<PAGE> 1
As filed with the Securities and Exchange Commission on July 2, 1996
REGISTRATION NO. 33-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
----------------
JOHN H. HARLAND COMPANY
(Exact name of registrant as specified in its charter)
GEORGIA 58-0278260
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2939 MILLER ROAD
DECATUR, GEORGIA 30035
(Address, including zip code, of registrant's principal executive offices)
JOHN H. HARLAND COMPANY
1981 INCENTIVE STOCK OPTION PLAN, AS EXTENDED
(Full title of the plan)
ROBERT J. AMMAN
PRESIDENT AND CHIEF EXECUTIVE OFFICER
JOHN H. HARLAND COMPANY
2939 MILLER ROAD
DECATUR, GEORGIA 30035
(770) 981-9460
(Name, address, including zip code, and telephone
number, including area code, of agent for service)
COPIES TO:
JOHN C. WALTERS, ESQ. ALAN J. PRINCE, ESQ.
SENIOR VICE PRESIDENT AND KING & SPALDING
GENERAL COUNSEL 191 PEACHTREE STREET
JOHN H. HARLAND COMPANY ATLANTA, GEORGIA 30303-1763
2939 MILLER ROAD (404) 572-4600
DECATUR, GEORGIA 30035
(770) 981-9460
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
===========================================================================================================================
Proposed Maximum Proposed Maximum
Amount to Offering Price Per Aggregate Offering Amount of
Title of Securities to be Registered be Registered Share(1) Price(1) Registration Fee
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value $1.00 per share 1,500,000 $24.1875 $36,281,250 $12,511
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</TABLE>
(1) Estimated solely for the purpose of computing the registration fee
pursuant to Rule 457(h) on the basis of the high and low prices of Common
Stock of John H. Harland Company on June 26, 1996.
<PAGE> 2
PART II
This Registration Statement on Form S-8 relates to an additional one
million five hundred thousand (1,500,000) shares of common stock, par value
$1.00 (the "Common Stock"), of John H. Harland Company (the "Company") to be
issued to employees of the Company and certain subsidiaries pursuant to the
John H. Harland Company 1981 Incentive Stock Option Plan, as Extended. As
permitted by General Instruction E (Registration of Additional Securities) to
Form S-8, this Registration Statement omits certain information otherwise
required by Form S-8.
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Securities and Exchange
Commission (the "Commission") are hereby incorporated by reference into this
Registration Statement:
1. The Annual Report of the Company on Form 10-K for the fiscal
year ended December 31, 1995;
2. All reports filed by the Company pursuant to Section 13(a) or
15(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), since December 31, 1995;
3. The description of the Company's Common Stock contained in the
Company's Registration Statement on Form 8-A dated April 28,
1970, filed under the Exchange Act, including any amendment or
report filed for the purpose of updating such description; and
4. The Company's Registration Statement on Form S-8 (File No.
33-60151) filed with the Commission on June 12, 1995.
All documents filed by the Company subsequent to the date of this
Registration Statement pursuant to Sections 13(a), 13(c), 14 and 15(d) of the
Exchange Act and prior to the filing of a post-effective amendment which
indicates that all securities offered hereby have been sold or which
deregisters all such securities then remaining unsold, shall be deemed to be
incorporated by reference in this Registration Statement and to be a part
hereof from the date of filing of such documents.
ITEM 8. EXHIBITS
<TABLE>
<CAPTION>
Exhibit Description
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<S> <C>
5.1 Opinion of King & Spalding
23.1 Consent of Deloitte & Touche LLP
23.2 Consent of King & Spalding (included in Exhibit 5.1)
24.1 Power of Attorney (included on signature page)
99.1 John H. Harland Company 1981 Incentive Stock Option Plan, as Extended
</TABLE>
<PAGE> 3
ITEM 9. UNDERTAKINGS
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this
Registration Statement:
(A) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(B) To reflect in the prospectus any facts or
events arising after the effective date of
the Registration Statement (or the most
recent post-effective amendment thereof)
which, individually or in the aggregate,
represent a fundamental change in the
information set forth in the Registration
Statement. Notwithstanding the foregoing,
any increase or decrease in volume of
securities offered (if the total dollar value
of securities offered would not exceed that
which was registered) and any deviation from
the low or high and of the estimated maximum
offering range may be reflected in the form
of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate,
the changes in volume and price represent no
more than 20% change in the maximum aggregate
offering price set forth in the "Calculation
of Registration Fee" table in the effective
registration statement; and
(C) To include any material information with
respect to the plan of distribution not
previously disclosed in the Registration
Statement or any material change to such
information in the Registration Statement;
provided, however, that paragraphs (a)(1)(A)
and (a)(1)(B) do not apply if the information
required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports
filed with or furnished to the Commission by the
Registrant pursuant to Section 13 or Section 15(d) of
the Securities Exchange Act of 1934 that are
incorporated by reference in the Registration
Statement.
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such
post-effective amendment shall be deemed to be a new
registration statement relating to the securities
offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a
post-effective amendment any of the securities being
registered which remain unsold at the termination of
the offering.
(b) The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act
of 1933, each filing of the Registrant's annual report
pursuant to Section 13(a) or 15(d) of the Securities Exchange
Act of 1934 (and, where applicable, each filing of an employee
benefit plan's Annual Report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by
reference in the Registration Statement shall be deemed to be
a new registration statement relating to the securities
offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering
thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers
and controlling persons of the Registrant pursuant to the
foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the
Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than
the payment by the Registrant of expenses incurred or paid by
a director, officer or controlling person of the Registrant in
the successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in
connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such
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<PAGE> 4
indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.
EXPERTS
The financial statements and the related financial statement schedule
incorporated in this Registration Statement by reference from the Company's
Annual Report on Form 10-K for the year ended December 31, 1995 have been
audited by Deloitte & Touche, independent auditors, as stated in their report
which is incorporated herein by reference, and have been so incorporated in
reliance upon the report of such firm given upon their authority as experts in
accounting and auditing.
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<PAGE> 5
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as
amended, the registrant certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-8 and has duly
caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Decatur, State of
Georgia on the 2nd day of July, 1996.
JOHN H. HARLAND COMPANY
By: /s/ Robert J. Amman
---------------------------
Robert J. Amman
Chief Executive Officer and
President
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below
constitutes and appoints Robert J. Amman and William M. Dollar and each of
them, his or her true and lawful attorneys-in-fact and agents, with full power
of substitution and resubstitution, for such persons and in his or her name,
place and stead, in any and all capacities, to sign any and all amendments to
this Registration Statement, and to file the same with all exhibits thereto and
other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and to perform each and every act and thing
requisite or necessary to be done in and about the premises, as fully and to
all intents and purposes as he might or could do in person, hereby ratifying
and confirming all that said attorneys-in-fact and agents, and any of them, or
their substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
registration statement has been signed by the following persons in the capacity
indicated on the 2nd day of July, 1996.
<TABLE>
<CAPTION>
Signature Title
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<S> <C>
/s/ Robert J. Amman Chief Executive Officer and President
- ------------------------------ (Principal Executive Officer)
Robert J. Amman
/s/ William M. Dollar Vice President, Finance and Treasurer
- ------------------------------ (Principal Financial and Accounting
William M. Dollar Officer)
/s/ Robert R. Woodson Chairman of the Board
- ------------------------------
Robert R. Woodson
</TABLE>
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<TABLE>
<CAPTION>
Signature Title
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<S> <C>
/s/ Juanita Powell Baranco Director
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Juanita Powell Baranco
/s/ Lawrence L. Gellerstedt Jr. Director
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Lawrence L. Gellerstedt Jr.
/s/ Edward J. Hawie Director
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Edward J. Hawie
/s/ John J. McMahon Jr. Director
- ----------------------------------
John J. McMahon Jr.
/s/ G. Harold Northop Director
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G. Harold Northrop
/s/ H.G. Pattillo Director
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H. G. Pattillo
/s/ Larry L. Prince Director
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Larry L. Prince
/s/ John H. Weitnauer Jr. Director
- ----------------------------------
John H. Weitnauer Jr.
/s/ Robert A. Yellowlees Director
- ----------------------------------
Robert A. Yellowlees
</TABLE>
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<PAGE> 7
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit Description Page No.
- ------- ----------- --------
<S> <C>
5.1 Opinion of King & Spalding
23.1 Consent of Deloitte & Touche LLP
23.2 Consent of King & Spalding (included
in Exhibit 5.1)
24.1 Power of Attorney (included on signature page)
99.1 John H. Harland Company 1981 Incentive
Stock Option Plan, as Extended
</TABLE>
<PAGE> 1
EXHIBIT 5.1
Opinion of King & Spalding
<PAGE> 2
July 1, 1996
John H. Harland Company
2939 Miller Road
Decatur, Georgia 30035
Re: John H. Harland Company -- Form S-8
Registration Statement
Gentlemen:
We have acted as counsel for John H. Harland Company, a Georgia
corporation (the "Company"), in connection with the preparation of a
Registration Statement on Form S-8 (the "Registration Statement") to be filed
with the Securities and Exchange Commission. The Registration Statement
relates to an additional 1,500,000 shares of the Company's common stock, par
value $1.00 per share (the "Shares"), to be issued upon the exercise of options
(the "Options") granted pursuant to the John H. Harland Company 1981 Incentive
Stock Option Plan, as Extended (the "Stock Option Plan").
As such counsel, we have examined and relied upon such records,
documents, certificates and other instruments as in our judgment are necessary
or appropriate to form the basis for the opinions hereinafter set forth. In
all such examinations, we have assumed the genuineness of signatures on
original documents and the conformity to such original documents of all copies
submitted to us as certified, conformed or photographic copies, and as to
certificates of public officials, we have assumed the same to have been
properly given and to be accurate.
For purposes of this opinion, we have assumed the following: (i) the
Shares that may be issued upon exercise of the Options will continue to be duly
authorized on the dates of such issuance and (ii) on the date on which any
Option is exercised, such Option will have been duly executed, issued and
delivered by the Company and will constitute the legal, valid and binding
obligation of the Company, enforceable against the Company in accordance with
its terms subject, as to enforceability, to applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' rights
generally, general equitable principles and the discretion of courts in
granting equitable remedies.
The opinions expressed herein are limited in all respects to the
federal laws of the United States of America and the laws of the State of
Georgia, and no opinion is expressed with respect to the laws of any other
jurisdiction or any effect which such laws may have on the opinions expressed
herein. This opinion is limited to the matters stated herein, and no opinion
is implied or may be inferred beyond the matters expressly stated herein.
Based upon the foregoing and subject to the limitations,
qualifications and assumptions set forth herein, we are of the opinion that:
(a) The Shares are duly authorized; and
<PAGE> 3
John H. Harland Company
July 1, 1996
Page Two
(b) When the Shares are issued upon exercise of the Options
against payment therefor, as provided in the Stock Option
Plan, such Shares will be validly issued, fully paid and
nonassessable.
This opinion is given as of the date hereof, and we assume no
obligation to advise you after the date hereof of facts or circumstances that
come to our attention or changes in law that occur which could affect the
opinions contained herein. This letter is being rendered solely for the
benefit of John H. Harland Company in connection with the matters addressed
herein. This opinion may not be furnished to or relied upon by any person or
entity for any purpose without our prior written consent.
We consent to the filing of this opinion as an Exhibit to the
Registration Statement.
Very truly yours,
/s/ King & Spalding
KING & SPALDING
<PAGE> 1
EXHIBIT 23.1
Consent of Deloitte & Touche LLP
<PAGE> 2
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
John H. Harland Company on Form S-8 of our report dated January 26, 1996,
appearing in the Annual Report on Form 10-K of John H. Harland Company for the
year ended December 31, 1995, and to the reference to us under the heading
"Experts" in this Registration Statement.
/s/ DELOITTE & TOUCHE LLP
- -------------------------
DELOITTE & TOUCHE LLP
Atlanta, Georgia
June 28, 1996
<PAGE> 1
EXHIBIT 99.1
John H. Harland Company 1981
Incentive Stock Option Plan, as Extended
<PAGE> 2
JOHN H. HARLAND COMPANY
1981 INCENTIVE STOCK OPTION PLAN, AS EXTENDED
(As Amended Through April 26, 1996)
Section 1.
BACKGROUND
The John H. Harland Company 1981 Incentive Stock Option Plan
was adopted effective as of September 21, 1981 and expired by its terms on
September 20, 1991. There were 435,955 shares of $1.00 par value Common Stock
("Stock") of the John H. Harland Company ("Company") available for options
under such plan at that time. The John H. Harland Company 1981 Incentive
Stock Option Plan, as Extended, ("Plan") was a reactivation of the 1981
Incentive Stock Option Plan and extended the life of such plan effective as of
November 18, 1992. This amendment and restatement of the Plan incorporates all
amendments made through April 26, 1996.
Section 2.
PURPOSE
The purpose of this Plan is to promote the interests of the
Company and its subsidiaries by encouraging its key employees to continue their
association with the Company and by providing such employees with the
additional incentive for industry and efficiency inherent in an opportunity to
participate in the ownership of the Company and in its future growth.
Section 3.
OPTION SHARES
The shares of the Company's Stock which may be subject to
stock options granted pursuant to this Plan shall be an aggregate number of
2,685,955 shares of authorized but unissued Stock. In the event that a stock
option granted pursuant to this Plan to purchase any of such shares of Stock
shall expire or be exchanged for a new option for any reason before being
exercised in full, the shares of Stock reserved for the unexercised portion of
such option again shall become available for stock options granted pursuant to
this Plan.
Section 4.
EFFECTIVE DATE OF PLAN
The effective date of this Plan shall be October 27, 1995, the
date as of which the Company's Board of Directors approved the most recent
amendments to this Plan, provided the shareholders of the Company (acting at a
duly called meeting of such shareholders) also approve this Plan on or before
October 27, 1996. All options granted before such shareholder approval shall
be granted subject to such approval.
Section 5.
ADMINISTRATION OF THE PLAN
The Plan shall be administered by a Stock Option Committee
("Committee") of not less than three (3) members appointed by the Board of
Directors of the Company from among its members. No member of such Board of
Directors shall be appointed or serve as a member of the Committee, and any
such appointment or service immediately and automatically shall terminate, in
the event that (1) such person is, or becomes, a key employee (as described in
Section 6 of this Plan), (2) such person is, or becomes, eligible for the
allocation of stock or the grant of any option or stock appreciation right
under any other plan of the Company or any of its affiliates (as such term is
defined in the General Rules and Regulations
<PAGE> 3
under the Securities Exchange Act of 1934, as amended) or (3) such person was
described in clause (1) or clause (2) of this Section 5 within the immediately
preceding year.
Section 6.
ELIGIBILITY
Only key employees of the Company and of each of its
subsidiaries (as defined in Section 424(f) of the Internal Revenue Code of
1986, as amended ("Code")) and as hereinafter referred to as "subsidiaries")
shall be eligible for the grant of an incentive stock option pursuant to this
Plan. A key employee can be a member of the Board of Directors of the Company,
but no member of the Board of Directors of the Company shall be a key employee
under this Plan solely by reason of his membership on such Board of Directors.
Section 7.
GRANT OF OPTIONS
Stock options shall be granted by the Company acting through
the Committee to key employees pursuant to the terms of this Plan from time to
time to purchase shares of Stock; provided, however, if the Committee intends
that such option qualify as an incentive stock option under Section 422 of the
Code, the aggregate fair market value (as determined as of the date an
incentive stock option is granted) of the Stock covered by such option and the
stock covered by any other incentive stock options granted to such key employee
(pursuant to any other plans of the Company or its subsidiaries) which first
become exercisable in any calendar year shall not exceed $100,000. Such fair
market value figure shall be determined by the Committee on the date such
incentive stock option is granted, and the Committee shall interpret and
administer the limitation set forth in this paragraph in accordance with
Section 422(d) of the Code. A stock option may be granted by a key employee
in exchange for the cancellation of any option to purchase Stock or under any
other circumstances under which the Committee deems appropriate. The aggregate
number of shares of Stock subject to options granted to a key employee in any
calendar year shall not exceed 350,000 shares of Stock. Notwithstanding the
foregoing, however, the Committee may make a one-time grant of an option to the
President and Chief Executive Officer of the Company to purchase up to
1,000,000 shares of Stock; provided that the option price (as described in
Section 8) for at least 666,666 of the shares subject to such option exceeds
the fair market value of the Stock on the date of the grant of the option.
Each grant of a stock option pursuant to this Plan shall be
evidenced by a written stock option agreement ("option agreement"), signed by a
member of the Committee or by a duly authorized officer of the Company, and
each option agreement shall incorporate such terms and conditions as the
Committee acting in its discretion deems consistent with the terms of this Plan
and, if the Committee intends such option to qualify as an incentive stock
option, which are not inconsistent with the provisions of Section 422 of the
Code. The Committee (with the written consent of a key employee) also shall
have the power to amend an option agreement to the extent that the Committee
acting in its discretion deems consistent with the terms of this Plan. The
stock option agreement for an option which the Committee intends to qualify as
an incentive stock option shall state that such option is an incentive stock
option.
Section 8.
OPTION PRICE
The price for each share of Stock subject to purchase under a
stock option granted pursuant to this Plan ("option price") shall be determined
by the Committee but in no event shall be less than the fair market value of
the Stock on the date of the grant of the option; provided, however, (1) if a
key employee owns (after taking into account the attribution rules in Section
424(d) of the Code) stock of the Company or its subsidiaries which possesses
more than ten percent of the total combined voting power of all classes of
stock of the Company or a subsidiary, the option price for a stock option
granted to such key employee which the Committee intends to qualify as an
incentive stock option shall in no event be less than one hundred ten percent
of the fair market value of the Stock on the date the option is granted to such
key employee and (2) if the Committee grants an option to a key employee under
this Plan for a number of shares of Stock in exchange for the cancellation of
any option (whether or not granted under this Plan) to purchase the same number
of shares of Stock, the option price under such option for such shares shall be
the same as the option price for such shares under the option which is
cancelled. An option agreement at the discretion of the Committee can provide
for the payment of the option price (upon the exercise of a stock option) in
cash, in Stock or in a combination of cash and Stock. A payment by a check
acceptable to the Committee shall be treated as a payment in cash under this
Plan.
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<PAGE> 4
Section 9.
LIFE OF OPTION
Each stock option granted pursuant to this Plan shall be
exercisable on or, if so provided in the option agreement which evidences such
option, after the date the option is granted and shall expire automatically on
the date the option is exercised in full or, if earlier, shall expire according
to the terms of such option agreement; provided, however, the terms of each
such option agreement shall make each stock option (to the extent not fully
exercised) expire no later than on or before the first to occur of (1) the end
of the three consecutive month period which immediately follows the last day
(in his current period of employment) that the key employee is employed by the
Company or its subsidiaries (or the end of such longer period as the Committee
(subject to the rules in Section 9(2) and Section 9(3) in its discretion
deems appropriate under the circumstances), (2) the date which is the tenth
anniversary of the date the option is granted or (3) the date which is the
fifth anniversary of the date the option is granted in the event that (a) the
option is granted to a key employee who owns (after taking into account the
attribution rules in Section 424(d) of the Code) stock which possesses more
than ten percent of the total combined voting power of all classes of stock of
the Company or a subsidiary and (b) the Committee intends that such option
qualify as an incentive stock option. A transfer of employment from the
Company to a subsidiary or from a subsidiary to the Company or between two
subsidiaries shall not be treated as a termination of employment under this
Plan.
Section 10.
DEATH OR DISABILITY
In the event that the employment of a key employee by the
Company or its subsidiaries terminates because he dies or becomes disabled
(within the meaning of Section 23(e)(3) of the Code), the three consecutive
month period described in Section 9(l) of this Plan automatically shall become
a twelve consecutive month period.
Section 11.
NON-TRANSFERABILITY
No stock option granted pursuant to this Plan shall be
transferable by a key employee otherwise than by will or by the laws of descent
and distribution, and such option shall be exercisable during the key
employee's lifetime only by the key employee. The restriction on transfer
described in this Section 11 shall be incorporated in each option agreement.
Section 12.
SECURITIES REGISTRATION
Each stock option agreement shall provide that, upon the
receipt of shares of Stock pursuant to the exercise of a stock option granted
under this Plan, the key employee shall, if so requested by the Company, hold
such shares of Stock for investment and not with a view to resale or
distribution to the public and, if so requested by the Company, shall deliver
to the Company a written undertaking satisfactory to the Company to that
effect. As for Stock issued pursuant to this Plan, the Company at its expense
shall take such action as it deems necessary or appropriate to register the
original issuance of such Stock to a key employee under the Securities Act of
1933, as amended, or under any other applicable securities laws or to qualify
any such Stock for an exemption under any such laws prior to the issuance of
such Stock to a key employee; however, the Company shall have no obligation
whatsoever to take any such action in connection with the transfer, resale or
other disposition of such Stock by a key employee.
Section 13.
LIFE OF PLAN
This Plan shall terminate on November 17, 2002 or, if earlier,
on the date on which all of the Stock reserved under Section 3 of this Plan
has been issued as a result of the exercise of stock options granted pursuant
to this Plan. No options to purchase Stock shall be granted under this Plan
after the date the Plan terminates but, as for any stock options
- 3 -
<PAGE> 5
granted pursuant to this Plan which are outstanding on such date, the Committee
and its full administrative powers shall survive (the termination of this Plan)
until all such options have been exercised in full or otherwise have expired.
Section 14.
ADJUSTMENT
The number of shares of Stock available for the granting of
options under Section 3 of this Plan and the number of shares of Stock subject
to stock options granted pursuant to this Plan and the related option price
shall be adjusted by the Committee in an equitable manner to reflect any change
in the capitalization of the Company, including, but not limited to, such
changes as stock dividends or stock splits. Furthermore, the Committee shall
have the right to adjust (in a manner which satisfies the requirements of
Section 424(a) of the Code) the number of shares of Stock available for the
granting of options under Section 3 of this Plan and the number of shares of
Stock covered by stock options granted under this Plan and the related option
price in the event of any corporate transaction described in 424(a) of the Code
which provides for the substitution or assumption of such options. If any
adjustment under this Section 14 would create a fractional share of Stock or a
right to acquire a fractional share of Stock, such fractional share shall be
disregarded and the number of shares of Stock available under this Plan and the
number subject to any options granted pursuant to this Plan shall be the next
lower number of shares of Stock, rounding all fractions downward. An
adjustment made under this Section 14 by the Committee shall be conclusive and
binding on all affected persons.
Section 15.
SALE OR MERGER OF THE COMPANY
If the Company agrees to sell all or substantially all of its
assets for cash or property or for a combination of cash and property or agrees
to any merger, consolidation, reorganization, division or other corporate
transaction in which Stock is converted into another security or into the right
to receive securities or property and such agreement does not provide for the
assumption or substitution of stock options granted under this Plan, each
option agreement at the direction and discretion of the Company's Board of
Directors may be cancelled unilaterally by the Company if (1) any restrictions
on the exercise of a stock option are waived before the stock option agreement
is cancelled such that the key employee has the opportunity to exercise the
option in full before such cancellation, (2) the Company transfers to the key
employee shares of Stock, the number of which shall be determined by the
Company by dividing the excess of (a) the fair market value of the number of
shares which remain subject to the exercise of such option as of any date over
the total option price for such shares by (b) the fair market value of a share
of Stock on such date, which number shall be rounded down to the nearest whole
number, or (3) the Company transfers to a key employee the same consideration
which the key employee otherwise would receive as a shareholder of the Company
in connection with such sale or other corporate transaction if he held the
number of shares of Stock which would have been transferrable to him under
Section 15(2) if such number had been determined immediately before such sale
or other corporate transaction.
Section 16.
AMENDMENT OR TERMINATION
This Plan may be amended by the Company's Board of Directors
from time to time to the extent that such Board of Directors deems necessary or
appropriate in light of, and consistent with, the provisions of Section 422 of
the Code; provided, however, no such amendment shall be made absent the
approval of the shareholders of the Company (1) to increase the number of
shares of Stock available under Section 3 for granting stock options, (2) to
extend the maximum life of the Plan under Section 13 or the maximum life of an
option under Section 9, (3) to decrease the minimum option price under Section
8, (4) to change the class of employees eligible for stock options under
Section 6 or to otherwise materially modify (within the meaning of Rule 16b-3
of the Securities Exchange Act of 1934, as amended) the requirements as to
eligibility for participation in this Plan or (5) to otherwise materially
increase (within the meaning of Rule 16b-3 of the Securities Exchange Act of
1934, as amended) the benefits accruing to a key employee under this Plan. The
Company's Board of Directors also may suspend the granting of stock options
pursuant to this Plan at any time and may terminate this Plan at any time;
provided, however, the Board of Directors shall not have the right to modify,
amend or cancel any stock option granted before such suspension or termination
unless (1) the key employee consents in writing to such modification, amendment
or cancellation or (2) there is a dissolution or liquidation of the Company or
a transaction described in Section 15 of this Plan.
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<PAGE> 6
Section 17.
MISCELLANEOUS
The headings to sections in this Plan have been included for
convenience of reference only. The masculine pronoun shall include the
feminine and the singular the plural whenever appropriate.
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