<PAGE>
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF
THE SECURITIES EXCHANGE ACT OF 1934
<TABLE>
<S> <C>
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement / / Confidential, For Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>
THE ALPINE GROUP, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of security to which transaction applies:
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed pursuant to
Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
(5) Total fee paid:
- --------------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials:
- --------------------------------------------------------------------------------
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
- --------------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement no.:
- --------------------------------------------------------------------------------
(3) Filing Party:
- --------------------------------------------------------------------------------
(4) Date Filed:
- --------------------------------------------------------------------------------
<PAGE>
THE ALPINE GROUP, INC.
1790 BROADWAY
NEW YORK, NEW YORK 10019-1412
August 22, 1997
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders of The
Alpine Group, Inc. (the "Company"), a Delaware corporation, to be held on
Thursday, September 25, 1997 at 10:00 a.m., local time, at Le Parker Meridien
hotel, third floor, 118 West 57th Street, New York, New York.
At this meeting, you will be asked to consider and vote upon the election of
three directors of the Company, the ratification of the appointment of Arthur
Andersen LLP as the Company's independent certified public accountants, the
ratification of the adoption by the Board of Directors of the Company's 1997
Stock Option Plan and the ratification of the adoption by the Board of Directors
of an amendment to the Company's Employee Stock Purchase Plan.
YOUR VOTE IS IMPORTANT. The Board of Directors appreciates and encourages
stockholder participation in the Company's affairs and cordially invites you to
attend the meeting in person. It is important in any event that your shares be
represented and we ask that you sign, date and mail the enclosed proxy card in
the envelope provided at your earliest convenience.
We sincerely thank you for your support.
Very truly yours,
Steven S. Elbaum
CHAIRMAN OF THE BOARD AND
CHIEF EXECUTIVE OFFICER
<PAGE>
THE ALPINE GROUP, INC.
1790 BROADWAY
NEW YORK, NEW YORK 10019-1412
------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON SEPTEMBER 25, 1997
To the Stockholders of The Alpine Group, Inc.
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of The Alpine
Group, Inc. (the "Company"), a Delaware corporation, will be held on September
25, 1997 at 10:00 a.m., local time, at Le Parker Meridien hotel, third floor,
118 West 57th Street, New York, New York for the purposes of considering and
voting upon the following matters, as more fully described in the attached Proxy
Statement:
1. To elect three directors of the Company;
2. To ratify the appointment of Arthur Andersen LLP as the independent
certified public accountants of the Company;
3. To ratify the adoption by the Board of Directors of the Company's 1997
Stock Option Plan;
4. To ratify the adoption by the Board of Directors of an amendment to the
Company's Employee Stock Purchase Plan; and
5. To transact such other business as may properly come before the meeting
or any adjournment thereof.
The Board of Directors has fixed the close of business on July 28, 1997 as the
record date for the determination of stockholders entitled to notice of, and to
vote at, the meeting.
By Order of the Board of Directors,
Stewart H. Wahrsager
SECRETARY
August 22, 1997
YOUR ATTENTION IS DIRECTED TO THE ACCOMPANYING PROXY STATEMENT
YOU ARE CORDIALLY INVITED TO ATTEND THE MEETING IN PERSON, WHETHER OR NOT YOU
EXPECT TO BE PRESENT, PLEASE MARK, DATE, SIGN AND RETURN THE ACCOMPANYING FORM
OF PROXY IN THE ENVELOPE ENCLOSED (TO WHICH NO POSTAGE NEED BE AFFIXED IF MAILED
IN THE UNITED STATES) SO THAT YOUR VOTE CAN BE RECORDED.
<PAGE>
THE ALPINE GROUP, INC.
1790 BROADWAY
NEW YORK, NEW YORK 10019-1412
------------------------
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON SEPTEMBER 25, 1997
This Proxy Statement is being furnished to the stockholders of The Alpine
Group, Inc. (the "Company") in connection with the solicitation of proxies, in
the accompanying form, by the Company, for use at the Annual Meeting of
Stockholders to be held at 10:00 a.m., local time, on September 25, 1997 at Le
Parker Meridien hotel, third floor, 118 West 57th Street, New York, New York and
at any and all adjournments or postponements thereof.
The stockholders of record at the close of business on July 28, 1997 will be
entitled to receive notice of and to vote at the meeting and any adjournments or
postponements thereof. As of July 28, 1997, there were issued and outstanding
16,889,781 shares of the Company's Common Stock, par value $.10 per share (the
"Common Stock"), and 1,750 shares of the Company's 9% Cumulative Convertible
Senior Preferred Stock, par value $1.00 per share (the "9% Preferred Stock"),
the only classes of voting securities outstanding. The stockholders of record
will be entitled to one vote for each share of Common Stock and 100 votes for
each share of 9% Preferred Stock registered in his or her name on the record
date. The holders of the Common Stock and the 9% Preferred Stock will vote
together as a class on all matters presented at the meeting. A majority of all
the outstanding shares of the Common Stock constitutes a quorum and is required
to be present in person or by proxy to conduct business at the meeting.
Stockholders may revoke the authority granted by their executed proxies at
any time prior to their use by filing with the Secretary of the Company a
written revocation or a duly executed proxy bearing a later date or by attending
the meeting and voting in person. Solicitation of proxies will be made chiefly
through the mails, but additional solicitation may be made by telephone or
telegram by the officers or regular employees of the Company (who will not be
specifically compensated for such services). The Company may also enlist the aid
of brokerage houses or the Company's transfer agent in soliciting proxies, and
the Company will reimburse them for their reasonable expenses. All solicitation
expenses, including costs of preparing, assembling and mailing proxy material,
will be borne by the Company. This proxy statement and accompanying form of
proxy are being mailed to stockholders on or about August 22, 1997.
Shares of the Common Stock and the 9% Preferred Stock represented by
executed and unrevoked proxies will be voted in accordance with the choice or
instructions specified thereon. It is the intention of the persons named in the
proxy, unless otherwise specifically instructed in the proxy, to vote all
proxies received by them in favor of the three nominees named herein for
election as directors, in favor of the ratification of the appointment of Arthur
Andersen LLP as the independent public accountants of the Company, in favor of
the ratification of the adoption of the Company's 1997 Stock Option Plan and in
favor of the ratification of the adoption of an amendment to the Company's
Employee Stock Purchase Plan. The Board of Directors does not know of any other
matters which may be presented for consideration at the meeting. However, if
other matters properly come before the meeting, the persons named in the
accompanying proxy intend to vote thereon in accordance with their judgment.
If a quorum is present at the meeting, those nominees receiving a plurality
of the votes cast will be elected as directors. The affirmative vote of the
holders of a majority in voting power of the shares present in person or
represented by proxy and entitled to vote at the meeting will be required to
ratify the appointment of Arthur Andersen LLP as the independent public
accountants of the Company, to ratify the adoption of the Company's 1997 Stock
Option Plan and to ratify the adoption of an amendment to the Company's Employee
Stock Purchase Plan. Abstentions from voting on a proposal will have the effect
of a
<PAGE>
"no" vote. Broker non-votes are not considered shares present, are not entitled
to vote and therefore will not affect the outcome of the vote on a proposal.
BENEFICIAL OWNERSHIP OF VOTING SECURITIES
The following table contains information as of July 28, 1997 regarding the
number of shares of Common Stock and 9% Preferred Stock beneficially owned by
(i) each person known to the Company to have beneficial ownership of more than
five percent thereof, (ii) each director of the Company, (iii) each executive
officer named in the Summary Compensation Table herein, and (iv) all directors
and executive officers as a group. The information contained herein is based on
information provided by such beneficial holders to the Company.
BENEFICIAL OWNERSHIP OF VOTING SECURITIES
<TABLE>
<CAPTION>
COMMON STOCK 9% PREFERRED STOCK
----------------------- ------------------------
<S> <C> <C> <C> <C>
NUMBER OF PERCENT NUMBER OF PERCENT
NAME AND ADDRESS OF BENEFICIAL OWNER SHARES OF CLASS SHARES OF CLASS
- ------------------------------------------------------------------ ---------- ----------- ----------- -----------
Heartland Advisors, Inc........................................... 1,790,000(1) 10.6% -- --
790 North Milwaukee Street
Milwaukee, WI 53202
Steven S. Elbaum.................................................. 1,634,422(2) 9.4 -- --
1790 Broadway New York, NY
10019-1412
Alexandra Investment Management, Ltd.............................. 1,097,391(3) 6.5 -- --
237 Park Avenue
Ninth Floor
New York, NY 10017
Financial Strategic Portfolios, Inc............................... -- -- 1,000 57.1%
Technology Portfolio
7800 E. Union Avenue
Denver, CO 80237
Connecticut Innovations, Inc...................................... -- -- 500 28.6
845 Brook Street
Rocky Hill, CT 06076
Patrick W. Allender............................................... -- -- 250 14.3
5 Holly Leaf Court
Bethesda, MD 20817
Kenneth G. Byers, Jr.............................................. 526,602 3.1 -- --
Bragi F. Schut.................................................... 520,198(4) 3.1 -- --
James R. Kanely................................................... 258,795(5) 1.5 -- --
David S. Aldridge................................................. 207,675(6) 1.2 -- --
John J. Jansing................................................... 201,836(7) 1.2 -- --
Stephen M. Johnson................................................ 65,101(8) * -- --
Randolph Harrison................................................. 55,877 * -- --
Gene E. Lewis..................................................... 43,314(9) * -- --
Ernest C. Janson, Jr.............................................. 26,000 * -- --
Stewart H. Wahrsager.............................................. 25,389(10) * -- --
All directors and executive officers as a group................... 3,565,209(11) 19.9 -- --
</TABLE>
- ------------------------
* Less than one percent
2
<PAGE>
(1) Based upon a Schedule 13-G, Amendment No. 1, filed with the Securities and
Exchange Commission on or about January 8, 1997.
(2) Includes (i) 1,262 shares owned by Mr. Elbaum's wife as custodian for their
minor son, as to which shares Mr. Elbaum disclaims beneficial ownership and
(ii) 446,133 shares issuable upon exercise of certain stock options.
(3) Based upon a Schedule 13-D filed with the Securities and Exchange Commission
on or about August 6, 1997. In addition, Mikhail A. Filimonov, the Chairman,
Chief Executive Officer and Chief Investment Officer of such entity, and
Dimitri Sogoloff, the Chief Operations Officer of such entity, may be deemed
to be the beneficial owners of such shares by reason of their power to
direct the voting and disposition of such shares.
(4) Includes (i) 950 shares owned by Mr. Schut's wife, as to which shares Mr.
Schut disclaims beneficial ownership and (ii) 182,711 shares issuable upon
exercise of certain stock options.
(5) Includes 180,619 shares issuable upon exercise of certain stock options.
(6) Includes 131,338 shares issuable upon exercise of certain stock options.
(7) Includes 30,503 shares issuable upon exercise of certain stock options.
(8) Includes 35,101 shares issuable upon exercise of certain stock options.
(9) Includes 33,307 shares issuable upon exercise of certain stock options.
(10) Includes 14,389 shares issuable upon exercise of certain stock options.
(11) Includes (i) 1,054,101 shares issuable upon exercise of certain stock
options and (ii) 2,212 shares as to which the officers and directors
disclaim beneficial ownership.
PROPOSAL I: ELECTION OF DIRECTORS
The Board of Directors of the Company consists of three classes of
directors, with terms expiring in successive years. Three current directors,
Kenneth G. Byers, Jr., Randolph Harrison and Ernest C. Janson, Jr., have been
nominated for reelection with terms to expire in 2000. The terms of the
remaining five current directors expire in 1998 (Messrs. Elbaum, Kanely and
Schut) and 1999 (Messrs. Jansing and Lewis).
It is the intention of each of the persons named in the accompanying form of
proxy to vote the shares represented thereby in favor of each of the three
nominees. In case any of the nominees are unable or decline to serve, such
persons named in the accompanying form of proxy reserve the right to vote the
shares represented by such proxy for another person duly nominated by the Board
in his stead or, if no other person is nominated, to vote such shares only for
the remaining nominee(s). The Board has no reason to believe that any person
named will be unable or will decline to serve.
INFORMATION WITH RESPECT TO NOMINEES AND CONTINUING DIRECTORS
<TABLE>
<CAPTION>
YEAR
FIRST
ELECTED
NAME AGE DIRECTOR POSITION WITH THE COMPANY AND OTHER BUSINESS EXPERIENCE
- ------------------------------------ --- ----------- -----------------------------------------------------------
<S> <C> <C> <C>
Kenneth G. Byers, Jr................ 54 1993 President and sole shareholder of Byers Engineering
Company, a telecommunications technical services firm, for
more than the past five years; a director of Superior
TeleTec Inc. until its merger with and into the Company in
November 1993.
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
YEAR
FIRST
ELECTED
NAME AGE DIRECTOR POSITION WITH THE COMPANY AND OTHER BUSINESS EXPERIENCE
- ------------------------------------ --- ----------- -----------------------------------------------------------
<S> <C> <C> <C>
Steven S. Elbaum.................... 48 1980 Chairman of the Board of Directors and Chief Executive
Officer of the Company since 1984; a director of Interim
Services, Inc., a provider of value added staffing and
health care services, Humascan, Inc., a developer of
medical testing devices, and Broadway & Seymour, Inc., a
software and systems integration company, and Chairman of
the Board of Directors of PolyVision Corporation, an
information display company, and Superior TeleCom Inc., the
Company's 50.1% owned subsidiary.
Randolph Harrison................... 65 1980 A private investor and consultant to Poten & Partners,
Inc., an energy and shipping industry consulting firm, of
which he was President prior to 1985.
John C. Jansing..................... 71 1978 Chairman of The Independent Election Corporation of
America, a shareholder proxy tabulating firm, from 1976 to
1992 and currently a director of Vestaur Securities, Inc.
and 14 Lord Abbett mutual funds.
Ernest C. Janson, Jr................ 74 1987 A partner with Coopers & Lybrand LLP, independent public
accountants, until his retirement in 1985.
James R. Kanely..................... 56 1993 A private investor; President and Chief Operating Officer
of the Company from November 1993 to October 1995; and
prior thereto, President of Superior TeleTec Inc.
Gene E. Lewis....................... 69 1992 Chairman of the Board and Chief Executive Officer of
Novecon Technologies Corporation, a technology
commercialization company, since 1994; prior thereto, a
consultant to various health care and venture capital
companies from 1989 to 1994.
Bragi F. Schut...................... 56 1983 Executive Vice President of the Company since 1986; a
director of PolyVision Corporation, an information display
company, and Superior TeleCom Inc.
</TABLE>
BOARD AND COMMITTEE MEETINGS
During the fiscal year ended April 30, 1997, the Board of Directors held
four meetings. Each member of the Board attended at least 75% of the meetings of
the Board and meetings of any committees of the Board on which he served that
were held during the time he served.
The Board of Directors has an Executive Committee, a Compensation Committee
and an Audit Committee, and no other committees.
The present members of the Executive Committee are Messrs. Elbaum (who
serves as Chairman), Jansing and Schut. The Executive Committee exercises all
authority of the Board of Directors in the
4
<PAGE>
management of the Company, subject to certain limitations imposed by the General
Corporation Law of the State of Delaware.
The present members of the Compensation Committee are Messrs. Harrison,
Jansing and Janson. The principal functions of the Compensation Committee are to
administer the Company's 1987 Long-Term Equity Incentive Plan, 1984 Restricted
Stock Plan, Employee Stock Purchase Plan, 1997 Interim Stock Option Plan and,
subject to the approval of the stockholders of such plan, the 1997 Stock Option
Plan, and, on behalf of the Board of Directors, to review current and proposed
employment arrangements with existing and prospective senior management
employees and to review and determine matters pertaining to base and incentive
compensation for the Chief Executive Officer and other senior management
employees. The Compensation Committee is advised periodically by Hewitt
Associates, a nationally recognized, independent compensation and benefits
consulting firm. During the fiscal year ended April 30, 1997, the Compensation
Committee had two meetings.
The present members of the Audit Committee are Messrs. Byers, Janson and
Lewis. The Audit Committee's principal functions are to review the Company's
annual and periodic financial statements, to examine and consider matters
relating to the administration and audit of the Company's accounts and its
financial affairs, to recommend the employment of outside auditors and to meet
with the Company's personnel as it deems appropriate to carry out its functions.
The Audit Committee met once during the fiscal year ended April 30, 1997.
VOTE REQUIRED
THE BOARD OF DIRECTORS RECOMMENDS THAT HOLDERS OF THE COMMON STOCK AND 9%
PREFERRED STOCK VOTE FOR THE THREE NOMINEES LISTED ABOVE. Their election will
require a plurality of the votes cast by holders of the Common Stock and 9%
Preferred Stock present in person or represented by proxy and entitled to vote,
voting together as a single class.
MANAGEMENT
EXECUTIVE OFFICERS
Set forth below is certain information regarding the executive officers of
the Company, each of whom serves at the discretion of the Board of Directors.
<TABLE>
<CAPTION>
NAME AGE POSITION WITH THE COMPANY AND OTHER BUSINESS EXPERIENCE
- ------------------------------------ --- ---------------------------------------------------------------------
<S> <C> <C>
Steven S. Elbaum.................... 48 Chairman of the Board of Directors and Chief Executive Officer since
1984, Chairman of the Board, President and Chief Executive Officer of
Superior TeleCom Inc. since 1996.
Bragi F. Schut...................... 56 Executive Vice President since 1986.
Stephen M. Johnson.................. 48 Executive Vice President and Chief Operating Officer since November
1995. Prior thereto he was President and Chief Operating Officer of
Adience, Inc. (a wholly-owned subsidiary of the Company) from April
1994 through October 1995. From January 1994 to April 1994, Mr.
Johnson was an independent consultant. He was President and Chief
Executive Officer of Climax Metals Company, a minerals mining and
chemical subsidiary of Amax, Inc., from 1987 through 1993.
</TABLE>
5
<PAGE>
<TABLE>
<CAPTION>
NAME AGE POSITION WITH THE COMPANY AND OTHER BUSINESS EXPERIENCE
- ------------------------------------ --- ---------------------------------------------------------------------
<S> <C> <C>
David S. Aldridge................... 43 Chief Financial Officer since November 1993 and Treasurer since
January 1994. Chief Financial Officer and Treasurer of Superior
TeleCom Inc. since 1996. Prior to 1994, he was Chief Financial
Officer of Superior TeleTec Inc. until its merger with and into the
Company in November 1993.
Stewart H. Wahrsager................ 48 Senior Vice President, General Counsel and Secretary since January
1996 and Secretary of Superior TeleCom Inc. since 1996. Prior thereto
he was a partner in the law firm of Rubin Baum Levin Constant &
Friedman.
</TABLE>
EXECUTIVE COMPENSATION
The following table sets forth certain information during each of the
Company's three fiscal years ended each of April 30, 1995, April 30, 1996 and
April 30, 1997 with respect to compensation earned by or paid to the Company's
Chief Executive Officer and each of the four most highly compensated executive
officers of the Company other than the Chief Executive Officer.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
ANNUAL COMPENSATION (1) COMPENSATION AWARDS
----------------------------------- -----------------------
<S> <C> <C> <C> <C> <C> <C>
FISCAL RESTRICTED OPTION
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS STOCK SHARES (9) OTHER (10)
- ----------------------------------------- ----------- ---------- ---------- ---------- ----------- ----------
Steven S. Elbaum......................... 1997 $ 433,200(2) $325,000(4) -- 347,716(3) $ 83,530
Chairman and Chief -- 325,000(5) -- -- --
Executive Officer 1996 419,000 261,700(4) -- 133,500 124,920
1995 -- 175,000(6) -- -- --
275,000 175,000(4) -- -- 7,370
Bragi F. Schut........................... 1997 $ 237,800 $ 143,000(4) -- 118,705(3) $ 31,762
Executive Vice President -- 150,000(5) -- -- --
1996 203,000 114,900(4) -- 65,400 33,476
1995 -- 75,000(6) -- -- --
172,000 75,000(4) -- -- --
Stephen M. Johnson (11).................. 1997 $ 294,000 $ 169,000(4) -- 113,800 $ 8,838
Executive Vice President and 1996 145,100 207,600(7) $ 153,750(8) 80,300 8,849
Chief Operating Officer
David S. Aldridge........................ 1997 $ 195,000 $ 102,000(4) -- 57,700 $ 70,685
Chief Financial Officer 1996 -- 150,000(5) -- -- --
1995 184,000 90,500(4) -- 65,400 54,718
-- 60,000(6) -- -- --
153,718 60,000(4) -- -- 55,813
Stewart H. Wahrsager (11)................ 1997 $ 151,000 $ 68,000(4) -- 34,000 $ 14,245
Senior Vice President, General -- 76,000(5) -- -- --
Counsel and Secretary 1996 50,000 33,700(7) $ 45,000(8) 29,833 4,988
</TABLE>
6
<PAGE>
- ------------------------
(1) The aggregate dollar value of all perquisites and other personal benefits,
securities or property earned by or paid to any of the named individuals did
not exceed the lesser of $50,000 or 10% of the total annual salary and bonus
set forth for such individual during any of the last three fiscal years.
(2) Does not include salary of $102,000 paid to Mr. Elbaum by Superior TeleCom
Inc. under his employment agreement with such entity. See "Certain
Transactions."
(3) Options granted to Messrs. Elbaum and Schut include 183,016 and 61,005
options, respectively, which represent a reissuance of previously issued
options which were due to expire during fiscal 1997. The new options are
identical to the original options, except that the new options vest over the
three-year period commencing on the date of the reissuance. See
"Compensation Committee Report on Executive Compensation."
(4) Annual cash incentive bonus payments awarded pursuant to the annual cash
incentive bonus program of the Company as described under "Compensation
Committee Report on Executive Compensation -- Executive Compensation
Policy."
(5) Discretionary cash bonus awarded in respect of fiscal 1997, as described
under "Compensation Committee Report on Executive Compensation--Executive
Compensation Policy."
(6) Bonus payments to Messrs. Elbaum, Schut and Aldridge which, although paid in
fiscal 1996, were approved by the Compensation Committee in respect of
fiscal 1995 but were deferred and became payable only upon completion of the
Company's acquisition of the U.S. and Canadian copper wire and cable
business of Alcatel NA Cable Wire Inc. which occurred during fiscal 1996.
(7) Fiscal 1996 bonus payments to Messrs. Johnson and Wahrsager include, in
addition to cash incentive bonus payments pursuant to the cash incentive
bonuses program of the Company prorated for the respective periods of
employment of these executives during fiscal 1996, one time only payments of
$125,000 and $15,000, respectively, paid at the time of signing of their
respective employment agreements.
(8) The dollar value set forth is based on the closing price per share for the
Common Stock on the respective dates of grant. The aggregate number of
shares held by Mr. Johnson and Mr. Wahrsager at April 30, 1997 were 30,000
and 10,000, respectively, with a value of $277,500 and $92,500,
respectively.
(9) Does not reflect the following performance options granted during the year
ended April 30, 1996, each of which is contingent and subject to adjustment,
as described under "Compensation Committee Report on Executive
Compensation--Executive Compensation Policy."
<TABLE>
<CAPTION>
NUMBER OF
PERFORMANCE
OPTIONS GRANTED EXERCISE PRICE EXPIRATION DATE
--------------- --------------- ---------------
<S> <C> <C> <C>
Steven S. Elbaum................................ 106,800(a) $ 5.125 11/15/05
80,100(b) $ 5.625 4/10/06
Bragi F. Schut.................................. 37,400(a) $ 5.125 11/15/05
9,400(b) $ 5.625 4/10/06
Stephen M. Johnson.............................. 15,500(b) $ 5.625 4/10/06
David S. Aldridge............................... 37,400(a) $ 5.125 11/15/05
9,400(b) $ 5.625 4/10/06
Stewart H. Wahrsager............................ 5,500(b) $ 5.625 4/10/06
</TABLE>
(a) Performance options granted during fiscal 1996 with respect to fiscal
1996, the exercise price of which is equal to the market price of the
Common Stock at the date of grant.
7
<PAGE>
(b) Performance options granted during fiscal 1996 with respect to fiscal
1997, the exercise price of which is equal to 150% of the market price of
the Common Stock at the date of grant.
(10) The amounts set forth include (i) matching contributions made by the
Company under defined contribution plans of its subsidiaries, (ii) $11,750
accrued under an unfunded, nonqualified defined benefit plan for the payment
of future annuities to Mr. Aldridge, (iii) with respect to Mr. Schut,
$23,750 representing the net present value of the vested portion of an
annuity the Company has agreed to pay in 15 equal annual installments of
$18,900 commencing in the year when Mr. Schut reaches age 60 and (iv) with
respect to Messrs. Elbaum and Aldridge, payments of $74,259 and $52,500,
respectively, pursuant to their employment agreements for federal tax
consequences upon vesting of certain restricted stock grants.
(11) Messrs. Johnson and Wahrsager joined the Company in November 1995 and
January 1996, respectively. Prior to November 1995, and since December 1994,
Mr. Johnson served as President and Chief Operating Officer of Adience,
Inc., a wholly-owned subsidiary of the Company. Mr. Johnson's compensation
reflected in the above table does not include compensation received as an
officer of Adience, Inc.
8
<PAGE>
STOCK OPTION GRANTS IN FISCAL 1997
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE
(AT ASSUMED ANNUAL RATES
OF
NUMBER OF % OF TOTAL STOCK PRICE APPRECIATION
SECURITIES OPTIONS FOR
UNDERLYING GRANTED TO EXERCISE OPTION TERM)
OPTIONS EMPLOYEES IN PRICE EXPIRATION ------------------------
NAME GRANTED FISCAL 1997 ($/SH) DATE 5% 10%
- ----------------------------------- ----------- --------------- ----------- ----------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C>
Steven S. Elbaum................... 164,700 21.1% $ 8.125 4/9/07 $ 841,600 $ 2,132,700
183,016(a) 23.4 $ 3.140 5/3/01 878,600 1,739,500
Stephen M. Johnson................. 113,800 14.6 $ 8.125 4/9/07 581,500 1,473,600
Bragi F. Schut..................... 57,700 7.4 $ 8.125 4/9/07 294,800 747,200
61,005(a) 7.8 $ 3.140 5/3/01 292,900 574,800
David S. Aldridge.................. 57,700 7.4 $ 8.125 4/9/07 294,800 747,200
Stewart H. Wahrsager............... 34,000 4.4 $ 8.125 4/9/07 173,700 440,300
</TABLE>
- ------------------------
(a) Reissued options described in footnote 3 to the Summary Compensation Table.
AGGREGATED OPTION EXERCISES AND YEAR-END OPTION VALUES
The following table presents information for the individuals named above as
to the exercise of stock options during the fiscal year ended April 30, 1997 and
the number of shares underlying, and the value of, unexercised options
outstanding at April 30, 1997:
<TABLE>
<CAPTION>
NUMBER OF SHARES
EXERCISES DURING UNDERLYING VALUE OF UNEXERCISED
THE FISCAL YEAR UNEXERCISED OPTIONS (2) IN-THE-MONEY OPTIONS (1)(2)
---------------------------- -------------------------- ---------------------------
<S> <C> <C> <C> <C> <C> <C>
NUMBER
OF SHARES VALUE
NAME ACQUIRED REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- --------------------------- ------------- ------------- ----------- ------------- ------------ -------------
Steven S. Elbaum........... -- -- 446,133 340,000 $ 2,308,700 $ 1,175,500
Bragi F. Schut............. -- -- 182,711 129,504 856,300 467,400
Stephen M. Johnson......... -- -- 35,101 158,999 120,000 365,100
David S. Aldridge.......... -- -- 131,338 88,833 455,500 218,900
Stewart H. Wahrsager....... -- -- 14,389 49,444 66,873 117,059
</TABLE>
- ------------------------
(1) Based on the closing price of $9.25 of the Common Stock on April 30, 1997.
(2) Does not reflect the performance options described in footnote 9 to the
Summary Compensation Table.
COMPENSATION OF DIRECTORS
Directors who are not employees of the Company or otherwise compensated by
the Company are entitled to be paid an annual retainer fee of $20,000 per year,
together with expenses of attendance, plus $1,000 for each meeting of the Board
or of a committee of the Board attended. A non-employee director with at least
five years of service also receives, upon reaching age 70 and termination of
service to the Company, a retirement benefit of $10,000 per year for 15 years
after his retirement, payable to the director or the director's beneficiaries in
the event of his death. At the option of each director, his director's fees may
be payable in shares of Common Stock (based upon the fair market value of Common
Stock at the
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beginning of each fiscal year). Directors' fees also may be deferred, at the
option of each director, pursuant to the Directors' Deferred Compensation Plan
and (i) be paid in cash with interest at the prime rate or (ii) be paid in
Common Stock based on stock units accumulated under the plan.
EMPLOYMENT AGREEMENTS
The Company has employment agreements with each of its executive officers.
Pursuant to these agreements, Mr. Elbaum serves as Chairman of the Board and
Chief Executive Officer at an annual salary of $433,200, Mr. Johnson serves as
Executive Vice President and Chief Operating Officer at an annual salary of
$302,800, Mr. Schut serves as Executive Vice President at an annual salary of
$237,800, Mr. Aldridge serves as Chief Financial Officer at an annual salary of
$195,000 and Mr. Wahrsager serves as Senior Vice President, General Counsel and
Secretary at an annual salary of $154,500. The agreements also provide for
annual performance-based bonuses, participation in a performance-based long-term
incentive stock option award program, indemnification from any income tax
liability arising from the vesting of certain restricted stock awards and
certain other benefits, including medical, dental and other insurance benefits.
The agreements with Messrs. Elbaum and Schut also provide that they will serve
on the Board of Directors of the Company, and Mr. Schut's agreement provides for
the annuity described in footnote 10 to the Summary Compensation Table.
Each employment agreement is for a term ending upon the occurrence of any of
the following events: (i) notification by the executive or the Company to the
other that he or it desires to terminate the employment agreement; (ii) the
death or disability of the executive; (iii) termination by the Company for
"cause" and (iv) termination by the executive for "good reason." Generally, if
an executive terminates his employment for "good reason," or the Company
terminates his employment without cause, the executive is entitled to receive a
severance payment equal to one to one and one-half times his annual salary and
bonus for the prior year. In the event of termination of employment under other
circumstances, including a "change in control" of the Company (which is defined
as (i) the acquisition by a person or entity of 20% of the Company's voting
securities, (ii) the occurrence of circumstances such that individuals who
constituted the Company's Board of Directors as of April 26, 1995 no longer
constitute a majority of the Company's Board of Directors, (iii) a transaction
involving the sale of all or substantially all of the Company's assets or (iv)
certain other business combinations) each executive is entitled to varying
benefits described in the employment agreements.
Each executive officer is a participant in a Senior Executive Retirement
Plan ("SERP") which became effective in February 1997. The SERP is an unfunded
defined benefit plan. Subject to vesting, each participant will be entitled to
an annual retirement benefit upon reaching age 65 equal to 2.5% times his years
of credited service (up to a maximum of 20 years), multiplied by his highest
average cash compensation during any three consecutive years during the final
five years of his employment, less primary social security benefits and certain
other retirement benefits paid by the Company and other employers.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Randolph Harrison, John C. Jansing and Ernest C. Janson, Jr. served on the
Compensation Committee during fiscal 1997. There were no Compensation Committee
interlocks or insider (employee) participation during fiscal 1997.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
INTRODUCTION
The Compensation Committee is made up of independent outside directors who
are neither officers nor employees of the Company or its subsidiaries. The
principal functions of the Compensation Committee are to administer the
Company's 1987 Long-Term Equity Incentive Plan, 1984 Restricted Stock Plan,
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Employee Stock Purchase Plan, 1997 Interim Stock Option Plan and, subject to the
approval of the stockholders of such plan, the 1997 Stock Option Plan, and, on
behalf of the Board of Directors, to review current and proposed employment
arrangements with existing and prospective senior management employees and to
review and determine matters pertaining to base and incentive compensation for
the Chief Executive Officer and other senior management employees. In the
exercise of its functions, the Compensation Committee is advised periodically by
Hewitt Associates, a nationally recognized, independent compensation and
benefits consulting firm.
EXECUTIVE COMPENSATION POLICY
The executive compensation policy is designed to attract and retain highly
qualified executive officers, to reinforce strategic performance objectives
through the use of incentive compensation programs, and to create a mutuality of
interest between executive officers and stockholders through compensation
structures that share the rewards and risks of strategic business planning and
implementation. Total compensation is intended to be competitive with that paid
to qualified executives of companies with a strong entrepreneurial business
approach likely to be more prevalent in a leveraged holding company than in
traditional operating companies.
There are three components of executive compensation: (i) base salary and
employee benefits applicable to all employees; (ii) annual cash incentive awards
and (iii) long-term incentive awards.
The Compensation Committee's approach to base compensation generally has
been to offer competitive salaries that are at the 50th percentile level
relative to a peer group of companies. It is intended that base salary be a
relatively smaller element in the total executive officer compensation as the
Company has introduced a more formal program of annual cash incentive awards and
long-term incentive awards. The Compensation Committee annually examines
compensation levels of executives who are employed in similar positions in
public companies with similar sales and market capitalization. The Compensation
Committee obtained the assistance of Hewitt Associates, compensation and benefit
consultants, to develop and approve a compensation program consistent with the
foregoing guidelines and emphases.
Annual cash incentive awards are intended to link executive pay with
performance in areas key to the Company's short-term operating objectives and
successes consistent with the Company's strategic business plan. The annual cash
bonus awards are weighted 75% to the achievement of financial measures, largely
oriented around return on capital employed, and 25% to a subjective assessment
of individual performance. The financial performance targets are established in
April of the preceding fiscal year by the Compensation Committee. When setting
measures and goals for other executive officers, the Compensation Committee
considers the input of the Company's Chief Executive Officer. Target financial
performance measures are based upon historical patterns of the Company's
performance, the next fiscal year's annual plan and longer-term strategic
objectives. All performance targets are set at or above normal expectations of
performance to assure that bonuses are not paid for substandard accomplishments.
In addition to the cash incentive awards to certain of the executive
officers pursuant to their respective employment agreements and under the
Compensation Program for Senior Executives of the Company, the Compensation
Committee determined, after consultation with Hewitt Associates, compensation
consultants to the Company, to pay discretionary cash bonuses in respect of
fiscal 1997 to the executives indicated on the Summary Compensation Table in
recognition of the extraordinary results and achievements of the Company during
fiscal 1997, including (i) the successful completion of the reorganization of
the Company's telecommunications wire and cable and data communications and
electronics subsidiaries, and the resulting initial public offering of 49.9% of
the common stock of Superior TeleCom Inc. which generated approximately $101.0
million in equity proceeds and gave rise to a substantial gain to the Company,
(ii) the refinancing of substantially all of the Company's debt resulting in a
significant reduction in the weighted average cost of such debt, (iii) the
increase in per share net income from $0.23 per share in fiscal 1996 to $3.04
per share ($.80 per share excluding non-recurring items) in fiscal 1997, (iv)
the increase in
11
<PAGE>
comparative fiscal 1997 cash flows (as measured by EBITDA) and return on capital
employed by 64% and 74%, respectively and (v) the successful listing of both the
Common Stock and the common stock of Superior TeleCom Inc. on the New York Stock
Exchange which, in the Committee's opinion, increases the Company's visibility
with major institutional and individual investors and has a favorable impact on
the Company's stockholders.
The long-term incentive award program is based upon an annual long-term
incentive value assigned to each eligible executive, which value (based on the
Black-Scholes Option Pricing Model) may be allocated between basic direct option
grants and performance option grants, both of which are awarded pursuant to the
Company's 1987 Long-Term Equity Incentive Plan and 1997 Interim Stock Option
Plan. The Board of Directors adopted the 1997 Interim Stock Option Plan,
effective April 9, 1997, to provide for option grants solely during fiscal 1997.
The terms of the 1997 Interim Stock Option Plan are substantially similar to the
terms of the 1987 Long-Term Equity Incentive Plan.
During fiscal 1997, only direct option grants were awarded and the Company
discontinued the use of performance options due to the variable accounting
nature of such stock options and the resulting non-cash charges to earnings. The
basic direct option grants are priced at fair market value on date of grant,
vest equally over a period of three years and expire 10 years after the date of
grant. Performance option grants issued in respect of fiscal 1996 and fiscal
1995 were priced at fair market value or at a premium thereof, and are
contingent and adjusted at the end of the third fiscal year following grant,
based upon actual financial performance of the Company over such three-year
period compared to target financial performance of the Company for such period
as established by the Compensation Committee in the manner described above. This
comparison, expressed as a three-year weighted performance percentage, is
utilized to convert the performance option grant to an actual option grant in
accordance with the conversion matrix established by the Compensation Committee.
Based upon the aforesaid performance percentage, the matrix may yield actual
option share awards which vary between 0% and 150% of standard performance
grants.
The Company's policy with respect to the deductibility limit of Section
162(m) of the Internal Revenue Code of 1986, as amended (the "Code"), generally
is to preserve the federal income tax deductibility of compensation paid when it
is appropriate and is in the best interests of the Company and its stockholders.
However, the Company reserves the right to authorize the payment of
nondeductible compensation if it deems that it is appropriate.
1997 COMPENSATION FOR THE CHIEF EXECUTIVE OFFICER
During fiscal 1997, the Chief Executive Officer of the Company received a
base salary in accordance with his employment agreement. In determining the
compensation under this agreement, the Compensation Committee considered (i)
data from outside studies and proxy materials regarding compensation of chief
executive officers at comparable companies, (ii) the input of other directors
regarding the performance of the Chief Executive Officer and (iii) advice from
Hewitt Associates.
In establishing the compensation paid to Mr. Elbaum for fiscal 1997, the
Compensation Committee considered the fact that Mr. Elbaum had significant
responsibilities as an executive officer of Superior TeleCom Inc., the Company's
50.1%-owned subsidiary, and Superior TeleCom's subsidiaries. Although Mr. Elbaum
devoted a certain amount of time to matters directly related to these other
enterprises, the Committee believes his total compensation from the Company for
fiscal 1997 was appropriate and reasonable. This judgment is based on the
Committee's conclusion that Mr. Elbaum has fully and effectively discharged the
responsibilities of his position with the Company to the Company's substantial
benefit, particularly with respect to the matters set forth in the paragraph(s)
above and the amounts paid to executives with comparable responsibilities for
companies of similar size in similar industries. Moreover, the Committee
believes that Mr. Elbaum's strong leadership, guidance and direction to the
Company as
12
<PAGE>
Chairman and Chief Executive Officer during fiscal 1997 have contributed to the
Company's growth and success during such period.
A portion of the annual cash bonus awarded to the Chief Executive Officer in
fiscal 1997 was granted pursuant to the annual cash incentive provisions of his
employment agreement. As described above, this performance bonus is weighted 75%
to the achievement of financial measures and 25% to a subjective assessment of
job performance. The Company exceeded its financial performance targets in
fiscal 1997. With respect to job performance, in the Committee's judgment, the
Chief Executive fully satisfied all expectations.
A portion of the cash bonus awarded to the Chief Executive Officer in fiscal
1997 was granted by the Compensation Committee as a discretionary bonus in
recognition of the Chief Executive Officer's contribution to the extraordinary
results and achievements of the Company during fiscal 1997, as described more
fully above.
Basic stock options were granted to the Chief Executive Officer during
fiscal 1997 (see Stock Option Grants in Fiscal 1997 Table). The grant was made
pursuant to the Company's long-term award incentive program and followed the
principles described above with respect to such program. In addition, during
fiscal 1997 the Company granted options to the Chief Executive Officer to
purchase 183,016 shares of Common Stock, which options represented a reissuance
of previously issued options which were due to expire during fiscal 1997. The
new options are identical to the original options, except that the new options
vest over the three-year period commencing on the date of reissuance.
Overall, the Compensation Committee believes that the Chief Executive
Officer is being appropriately compensated in a manner that is consistent with
the long-term interests of stockholders.
The foregoing report is submitted by members of the Compensation Committee.
Randolph Harrison, CHAIRMAN
Ernest C. Janson, Jr.
John C. Jansing
PERFORMANCE GRAPH
The following graph compares the yearly percentage change in the cumulative
total stockholder return on the Common Stock for each of the Company's last five
fiscal years with the cumulative total return (assuming reinvestment of
dividends) of (i) the American Stock Exchange market value index, (ii) the
Standard & Poor's 500 Stock Index and (iii) a peer group of companies with
market capitalization similar to that of the Company. The cumulative total
stockholder return on the Common Stock is compared to both the American Stock
Exchange market value index and the Standard & Poor's 500 Stock Index because
the Common Stock was traded on the American Stock Exchange for the last five
fiscal years until October 11, 1996, when the Common Stock was first traded on
the New York Stock Exchange, because the Company used the American Stock
Exchange market value index as the basis of such comparison for fiscal 1996, and
because the Company believes these comparisons will be the most meaningful when
both are presented. The Company compares its stockholder return on the Common
Stock with that of issuers with similar market capitalizations because it cannot
reasonably identify a peer group engaged in the same lines of business as the
Company. The returns of each of the peer group of companies are weighted on a
market capitalization basis at the time of each registered data point.
13
<PAGE>
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN OF
THE ALPINE GROUP, INC., AMEX MARKET VALUE INDEX, STANDARD & POOR'S
500 STOCK INDEX AND PEER GROUP
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
4/92 4/93 4/94 4/95 4/96 4/97
<S> <C> <C> <C> <C> <C> <C>
THE ALPINE GROUP, INC. $100 145 78 61 72 148
PEER GROUP $100 76 103 131 145 101
AMEX MARKET VALUE $100 108 113 122 151 145
S&P 500 $100 109 115 135 176 220
</TABLE>
CERTAIN TRANSACTIONS
As of April 30, 1997, Steven S. Elbaum, Chairman and Chief Executive Officer
of the Company, owed the Company approximately $537,000, consisting primarily of
a $300,000 loan made by the Company to finance Mr. Elbaum's exercise of certain
stock options and loans made to Mr. Elbaum in respect of the tax consequences of
certain restricted stock awards. The indebtedness bears interest at the prime
rate plus one half percentage point (as to $300,000), the rate of 5.91% (as to
$223,000) and the prime rate (as to $14,000).
On October 2, 1996, in connection with a reorganization of its subsidiaries,
the Company entered into an agreement (the "Services Agreement") with Superior
TeleCom Inc. Pursuant to the Services Agreement, the Company agreed to provide
certain financial, audit and accounting, corporate finance and strategic
planning, legal, treasury, insurance and administrative services to Superior
TeleCom Inc. in return for an annual fee in addition to reimbursement of
incidental costs and expenses incurred in connection with the Company's
provision of such services. Such annual fee initially was set at the rate of
$925,000 per year. As of May 1, 1997, the Services Agreement was amended to
increase such annual fee to $2.7 million per year, which is estimated to reflect
commercially reasonable costs for the services provided.
14
<PAGE>
In connection with the foregoing reorganization, Superior TeleCom Inc. also
entered into an employment agreement with Steven Elbaum, the Chairman of the
Board and Chief Executive Officer of the Company, which provides for Mr. Elbaum
to provide his services as Chairman of the Board, President and Chief Executive
Officer of Superior TeleCom Inc. for an indefinite term at an annual base salary
of $175,000, as adjusted annually for increases in the Consumer Price Index, and
an annual bonus payable at the discretion of the Board of Directors of Superior
TeleCom Inc. Mr. Elbaum's employment agreement with Superior TeleCom Inc.
contains customary terms and provisions with respect to termination and other
matters. See "Compensation Committee Report on Executive Compensation" above.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934 BENEFICIAL
OWNERSHIP REPORTING COMPLIANCE
Based solely on a review of the reports and representations furnished to the
Company during the last fiscal year, the Company believes that each of the
persons required to file reports under Section 16(a) of the Securities Exchange
Act of 1934 (the "Exchange Act") was in compliance with all applicable filing
requirements with respect to the Company's most recent fiscal year, except that
Mr. Byers failed to file on a timely basis one report required by Section 16(a)
of the Exchange Act relating to one transaction. This transaction related to the
gift by Mr. Byers' wife of 361 shares of Common Stock. In addition, based solely
on such review, with respect to fiscal 1996, Messrs. Johnson, Elbaum, Schut and
Lewis failed to file on a timely basis two, one, one and one, reports,
respectively, required by Section 16(a) of the Exchange Act relating to two,
one, two and one transactions, respectively. These transactions, none of which
involved market purchases or sales of the Company's securities, related to (i)
options granted to Mr. Johnson pursuant to the Company's 1984 Restricted Stock
Plan, (ii) options granted to Mr. Johnson and Mr. Wahrsager on November 15, 1995
and April 10, 1996 pursuant to the Company's 1987 Long-Term Equity Incentive
Plan and (iii) the exchange by Messrs. Elbaum, Lewis and Schut of shares of 8%
Preferred Stock for shares of Common Stock, pursuant to an exchange transaction
completed in January 1996.
PROPOSAL II: RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors has appointed Arthur Andersen LLP, independent public
accountants, to audit the books and records of the Company for the current
fiscal year. The affirmative vote of the holders of a majority in voting power
of the shares of the Common Stock and the 9% Preferred Stock present, or
represented, and entitled to vote at the meeting, voting as a single class, will
be required to ratify the appointment of Arthur Andersen LLP as independent
public accountants of the Company.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS OF THE COMPANY VOTE
FOR THE PROPOSAL TO RATIFY SUCH APPOINTMENT.
Representatives of Arthur Andersen LLP are expected to be available at the
meeting of stockholders to respond to appropriate questions and will be given
the opportunity to make a statement if they desire to do so.
PROPOSAL III: APPROVAL OF THE ALPINE GROUP, INC. 1997 STOCK OPTION PLAN
The affirmative vote of at least a majority of the shares of Common Stock
and 9% Preferred Stock, voting together as a single class, present in person or
represented by proxy and entitled to vote on this matter at the meeting is
required to approve the adoption of The Alpine Group, Inc. 1997 Stock Option
Plan. THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE THEIR SHARES
FOR THE PROPOSAL TO ADOPT THE ALPINE GROUP, INC. 1997 STOCK OPTION PLAN.
15
<PAGE>
BACKGROUND
On June 24, 1997, the Board of Directors adopted The Alpine Group, Inc. 1997
Stock Option Plan (the "Stock Option Plan"), subject to stockholder approval.
The Stock Option Plan is an amendment and restatement of The Alpine Group, Inc.
1997 Interim Stock Option Plan which was originally effective on April 9, 1997.
The following description of the Stock Option Plan is a summary and is qualified
in its entirety by reference to the Stock Option Plan, a copy of which has been
filed as an exhibit to this Proxy Statement.
PURPOSE
The purpose of the Stock Option Plan is to enhance the profitability and
value of the Company for the benefit of stockholders by enabling the Company to
offer employees and consultants of the Company and its subsidiaries stock based
incentives and other equity interests in the Company in order to attract, retain
and reward such individuals and strengthen the mutuality of interests between
such individuals and the Company's stockholders.
ADMINISTRATION
The Stock Option Plan will be administered by a committee of the Board of
Directors which is intended to consist of two or more non-employee directors,
each of whom will be, to the extent required by Rule 16b-3 under the Exchange
Act ("Rule 16b-3") and Section 162(m) of the Code, a non-employee director as
defined in Rule 16b-3 and an outside director as defined under Section 162(m) of
the Code (the "Committee"). If no Committee exists which has the authority to
administer the Stock Option Plan, the functions of the Committee will be
exercised by the Board of Directors. The Committee has the full authority to
grant awards under the Stock Option Plan and to determine the persons to whom
awards will be granted, the time or times such awards will be granted, the terms
and conditions of such awards and the amounts of such awards.
ELIGIBILITY
All employees and consultants of the Company and its subsidiaries designated
by the Committee to participate in the Stock Option Plan are eligible to be
granted options and stock appreciation rights (collectively, the "Awards") under
the Stock Option Plan.
AVAILABLE SHARES
A maximum of 1,500,000 shares of Common Stock (which includes 536,900 shares
of Common Stock available under the Company's 1997 Interim Stock Option Plan)
may be issued for reference purposes under the Stock Option Plan.
The maximum number of shares of Common Stock subject to options or any stock
appreciation rights which may be granted under the Stock Option Plan to any
employee shall not exceed 200,000 shares per type of Award during each fiscal
year of the Company. If a stock appreciation right or a limited stock
appreciation right is granted in tandem with a stock option, it shall apply
against the individual limits for both stock options and stock appreciation
rights, but only once against the maximum number of shares available under the
Stock Option Plan. To the extent that shares of Common Stock for which options
or stock appreciation rights are permitted to be granted to an individual during
a fiscal year of the Company are not covered by a grant of an option or a stock
appreciation right in the Company's fiscal year, such shares of Common Stock
will be available for grant or issuance to the participant in any subsequent
fiscal year during the term of the Stock Option Plan.
The Committee may make appropriate adjustments to the number of shares
available for Awards and the terms of outstanding awards under the Stock Option
Plan to reflect any change in the Company's
16
<PAGE>
capital structure or business, stock dividend, stock split, recapitalization,
reorganization, merger, consolidation or sale of all or substantially all the
assets of the Company.
TYPES OF AWARDS
The Stock Option Plan provides for the grant of any or all of the following
types of awards: (i) stock options, including incentive stock options and
nonqualified stock options and (ii) stock appreciation rights, in tandem with
stock options or freestanding. Each of these types of awards is discussed in
more detail below. Awards may be granted singly, in combination, or in tandem,
as determined by the Committee.
STOCK OPTIONS
Under the Stock Option Plan, the Committee may grant awards in the form of
options to purchase shares of the Common Stock. Options granted to eligible
employees may be in the form of incentive stock options or nonqualified stock
options; solely nonqualified stock options may be granted to eligible
consultants. The Committee will, with regard to each option, determine the
number of shares subject to the option, the term of the option (which will not
exceed ten years, provided, however, that the term of an incentive stock option
granted to a ten percent stockholder of the Company will not exceed five years),
the exercise price per share of stock subject to the option, the vesting
schedule (if any), and the other material terms of the option. No option may
have an exercise price less than the fair market value of the Common Stock at
the time of grant (or, in the case of an incentive stock option granted to a
holder of ten percent or more of the total combined voting power of all classes
of stock of the Company or its subsidiary corporations, 110 percent of fair
market value).
Options will be exercisable at such time or times and subject to such terms
and conditions as determined by the Committee at grant. All options may be made
exercisable in installments, and the exercisability of options may be
accelerated by the Committee. The option price upon exercise may, to the extent
determined by the Committee at or after the time of grant, be paid by a
participant in cash, in shares of Common Stock owned by the participant for at
least 6 months (free and clear of any liens and encumbrances), through a
cashless exercise procedure or by such other method as is approved by the
Committee.
STOCK APPRECIATION RIGHTS ("SARS")
The Stock Option Plan authorizes the Committee to grant SARs either with a
stock option ("Tandem SARs") or independent of a stock option ("Non-Tandem
SARs"). An SAR is a right to receive a payment either in cash or Common Stock as
the Committee may determine, equal in value to the excess of the fair market
value of a share of Common Stock on the date of exercise over the reference
price per share of Common Stock established in connection with the grant of the
SAR. The reference price per share covered by an SAR will be the per share
exercise price of the related option in the case of a Tandem SAR and will be the
per share fair market value of the Common Stock on the date of grant in the case
of a Non-Tandem SAR.
A Tandem SAR may be granted at the time of the grant of the related stock
option or, if the related stock option is a nonqualified stock option, at any
time thereafter during the term of the option. A Tandem SAR generally may be
exercised at and only at the times and to the extent the related option is
exercisable. A Tandem SAR is exercised by surrendering the same portion of the
related option. A Tandem SAR expires upon the termination of the related option.
A Non-Tandem SAR will be exercisable as provided by the Committee and will
have such other terms and conditions as the Committee may determine. A
Non-Tandem SAR may have a term no longer than ten years from its date of grant.
A Non-Tandem SAR is subject to acceleration of vesting or immediate termination
upon termination of employment in certain circumstances.
17
<PAGE>
The Committee is also authorized to grant "limited SARs," either as Tandem
SARs or Non-Tandem SARs. Limited SARs would become exercisable only upon the
occurrence of a change in control (as defined by the Committee) or such other
event as the Committee may, in its sole discretion, designate at the time of
grant or thereafter.
AMENDMENTS
The Stock Option Plan provides that it may be amended by the Board of
Directors or the Committee, except that no such amendment, without stockholder
approval to the extent such approval is required by the laws of the State of
Delaware, Rule 16b-3 or under Section 162(m) or 422 of the Code, may increase
the aggregate number of shares of Common Stock that may be issued under the
Stock Option Plan, increase the maximum individual limits for any fiscal year,
change the classification of employees and consultants eligible to receive
Awards, decrease the minimum option price of any option or extend the maximum
option period under the Stock Option Plan.
MISCELLANEOUS
Subject to limited post-employment and post-consultancy exercise periods and
vesting in certain instances, Awards to a participant under the Stock Option
Plan are generally forfeited upon any termination of employment or consultancy.
Participants required to file reports under Section 16(a) of the Exchange Act
may be limited to certain specific exercise, election or holding periods with
respect to the Awards granted to them under the Stock Option Plan. Awards will
have such terms and will terminate upon such conditions as may be contained in
individual Awards. Although Awards will generally be nontransferable (except by
will or the laws of descent and distribution), the Committee may determine at
the time of grant or thereafter that an option that is otherwise nontransferable
is transferable in whole or in part and in such circumstances, and under such
conditions, as specified by the Committee.
U.S. FEDERAL INCOME TAX CONSEQUENCES
The following discussion of the principal U.S. federal income tax
consequences with respect to options under the Stock Option Plan is based on
statutory authority and judicial and administrative interpretations as of the
date of this Proxy Statement, which are subject to change at any time (possibly
with retroactive effect) and may vary in individual circumstances. At the
present time, provisions under the Taxpayer's Relief Act of 1997 may affect the
following description and, in particular, are expected to change the holding
periods and tax rates for capital gains treatment. Therefore, the following is
designed to provide only a general understanding of the federal tax consequences
(state and local tax consequences are not addressed below). This discussion is
limited to the U.S. federal income tax consequences to individuals who are
citizens or residents of the U.S., other than those individuals who are taxed on
a residence basis in a foreign country.
Under current U.S. federal income tax laws, the grant of an incentive stock
option can be made solely to employees and generally has no income tax
consequences for the optionee or the Company. In general, no taxable income
results to the optionee upon the grant or exercise of an incentive stock option.
However, the amount by which the fair market value of the stock acquired
pursuant to the incentive stock option exceeds the exercise price is an
adjustment item for purposes of alternative minimum tax. If no disposition of
the shares is made within either two years from the date the incentive stock
option was granted or one year from the date of exercise of the incentive stock
option, any gain or loss realized upon disposition of the shares will be treated
as capital gain or loss to the optionee. The Company will not be entitled to a
tax deduction upon the exercise of an incentive stock option, nor upon a
subsequent disposition of the shares, unless the disposition occurs prior to the
expiration of the holding period described above. In general, if the optionee
does not satisfy these holding period requirements, any gain equal to the
difference between the exercise price and the fair market value of the stock at
exercise (or, if a lesser amount, the amount realized on disposition over the
exercise price) will constitute ordinary income. In the event of such a
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disposition before the expiration of the holding period described above, the
Company is entitled to a deduction at that time equal to the amount of ordinary
income recognized by the optionee. Any gain in excess of the amount recognized
by the optionee as ordinary income would be taxed to the optionee as short-term
or long-term capital gain (depending on the applicable holding period).
In general, an optionee will realize no taxable income upon the grant of
nonqualified stock options and the Company will not receive a deduction at the
time of such grant, unless the option has a readily ascertainable fair market
value (as determined under applicable tax law) at the time of grant. Upon
exercise of a nonqualified stock option, an optionee generally will recognize
ordinary income in an amount equal to the excess of the fair market value of the
stock on the date of exercise over the exercise price. Upon a subsequent sale of
the stock by the optionee, the optionee will recognize short-term or long-term
capital gain or loss, depending upon his or her holding period for the stock.
Subject to the possible application of Section 162(m) of the Code, the Company
will generally be allowed a deduction equal to the amount recognized by the
optionee as ordinary income.
In addition: (i) any officers and directors of the Company subject to
Section 16(b) of the Exchange Act may be subject to special tax rules regarding
the income tax consequences concerning their Awards; (ii) any entitlement to a
tax deduction on the part of the Company is subject to the applicable federal
tax rules, including, without limitation, Code Section 162(m) regarding a $1
million limitation on deductible compensation; (iii) in the event that the
exercisability of an Award is accelerated because of a change in control,
payments relating to the options, either alone or together with certain other
payments may constitute parachute payments under Section 280G of the Code, which
excess amounts may be subject to excise taxes and be nondeductible by the
Company; and (iv) the exercise of an incentive stock option may have
implications in the computation of alternative minimum taxable income.
In general, Section 162(m) of the Code denies a publicly held corporation a
deduction for federal income tax purposes for compensation in excess of $1
million per year per person to its chief executive officer and the four other
officers whose compensation is disclosed in its proxy statement, subject to
certain exceptions. Options and SARs will generally qualify under one of these
exceptions if they are granted under a plan that states the maximum number of
shares with respect to which options and SARs may be granted to any employee
during a specified period and the plan under which the options and SARs are
granted is approved by stockholders and is administered by a compensation
committee comprised of outside directors. The Stock Option Plan is intended to
satisfy these requirements with respect to options and SARs.
The Stock Option Plan is not subject to any of the requirements of the
Employee Retirement Income Security Act of 1974, as amended. The Stock Option
Plan is not, nor is it intended to be, qualified under Section 401(a) of the
Code.
PROPOSAL IV: APPROVAL OF AMENDMENT TO THE ALPINE GROUP, INC.
EMPLOYEE STOCK PURCHASE PLAN
The affirmative vote of at least a majority of the shares of Common Stock
and 9% Preferred Stock, voting together as a single class, present in person or
represented by proxy and entitled to vote on this matter at the meeting is
required to approve an amendment to the Employee Stock Purchase Plan. THE BOARD
OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE THEIR SHARES FOR THE PROPOSAL
TO ADOPT THE AMENDMENT TO THE ALPINE GROUP, INC. EMPLOYEE STOCK PURCHASE PLAN.
AMENDMENT TO THE ALPINE GROUP, INC. EMPLOYEE STOCK PURCHASE PLAN
The Board of Directors of The Alpine Group, Inc. (the "Company") approved an
amendment to The Alpine Group, Inc. Employee Stock Purchase Plan (the "Stock
Purchase Plan") as of June 30, 1997, subject to the approval of stockholders, to
change the definition of "designated subsidiaries" and to provide that a
designated subsidiary includes (i) a subsidiary of the Company on the Stock
Purchase Plan's
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restatement date (I.E., December 1, 1996) and (ii) an entity that becomes a
subsidiary after the Stock Purchase Plan's restatement date and is designated by
the Board of Directors (or a duly authorized committee thereof) as eligible to
participate in the Plan and as a designated subsidiary under the Stock Purchase
Plan. Under the Stock Purchase Plan, employees of the Company and designated
subsidiaries are eligible to participate in the Plan, as described below.
Without giving effect to the amendment, all of the Company's subsidiaries are
"designated subsidiaries" under the Stock Purchase Plan.
The amendment is intended to provide the Company with the flexibility to
determine which subsidiaries of the Company may participate in the Stock
Purchase Plan and, in particular, omit from participation those subsidiaries
located outside the United States and Canada. The amendment effects no other
changes to the Stock Purchase Plan.
SUMMARY OF THE STOCK PURCHASE PLAN (AS AMENDED)
The following description of the Stock Purchase Plan, giving effect to the
amendment, is a summary and is qualified in its entirety by reference to the
Stock Purchase Plan, as amended, a copy of which has been filed as an exhibit to
this Proxy Statement.
BACKGROUND
On September 27, 1995, the Board of Directors adopted The Alpine Group, Inc.
1994 Employee Stock Purchase Plan, which was approved by the stockholders of the
Company effective November 16, 1995. Effective as of December 1, 1996, the Stock
Purchase Plan was amended and restated and renamed The Alpine Group, Inc.
Employee Stock Purchase Plan.
PURPOSE
The purpose of the Stock Purchase Plan is to provide employees of the
Company and designated subsidiaries with an opportunity to purchase Common Stock
of the Company at a discount through accumulated payroll deductions. It is the
intention of the Company that the Stock Purchase Plan qualify as an "employee
stock purchase plan" within the meaning of Section 423 of the Code and the
provisions of the Stock Purchase Plan be construed in a manner consistent with
the requirements of such section of the Code.
ADMINISTRATION
The Stock Purchase Plan is administered by the Compensation Committee of the
Board of Directors or such other committee appointed from time to time by the
Board of Directors (the "Committee"). To the extent that no Committee exists
which has the authority to administer the Stock Purchase Plan, the functions of
the Committee will be exercised by the Board of Directors. The Committee
possesses the full power and authority, subject to the provisions of the Stock
Purchase Plan, to promulgate such rules and regulations as it deems necessary
for the proper administration of the Stock Purchase Plan, to interpret the
provisions and supervise the administration of the Stock Purchase Plan and to
take all action in connection therewith or in relation thereto as it deems
necessary or advisable.
The Committee has currently designated Smith Barney, Inc. as its agent to
administer the Stock Purchase Plan, to purchase and sell shares of Common Stock
in accordance with the Stock Purchase Plan, to keep records, to send statements
of account to employees, to act as custodian and to perform other duties
relating to the Stock Purchase Plan, as the Committee may request from time to
time.
While the Company pays for the administration of the Stock Purchase Plan,
employees are fully responsible for (i) any brokerage fees and commissions
charged for the sale of Common Stock, (ii) any fees for certificates of shares
of Common Stock and (iii) any taxes owed by them as a result of participation in
the Stock Purchase Plan.
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ELIGIBILITY
Employees of the Company and its designated subsidiaries (who customarily
work more than 20 hours per week and at least 5 months per year) are eligible to
participate in the Stock Purchase Plan commencing on the first day of any
calendar quarter. Designated subsidiaries include (i) each subsidiary
corporation as of the Plan's restatement date (I.E., December 1, 1996) and (ii)
any entity that becomes a subsidiary corporation after the Plan's restatement
date and is designated by the Board (or a duly authorized committee thereof)
from time to time in its sole discretion as eligible to participate in the Plan
and as a Designated Subsidiary under the Plan. The current designated
subsidiaries are: Adience, Inc.; Adience Canada Inc.; Superior TeleCom Inc.;
Superior Telecommunications Inc.; Superior Cable Corporation; DNE Systems, Inc.;
DNE Technologies, Inc.; and DNE Manufacturing and Service Company.
Subject to notice periods described in the Stock Purchase Plan, an eligible
employee may become a participant in the Stock Purchase Plan by completing the
appropriate form and forwarding it to his or her employer indicating the amount
of the deductions to be taken from his or her pay. Deductions will generally
begin on the first payroll period following the next offering date (the first
day of a calendar quarter), following appropriate notice. An eligible employee
may continue to participate in the Stock Purchase Plan until he or she elects to
cease participation in the Stock Purchase Plan or until the Stock Purchase Plan
is terminated. In addition, an employee's participation in the Stock Purchase
Plan will be automatically suspended if he or she is no longer eligible to
participate in the Stock Purchase Plan (e.g., the employee no longer customarily
works more than 20 hours per week and at least 5 months per year), retires,
dies, terminates employment for any reason, or becomes a 5% owner (as defined by
the Stock Purchase Plan).
AVAILABLE SHARES
A maximum of 500,000 shares of Common Stock (subject to adjustment as
described below) may be reserved for sale under the Stock Purchase Plan.
Purchases of Common Stock under the Stock Purchase Plan are made on the open
market, or, in the sole discretion of the Committee, may be made by the
Company's delivery of treasury shares or newly-issued and authorized shares to
the Stock Purchase Plan, upon such terms as the Committee may approve.
In the event of any change affecting shares of Common Stock including a
reclassification, recapitalization, merger, consolidation, reorganization, stock
dividend, stock split or reverse stock split, combination or exchange of shares,
repurchase of shares, change in corporate structure or otherwise, or the
distribution of an extraordinary dividend, the Committee may make any
appropriate equitable adjustments, if any, to be made under the Stock Purchase
Plan.
STOCK PURCHASES
Each eligible employee may purchase shares of Common Stock at a discount,
through payroll deductions of a fixed percentage of compensation or in
designated dollar amounts per payroll period up to a maximum of 25% of the
employee's compensation (as defined in the Stock Purchase Plan) received each
payroll period, or such lesser percentage as determined by the Committee (but no
less than 1% of compensation). Purchases are made on a quarterly basis.
An eligible employee may not purchase shares of Common Stock under the Stock
Purchase Plan and any other stock purchase plan of the Company, its parent
corporation, or any subsidiary corporation at a rate which exceeds $25,000 of
the fair market value of such stock for any calendar year. In addition, certain
employees may not participate in the Stock Purchase Plan if, immediately after
the grant, such employee (or any other related person) would own stock and/or
hold outstanding options to purchase stock possessing 5% or more of the total
combined voting power or value of all classes of stock of the Company or of any
subsidiary corporation or parent corporation.
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PURCHASE PRICE
The purchase price for a share of Common Stock is based on a designated
percentage of its fair market value. Effective January 1, 1997, the percentage
is 85%. The Board of Directors may change the applicable percentage, in its sole
discretion, at least 30 days prior to the beginning of a calendar quarter, but
the price per share of Common Stock cannot be less than 85% of the fair market
value of a share of Common Stock on the day immediately prior to the first day
of a calendar quarter (the "Offering Date"), or 85% of the fair market value of
a share of Common Stock on the last business day of the calendar quarter (the
"Exercise Date").
ACCOUNTS AND SALES OF SHARES
A participant's entire account consisting of payroll deductions is used to
purchase shares of Common Stock on a quarterly basis. The Stock Purchase Plan's
agent holds the shares of Common Stock credited to a participant's account on a
book entry basis. A participant is entitled to vote all purchased shares of
Common Stock as soon as they are credited to his or her account.
A participant may sell all or a portion of the shares of Common Stock held
under the Stock Purchase Plan through the agent for the Stock Purchase Plan,
subject to brokerage commissions. Alternatively, subject to certain limitations
in the Stock Purchase Plan, a participant may request a certificate for his or
her whole shares of Common Stock held under the Stock Purchase Plan.
WITHDRAWALS; TERMINATION OF EMPLOYMENT; DISABILITY OR LEAVE OF ABSENCE PRIOR TO
TERMINATION OF EMPLOYMENT.
Subject to appropriate notice, a participant may withdraw all, but not less
than all, the payroll deductions (without interest) credited to such
participant's account not used to purchase shares of Common Stock under the
Stock Purchase Plan at any time prior to the Exercise Date. No further payroll
deductions for the purchase of shares of Common Stock will be made for such
participant during a quarterly offering period. A participant's withdrawal from
an offering will not have any effect upon such participant's eligibility to
participate in a subsequent offering or in any similar plan which may hereafter
be adopted by the Company.
If a participant retires or terminates his or her employment with the
Company or any subsidiary for any reason other than death, the payroll
deductions credited to such participant's account not used to purchase shares of
Common Stock will be returned or distributed to the participant (without
interest) as soon as practicable following the participant's retirement or other
termination of employment. In the event of a participant's death, disability or
leave of absence, however, any such remaining payroll deductions credited to the
participant's account will be used to purchase shares of Common Stock.
Generally, a terminated participant or, in the case of death, his or her
beneficiary, may elect (i) to receive certificates for all of the whole shares
of Common Stock and cash in lieu of any fractional shares of Common Stock
credited to the participant's account under the Stock Purchase Plan, (ii) to
have certificates for all shares of Common Stock (including fractional shares)
credited to the participant's account under the Stock Purchase Plan transferred
to an individual brokerage account established by the agent, or (iii) a
combination of (i) and (ii). With respect to a participant who becomes
ineligible to participate due to a disability or leave of absence, shares of
Common Stock held in such participant's account will continue to be held in the
participant's account unless he or she elects otherwise in accordance with the
terms of the Stock Purchase Plan.
AMENDMENTS
The Stock Purchase Plan provides that the Company, by action of the Board of
Directors (or a duly authorized committee thereof), may at any time terminate or
amend the Stock Purchase Plan. No
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amendment shall be effective unless approved by the stockholders of the Company
if stockholder approval of such amendment is required to comply with Section 423
of the Code or to comply with any other applicable law, regulation or stock
exchange rule.
MISCELLANEOUS
Neither payroll deductions credited to a participant's account nor the right
to purchase or receive shares under the Stock Purchase Plan may be assigned,
transferred, pledged or otherwise disposed of in an way (other than by will or
the laws of descent and distribution) by the participant. Any attempt at
assignment, transfer, pledge or other disposition shall be without effect,
except that the Company may treat such act as an election to withdraw funds.
All rights of a participant granted under the Stock Purchase Plan, including
but not limited to, the right to purchase shares of Common Stock and the ability
to authorize payroll deductions, shall relate solely to a participant, except as
otherwise provided under the Stock Purchase Plan in the event of the
participant's death.
U.S. FEDERAL INCOME TAX CONSEQUENCES
The following discussion of the principal U.S. federal income tax
consequences with respect to purchases under the Stock Purchase Plan is based on
statutory authority and judicial and administrative interpretations as of the
date of this Proxy Statement, which are subject to change at any time (possibly
with retroactive effect) and may vary in individual circumstances. At the
present time, provisions under the Taxpayer Relief Act of 1997 may affect the
following description and, in particular, are expected to change the holding
periods and tax rates for capital gains treatment. Therefore, the following is
designed to provide only a general understanding of the federal tax consequences
(state and local tax consequences are not addressed below). This discussion is
limited to the U.S. federal income tax consequences to individuals who are
citizens or residents of the U.S., other than those individuals who are taxed on
a residence basis in a foreign country.
Under current U.S. federal income tax laws, a participant in the Stock
Purchase Plan will not recognize taxable income, nor will the Company be
entitled to a deduction, when the participant purchases shares of Common Stock,
provided that the participant holds such Common Stock for the applicable holding
period (discussed below).
A participant will recognize taxable income upon the disposition of Common
Stock purchased under the Stock Purchase Plan. For this purpose, the term
"disposition" is defined as a sale, exchange, gift or transfer of legal title.
However, certain transfers of Common Stock are not treated as dispositions,
including, for example, transfers from a decedent to an estate, transfer by
bequest or inheritance, transfers to joint ownership with a right of
survivorship, certain exchanges of stock pursuant to corporate reorganizations,
pledges or hypothecations.
(a) SALE OF COMMON STOCK AFTER THE APPLICABLE HOLDING PERIOD.
If a participant holds shares of Common Stock for at least 2 years after the
Offering Date to which they are attributable, the participant will be taxed at
ordinary income rates in the year of sale of the Common Stock on an amount equal
to the lesser of: (i) the excess of the fair market value of the Common Stock on
the Offering Date over the purchase price, or (ii) the excess of the fair market
value of the Common Stock on the date of sale over the purchase price. The
remaining gain, if any, from the sale will be treated as a long-term capital
gain. The Company will not be entitled to a deduction upon the participant's
acquisition or qualifying disposition of Common Stock.
To calculate a participant's gain or loss on the sale of Common Stock, the
amount realized from the sale must be reduced by the basis (purchase price
increased by ordinary income resulting from sale). If the basis of the Common
Stock exceeds the amount realized, the loss will be a long-term capital loss.
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Any dividends paid with respect to Common Stock will be included in a
participant's income in the year received and will be subject to taxation.
If a participant dies before disposing of Common Stock purchased under the
Stock Purchase Plan (whether occurring prior to or after the 2 year holding
period), the participant's tax return for the year in which he or she dies must
include an amount as ordinary income, which will be calculated in the manner
described above. The basis of Common Stock held by a participant's estate or the
person receiving the Common Stock by bequest or inheritance will generally be
equal to the fair market value of the Common Stock on the participant's date of
death, calculated without regard to the ordinary income included on the
participant's final income tax return.
(b) SALE OF COMMON STOCK PRIOR TO THE END OF THE APPLICABLE HOLDING PERIOD.
If a participant sells Common Stock purchased pursuant to the Stock Purchase
Plan within 2 years of the Offering Date to which they are attributable, the
sale will be deemed a disqualifying disposition and the excess of the fair
market value of the Common Stock on the Exercise Date over the price paid for
such Common Stock will be treated as ordinary income, even if that amount is
more than the gain from the sale. This amount will be included in the
participant's total taxable wages shown on his or her Form W-2 in the year of
the disqualifying disposition. In addition, the Company will be entitled to take
a deduction on its income tax return equal to the amount of the participant's
ordinary income resulting from the sale.
A participant's ordinary income is then added to the purchase price of the
Common Stock for purposes of determining the basis of the Common Stock. The
capital gain or loss on a sale of Common Stock is calculated by subtracting this
basis from the amount realized on the sale. The capital gain or loss will either
be long-term or short-term depending on the time period during which the Common
Stock has been held.
The Company may make such provisions as it deems necessary or appropriate to
satisfy any of its obligations to withhold federal, state or local income or
other taxes incurred by reason of the issuance of shares under the Stock
Purchase Plan.
The Stock Purchase Plan is not subject to any of the requirements of the
Employee Retirement Income Security Act of 1974, as amended. While the Stock
Purchase Plan is intended to be qualified under Section 423 of the Code, it is
not, nor is it intended to be, qualified under Section 401(a) of the Code.
OTHER MATTERS
The Company's Board of Directors does not know of any other matters which
may be brought before the meeting. However, if any such other matters are
properly presented for action, it is the intention of the persons named in the
accompanying form of proxy to vote the shares represented thereby in accordance
with their judgment on such matters.
MISCELLANEOUS
It is important that proxies be returned promptly. Stockholders who do not
expect to attend the meeting in person are urged to mark, sign and date the
accompanying proxy and mail it in the enclosed return envelope, which requires
no postage if mailed in the United States, so that their votes can be recorded.
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STOCKHOLDER PROPOSALS
Stockholder proposals intended to be presented at the next Annual Meeting of
Stockholders of the Company must be received by the Company by April 30, 1998 in
order to be considered for inclusion in the Company's proxy statement relating
to such meeting.
By Order of the Board of Directors,
Stewart H. Wahrsager
SECRETARY
New York, New York
August 22, 1997
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EXHIBITS
<TABLE>
<S> <C>
Exhibit The Alpine Group, Inc. 1997 Stock Option Plan
A:
Exhibit The Alpine Group, Inc. Employee Stock Purchase Plan (Amended and Restated as
B: of December 1, 1996)
</TABLE>
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Exhibit A
THE ALPINE GROUP, INC.
1997 STOCK OPTION PLAN
ARTICLE I.
PURPOSE
The purpose of The Alpine Group, Inc. 1997 Stock Option Plan (the "Plan") is
to enhance the profitability and value of The Alpine Group, Inc. (the "Company")
and its subsidiaries for the benefit of their stockholders by enabling the
Company (i) to offer employees and Consultants of the Company and Subsidiaries,
stock based incentives and other equity interests in the Company, thereby
creating a means to raise the level of stock ownership by employees and
Consultants in order to attract, retain and reward such individuals and
strengthen the mutuality of interests between such individuals and the Company's
stockholders.
ARTICLE II.
DEFINITIONS
For purposes of this Plan, the following terms shall have the following
meanings:
2.1. "Acquisition Events" shall have the meaning set forth in Section
4.2(d).
2.2. "Award" shall mean any award under this Plan of any Stock Option and
Stock Appreciation Right. All Awards shall be confirmed by, and subject to the
terms of, a written agreement executed by the Company and the Participant.
2.3. "Board" shall mean the Board of Directors of the Company.
2.4. "Cause" shall mean, with respect to a Participant's Termination of
Employment or Termination of Consultancy, unless otherwise determined by the
Committee at grant, or, if no rights of the Participant are reduced, thereafter,
termination due to a Participant's dishonesty, fraud, insubordination, willful
misconduct, refusal to perform services (for any reason other than illness or
incapacity) or materially unsatisfactory performance of his or her duties for
the Company or a Subsidiary, as determined by the Committee in its sole
discretion.
2.5. "Code" shall mean the Internal Revenue Code of 1986, as amended. Any
reference to any section of the Code shall also be a reference to any successor
provision.
2.6. "Committee" shall mean a committee of the Board appointed from time to
time by the Board, which committee shall be intended to consist of two or more
non-employee directors, each of whom shall be, to the extent required by Rule
16b-3 and Section 162(m) of the Code, a non-employee director as defined in Rule
16b-3 and an outside director as defined under Section 162(m) of the Code. To
the effect that no Committee exists which has the authority to administer the
Plan, the functions of the Committee shall be exercised by the Board. If for any
reason the appointed Committee does not meet the requirements of Rule 16b-3 or
Section 162(m) of the Code, such noncompliance with the requirements of Rule
16b-3 and Section 162(m) of the Code shall not affect the validity of Awards,
grants, interpretations or other actions of the Committee.
2.7. "Common Stock" shall mean the Common Stock, $.10 par value per share,
of the Company.
2.8. "Company" shall mean The Alpine Group, Inc., a Delaware corporation.
2.9. "Consultant" shall mean any adviser or consultant to the Company and
its Subsidiaries who is eligible pursuant to Section 5.1 to be granted Awards
under this Plan.
2.10. "Disability" shall mean total and permanent disability, as defined in
Section 22(e)(3) of the Code.
<PAGE>
2.11. "Effective Date" shall mean April 9, 1997, subject to Article XII.
2.12. "Eligible Employees" shall mean the employees of the Company and the
Subsidiaries who are eligible pursuant to Section 5.1 to be granted Awards under
this Plan.
2.13. "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
2.14. "Fair Market Value" for purposes of this Plan, unless otherwise
required by any applicable provision of the Code or any regulations issued
thereunder, shall mean, as of any date, the last sales price reported for the
Common Stock on the applicable date (i) as reported by the principal national
securities exchange in the United States on which it is then traded, or (ii) if
not traded on any such national securities exchange, as quoted on an automated
quotation system sponsored by the National Association of Securities Dealers. If
the Common Stock is not readily tradable on a national securities exchange or
any system sponsored by the National Association of Securities Dealers, its Fair
Market Value shall be set in good faith by the Committee on the advice of a
registered investment adviser (as defined under the Investment Advisers Act of
1940). For purposes of the grant of any Award, the applicable date shall be the
date for which the last sales price is available at the time of grant. For
purposes of the exercise of any Stock Appreciation Right the applicable date
shall be the date a notice of exercise is received by the Committee or, if not a
day on which the applicable market is open, the next day that it is open.
2.15. "Good Reason" shall mean, with respect to a Participant's Termination
of Employment or Termination of Consultancy, unless otherwise determined by the
Committee at grant, or, if no rights of the Participant are reduced, thereafter,
a voluntary termination due to "good reason," as the Committee, in its sole
discretion decides to treat as a Good Reason termination.
2.16. "Incentive Stock Option" shall mean any Stock Option awarded under
this Plan intended to be and designated as an "Incentive Stock Option" within
the meaning of Section 422 of the Code.
2.17. "Limited Stock Appreciation Right" shall mean an Award made pursuant
to Section 7.5 of this Plan which may be a Tandem Stock Appreciation Right or a
Non-Tandem Stock Appreciation Right.
2.18. "Non-Qualified Stock Option" shall mean any Stock Option awarded under
this Plan that is not an Incentive Stock Option.
2.19. "Non-Tandem Stock Appreciation Right" shall mean a Stock Appreciation
Right entitling the holder to receive an amount in cash or stock equal to the
excess of (x) the Fair Market Value of a share of Common Stock as of the date
such right is exercised, over (y) the aggregate exercise price of such right,
otherwise than on surrender of a Stock Option.
2.20. "Participant" shall mean the following persons to whom an Award has
been made pursuant to this Plan: Eligible Employees and Consultants of the
Company and Subsidiaries.
2.21. "Reference Stock Option" shall have the meaning set forth in Section
7.1.
2.22. "Retirement" with respect to a Participant's Termination of Employment
or Termination of Consultancy shall mean a Termination of Employment or
Termination of Consultancy without Cause or for Good Reason from the Company
and/or a Subsidiary by a Participant who has attained (i) at least age 65; or
(ii) such earlier date after age 55 as approved by the Committee with regard to
such Participant.
2.23. "Rule 16b-3" shall mean Rule 16b-3 under Section 16(b) of the Exchange
Act as then in effect or any successor provisions.
2.24. "Section 162(m) of the Code" shall mean the exception for
performance-based compensation under Section 162(m) of the Code and any Treasury
regulations thereunder.
2.25. "Stock Appreciation Right" shall mean the right pursuant to an Award
granted under Article VII.
A-3
<PAGE>
2.26. "Stock Option" or "Option" shall mean any Option to purchase shares of
Common Stock granted to Eligible Employees or Consultants pursuant to Article
VI.
2.27. "Subsidiary" shall mean any subsidiary of the Company within the
meaning of Section 424(f) of the Code.
2.28. "Tandem Stock Appreciation Right" shall mean a Stock Appreciation
Right entitling the holder to surrender to the Company all (or a portion) of a
Stock Option in exchange for an amount in cash or stock equal to the excess of
(i) the Fair Market Value, on the date such Stock Option (or such portion
thereof) is surrendered, of the Common Stock covered by such Stock Option (or
such portion thereof), over (ii) the aggregate exercise price of such Stock
Option (or such portion thereof).
2.29. "Ten Percent Stockholder" shall mean a person owning stock of the
Company possessing more than 10% of the total combined voting power of all
classes of stock of the Company, as defined in Section 422 of the Code.
2.30. "Termination of Consultancy" shall mean, with respect to a Consultant,
that the Consultant is no longer acting as a Consultant to the Company and its
Subsidiaries. In the event an entity shall cease to be a Subsidiary, there shall
be deemed a Termination of Consultancy of any individual who is not otherwise a
Consultant of the Company or another Subsidiary at the time the entity ceases to
be a Subsidiary.
2.31. "Termination of Employment" shall mean (i) a termination of service of
a Participant from the Company and its Subsidiaries; or (ii) when an entity
which is employing a Participant ceases to be a Subsidiary, unless the
Participant thereupon becomes employed by the Company or another Subsidiary.
2.32. "Transfer" or "Transferred" shall mean anticipate, alienate, attach,
sell, assign, pledge, encumber, charge or otherwise transfer.
ARTICLE III.
ADMINISTRATION
3.1. THE COMMITTEE. The Plan shall be administered and interpreted by the
Committee.
3.2. AWARDS. The Committee shall have full authority to grant, pursuant to the
terms of this Plan (including Article V hereof) Stock Options and Stock
Appreciation Rights to Eligible Employees and Consultants. In particular, the
Committee shall have the authority:
(a) to select the Eligible Employees and Consultants to whom Stock
Options and Stock Appreciation Rights may from time to time be granted
hereunder;
(b) to determine whether and to what extent Stock Options and Stock
Appreciation Rights are to be granted hereunder to one or more Eligible
Employees or Consultants;
(c) to determine, in accordance with the terms of this Plan, the number
of shares of Common Stock to be covered by each Award to an Eligible
Employee or Consultant hereunder;
(d) to determine the terms and conditions, not inconsistent with the
terms of this Plan, of any Award granted hereunder to an Eligible Employee
or Consultant (including, but not limited to, the exercise or purchase price
(if any), any restriction or limitation, any vesting schedule or
acceleration thereof or any forfeiture restrictions or waiver thereof,
regarding any Stock Option or Stock Appreciation Right, and the shares of
Common Stock relating thereto, based on such factors, if any, as the
Committee shall determine, in its sole discretion);
(e) to determine whether and under what circumstances a Stock Option may
be settled in cash and/or Common Stock under Section 6.3(d);
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(f) to determine whether, to what extent and under what circumstances to
provide loans (which may be on a recourse basis and shall bear interest at
the rate the Committee shall provide) to Eligible Employees and Consultants
in order to exercise Options under the Plan;
(g) to determine whether a Stock Appreciation Right shall be a Tandem
Stock Appreciation Right or Non-Tandem Stock Appreciation Right;
(h) to determine whether to require an Eligible Employee or Consultant,
as a condition of the granting of any Award, to not sell or otherwise
dispose of shares acquired pursuant to the exercise of an Option or as an
Award for a period of time as determined by the Committee, in its sole
discretion, following the date of the acquisition of such Option or Award;
and
(i) to modify, extend or renew an Award, subject to Section 9.1 herein,
provided, however, that if an Award is modified, extended or renewed and
thereby deemed to be the issuance of a new Award under the Code or the
applicable accounting rules, the exercise price of an Award may continue to
be the original exercise price even if less than the Fair Market Value of
the Common Stock at the time of such modification, extension or renewal.
3.3. GUIDELINES. Subject to Article IX hereof, the Committee shall have the
authority to adopt, alter and repeal such administrative rules, guidelines and
practices governing this Plan and perform all acts, including the delegation of
its administrative responsibilities, as it shall, from time to time, deem
advisable; to construe and interpret the terms and provisions of this Plan and
any Award issued under this Plan (and any agreements relating thereto); and to
otherwise supervise the administration of this Plan. The Committee may correct
any defect, supply any omission or reconcile any inconsistency in this Plan or
in any agreement relating thereto in the manner and to the extent it shall deem
necessary to carry this Plan into effect, but only to the extent any such action
would be permitted under the applicable provisions of both Rule 16b-3 and
Section 162(m) of the Code. The Committee may adopt special guidelines and
provisions for persons who are residing in, or subject to, the taxes of,
countries other than the United States to comply with applicable tax and
securities laws.
3.4. DECISIONS FINAL. Any decision, interpretation or other action made or
taken in good faith by or at the direction of the Company, the Board, or the
Committee (or any of its members) arising out of or in connection with this Plan
shall be within the absolute discretion of the Company, the Board or the
Committee, as the case may be, and shall be final, binding and conclusive on the
Company and all employees and Participants and their respective heirs,
executors, administrators, successors and assigns.
3.5. RELIANCE ON COUNSEL. The Company, the Board or the Committee may
consult with legal counsel, who may be counsel for the Company or other counsel,
with respect to its obligations or duties hereunder, or with respect to any
action or proceeding or any question of law, and shall not be liable with
respect to any action taken or omitted by it in good faith pursuant to the
advice of such counsel.
3.6. PROCEDURES. If the Committee is appointed, the Board shall designate
one of the members of the Committee as chairman and the Committee shall hold
meetings, subject to the By-Laws of the Company, at such times and places as the
Committee shall deem advisable. A majority of the Committee members shall
constitute a quorum. All determinations of the Committee shall be made by a
majority of its members. Any decision or determination reduced to writing and
signed by all the Committee members in accordance with the By-Laws of the
Company shall be fully as effective as if it had been made by a vote at a
meeting duly called and held. The Committee may keep minutes of its meetings and
may make such rules and regulations for the conduct of its business as it shall
deem advisable.
3.7. DESIGNATION OF CONSULTANTS/LIABILITY.
(a) The Committee may designate employees of the Company and
professional advisors to assist the Committee in the administration of this
Plan and may grant authority to employees to execute agreements or other
documents on behalf of the Committee.
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(b) The Committee may employ such legal counsel, consultants and agents
as it may deem desirable for the administration of this Plan and may rely
upon any opinion received from any such counsel or consultant and any
computation received from any such consultant or agent. Expenses incurred by
the Committee or Board in the engagement of any such counsel, consultant or
agent shall be paid by the Company. The Committee, its members and any
person designated pursuant to Section 3.7(a) shall not be liable for any
action or determination made in good faith with respect to this Plan. To the
maximum extent permitted by applicable law, no officer of the Company or
member or former member of the Committee or of the Board shall be liable for
any action or determination made in good faith with respect to this Plan or
any Award granted under it. To the maximum extent permitted by applicable
law and the Certificate of Incorporation and By-Laws of the Company and to
the extent not covered by insurance, each officer and member or former
member of the Committee or of the Board shall be indemnified and held
harmless by the Company against any cost or expense (including reasonable
fees of counsel reasonably acceptable to the Company) or liability
(including any sum paid in settlement of a claim with the approval of the
Company), and advanced amounts necessary to pay the foregoing at the
earliest time and to the fullest extent permitted, arising out of any act or
omission to act in connection with this Plan, except to the extent arising
out of such officer's, member's or former member's own fraud or bad faith.
Such indemnification shall be in addition to any rights of indemnification
the officers, directors or members or former officers, directors or members
may have under applicable law or under the Certificate of Incorporation or
By-Laws of the Company or Subsidiary. Notwithstanding anything else herein,
this indemnification will not apply to the actions or determinations made by
an individual with regard to Awards granted to him or her under this Plan.
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ARTICLE IV.
SHARE AND OTHER LIMITATIONS
4.1. SHARES.
(a) GENERAL LIMITATION. The aggregate number of shares of Common Stock
which may be issued or used for reference purposes under this Plan shall not
exceed 1,500,000 shares (subject to any increase or decrease pursuant to
Section 4.2) which may be either authorized and unissued Common Stock or
Common Stock held in or acquired for the treasury of the Company. If any
Option or Stock Appreciation Right granted under this Plan expires,
terminates or is canceled for any reason without having been exercised in
full, the number of shares of Common Stock underlying any unexercised Stock
Appreciation Right or Option shall again be available for the purposes of
Awards under this Plan. If a Tandem Stock Appreciation Right or a Limited
Stock Appreciation Right granted in tandem with an Option is granted under
this Plan, such grant shall only apply once against the maximum number of
shares of Common Stock which may be issued under this Plan.
(b) INDIVIDUAL PARTICIPANT LIMITATIONS. (i) The maximum number of shares
of Common Stock subject to any Option or any Stock Appreciation Right which
may be granted under this Plan during any fiscal year of the Company to each
Eligible Employee shall be 200,000 shares per type of Award (subject to any
increase or decrease pursuant to Section 4.2). If a Tandem Stock
Appreciation Right or Limited Stock Appreciation Right is granted in tandem
with an Option it shall apply against the Eligible Employee's individual
share limitations for both Stock Appreciation Rights and Options. To the
extent that shares of Common Stock for which Options or Stock Appreciation
Rights are permitted to be granted to a Participant pursuant to Section
4.1(b) during a fiscal year of the Company are not covered by a grant of an
Option or a Stock Appreciation Right in the Company's fiscal year, such
shares of Common Stock shall be available for grant or issuance to the
Participant in any subsequent fiscal year during the term of the Plan.
4.2. CHANGES.
(a) The existence of this Plan and the Awards granted hereunder shall
not affect in any way the right or power of the Board or the stockholders of
the Company to make or authorize any adjustment, recapitalization,
reorganization or other change in the Company's capital structure or its
business, any merger or consolidation of the Company, or Subsidiaries, any
issue of bonds, debentures, preferred or prior preference stock ahead of or
affecting Common Stock, the authorization or issuance of additional shares
of Common Stock, the dissolution or liquidation of the Company or
Subsidiaries, any sale or transfer of all or part of its assets or business
or any other corporate act or proceeding.
(b) In the event of any change in the capital structure or business of
the Company by reason of any stock dividend or extraordinary dividend, stock
split or reverse stock split, recapitalization, reorganization, merger,
consolidation, or exchange of shares, distribution with respect to its
outstanding Common Stock or capital stock other than Common Stock,
reclassification of its capital stock, any sale or transfer of all or part
of the Company's assets or business, or any similar change affecting the
Company's capital structure or business and the Committee determines an
adjustment is appropriate under this Plan, then the aggregate number and
kind of shares which thereafter may be issued under this Plan, the number
and kind of shares or other property (including cash) to be issued upon
exercise of an outstanding Option or other Awards granted under this Plan
and the purchase or exercise price thereof shall be appropriately adjusted
consistent with such change in such manner as the Committee may deem
equitable to prevent substantial dilution or enlargement of the rights
granted to, or available for, Participants under this Plan or as otherwise
necessary to reflect the change, and any such adjustment determined by the
Committee in good faith shall be binding and conclusive on the Company and
all Participants and employees and their respective heirs, executors,
administrators, successors and assigns.
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(c) Fractional shares of Common Stock resulting from any adjustment in
Options or Awards pursuant to Section 4.2(a) or (b) shall be aggregated
until, and eliminated at, the time of exercise by rounding-down for
fractions less than one-half and rounding-up for fractions equal to or
greater than one-half. No cash settlements shall be made with respect to
fractional shares eliminated by rounding. Notice of any adjustment shall be
given by the Committee to each Participant whose Option or Award has been
adjusted and such adjustment (whether or not such notice is given) shall be
effective and binding for all purposes of this Plan.
(d) In the event of a merger or consolidation in which the Company is
not the surviving entity or in the event of any transaction that results in
the acquisition of all or substantially all of the Company's outstanding
Common Stock by a single person or entity or by a group of persons and/or
entities acting in concert, or in the event of the sale or transfer of all
or substantially all of the Company's assets (all of the foregoing being
referred to as "Acquisition Events"), then the Committee may, in its sole
discretion, terminate all outstanding Options and Stock Appreciation Rights
of Eligible Employees and Consultants, effective as of the date of the
Acquisition Event, by delivering notice of termination to each such
Participant at least 30 days prior to the date of consummation of the
Acquisition Event; provided, that during the period from the date on which
such notice of termination is delivered to the consummation of the
Acquisition Event, each such Participant shall have the right to exercise in
full all of his or her Options and Stock Appreciation Rights that are then
outstanding (whether vested or not vested) but contingent on the occurrence
of the Acquisition Event, and, provided that, if the Acquisition Event does
not take place within a specified period after giving such notice for any
reason whatsoever, the notice and exercise shall be null and void. If an
Acquisition Event occurs, to the extent the Committee does not terminate the
outstanding Options and Stock Appreciation Rights pursuant to this Section
4.2(d), then the provisions of Section 4.2(b) shall apply.
4.3. PURCHASE PRICE. Notwithstanding any provision of this Plan to the
contrary, if authorized but previously unissued shares of Common Stock are
issued under this Plan, such shares shall not be issued for a consideration
which is less than as permitted under applicable law.
ARTICLE V.
ELIGIBILITY
5.1. All employees and Consultants of the Company and its Subsidiaries are
eligible to be granted Options and Stock Appreciation Rights under this Plan.
Eligibility under this Plan shall be determined by the Committee.
ARTICLE VI.
STOCK OPTION GRANTS
6.1. OPTIONS. Each Stock Option granted hereunder shall be one of two types:
(i) an Incentive Stock Option intended to satisfy the requirements of Section
422 of the Code or (ii) a Non-Qualified Stock Option.
6.2. GRANTS. The Committee shall have the authority to grant to any Eligible
Employee one or more Incentive Stock Options, Non-Qualified Stock Options, or
both types of Stock Options (in each case with or without Stock Appreciation
Rights). To the extent that any Stock Option does not qualify as an Incentive
Stock Option (whether because of its provisions or the time or manner of its
exercise or otherwise), such Stock Option or the portion thereof which does not
so qualify, shall constitute a separate Non-Qualified Stock Option. The
Committee shall have the authority to grant to any Consultant one or more
Non-Qualified Stock Options (with or without Stock Appreciation Rights).
Notwithstanding any other provision of the Plan to the contrary or any provision
in an agreement evidencing the grant of an Option to the contrary, any Option
granted to a Consultant shall be a Non-Qualified Stock Option.
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6.3. TERMS OF OPTIONS. Options granted under this Plan shall be subject to
the following terms and conditions, and shall be in such form and contain such
additional terms and conditions, not inconsistent with the terms of this Plan,
as the Committee shall deem desirable:
(a) OPTION PRICE. The option price per share of Common Stock purchasable
under an Incentive Stock Option shall be determined by the Committee at the
time of grant but shall not be less than 100% of the Fair Market Value of a
share of Common Stock at the time of grant; provided, however, that if an
Incentive Stock Option is granted to a Ten Percent Stockholder, the purchase
price shall be no less than 110% of the Fair Market Value of the Common
Stock. The purchase price of shares of Common Stock subject to a
Non-Qualified Stock Option shall be determined by the Committee but shall
not be less than the 100% of the Fair Market Value of a share of Common
Stock at the time of grant.
(b) OPTION TERM. The term of each Stock Option shall be fixed by the
Committee, but no Stock Option shall be exercisable more than 10 years after
the date the Option is granted, provided, however, the term of an Incentive
Stock Option granted to a Ten Percent Stockholder may not exceed five years.
(c) EXERCISABILITY. Stock Options shall be exercisable at such time or
times and subject to such terms and conditions as shall be determined by the
Committee at the time of grant. If the Committee provides, in its
discretion, that any Stock Option is exercisable subject to certain
limitations (including, without limitation, that it is exercisable only in
installments or within certain time periods), the Committee may waive such
limitations on the exercisability at any time at or after the time of grant
in whole or in part (including, without limitation, that the Committee may
waive the installment exercise provisions or accelerate the time at which
Options may be exercised), based on such factors, if any, as the Committee
shall determine, in its sole discretion.
(d) METHOD OF EXERCISE. Subject to whatever installment exercise and
waiting period provisions apply under Section 6.3(c), Stock Options may be
exercised in whole or in part at any time during the Option term, by giving
written notice of exercise to the Company specifying the number of shares to
be purchased. Such notice shall be accompanied by payment in full of the
exercise price in such form, or such other arrangement for the satisfaction
of the exercise price, as the Committee may accept. If and to the extent
determined by the Committee in its sole discretion at or after grant,
payment in full or in part may also be made in the form of Common Stock
owned by the Participant for at least 6 months (and for which the
Participant has good title free and clear of any liens and encumbrances and
has represented that he has owned the shares of Common Stock for at least 6
months) based on the Fair Market Value of the Common Stock on the payment
date, or, if the Common Stock is traded on a national securities exchange,
through the delivery of irrevocable instructions to a broker to deliver
promptly to the Company an amount equal to the purchase price. No shares of
Common Stock shall be issued until payment therefor, as provided herein, has
been made or provided for.
(e) INCENTIVE STOCK OPTION LIMITATIONS. To the extent that the aggregate
Fair Market Value (determined as of the time of grant) of the Common Stock
with respect to which Incentive Stock Options are exercisable for the first
time by an Eligible Employee during any calendar year under this Plan and/or
any other stock option plan of the Company or any Subsidiary or parent
corporation (within the meaning of Section 424(e) of the Code) exceeds
$100,000, such Options shall be treated as Options which are not Incentive
Stock Options.
Should the foregoing provision not be necessary in order for the Stock
Options to qualify as Incentive Stock Options, or should any additional
provisions be required, the Committee may amend this Plan accordingly,
without the necessity of obtaining the approval of the stockholders of the
Company.
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(f) FORM, MODIFICATION, EXTENSION AND RENEWAL OF OPTIONS. Subject to the
terms and conditions and within the limitations of this Plan, an Option
shall be evidenced by such form of agreement or grant as is approved by the
Committee, and the Committee may modify, extend or renew outstanding Options
granted under this Plan (provided that the rights of a Participant are not
reduced without his consent), or accept the surrender of outstanding Options
(up to the extent not theretofore exercised) and authorize the granting of
new Options in substitution therefor (to the extent not theretofore
exercised).
(g) OTHER TERMS AND CONDITIONS. Options may contain such other
provisions, which shall not be inconsistent with any of the foregoing terms
of the Plan, as the Committee shall deem appropriate.
ARTICLE VII.
STOCK APPRECIATION RIGHTS
7.1. TANDEM STOCK APPRECIATION RIGHTS. A Tandem Stock Appreciation Right may
be granted in conjunction with all or part of any Stock Option (a "Reference
Stock Option") granted under this Plan. In the case of a Tandem Stock
Appreciation Right which is granted in conjunction with a Non-Qualified Stock
Option, such rights may be granted either at or after the time of the grant of
such Reference Stock Option. In the case of a Tandem Stock Appreciation Right
which is granted in conjunction with an Incentive Stock Option, such rights may
be granted only at the time of the grant of such Reference Stock Option.
Consultants shall not be eligible for a grant of Tandem Stock Appreciation
Rights granted in conjunction with all or part of an Incentive Stock Option.
7.2. TERMS AND CONDITIONS OF TANDEM STOCK APPRECIATION RIGHTS. Tandem Stock
Appreciation Rights shall be subject to such terms and conditions, not
inconsistent with the provisions of this Plan, as shall be determined from time
to time by the Committee, including Article VIII and the following:
(a) TERM. A Tandem Stock Appreciation Right or applicable portion
thereof granted with respect to a Reference Stock Option shall terminate and
no longer be exercisable upon the termination or exercise of the Reference
Stock Option, except that, unless otherwise determined by the Committee, in
its sole discretion, at the time of grant, a Tandem Stock Appreciation Right
granted with respect to less than the full number of shares covered by the
Reference Stock Option shall not be reduced until and then only to the
extent the exercise or termination of the Reference Stock Option causes the
number of shares covered by the Tandem Stock Appreciation Right to exceed
the number of shares remaining available and unexercised under the Reference
Stock Option.
(b) EXERCISABILITY. Tandem Stock Appreciation Rights shall be
exercisable only at such time or times and to the extent that the Reference
Stock Options to which they relate shall be exercisable in accordance with
the provisions of Article VI and this Article VII.
(c) METHOD OF EXERCISE. A Tandem Stock Appreciation Right may be
exercised by an optionee by surrendering the applicable portion of the
Reference Stock Option. Upon such exercise and surrender, the Participant
shall be entitled to receive an amount determined in the manner prescribed
in this Section 7.2 and the Reference Stock Option or part thereof to which
such Stock Appreciation Right is related shall be deemed to have been
exercised for the purpose of the limitation set forth in Article IV of the
Plan on the number of shares of Common Stock to be issued under the Plan.
The Stock Options which have been so surrendered, in whole or in part, shall
no longer be exercisable to the extent the related Tandem Stock Appreciation
Rights have been exercised.
(d) PAYMENT. Upon the exercise of a Tandem Stock Appreciation Right a
Participant shall be entitled to receive an amount in cash and/or Common
Stock (as chosen by the Committee in its sole discretion) equal in value to
the excess of the Fair Market Value of one share of Common Stock over the
option price per share specified in the Reference Stock Option multiplied by
the number of shares
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in respect of which the Tandem Stock Appreciation Right shall have been
exercised, with the Committee having the right to determine the form of
payment.
7.3. NON-TANDEM STOCK APPRECIATION RIGHTS. Non-Tandem Stock Appreciation
Rights may also be granted without reference to any Stock Options granted under
this Plan.
7.4. TERMS AND CONDITIONS OF NON-TANDEM STOCK APPRECIATION RIGHTS.
Non-Tandem Stock Appreciation Rights shall be subject to such terms and
conditions, not inconsistent with the provisions of this Plan, as shall be
determined from time to time by the Committee, including Article VIII and the
following:
(a) TERM. The term of each Non-Tandem Stock Appreciation Right shall be
fixed by the Committee, but shall not be greater than 10 years after the
date the right is granted.
(b) EXERCISABILITY. Non-Tandem Stock Appreciation Rights shall be
exercisable at such time or times and subject to such terms and conditions
as shall be determined by the Committee at grant. If the Committee provides,
in its discretion, that any such right is exercisable subject to certain
limitations (including, without limitation, that it is exercisable only in
installments or within certain time periods), the Committee may waive such
limitation on the exercisability at any time at or after grant in whole or
in part (including, without limitation, that the Committee may waive the
installment exercise provisions or accelerate the time at which rights may
be exercised), based on such factors, if any, as the Committee shall
determine, in its sole discretion.
(c) METHOD OF EXERCISE. Subject to whatever installment exercise and
waiting period provisions apply under subsection (b) above, Non-Tandem Stock
Appreciation Rights may be exercised in whole or in part at any time during
the option term, by giving written notice of exercise to the Company
specifying the number of Non-Tandem Stock Appreciation Rights to be
exercised.
(d) PAYMENT. Upon the exercise of a Non-Tandem Stock Appreciation Right
a Participant shall be entitled to receive, for each right exercised an
amount in cash and/or Common Stock (as chosen by the Committee in its sole
discretion) equal in value to the excess of the Fair Market Value of one
share of Common Stock on the date the right is exercised over the Fair
Market Value of one share of Common Stock on the date the right was awarded
to the Participant.
7.5. LIMITED STOCK APPRECIATION RIGHTS. The Committee may, in its sole
discretion, grant Limited Stock Appreciation Rights. Limited Stock Appreciation
Rights may be exercised only upon the occurrence of a change in control (as
defined by the Committee) or such other event as the Committee may, in its sole
discretion, designate at the time of grant or thereafter. Upon the exercise of
Limited Stock Appreciation Rights, except as otherwise provided in an Award
agreement, the Participant shall receive in cash or Common Stock, as determined
by the Committee, an amount equal to the amount (1) set forth in Section 7.2(d)
with respect to Tandem Stock Appreciation Rights or (2) set forth in Section
7.4(d) with respect to Non-Tandem Stock Appreciation Rights.
ARTICLE VIII.
NON-TRANSFERABILITY AND TERMINATION OF
EMPLOYMENT/CONSULTANCY PROVISIONS
8.1. No Stock Option or Stock Appreciation Right shall be Transferred by the
Participant otherwise than by will or by the laws of descent and distribution.
All Stock Options and all Stock Appreciation Rights shall be exercisable, during
the Participant's lifetime, only by the Participant. Tandem Stock Appreciation
Rights may be Transferred, to the extent permitted above, only with the
underlying Stock Option. No Award shall, except as otherwise specifically
provided by law or herein, be Transferred in any manner, and any attempt to
Transfer any such Award shall be void, and no such Award shall in any manner be
used for the payment of, subject to, or otherwise encumbered by or hypothecated
for the debts, contracts, liabilities, engagements or torts of any person who
shall be entitled to such Award, nor shall it be subject to
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attachment or legal process for or against such person. Notwithstanding the
foregoing, the Committee may determine at the time of grant or thereafter, that
a Stock Option that is otherwise not transferable pursuant to this Article VIII
is transferable in whole or part and in such circumstances, and under such
conditions, as specified by the Committee.
8.2. TERMINATION OF EMPLOYMENT OR TERMINATION OF CONSULTANCY. Subject to the
applicable provisions of the Award agreement and this Plan, upon a Participant's
Termination of Employment or Termination of Consultancy for any reason during
any period of restriction as may be applicable for a given Award, the Award in
question will vest or be forfeited and shall be exercisable in accordance with
the terms and conditions established by the Committee at grant or thereafter,
provided, however that in the event a Participant has entered into an individual
employment agreement or individual consultancy agreement with the Company or
Subsidiary, to the extent that an Award conflicts, or is inconsistent, with the
terms, conditions and provisions of such individual employment agreement or
individual consultancy agreement, such individual employment agreement or
individual consultancy agreement shall control, and the Award shall be deemed to
be modified accordingly. Notwithstanding the foregoing, unless otherwise
determined by the Committee at grant or individual employment agreement or
individual consultancy agreement, if applicable, or, if no rights of the
Participant are reduced, thereafter, if a Participant's Termination of
Employment or Termination of Consultancy is for Cause for any reason, any Stock
Option or Stock Appreciation Right held by such Participant shall thereupon
terminate and expire as of the date of termination.
ARTICLE IX.
TERMINATION OR AMENDMENT OF THE PLAN
9.1. TERMINATION OR AMENDMENT. Notwithstanding any other provision of this
Plan, the Board or the Committee may at any time, and from time to time, amend,
in whole or in part, any or all of the provisions of the Plan (including any
amendment deemed necessary to ensure that the Company may comply with any
regulatory requirement referred to in this Article IX), or suspend or terminate
it entirely, retroactively or otherwise; provided, however, that, unless
otherwise required by law or specifically provided herein, the rights of a
Participant with respect to Awards granted prior to such amendment, suspension
or termination, may not be impaired without the consent of such Participant and,
provided further, without the approval of the stockholders of the Company in
accordance with the laws of the State of Delaware, to the extent required by the
applicable provisions of Rule 16b-3 or Section 162(m) of the Code, or with
respect to Incentive Stock Options, Section 422 of the Code, no amendment may be
made which would (i) increase the aggregate number of shares of Common Stock
that may be issued under this Plan; (ii) increase the maximum individual
Participant limitations for a fiscal year under Section 4.1(b); (iii) change the
classification of employees and Consultants eligible to receive Awards under
this Plan; (iv) decrease the minimum option price of any Stock Option; or (v)
extend the maximum option term under Section 6.3(b). In no event may this Plan
be amended without the approval of the stockholders of the Company in accordance
with the applicable laws of the State of Delaware to increase the aggregate
number of shares of Common Stock that may be issued under the Plan (subject to
Section 4.2), decrease the minimum option price of any Stock Option, or to make
any other amendment that would require stockholder approval under the rules of
any exchange or system on which the Company's securities are listed or traded at
the request of the Company.
The Committee may amend the terms of any Award theretofore granted,
prospectively or retroactively, but, subject to Article IV or as otherwise
specifically provided herein, no such amendment or other action by the Committee
shall impair the rights of any Participant without the Participant's consent.
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ARTICLE X.
UNFUNDED PLAN
10.1. UNFUNDED STATUS OF PLAN. This Plan is intended to constitute an
"unfunded" plan for incentive and deferred compensation. With respect to any
payments as to which a Participant has a fixed and vested interest but which are
not yet made to a Participant by the Company, nothing contained herein shall
give any such Participant any rights that are greater than those of a general
creditor of the Company.
ARTICLE XI.
GENERAL PROVISIONS
11.1. LEGEND. The Committee may require each person receiving shares
pursuant to an Award under the Plan to represent to and agree with the Company
in writing that the Participant is acquiring the shares without a view to
distribution thereof. In addition to any legend required by this Plan, the
certificates for such shares may include any legend which the Committee deems
appropriate to reflect any restrictions on Transfer.
All certificates for shares of Common Stock delivered under the Plan shall
be subject to such stock transfer orders and other restrictions as the Committee
may deem advisable under the rules, regulations and other requirements of the
Securities and Exchange Commission, any stock exchange upon which the Stock is
then listed or any national securities association system upon whose system the
Common Stock is then quoted, any applicable Federal or state securities law, and
any applicable corporate law, and the Committee may cause a legend or legends to
be put on any such certificates to make appropriate reference to such
restrictions.
11.2. OTHER PLANS. Nothing contained in this Plan shall prevent the Board
from adopting other or additional compensation arrangements, subject to
stockholder approval if such approval is required; and such arrangements may be
either generally applicable or applicable only in specific cases.
11.3. NO RIGHT TO EMPLOYMENT/CONSULTANCY. Neither this Plan nor the grant of
any Award hereunder shall give any Participant or other employee or Consultant
any right with respect to continuance of employment or consultancy by the
Company or any subsidiary, nor shall they be a limitation in any way on the
right of the Company or any subsidiary by which an employee is employed or
consultant retained to terminate his employment or consultancy, as applicable,
at any time.
11.4. WITHHOLDING OF TAXES. The Company shall have the right to deduct from
any payment to be made to a Participant, or to otherwise require, prior to the
issuance or delivery of any shares of Common Stock or the payment of any cash
hereunder, payment by the Participant of, any Federal, state or local taxes
required by law to be withheld.
The Committee shall permit any such withholding obligation with regard to
any Eligible Employee or Consultant to be satisfied by reducing the number of
shares of Common Stock otherwise deliverable or by delivering shares of Common
Stock already owned. Any fraction of a share of Common Stock required to satisfy
such tax obligations shall be disregarded and the amount due shall be paid
instead in cash by the Participant.
11.5. LISTING AND OTHER CONDITIONS.
(a) As long as the Common Stock is listed on a national securities
exchange or system sponsored by a national securities association, the issue
of any shares of Common Stock pursuant to an Award shall be conditioned upon
such shares being listed on such exchange or system. Notwithstanding the
foregoing, the grant of an Award hereunder is not intended to be conditional
and the Company shall have no obligation to issue such shares unless and
until such shares are so listed; provided, however, that any delay in the
issuance of such shares shall be based solely on a reasonable business
decision
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and the right to exercise any Option with respect to such shares shall be
suspended until such listing has been effected.
(b) If at any time counsel to the Company shall be of the opinion that
any sale or delivery of shares of Common Stock pursuant to an Award is or
may in the circumstances be unlawful or result in the imposition of excise
taxes on the Company under the statutes, rules or regulations of any
applicable jurisdiction, the Company shall have no obligation to make such
sale or delivery, or to make any application or to effect or to maintain any
qualification or registration under the Securities Act of 1933, as amended,
or otherwise with respect to shares of Common Stock or Awards, and the right
to exercise any Option shall be suspended until, in the opinion of said
counsel, such sale or delivery shall be lawful or will not result in the
imposition of excise taxes on the Company.
(c) Upon termination of any period of suspension under this Section
11.5, any Award affected by such suspension which shall not then have
expired or terminated shall be reinstated as to all shares available before
such suspension and as to shares which would otherwise have become available
during the period of such suspension, but no such suspension shall extend
the term of any Option.
11.6. GOVERNING LAW. This Plan shall be governed and construed in accordance
with the laws of the State of Delaware (regardless of the law that might
otherwise govern under applicable Delaware principles of conflict of laws).
11.7. CONSTRUCTION. Wherever any words are used in this Plan in the
masculine gender they shall be construed as though they were also used in the
feminine gender in all cases where they would so apply, and wherever any words
are used herein in the singular form they shall be construed as though they were
also used in the plural form in all cases where they would so apply. To the
extent applicable, this Plan shall be limited, construed and interpreted in a
manner so as to comply with Section 162(m) of the Code and the applicable
requirements of Rule 16b-3; however, noncompliance with Section 162(m) of the
Code and Rule 16b-3 shall have no impact on the effectiveness of an Award under
the Plan.
11.8. OTHER BENEFITS. No Award payment under this Plan shall be deemed
compensation for purposes of computing benefits under any retirement plan of the
Company or its subsidiaries nor affect any benefits under any other benefit plan
now or subsequently in effect under which the availability or amount of benefits
is related to the level of compensation.
11.9. COSTS. The Company shall bear all expenses included in administering
this Plan, including expenses of issuing Common Stock pursuant to any Awards
hereunder.
11.10. NO RIGHT TO SAME BENEFITS. The provisions of Awards need not be the
same with respect to each Participant, and such Awards to individual
Participants need not be the same in subsequent years.
11.11. DEATH/DISABILITY. The Committee may in its discretion require the
transferee of a Participant's Award to supply the Company with written notice of
the Participant's death or Disability and to supply the Company with a copy of
the will (in the case of the Participant's death) or such other evidence as the
Committee deems necessary to establish the validity of the Transfer of an Award.
The Committee may also require that the transferee agree in writing to be bound
by all of the terms and conditions of this Plan.
11.12. SECTION 16(B) OF THE EXCHANGE ACT. All elections and transactions
under the Plan by persons subject to Section 16 of the Exchange Act involving
shares of Common Stock are intended to comply with any applicable exemptive
condition under Rule 16b-3. The Committee may establish and adopt written
administrative guidelines, designed to facilitate compliance with Section 16(b)
of the Exchange Act, as it may deem necessary or proper for the administration
and operation of this Plan thereunder.
11.13. SEVERABILITY OF PROVISIONS. If any provision of this Plan shall be
held invalid or unenforceable, such invalidity or unenforceability shall not
affect any other provisions hereof, and the Plan shall be construed and enforced
as if such provisions had not been included.
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11.14. HEADINGS AND CAPTIONS. The headings and captions herein are provided
for reference and convenience only, shall not be considered part of this Plan,
and shall not be employed in the construction of the Plan.
ARTICLE XII.
EFFECTIVE DATE OF PLAN
The Plan is an amendment and restatement of The Alpine Group, Inc. 1997
Interim Stock Option Plan which was originally effective on the Effective Date.
The Plan, as amended and restated, is conditioned upon the approval of the Plan
by the stockholders in accordance with the requirements of the laws of the State
of Delaware and is effective upon the approval by the stockholders of the
Company.
ARTICLE XIII.
TERM OF PLAN
No Award shall be granted pursuant to the Plan on or after the tenth
anniversary of the earlier of the Effective Date or the date of stockholder
approval, but Awards granted prior to such tenth anniversary may extend beyond
that date.
ARTICLE XIV.
NAME OF PLAN
This Plan shall be known as The Alpine Group, Inc. 1997 Stock Option Plan.
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EXHIBIT B
(LANGUAGE WHICH IS CHANGED BY THE AMENDMENT TO THE EMPLOYEE STOCK
PURCHASE PLAN TO BE APPROVED BY STOCKHOLDERS IS IN ITALICS)
THE ALPINE GROUP, INC.
EMPLOYEE STOCK PURCHASE PLAN
Amended and Restated as of December 1, 1996
1. PURPOSE.
The purpose of the Plan is to provide employees of the Company and its
Designated Subsidiaries with an opportunity to purchase Common Stock of the
Company through accumulated payroll deductions. It is the intention of the
Company that the Plan qualify as an "employee stock purchase plan" within the
meaning of Section 423 of the Code and the provisions of the Plan shall be
construed in a manner consistent with the requirements of such section of the
Code. The Plan was approved by the Board on September 27, 1995, initially
effective on November 16, 1995, and was approved by the stockholders of the
Company on November 16, 1995. The Plan is now renamed The Alpine Group, Inc.
Employee Stock Purchase Plan and is amended and restated, effective as of
December 1, 1996.
2. DEFINITIONS.
(a) "Agent" shall mean the agent appointed by the Committee pursuant to
Section 11(b) hereof.
(b) "Board" shall mean the Board of Directors of the Company.
(c) "Change in Capitalization" shall mean any increase, reduction, or change
or exchange of shares of Common Stock for a different number or kind of shares
or other securities of the Company by reason of a reclassification,
recapitalization, merger, consolidation, reorganization, stock dividend, stock
split or reverse stock split, combination or exchange of shares, repurchase of
shares, change in corporate structure or otherwise,
(d) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(e) "Committee" shall mean the Compensation Committee of the Board or such
other committee appointed from time to time by the Board. To the extent that no
Committee exists which has the authority to administer the Plan, the functions
of the Committee shall be exercised by the Board.
(f) "Common Stock" shall mean shares of common stock, par value $.10 per
share, of the Company.
(g) "Company" shall mean The Alpine Group, Inc., a Delaware corporation.
(h) "Compensation" shall mean the total cash compensation paid during an
Offering Period by the Company, any Designated Subsidiary or any affiliate of
the Company to an Employee, including overtime and bonuses, as reported by the
Company, any Designated Subsidiary or any affiliate of the Company for federal
income tax purposes, and including an Employee's portion of salary deferral
contributions pursuant to Section 401(k) of the Code and any amount excludable
pursuant to Section 125 of the Code. Compensation shall not include any
contributions by the Company or any of its affiliates to, or benefits paid
under, this Plan or under any other pension, profit-sharing, fringe benefit,
group insurance or other employee welfare plan heretofore or hereafter adopted
or any deferred compensation arrangement. For purposes of this Section,
affiliate shall mean any entity required to be aggregated with the Company under
Section 414 (b), (c), (m) or (o) of the Code.
(i) "Designated Subsidiaries" shall mean each Subsidiary Corporation of the
Company. EFFECTIVE AS OF JUNE 30, 1997, "DESIGNATED SUBSIDIARIES" SHALL MEAN (I)
EACH SUBSIDIARY CORPORATION AS OF THE PLAN'S RESTATEMENT DATE (I.E., DECEMBER 1,
1996) AND (II) ANY ENTITY THAT BECOMES A SUBSIDIARY CORPORATION AFTER THE PLAN'S
RESTATEMENT DATE AND IS DESIGNATED BY THE BOARD (OR A DULY AUTHORIZED COMMITTEE
THEREOF) FROM TIME TO TIME IN ITS SOLE DISCRETION AS ELIGIBLE TO PARTICIPATE IN
THE PLAN AND AS A DESIGNATED SUBSIDIARY UNDER THE PLAN.
(j) "Employee" shall mean any person, including an officer, who is regularly
and continuously employed by the Company or a Designated Subsidiary.
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(k) "Employer" shall mean, with respect to any Employee, the Company or
Designated Subsidiary by which the Employee is employed.
(l) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
(m) "Exercise Date" shall mean the last business day of each Offering Period
in which payroll deductions are made under the Plan.
(n) "Fair Market Value" for purposes of this Plan, unless otherwise required
by any applicable provision of the Code or any regulations issued thereunder,
shall mean, as of any date, the last sales price reported for the Common Stock
on the applicable date (i) as reported by the principal national securities
exchange in the United States on which it is then traded, or (ii) if not traded
on any such national securities exchange, as quoted on an automated quotation
system sponsored by the National Association of Securities Dealers. If the
Common Stock is not readily tradable on a national securities exchange or any
system sponsored by the National Association of Securities Dealers, its Fair
Market Value shall be set in good faith by the Committee on the advice of a
registered investment adviser (as defined under the Investment Advisers Act of
1940).
(o) "Offering Date" shall mean the first day of each calendar quarter.
(p) "Offering Period" shall mean each calendar quarter during the
effectiveness of the Plan, commencing on each Offering Date, PROVIDED that the
Committee shall have the power to change the duration of Offering Periods.
(q) "Option" shall mean an option to purchase shares of Common Stock of the
Company.
(r) "Parent Corporation" shall mean any corporation (other than the Company)
in an unbroken chain of corporations ending with the employer corporation if, at
the time of granting an Option, each of the corporations other than the employer
corporation owns stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain.
(s) "Participant" shall mean an Employee who participates in the Plan.
(t) "Plan" shall mean The Alpine Group, Inc. Employee Stock Purchase Plan,
as amended from time to time.
(u) "Rule 16b-3" shall mean Rule 16b-3 under Section 16(b) of the Exchange
Act as then in effect or any successor provisions.
(v) "Subsidiary Corporation" shall mean any corporation (other than the
Company) in an unbroken chain of corporations beginning with the employer
corporation if, at the time of granting an Option, each of the corporations
other than the last corporation in the unbroken chain owns stock possessing
fifty percent (50%) or more of the total combined voting power of all classes of
stock in one of the other corporations in such chain.
3. ELIGIBILITY.
(a) Subject to the requirements of Section 4(b) hereof, any person who is
(i) an Employee as of an Offering Date and (ii) who customarily works more than
twenty (20) hours per week for an Employer and at least five (5) months per year
for an Employer shall be eligible to participate in the Plan and be granted an
Option for the Offering Period commencing on such Offering Date.
(b) Notwithstanding any provisions of the Plan to the contrary, no Employee
shall be granted an Option under the Plan:
(i) if, immediately after the grant, such Employee (or any other person
whose stock would be attributed to such Employee pursuant to Section 424(d)
of the Code) would own stock and/or hold outstanding Options to purchase
stock possessing five percent (5%) or more of the total combined voting
power or value of all classes of stock of the Company or of any Subsidiary
Corporation or Parent Corporation; or
(ii) which permits such Employee's right to purchase stock under all
employee stock purchase plans (as described in Section 423 of the Code) of
the Company and any Subsidiary Corporation or Parent Corporation to accrue
at a rate which exceeds twenty-five thousand dollars ($25,000) of fair
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market value of such stock (determined at the time such option is granted)
for any calendar year in which such option is outstanding at any time.
4. GRANT OF OPTION; PARTICIPATION.
(a) On each Offering Date, the Company shall commence an offer by granting
each eligible Employee an Option to purchase shares of Common Stock, subject to
the limitations set forth in Sections 3(b) and 10 hereof. The Committee shall
specify the terms and conditions for each such offer, including the number of
shares of Common Stock that may be purchased thereunder.
(b) Each eligible Employee may elect to become a Participant in the Plan
with respect to an Offering Period, only by filing an agreement with the Company
authorizing payroll deductions (as set forth in Section 5 hereof).
(c) The Option price per share of the Common Stock subject to an offering
shall be determined by the Board, in its sole discretion, and shall remain in
effect unless modified at least thirty (30) days prior to the applicable
Offering Date, but in no event shall be less than the lesser of: (i) eighty-five
percent (85%) of the Fair Market Value of a share of Common Stock on the date
immediately prior to the Offering Date or (ii) eighty-five (85%) of the Fair
Market Value of a share of Common Stock on the Exercise Date. Effective as of
December 1, 1996 until modified by the Board, the price per share of the Common
Stock subject to an offering shall be the lesser of: (i) eighty-five percent
(85%) of the Fair Market Value of a share of Common Stock on the date
immediately prior to the Offering Date or (ii) eighty-five (85%) of the Fair
Market Value of a share of Common Stock on the Exercise Date.
5. PAYROLL DEDUCTIONS.
(a) At least fourteen (14) days prior to each Offering Date, a Participant
may, in the manner prescribed by forms approved by the Committee, and subject to
the restriction set forth in Section 3(b)(ii) above, authorize a payroll
deduction in a designated dollar amount or in any whole percentage up to
twenty-five percent (25%) of his or her Compensation, PROVIDED, that such
maximum percentage may be reduced by the Committee, in its sole discretion,
prior to the Offering Date. The minimum amount that may be deducted as a
designated dollar amount or in any whole percentage of Compensation by a
Participant for each payroll period shall equal at least one percent (1%) of a
Participant's Compensation. A Participant may increase or decrease such payroll
deductions prior to the beginning of an Offering Period, upon fourteen (14)
days' prior written notice to the Committee. A Participant may terminate a
payroll deduction authorization at any time, upon seven (7) days' prior written
notice to the Committee. An authorization shall remain in effect until modified
or terminated by the Participant or until the percentage used to determine the
Option price (as set forth in Section 4(c) above) is effectively increased.
(b) All payroll deductions made by a Participant shall be credited to such
Participant's account under the Plan. A Participant may not make any additional
payments into such account.
(c) In the event a Participant makes a hardship withdrawal of employee
deferral (401(k)) contributions under a 401(k) profit sharing plan of the
Company, a Designated Subsidiary or an affiliate or any other plan qualified
under Section 401(a) of the Code that contains a Code Section 401(k) feature,
such Participant's payroll deductions and the purchase of shares of Common Stock
under the Plan shall be suspended until the first payroll period following the
Offering Date commencing after the twelve (12) month period after such hardship
withdrawal. If a Participant who elects a hardship withdrawal under such a
401(k) profit sharing plan or such other plan has a cash balance accumulated in
his or her account at the time of withdrawal that has not already been applied
to purchase shares of Common Stock, such cash balance shall be returned to the
Participant as soon as administratively practicable.
6. EXERCISE OF OPTION.
(a) Unless a Participant withdraws from the Plan as provided in Section 8
hereof, such Participant's election to purchase shares of Common Stock shall be
exercised automatically on the Exercise Date, and the maximum number of whole
and/or fractional shares of Common Stock subject to such Option shall be
purchased for such Participant at the applicable Option price with the
accumulated payroll deductions in
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<PAGE>
such Participant's account. If all or any portion of the shares cannot
reasonably be purchased on the Exercise Date in the sole discretion of the
Committee because of unavailability or any other reason, such purchase shall be
made as soon thereafter as feasible. In no event shall certificates for any
fractional shares be issued under the Plan.
(b) The shares of Common Stock purchased upon exercise of an Option
hereunder shall be credited to the Participant's account under the Plan and
shall be deemed to be transferred to the Participant on the Exercise Date and,
except as otherwise provided herein, the Participant shall have all rights of a
stockholder with respect to such shares, including, without limitation, the
right to receive dividends on the shares and the right to vote or tender such
shares.
7. DELIVERY OF COMMON STOCK.
(a) Certificates for whole shares of Common Stock shall not be issued to
Participants unless and until requested or as otherwise provided pursuant to
Section 8, but in no event shall certificates be issued earlier than sixty (60)
days (or such shorter period of time as the Committee, in its sole discretion,
may determine) following the Exercise Date on which such shares of Common Stock
were purchased. If a Participant requests certificates for whole shares of
Common Stock, any fractional shares of Common Stock shall remain in the
Participant's account during his or her employment, unless he or she requests
cash in lieu of the fractional shares. A fee fixed by the Plan's Agent or
transfer agent, as the case may be, may be charged to the Participant for the
issuance of certificates of shares of Common Stock and for the replacement of
lost certificates. Certificates for a fractional share of Common Stock shall not
be issued under any circumstance.
(b) A Participant may request the Agent to sell all or a portion of shares
of Common Stock for which certificates have not been issued and receive cash for
such shares, subject to any brokerage fees or commissions.
8. WITHDRAWALS; TERMINATION OF EMPLOYMENT; DISABILITY OR LEAVE OF ABSENCE PRIOR
TO TERMINATION OF EMPLOYMENT.
(a) A Participant may withdraw all, but not less than all, the payroll
deductions credited to such Participant's account (that have not been used to
purchase shares of Common Stock) under the Plan at any time prior to the
Exercise Date by giving seven (7) days' prior written notice to the Committee.
All such payroll deductions credited to such Participant's account shall be paid
to such Participant (without interest) promptly after receipt of such
Participant's written notice of withdrawal and such Participant's Option for the
Offering Period in which the withdrawal occurs shall be automatically
terminated. No further payroll deductions for the purchase of shares of Common
Stock shall be made for such Participant during such Offering Period. A
Participant's withdrawal from an offering shall not have any effect upon such
Participant's eligibility to participate in a subsequent offering or in any
similar plan which may hereafter be adopted by the Company.
(b) If a Participant retires or terminates his or her employment with the
Company or any Subsidiary for any reason other than death, the payroll
deductions credited to such Participant's account (that have not been used to
purchase shares of Common Stock) shall be returned or distributed to the
Participant (without interest) as soon as practicable following the
Participant's retirement or other termination of employment. The Participant
shall elect, within the sixty (60) day period following the Participant's
retirement or other termination of employment with the Company or any
Subsidiary, (i) to receive certificates for all of the whole shares of Common
Stock and cash in lieu of any fractional shares of Common Stock credited to the
Participant's account under the Plan, (ii) to have certificates for all shares
of Common Stock (including fractional shares) credited to the Participant's
account under the Plan transferred to an individual brokerage account
established by the Agent for the benefit of the Participant or for the benefit
of the Participant and his or her spouse as joint tenants with rights of
survivorship, or (iii) a combination of (i) and (ii). In the event the
Participant does not make an election within such sixty (60) day period,
certificates for all shares of Common Stock (including fractional shares)
credited to the Participant's account under the Plan shall be transferred to an
individual brokerage account established by
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the Agent for the benefit of the Participant. A fee fixed by the Plan's Agent
may be charged to the Participant for the issuance of certificates of shares of
Common Stock.
(c) In the event of the Participant's death, the Participant's Option shall
be exercised in accordance with the terms of the Plan such that the payroll
deductions credited to such Participant's account after the Offering Date
(whether before or immediately following the Participant's death) shall be used
to purchase shares of Common Stock in accordance with the terms of the Plan. The
Participant's beneficiary shall elect, within the sixty (60) day period
following the Exercise Date following the Participant's death, (i) to receive
certificates for all of the whole shares of Common Stock and cash in lieu of any
fractional shares of Common Stock credited to the Participant's account under
the Plan, (ii) to have certificates for all shares of Common Stock (including
fractional shares) credited to the Participant's account under the Plan
transferred to an individual brokerage account established by the Agent for the
benefit of the Participant's beneficiary, or (iii) a combination of (i) and
(ii). In the event the Participant's beneficiary does not make an election
within such sixty (60) day period, certificates for all shares of Common Stock
(including fractional shares) credited to the Participant's account under the
Plan shall be transferred to an individual brokerage account established by the
Agent for the benefit of the Participant's beneficiary. A fee fixed by the
Plan's Agent may be charged to the Participant's beneficiary for the issuance of
certificates of shares of Common Stock.
(d) In the event of a Participant's Disability or Leave of Absence, payroll
deductions shall only be taken from Compensation that is due and owing to the
Participant. To the extent that any cash balance has accumulated in the
Participant's account, such balance shall be used to purchase shares of Common
Stock on the Exercise Date. With respect to a Participant who becomes ineligible
to participate due to a Disability or Leave of Absence, shares of Common Stock
held in such Participant's account shall continue to be held in the
Participant's account unless he or she elects otherwise under Section 7(a). In
the event that such individual's Disability or Leave of Absence ends and such
individual returns to work as an Employee and satisfies the eligibility
conditions under Section 3, payroll deductions shall resume automatically in
accordance with his or her most recent payroll deduction authorization form in
effect prior to the Disability or Leave of Absence, unless he or she elects
otherwise. Section 8(b) shall apply to any termination of employment with the
Company or any Subsidiary following a Participant's Disability or Leave of
Absence. The terms "Disability" or "Disabled" shall mean a permanent and total
disability as defined under Section 22(e)(3) of the Code. A "Leave of Absence"
shall be determined in accordance with the personnel policies of the
Participant's Employer.
9. DIVIDENDS AND INTEREST.
(a) Cash dividends, if any, on shares of Common Stock acquired through the
Plan will be automatically paid by check directly to the Participant by the
Company, or if applicable, the transfer agent. Dividends paid in property other
than cash or Common Stock shall be distributed to Participants as soon as
practicable.
(b) No interest shall accrue on or be payable with respect to the payroll
deductions of a Participant in the Plan.
10. STOCK.
(a) The maximum number of shares of Common Stock which shall be reserved for
sale under the Plan shall be 500,000, subject to adjustment as provided in
Section 16 hereof. If the total number of shares which would otherwise be
subject to Options granted pursuant to Section 4(a) hereof on an Offering Date
exceeds the number of shares then available under the Plan (after deduction of
all shares for which Options have been exercised or are then outstanding), the
Committee shall make a pro rata allocation of the shares remaining available for
Option grant in as uniform a manner as shall be practicable and as it shall
determine to be equitable. In such event, the Committee shall give written
notice to each Participant of such reduction of the number of Option shares
affected thereby and shall similarly reduce the rate of payroll deductions, if
necessary. Purchases of Common Stock under the Plan shall be made by the Agent
on the open market, or in the sole discretion of the Committee, may be made by
the Company's delivery of
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treasury shares or newly-issued and authorized shares to the Plan, upon such
terms as the Committee may approve.
(b) Shares of Common Stock to be delivered to a Participant under the Plan
shall be registered solely in the name of the Participant or, at the election of
the Participant, in the name of the Participant and his or her spouse as joint
tenants with rights of survivorship.
11. ADMINISTRATION.
(a) The Plan shall be administered by the Committee, and the Committee may
select an administrator to whom its duties and responsibilities hereunder may be
delegated. The Committee shall have full power and authority, subject to the
provisions of the Plan, to promulgate such rules and regulations as it deems
necessary for the proper administration of the Plan, to interpret the provisions
and supervise the administration of the Plan, and to take all action in
connection therewith or in relation thereto as it deems necessary or advisable.
The Committee may adopt special guidelines and provisions for persons who are
residing in, or subject to, the laws of, countries other than the United States
to comply with applicable tax and securities laws. All interpretations and
determinations of the Committee shall be made in its sole and absolute
discretion based on the Plan document and shall be final, conclusive and binding
on all parties.
(b) The Committee may employ such legal counsel, consultants, brokers and
agents as it may deem desirable for the administration of the Plan and may rely
upon any opinion received from any such counsel or consultant and any
computation received from any such consultant, broker or agent. The Committee
may, in its sole discretion, designate an Agent to administer the Plan, purchase
and sell shares of Common Stock in accordance with the Plan, keep records, send
statements of account to employees and to perform other duties relating to the
Plan, as the Committee may request from time to time. The initial Agent for the
Plan is Smith Barney, Inc. Such Agent shall serve as custodian for purposes of
the Plan and, unless otherwise requested by the Participant, Common Stock
purchased under the Plan shall be held by and in the name of, or in the name of
a nominee of, the custodian for the benefit of each Participant, who shall
thereafter be a beneficial stockholder of the Company. The Committee may adopt,
amend or repeal any guidelines or requirements necessary for the custody and
delivery of the Common Stock, including, without limitation, guidelines
regarding the imposition of reasonable fees in certain circumstances.
(c) The Company shall, to the fullest extent permitted by law and the
Certificate of Incorporation and By-laws of the Company and, to the extent not
covered by insurance, indemnify each director, officer or employee of the
Employer (including the heirs, executors, administrators and other personal
representatives of such person) and each member of the Committee against all
expenses, costs, liabilities and losses (including attorneys' fees, judgments,
fines, excise taxes or penalties, and amounts paid or to be paid in settlement)
actually and reasonably incurred by such person in connection with any
threatened, pending or actual suit, action or proceeding (whether civil,
criminal, administrative or investigative in nature or otherwise) in which such
person may be involved by reason of the fact that he or she is or was serving
this Plan in any capacity at the request of the Employer, except in instances
where any such person engages in willful neglect or fraud. Such right of
indemnification shall include the right to be paid by the Company for expenses
incurred or reasonably anticipated to be incurred in defending any such suit,
action or proceeding in advance of its disposition; provided, however, that the
payment of expenses in advance of the settlement or final disposition of a suit,
action or proceeding, shall be made only upon delivery to the Company of an
undertaking by or on behalf of such person to repay all amounts so advanced if
it is ultimately determined that such person is not entitled to be indemnified
hereunder. Such indemnification shall be in addition to any rights of
indemnification the person may have as a director, officer or employee or under
the Certificate of Incorporation of the Company or the By-Laws of the Company.
Expenses incurred by the Committee or the Board in the engagement of any such
counsel, consultant or agent shall be paid by the Company.
(d) Employees shall be fully responsible for (i) any brokerage fees and
commissions charged for the sale of Common Stock, (ii) any fees for certificates
of shares of Common Stock and (iii) any taxes owed by them as a result of
participation in the Plan.
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12. DESIGNATION OF BENEFICIARY.
A Participant may file, on forms supplied by and delivered to the Company, a
written designation of a beneficiary who is to receive any shares of Common
Stock and cash remaining in such Participant's account under the Plan in the
event of the Participant's death. Such designation of beneficiary may be changed
by the Participant at any time by written notice. If a Participant is married on
the date of his death and no beneficiary had been designated by the Participant
prior to his death, the Participant's spouse will be presumed to be his
beneficiary. If a Participant is not married on the date of his death and no
beneficiary had been designated by the Participant prior to his death, the
Participant's beneficiary shall be his estate.
13. TRANSFERABILITY.
(a) Neither payroll deductions credited to a Participant's account nor any
rights with regard to the exercise of an Option or to receive shares under the
Plan may be assigned, transferred, pledged or otherwise disposed of in an way
(other than by will, the laws of descent and distribution or as provided in
Section 10(b) or 12 hereof) by the Participant. Any such attempt at assignment,
transfer, pledge or other disposition shall be without effect, except that the
Company may treat such act as an election to withdraw funds in accordance with
Section 8 hereof.
(b) All rights of a Participant granted under this Plan, including but not
limited to, the grant of an Option, the right to exercise an Option and the
ability to authorize payroll deductions shall relate solely to a Participant,
except as otherwise provided in Section 8(c) hereof.
14. USE OF FUNDS.
All payroll deductions received or held by the Company under the Plan may be
used by the Company for any corporate purpose, and the Company shall not be
obligated to segregate such payroll deductions.
15. REPORTS.
Individual accounts shall be maintained for each Participant in the Plan.
Statements of account shall be given to participating Employees at such times
prescribed by the Committee; such statements shall set forth the amounts of
payroll deductions, the per share purchase price, the number of shares of Common
Stock purchased, the aggregate shares in the Participant's account and the
remaining cash balance, if any.
16. EFFECT OF CERTAIN CHANGES.
(a) In the event of any increase, reduction, or change or exchange of shares
of Common Stock for a different number or kind of shares or other securities of
the Company by reason of a reclassification, recapitalization, merger,
consolidation, reorganization, stock dividend, stock split or reverse stock
split, combination or exchange of shares, repurchase of shares, change in
corporate structure or otherwise, or the distribution of an extraordinary
dividend, the Committee shall conclusively determine the appropriate equitable
adjustments, if any, to be made under the Plan, including without limitation
adjustments to the number of shares of Common Stock which have been authorized
for issuance under the Plan but have not yet been placed under Option, as well
as the price per share of Common Stock covered by each Option under the Plan
which has not yet been exercised.
(b) In the event of the complete liquidation of the Company or of a
reorganization, consolidation or merger in which the Company is not the
surviving Corporation, any Option granted under the Plan shall continue in full
force and effect unless either (i) the Board modifies such Option so that it is
fully exercisable with respect to all of the Common Stock subject thereto prior
to the effective date of such transaction or (ii) the surviving corporation
issues or assumes a stock option as contemplated under Section 424(a) of the
Code.
17. AMENDMENT OR TERMINATION.
The Company, by action of the Board (or a duly authorized committee
thereof), may at any time terminate or amend the Plan. No such termination shall
adversely affect Options previously granted and no amendment may make any change
in any Option theretofore granted which adversely affects the rights
B-7
<PAGE>
of any Participant. No amendment shall be effective unless approved by the
stockholders of the Company if stockholder approval of such amendment is
required to comply with Section 423 of the Code or to comply with any other
applicable law, regulation or stock exchange rule. Upon termination of the Plan,
the Company shall return or distribute the payroll deductions credited to such
Participant's account (that have not been used to purchase shares of Common
Stock).
18. NOTICES.
All notices or other communications by a Participant to the Company or the
Committee under or in connection with the Plan shall be deemed to have been duly
given when received in the form specified by the Company or Committee at the
location, or by the person, designated for the receipt thereof. Each Participant
shall be responsible for furnishing the Committee with the current and proper
address for the mailing of notices and the delivery of other information. Any
notices or communications by the Company to a Participant shall be deemed given
if directed to such address and mailed by regular United States mail,
first-class and prepaid. If any item mailed to such address is returned as
undeliverable to the addressee, mailing shall be suspended until the Participant
furnishes the proper address.
19. REGULATIONS AND OTHER APPROVALS; GOVERNING LAW.
(a) This Plan and the rights of all persons claiming hereunder shall be
construed and determined in accordance with the laws of the State of Delaware
without giving effect to the choice of law principles thereof, except to the
extent that such law is preempted by federal law.
(b) The obligation of the Company to sell or deliver shares of Common Stock
with respect to Options granted under the Plan shall be subject to all
applicable laws, rules and regulations, including all applicable federal and
state securities laws, and the obtaining of all such approvals by governmental
agencies as may be deemed necessary or appropriate by the Committee.
(c) To the extent required, the Plan is intended to comply with Rule 16b-3
and the Committee shall interpret and administer the provisions of the Plan in a
manner consistent therewith. Any provisions inconsistent with Rule 16b-3 shall
be inoperative and shall not affect the validity of the Plan. The Committee may
establish and adopt written administrative guidelines, designed to facilitate
compliance with Section 16(b) of the Exchange Act and Rule 16b-3, as it may deem
necessary or proper for the administration and operation of the Plan and the
transaction of business thereunder.
20. WITHHOLDING OF TAXES.
(a) If the Participant makes a disposition, within the meaning of Section
424(c) of the Code and regulations promulgated thereunder, of any share or
shares issued to such Participant pursuant to such Participant's exercise of an
Option, and such disposition occurs within the two-year period commencing on the
day after the Offering Date or within the one-year period commencing on the day
after the Exercise Date, such Participant shall immediately, or as soon as
practicable thereafter, notify the Company thereof and thereafter immediately
deliver to the Company any amount of federal, state or local income taxes and
other amounts which the Company informs the Participant the Company is required
to withhold.
(b) Notwithstanding anything herein to the contrary, the Employer shall have
the right to make such provisions as it deems necessary to satisfy any
obligations to withhold federal, state, or local income taxes or other taxes
incurred by reason of the issuance of Common Stock pursuant to the Plan.
Notwithstanding anything herein to the contrary, the Employer may require a
Participant to remit an amount equal to the required withholding amount and may
invalidate any election if the Participant does not remit applicable withholding
taxes.
21. NO EMPLOYMENT RIGHTS.
The establishment and operation of this Plan shall not confer any legal
rights upon any Participant or other person for a continuation of employment,
nor shall it interfere with the rights of an Employer to discharge any Employee
and to treat him without regard to the effect which that treatment might have
upon him as a Participant or potential Participant under the Plan.
B-8
<PAGE>
22. SEVERABILITY OF PROVISIONS.
If any provision of the Plan shall be held invalid or unenforceable, such
invalidity or unenforceability shall not affect any other provisions hereof, and
the Plan shall be construed and enforced as if such provisions had not been
included.
23. CONSTRUCTION.
The use of a masculine pronoun shall include the feminine, and the singular
form shall include the plural form, unless the context clearly indicates
otherwise. The headings and captions herein are provided for reference and
convenience only, shall not be considered part of the Plan, and shall not be
employed in the construction of the Plan.
B-9
<PAGE>
<TABLE>
<CAPTION>
RESEARCH PEER GROUP TOTAL RETURN WORKSHEET
<S> <C> <C> <C> <C> <C> <C> <C>
AGI
<CAPTION>
ALPINE GROUP INC PEER GROUP
2474RAGI
CUMULATIVE TOTAL RETURN
PEER GROUP CUMULATIVE TOTAL RETURN
----------------------------------------------------------------------------
(WEIGHTED AVERAGE BY MARKET VALUE)
4/92 4/93 4/94 4/95 4/96 4/97
<S> <C> <C> <C> <C> <C> <C> <C>
Peer Group Weighted Average: 100 76 103 131 145 101
Tractor Supply Co TSCO 100 373 327 354 288
Pharmacopcia Inc PCOP 100 141 74
Alltrista Corp JARS 100 80 114 146 144 130
Pacific Scientific Co PSX 100 107 207 352 331 214
Peak Technologies Group Inc PEAK 100 80 143 226 277 201
Titan Hldgs Inc TH 100 98 115 156 205
Seattle Filmworks Inc FOTO 100 128 223 401 721 534
Cross a T Co ATXA 100 67 68 78 72 50
Sinclair Broadcast Group Inc SBGI 100 158 96
Intelliquest Info Group Inc IQST 100 136 58
<CAPTION>
<S> <C>
04/30/92
ALPINE GROUP INC % PEER
GROUP
PEER GROUP CUMULATIVE TOTAL RETURN MKT CAP
(WEIGHTED AVERAGE BY MARKET VALUE)
04/30/97
<S> <C>
Peer Group Weighted Average: 100%
2,157
Tractor Supply Co 9.3%
Pharmacopcia Inc 13.4%
Alltrista Corp 8.6%
Pacific Scientific Co 11.1%
Peak Technologies Group Inc 9.5%
Titan Hldgs Inc 5.8%
Seattle Filmworks Inc 9.8%
Cross a T Co 10.3%
Sinclair Broadcast Group Inc 10.5%
Intelliquest Info Group Inc 11.6%
</TABLE>
<PAGE>
RESEARCH COMPANY TOTAL RETURN WORKSHEET
BEGIN: 04/30/92
FYE: 04/30/97
END: 04/30/97
AGI
ALPINE GROUP INC
<TABLE>
<CAPTION>
BEGIN CUM
TYPE NO. OF DIV DIV DIV ENDING TOTAL
OF CLOSE SHARES $ PER $.$$ SHARES NO. OF SHRHLDR
DATE* LINE PRICE** *** SHARE** PAID REINVD SHARES RETURN
- ------------------------------------ --------- --------- --------- ----------- --------- ----------- --------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
04/30/92 BEGIN 8.000 12.500 12.500 100
04/30/93 YE 11.625 12.500 12.500 145
04/30/94 YE 6.250 12.500 12.500 78
04/30/95 YE 4.875 12.500 12.500 61
06/14/95 CS EQ 5.375 12.500 1.500 18.75 3.488 15.988 86
04/30/96 YE 4.500 15.988 15.988 72
04/30/97 YE 9.250 15.988 15.988 148
</TABLE>
* Fiscal year end and ex-dividend dates.
** All Closing Prices and Dividends are adjusted for stock
splits. 2474FAGI
*** 'Begin No. of Shares' based on $100 investment.
11-Aug-97
