribution;
(2) the Stock Option is exercisable only by the Grantee, except as
otherwise provided herein or in the Grant Letter in the event of the death
of an individual Grantee;
(3) the aggregate fair market value of the Common Stock determined as of
the date of the Grant with respect to which Incentive Stock Options are
exercisable for the first time by a Grantee during any calendar year under
the Plan and under any other stock option plan of the Company shall not
exceed $100,000; and
(4) unless the Grantee could otherwise transfer Common Stock issued
pursuant to the Stock Option without incurring liability under Section 16(b)
of the Securities and Exchange Act of 1934, as amended (the "Exchange Act"),
at least six months must elapse from the date of acquisition of the Stock
Option until the date of disposition of the Common Stock issued upon
exercise thereof.
5
<PAGE>
6. RESTRICTED STOCK GRANTS
The Committee may issue shares of Common Stock to an Eligible Participant
pursuant to an incentive or long range compensation plan, program or contract
approved by the Committee (a "Restricted Stock Grant"). The following provisions
are applicable to Restricted Stock Grants:
(a) GENERAL REQUIREMENTS. Shares of Common Stock issued pursuant to
Restricted Stock Grants will be issued in consideration for cash or services
rendered having a value, as determined by the Board, at least equal to the par
value thereof. All conditions and restrictions imposed under each Restricted
Stock Grant, and the period of years during which the Restricted Stock Grant
will remain subject to such restrictions, shall be set forth in the Grant Letter
and designated therein as the "Restriction Period." All restrictions imposed
under any Restricted Stock Grant shall lapse on such date or dates as the
Committee may approve until the restrictions have lapsed as to 100% of the
shares, except that upon a Change of Control of the Company, all restrictions on
the transfer of the shares which have not been forfeited prior to such date
shall lapse. In addition, the Committee, in circumstances that it deems
equitable, may determine as to any or all Restricted Stock Grants, that all the
restrictions shall lapse, notwithstanding any Restriction Period.
(b) NUMBER OF SHARES. The Committee, in its sole discretion, shall
determine the number of shares of Common Stock that will be granted in each
Restricted Stock Grant.
(c) REQUIREMENT OF RELATIONSHIP WITH COMPANY. If the Grantee's
relationship with the Company (as an employee, independent contractor or
consultant, as the case may be) terminates during the period designated in the
Grant Letter as the Restriction Period, the Restricted Stock Grant shall
terminate as to all shares covered by the Grant as to which restrictions on
transfer have not lapsed, and such shares shall be immediately returned to the
Company. The Committee may, in its sole discretion, provide for complete or
partial exceptions to the provisions of this Section 6(c).
(d) RESTRICTIONS ON TRANSFER AND LEGEND ON STOCK CERTIFICATE. During the
Restriction Period, a Grantee may not sell, assign, transfer, pledge or
otherwise dispose of the shares of Common Stock to which such Restriction Period
applies except to a Successor Grantee pursuant to Section 7 below. Each
certificate representing a share of Common Stock issued or transferred under a
Restricted Stock Grant shall contain a legend giving appropriate notice of the
restrictions in the Grant. The Grantee shall be entitled to have the legend
removed from the stock certificate or certificates representing any such shares
as to which all restrictions have lapsed.
7. TRANSFERABILITY OF OPTIONS AND GRANTS
Only a Grantee or Committee Member (or, in the case of an individual Grantee
and a Committee Member, his or her authorized legal representative on behalf of
Grantee or Committee Member) may exercise rights under a Grant or a Director's
Grant. No individual Grantee or Committee Member may transfer those rights
except by will or by the laws of descent and distribution or, in the case of a
Grant other than an Incentive Stock Option and to the extent permitted under
Rule 16b-3 of the Exchange Act and by the Committee in its sole discretion, (a)
pursuant to a qualified domestic relations order as defined under the Code or
Title I of ERISA or the rules thereunder and (b) to a trust for the benefit of a
member of the Grantee's immediate family. Upon the death of an individual
Grantee or Committee Member, the personal representative or other person
entitled to succeed to the rights of the Grantee or Committee Member ("Successor
Grantee") may exercise such rights. A Successor Grantee shall furnish proof
satisfactory to the Company of such person's right to receive the Grant or the
Director's Grant under the Grantee's will or under the applicable laws of
descent and distribution.
8. CHANGE OF CONTROL OF THE COMPANY
As used herein, a "Change of Control" shall be deemed to have occurred when
(a) any "person" (as such term is used in Section 13(d) and 14(d) of the
Exchange Act) becomes the "beneficial owner", directly or indirectly, of
securities of the Company representing thirty (30%) percent or more of the
combined voting power of the Company's then outstanding securities or (b) the
Company becomes a
6
<PAGE>
subsidiary of another corporation or is merged or consolidated into another
corporation or if substantially all of its assets shall have been sold to an
unaffiliated party or parties unless thereafter (1) directors of the Company
immediately prior thereto continue to constitute at least fifty (50%) percent of
the directors of the surviving entity or purchaser or (2) the Company's
securities continue to represent, or are converted into securities which
represent, more than seventy (70%) percent of the combined voting power of the
surviving entity or purchaser, or (c) fifty (50%) percent or more of the Board
is comprised of persons who were not nominated by the Board for election as
directors, or (d) the Board adopts a plan of complete liquidation of the
Company.
9. CERTAIN CORPORATE CHANGES
(a) SALE OR EXCHANGE OF ASSETS, DISSOLUTION OR LIQUIDATION OR MERGER OR
CONSOLIDATION WHERE THE COMPANY DOES NOT SURVIVE. If all or substantially all
of the assets of the Company are to be sold or exchanged, the Company is to be
dissolved or liquidated, or the Company is a party to a merger or consolidation
with another corporation in which the Company will not be the surviving
corporation, then, at least ten days prior to the effective date of such event,
the Company shall give each Grantee with any outstanding Grants (including
Director's Grants) written notice of such event. Each such Grantee shall
thereupon have the right to exercise in full any installments of such Grants
(including Director's Grants) not previously exercised (whether or not the right
to exercise such installments has accrued pursuant to such Grants (including
Director's Grants)), within ten days after such written notice is sent by the
Company. Any installments of such Grants (including Director's Grants) not so
exercised shall thereafter lapse and be of no further force or effect.
(b) MERGER OR CONSOLIDATION WHERE THE COMPANY SURVIVES. If the Company is
a party to a merger or consolidation in which the Company will be the surviving
corporation, then the Committee may, in its sole discretion, elect to give each
Grantee with any outstanding Grants (including Director's Grants) written notice
of such event. If such notice is given, each such Grantee shall thereupon have
the right to exercise in full any installments of such Grants (including
Director's Grants) not previously exercised (whether or not the right to
exercise such installments has accrued pursuant to such Grants (including
Director's Grants), within ten days after such written notice is sent by the
Company. Any installments of such Grants (including Director's Grants) not so
exercised shall thereafter lapse and be of no further force or effect.
10. SHAREHOLDER APPROVAL
This Plan is subject to and no Options shall be exercisable hereunder until
after approval by holders of a majority of the shares of the stock of the
Company present or represented by a proxy in a separate vote at a duly held
meeting of the shareholders of the Company within twelve months after the date
of the adoption of the Plan by the Board. If the Plan is not so approved by
shareholders, the Plan and all Stock Options and Restricted Stock Grants,
including Director's Grants, hereunder shall terminate and be of no force or
effect.
11. AMENDMENT AND TERMINATION OF THE PLAN
(a) AMENDMENT. Subject to the provisions of Section 2(b)(ii) hereof, the
Board may amend or terminate the Plan at any time; provided that the approval of
the shareholders of the Company shall be required in respect of any amendment
that (A) materially increases the benefits accruing to Eligible Participants
under the Plan, (B) increases the aggregate number of shares of Common Stock
that may be issued or transferred under the Plan (other than by operation of
Section 3(b) above), (C) materially modifies the requirements as to eligibility
for participation in the Plan; or (D) modifies the provisions for determining
the fair market value of a share of Common Stock.
(b) TERMINATION OF PLAN. The Plan shall terminate on January 11, 2005 (as
set forth in Section 19 below) unless earlier terminated by the Board or unless
extended by the Board with the approval of the shareholders.
(c) TERMINATION AND AMENDMENT OF OUTSTANDING GRANTS. A termination or
amendment of the Plan that occurs after a Grant (including Director's Grant) is
made shall not result in the termination
7
<PAGE>
or amendment of such Grant (including Director's Grant) unless the Grantee or
the Committee Member, as the case may be, consents or unless the Committee acts
under Section 17(b) below. The termination of the Plan shall not impair the
power and authority of the Committee with respect to an outstanding Grant.
Whether or not the Plan has terminated, an outstanding Grant may be terminated
or amended under Section 17(b) below or may be amended by agreement of the
Company and the Grantee which is consistent with the Plan.
(d) EMPLOYEES IN FOREIGN COUNTRIES. The Board shall have the authority to
adopt such modifications, procedures and subplans as may be necessary or
desirable to comply with provisions of the laws of foreign countries in which
the Company or its Subsidiaries may operate to assure the viability of benefits
from Grants made to participants employed in such countries and to meet the
objectives of the Plan.
12. RIGHTS OF ELIGIBLE PARTICIPANTS
Nothing in the Plan shall entitle any Eligible Participant or other person
to any claim or right to any Grant under the Plan. Neither the Plan nor any
action taken hereunder shall be construed as giving any Eligible Participant,
Committee Member or Grantee any rights to be retained by the Company in any
capacity, whether as an employee, member of the Board, independent contractor,
consultant or otherwise.
13. WITHHOLDING OF TAXES
The Company shall have the right to require a Grantee or Committee Member to
pay to the Company the amount of any taxes which the Company is required to
withhold in respect of an Option Grant or Restricted Stock Grant or to take
whatever action it deems necessary to protect the interests of the Company in
respect of such tax liabilities, including, without limitation, withholding a
portion of the shares of Common Stock otherwise deliverable pursuant to the
Plan. The Company's obligation to issue or transfer shares of Common Stock upon
the exercise of a Stock Option or the acceptance of a Restricted Stock Grant
shall be conditioned upon the Grantee's or Committee Member's compliance with
the requirements of this section to the satisfaction of the Committee.
14. AGREEMENTS WITH GRANTEES AND COMMITTEE MEMBERS
Each Option Grant made under the Plan shall be evidenced by a Grant Letter
containing such terms and conditions as the Committee shall approve. Each
Restricted Stock Grant shall be evidenced by a Grant Letter containing the
restrictions imposed upon such grant, including but not limited to, restrictions
imposed by federal and state securities laws.
15. REQUIREMENTS FOR ISSUANCE OF SHARES
No Common Stock shall be issued or transferred under the Plan unless and
until all applicable legal requirements have been complied with to the
satisfaction of the Committee. The Committee shall have the right to condition
any Stock Option or Restricted Stock Grant on the Grantee's undertaking in
writing to comply with such restrictions on any subsequent disposition of the
shares of Common Stock issued or transferred thereunder as the Committee shall
deem necessary or advisable as a result of any applicable law, regulation or
official interpretation thereof, and certificates representing such shares may
be legended to reflect any such restrictions.
16. HEADINGS
The section headings of the Plan are for reference only. In the event of a
conflict between a section heading and the content of a section of the Plan, the
content of the section shall control.
17. EFFECTIVE DATE OF THE PLAN
The Plan shall be effective as of January 11, 1995, subject to the approval
of the Company's shareholders within 12 months after such effective date.
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18. MISCELLANEOUS
(a) SUBSTITUTE GRANTS. The Committee may make a Grant to an employee, or
an independent contractor or consultant of another corporation, if such person
shall become an Eligible Participant by reason of a corporate merger,
consolidation, acquisition of stock or property, reorganization or liquidation
involving the Company or a Subsidiary Corporation and such other corporation.
Any such Grant shall be made in substitution for a stock option or restricted
stock grant granted by the other corporation ("Substituted Stock Incentives"),
but the terms and conditions of the substitute Grant may vary from the terms and
conditions required by the Plan and from those of the Substituted Stock
Incentives. The Committee shall prescribe the provisions of the substitute
Grants.
(b) COMPLIANCE WITH LAW. The Plan, the exercise of Grants and the
obligations of the Company to issue or transfer shares of Common Stock under
Grants shall be subject to all applicable laws and required approvals by any
governmental or regulatory agencies. The Committee (or in the case of Director's
Grants, the Board of Directors) may revoke any Grant if it is contrary to law or
modify any Grant to bring it into compliance with any valid and mandatory
government regulations. The Committee may also adopt rules regarding the
withholding of taxes on payments to Grantees. The Committee may, in its sole
discretion, agree to limit its authority under this section.
(c) OWNERSHIP OF STOCK. A Grantee or Successor Grantee shall have no
rights as a shareholder with respect to any shares of Common Stock covered by a
Grant or Director's Grant until the shares are issued or transferred to the
Grantee or Successor Grantee on the stock transfer records of the Company.
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EXHIBIT 5
March 5, 1996
CTI Group (Holdings) Inc.
901 S. Trooper Road
Valley Forge, PA 19484
Gentlemen:
We have acted as counsel to CTI Group (Holdings) Inc. (formerly
Communications Group, Inc.), a Delaware corporation (the "Company"), in
connection with the preparation of the Company's registration statement on Form
S-8 (the "Registration Statement") filed with the Securities and Exchange
Commission pursuant to the Securities Act of 1933, as amended (the "Act"), on
March 5, 1996. The Registration Statement relates to the sale of an aggregate of
up to 600,000 shares of the Company's common stock, par value $.01 per share
(the "Common Stock").
In connection therewith, we have examined and relied upon the original or
copies of (i) the Certificate of Incorporation, as amended through the date
hereof and the By-laws of the Company; (ii) minutes and records of the corporate
proceedings with respect to the issuance of the shares of Common Stock described
above; (iii) the Company's Stock Option and Restricted Stock Plan (the "Plan");
and (iv) such other documents as we have deemed necessary as a basis for the
opinion hereinafter set forth.
In our examination of the foregoing documents, we have assumed (i) the due
execution, by all relevant parties, and authorization of all agreements to which
the Company or any of its subsidiaries is a party; (ii) the genuineness of all
signatures; and (iii) the authenticity of all documents submitted to us as
originals as well as the conformity to the originals of all documents submitted
to us as photostatic copies.
As to various questions of fact material to this opinion, we have relied, to
the extent we deemed reasonably appropriate, upon representations or
certificates of officers or directors of the Company, without independent
verification of their accuracy.
Based upon the foregoing and subject to the qualifications hereinafter set
forth, we are of the opinion that:
The aggregate of up to 600,000 shares included in the Registration
Statement, when issued in accordance with the terms of the Plan, will be legally
issued, fully paid and non-assessable.
We are members of the Bar of the Commonwealth of Pennsylvania and do not
express any opinion as to matters governed by laws other than the laws of the
Commonwealth of Pennsylvania, the General Corporation Law of the State of
Delaware and the federal laws of the United States of America.
We hereby consent to the filing of this opinion as an Exhibit to the
Registration Statement and to the reference to our firm under the caption "Legal
Matters" contained therein. In giving such consent, we do not thereby admit that
we come within the category of persons whose consent is required under Section 7
of the Act, or the Rules and Regulations of the Securities and Exchange
Commission promulgated thereunder.
Very truly yours,
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EXHIBIT 23.1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We consent to the incorporation by reference in this registration statement
on Form S-8 of our report dated June 23, 1995, on our audits of the consolidated
financial statements of CTI Group (Holdings) Inc. (formerly Communications
Group, Inc.) and subsidiaries as of March 31, 1995 and 1994 and for each of the
two years in the period ended March 31, 1995, which report is included in the
Company's Annual Report on Form 10-KSB for the year ended March 31, 1995.
Jenkintown, Pennsylvania
March 5, 1996
