33 -
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
JAMES RIVER CORPORATION OF VIRGINIA
(Exact name of registrant as specified in its charter)
VIRGINIA 54-0848173
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
120 Tredegar Street
Richmond, Virginia 23219
(804) 644-5411
(Address, including zip code and telephone number,
of Principal Executive Offices)
JAMES RIVER CORPORATION OF VIRGINIA
1996 STOCK INCENTIVE PLAN
(Full title of the plan)
Clifford A. Cutchins, IV, Esquire
Senior Vice President, General Counsel, Corporate Secretary
James River Corporation of Virginia
120 Tredegar Street
Richmond, Virginia 23219
(804) 644-5411
(Name, address, including zip code, and
telephone number, including area code, of agent for service)
Copy to
Marshall H. Earl, Jr., Esquire
McGuire, Woods, Battle & Boothe, L.L.P.
One James Center
Richmond, Virginia 23219
Approximate date of commencement of proposed sale to the public:
As soon as practicable after the effective date of the
registration statement.
This is page 1 of 30 pages.
Exhibit Index appears on page 12.
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CALCULATION OF REGISTRATION FEE
Proposed Proposed
Title of Maximum Maximum
Securities Amount Offering Aggregate Amount of
to be to be Price Per Offering Registration
Registered Registered Share Price Fee
Common Stock
$.10 par
value 5,280,361(1) $25.375 (2) $133,989,160 $46,203.00
Rights to
Purchase
1/1000 of a
share of
Series M
Cumulative
Participating
Preferred
Stock $10,
par value 5,280,361(3) N/A N/A $100.00
(1) Represents the maximum number of shares of Common Stock
of James River Corporation of Virginia (the "Company") that may
be offered and sold hereunder.
(2) Estimated solely for purposes of calculating the
registration fee. Based on the average of the high and low
prices for the Common Stock reported on the New York Stock
Exchange on April 1, 1996.
(3) The Rights to purchase 1/1000 of a share of Series M
Cumulative Participating Preferred Stock will be attached to and
will trade with shares of the Common Stock. Value attributable
to such Rights, if any, will be reflected in the market price of
such Common Stock. The fee paid represents the minimum statutory
fee pursuant to Section 6(b) of the Securities Act of 1933.
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PART II.
INFORMATION REQUIRED IN REGISTRATION STATEMENT
Item 3. Incorporation of Certain Documents by Reference
James River Corporation of Virginia (the "Company") hereby
incorporates by reference into this Registration Statement the
documents listed below which have been filed with the Securities
and Exchange Commission.
(a) The Company's Annual Report on Form 10-K for the
year ended December 31, 1995;
(b) The Company's Proxy Statement for the annual
meeting held on April 25, 1996;
(c) The description of the Company's common stock
("Common Stock") included in the Registration Statement on
Form 8-A dated January 3, 1980, incorporating by reference
the description included under the heading "Description of
Common Stock" in Amendment No. 1 to Registration Statement
No. 2-63209, as amended by Amendment No. 4 to Application or
Report on Form 8 dated July 28, 1992, and
(d) The description of the Rights to Purchase Series M
Cumulative Participating Preferred Stock (the "Rights")
included in the Registration Statement on Form 8-A dated
March 3, 1989, as amended by Amendment No. 1 to Application
or Report on Form 8 dated July 28, 1992.
Each document or report subsequently filed by the Company
and the James River Corporation of Virginia 1996 Stock Incentive
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Plan (the "Plan") with the Commission pursuant to Sections 13(a),
13(c), 14, or 15(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act") after the date of this Registration
Statement, but prior to the filing of a posteffective amendment
to this Registration Statement which indicates that all
securities offered by this Registration Statement have been sold
or which deregisters all such securities then remaining unsold,
shall be deemed to be incorporated by reference into this
Registration Statement. Each document or report incorporated
into this Registration Statement by reference shall be deemed to
be a part of this Registration Statement from the date of the
filing of such document with the Securities and Exchange
Commission until the information contained therein is superseded
or updated by any subsequently filed document which is
incorporated by reference into this Registration Statement.
Item 6. Indemnification of Directors and Officers
Article 10 of the Virginia Stock Corporation Act allows, in
general, for indemnification, in certain circumstances, by a
corporation of any person threatened with or made a party to any
action, suit or proceeding by reason of the fact that he or she
is, or was, a director, officer, employee or agent of such
corporation. Indemnification is also authorized with respect to
a criminal action or proceeding where the person had no
reasonable cause to believe that his or her conduct was unlawful.
Article 9 of the Virginia Stock Corporation Act provides
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limitations on damages by officers and directors, except in cases
of willful misconduct or knowing violation of the criminal law.
Article VI of the Company's Amended and Restated Articles of
Incorporation provides for mandatory indemnification of any
director or officer of the Company who is, was, or is threatened
to be made a party to any proceeding by reason of the fact that
he or she is or was a director or officer of the Company or is or
was serving the Company or any other legal entity in any capacity
at the request of the Company while a director or officer of the
Company against all liabilities and expenses incurred in the
proceeding, except such liabilities and expenses as are incurred
because of such director's or officer's willful misconduct or
knowing violation of the criminal law.
The Company's Amended and Restated Articles of Incorporation
also provide that in every instance permitted under Virginia
corporate law in effect from time to time, the liability of a
director or officer of the Company to the Company or its
shareholders shall not exceed one dollar.
The Company maintains a standard policy of officers' and
directors' liability insurance.
Item 8. Exhibits
See Index to Exhibits.
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Item 9. Undertakings
The undersigned registrant hereby undertakes:
(a) (1) To file, during any period in which offers or
sales are being made, a post-effective amendment to this
registration statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933, as amended (the
"Securities Act");
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration
statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate, represent
a fundamental change in the information set forth in the
registration statement;
(iii) To include any material information with respect
to the plan of distribution not previously disclosed in the
registration statement or any material change to such
information in the registration statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii)
do not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed by the registrant pursuant to Section 13
or Section 15(d) of the Exchange Act that are incorporated by
reference in the registration statement.
(2) That, for the purpose of determining any liability
under the Securities Act, each such post-effective amendment
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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) That, for purposes of determining any liability under
the Securities Act, each filing of the Company's annual report
pursuant to Section 13(a) or Section 15(d) of the Exchange Act,
and each filing of the Plan's annual report pursuant to Section
15(d) of the Exchange Act 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 may be permitted to directors, officers
and controlling persons of the registrant pursuant to the
foregoing provisions, or otherwise, the Company has been advised
that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other
than the payment by the Company of expenses incurred or paid by a
director, officer or controlling person of the Company in the
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successful defense of any action, suit or proceeding) is asserted
by such director, officer or controlling person in connection
with the securities being registered, the Company will, unless in
the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act and will
be governed by the final adjudication of such issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the registrant certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form
S-8, and has duly caused this registration statement to be signed
on its behalf by the undersigned, thereunto duly authorized, in
the City of Richmond and Commonwealth of Virginia on April 2,
1996.
JAMES RIVER CORPORATION OF VIRGINIA
By: /s/ Stephen E. Hare
Stephen E. Hare
Senior Vice President,
Corporate Finance and Chief
Financial Officer
POWER OF ATTORNEY
Know All Men and Women By These Presents that each
individual whose signature appears below constitutes and appoints
Stephen E. Hare and Clifford A. Cutchins, IV, Esquire, and each
of them, such individual's true and lawful attorneys-in-fact and
agents with full power of substitution, for such individual and
in his or her name, place and stead, in any and all capacities,
to sign any and all amendments (including post-effective
amendments) to this registration statement and any registration
statement related to the offering contemplated by this
registration statement that is to be effective upon filing
pursuant to Rule 462(b) under the Securities Act of 1933, and to
file the same, with all exhibits thereto, and all 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 perform each and
every act and thing requisite and necessary to be done in and
about the premises, as fully to all intents and purposes as he or
she might or could do in person, hereby ratifying and confirming
all that said attorneys-in-fact and agents, or any of them, or
their or his or her substitute or substitutes, may lawfully do or
cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed on April 2, 1996 by
the following persons in the respective capacities indicated
below their names.
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/s/ Miles L. Marsh Chairman of the Board of Directors,
Miles L. Marsh President, and Chief Executive
Officer (Principal Executive
Officer)
/s/ Stephen E. Hare Senior Vice President, Corporate
Stephen E. Hare Finance and Chief Financial Officer
(Principal Financial and Accounting
Officer)
/s/ William T. Burgin Director
William T. Burgin
/s/ Worley H. Clark, Jr. Director
Worley H. Clark, Jr.
/s/ William T. Comfort, Jr. Director
William T. Comfort, Jr.
/s/ William V. Daniel Director
William V. Daniel
/s/ Bruce C. Gottwald Director
Bruce C. Gottwald
/s/ Robert M. O'Neil Director
Robert M. O'Neil
/s/ Joseph T. Piemont Director
Joseph T. Piemont
/s/ Anne M. Whittemore Director
Anne M. Whittemore
/s/ Robert C. Williams Director
Robert C. Williams
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EXHIBITS
TO
JAMES RIVER CORPORATION OF VIRGINIA
REGISTRATION STATEMENT ON FORM S-8
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Exhibit Index
The following exhibits are filed herewith as part of this
Registration Statement:
Exhibit Page
No. No.
5.1 Opinion and Consent of McGuire, Woods,
Battle & Boothe, L.L.P., Counsel to the
Company as to the validity of the
Common Stock offered hereunder 13
23.1 Consent of Independent Accountants 15
24.2 Consent of McGuire, Woods, Battle & Boothe,
L.L.P. (included in Exhibit 5.1)
99.1 James River Corporation of Virginia
1996 Stock Incentive Plan 16
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EXHIBIT 5.1
April 2, 1996
Board of Directors
James River Corporation of Virginia
120 Tredegar Street
Richmond, Virginia 23219
Gentlemen:
We have acted as your counsel in connection with the
preparation of a Registration Statement on Form S-8 to be filed
with the Securities and Exchange Commission pursuant to the
Securities Act of 1933, as amended (the "Registration
Statement"), with respect to the offering of up to 5,280,361
shares of Common Stock, $.10 par value ("Common Stock") of James
River Corporation of Virginia (the "Company") to be issued
pursuant to the James River Corporation of Virginia 1996 Stock
Incentive Plan (the "Plan") accompanied by an equivalent number
of rights to purchase 1/1000 of a share of Series M Cumulative
Preferred Stock, $10 par value ("Rights").
We are familiar with the Registration Statement and have
examined such corporate documents and records, including the
Plan, and such matters of law as we have considered appropriate
to enable us to render the following opinion. On the basis of
the foregoing, we are of the opinion that:
The Company is a corporation duly organized and validly
existing under the laws of the Commonwealth of Virginia and has
the power to issue up to 5,280,361 shares of Company Common Stock
and an equivalent number of Rights that are to be registered with
the Securities and Exchange Commission on a Form S-8 Registration
Statement. We are further of the opinion that the Common Stock
and Rights being registered, when issued in accordance with the
related resolutions of the Board of Directors and the terms of
the Plan, will be duly authorized, validly issued, fully paid and
non-assessable.
We re-affirm our opinion regarding the Rights given to James
River's Board of Directors as confirmed in our letter of February
9, 1989, a copy of which is attached to our opinion filed as
Exhibit 5 to James River's Registration Statement (No. 33-56657)
on Form S-8. In our opinion regarding the Rights, we discussed
whether certain provisions of Section 13.1-638 of the Code of
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Virginia (the "Code") might prohibit the restrictions on transfer
imposed under the agreement governing the Rights. The Code was
amended, effective July 1, 1990, to provide that, notwithstanding
such provisions of Section 13.1-638, the terms of rights issued
by a corporation may include restrictions on transfer by
designated persons or classes of persons.
We consent to the filing of this opinion as Exhibit 5.1 to
the Registration Statement and to the reference to us under the
caption "Legal Opinions" in the Registration Statement.
Very truly yours,
/s/ McGuire, Woods, Battle & Boothe, L.L.P.
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EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this registration
statement on Form S-8, pertaining to the James River Corporation
of Virginia 1996 Stock Incentive Plan, of our report dated
January 25, 1996, except as to the information presented in Note
17, for which the date is January 30, 1996, on our audits of the
consolidated financial statements of James River Corporation of
Virginia and Subsidiaries ("James River") as of December 31,
1995, and December 25, 1994, and for each of the three fiscal
years in the period ended December 31, 1995, which report is
incorporated by reference in James River's Annual Report on Form
10-K for the fiscal year ended December 31, 1995.
/s/ Coopers & Lybrand L.L.P.
Richmond, Virginia
April 3, 1996
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EXHIBIT 99.1
JAMES RIVER CORPORATION OF VIRGINIA
1996 STOCK INCENTIVE PLAN
JAMES RIVER CORPORATION OF VIRGINIA (the "Company") hereby
adopts this James River Corporation of Virginia 1996 Stock
Incentive Plan.
1. Purpose. The purpose of the James River Corporation of
Virginia 1996 Stock Incentive Plan (the "Plan") is to further the
long term stability and financial success of the Company by
attracting and retaining key management employees and employees
of the Company and its Subsidiaries and Foreign Affiliates who
can contribute to the financial success of those corporations
through the use of stock incentives. It is believed that
ownership of Company Stock will stimulate the efforts of those
employees upon whose judgment, interest and efforts the Company
and its Subsidiaries and Foreign Affiliates is and will be
largely dependent for the successful conduct of their business.
It is also believed that awards granted to such employees under
this Plan will also further the identification of those
employees' interests with those of the Company's shareholders.
The Plan has been adopted by the Board of Directors of the
Company and subject to the approval of the Company's
shareholders. The Plan is intended to conform to the provisions
of Securities and Exchange Commission Rule 16b-3 ("Rule 16b-3").
2. Definitions. As used in the Plan, the following terms
have the meanings indicated:
(a) "Act" means the Securities Exchange Act of 1934,
as amended.
(b) "Applicable Withholding Taxes" means the aggregate
amount of federal, state and local income and payroll taxes
that the Company is required to withhold in connection with
any exercise of an Option or the award, lapse of
restrictions or payment with respect to Restricted Stock or
Incentive Stock.
(c) "Award" means the award of an Option, Restricted
Stock or Incentive Stock under the Plan.
(d) "Beneficiary" means the person or persons entitled
to receive a benefit pursuant to an Award upon the death of
a Participant determined under Section 19.
(e) "Board" means the Board of Directors of the
Company.
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(f) "Change of Control" means:
(i) The acquisition by any unrelated person of
beneficial ownership (as that term is used for purposes
of the Act) of 20% or more of the then outstanding
shares of common stock of the Company or the combined
voting power of the then outstanding voting securities
of the Company entitled to vote generally in the
election of directors. The term "unrelated person"
means any person other than (x) the Company and its
Subsidiaries, (y) an employee benefit plan or trust of
the Company or its Subsidiaries, and (z) a person who
acquires stock of the Company pursuant to an agreement
with the Company that is approved by the Board in
advance of the acquisition, unless the acquisition
results in a Change of Control pursuant to subsection
(ii) below. For purposes of this subsection, a
"person" means an individual, entity or group, as that
term is used for purposes of the Act.
(ii) Any tender or exchange offer, merger or other
business combination, sale of assets or contested
election, or any combination of the foregoing
transactions, the persons who were directors of the
Company before such transactions shall cease to
constitute a majority of the Board of Directors of the
Company or any successor to the Company.
(g) "Code" means the Internal Revenue Code of 1986, as
amended.
(h) "Committee" means the committee appointed to
administer the Plan as provided in Section 16.
(i) "Company" means James River Corporation of
Virginia
(j) "Company Stock" means common stock of the Company.
In the event of a change in the capital structure of the
Company (as provided in Section 15), the shares resulting
from such a change shall be deemed to be Company Stock
within the meaning of the Plan.
(k) "Corporate Change" means a consolidation, merger,
dissolution or liquidation of the Company, a Subsidiary or
Foreign Affiliate, or a sale or distribution of assets or
stock (other than in the ordinary course of business) of the
Company, a Subsidiary or Foreign Affiliate; provided that,
unless the Committee determines otherwise, a Corporate
Change shall only be considered to have occurred with
respect to Participants whose business unit is affected by
the Corporate Change.
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(l) "Date of Grant" means the date as of which an
Award is made by the Committee.
(m) "Disability" or "Disabled" means, as to an
Incentive Stock Option, a Disability within the meaning of
Section 22(e)(3) of the Code. As to all other Incentive
Awards, the Committee shall determine whether a Disability
exists and such determination shall be conclusive.
(n) "Fair Market Value" means (i) if the Company Stock
is traded on an exchange, the mean of the highest and lowest
registered sales prices of the Company Stock on the exchange
on which the Company Stock generally has the greatest
trading volume, or (ii) if the Company Stock is traded in
the over-the-counter market, the mean between the closing
bid and asked prices as reported by NASDAQ. Fair Market
Value shall be determined as of the applicable date
specified in the Plan or, if there are no trades on such
date, the value shall be determined as of the last preceding
day on which the Company Stock is traded.
(o) "Foreign Affiliate" means an entity that is not
organized under the laws of the United States, or any state
thereof or any political subdivision of any state, and in
which the Company has, directly or indirectly, a substantial
interest.
(p) "Incentive Stock" means Company Stock awarded when
performance goals are achieved pursuant to an incentive plan
established by the Committee as provided in Section 8.
(q) "Incentive Stock Option" means an Option intended
to meet the requirements of, and qualify for favorable
Federal income tax treatment under, Code section 422.
(r) "Insider" means a person subject to Section 16(b)
of the Act.
(s) "Nonstatutory Stock Option" means an Option that
does not meet the requirements of Code section 422, or that
is otherwise not intended to be an Incentive Stock Option
and is so designated.
(t) "Option" means a right to purchase Company Stock
granted under the Plan, at a price determined in accordance
with the Plan.
(u) "Parent" means, with respect to any corporation, a
parent of that corporation within the meaning of Code
section 424(e).
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(v) "Participant" means any employee who receives an
Award under the Plan.
(w) "Replacement Feature" means a feature of an
Option, as described in the Participant's stock option
agreement, that provides for the automatic grant of a
Replacement Option in accordance with the provisions of
Section 9(b).
(x) "Replacement Option" means an Option granted to a
Participant equal to the number of shares of already owned
Company Stock that are delivered by the Participant to
exercise an Option, as described in Section 9(b).
(y) "Restricted Stock" means Company Stock awarded
upon the terms and subject to the restrictions set forth in
Section 7.
(z) "Rule 16b-3" means Rule 16b-3 of the Act. A
reference in the Plan to Rule 16b-3 shall include a
reference to any corresponding subsequent rule or any
amendments to Rule 16b-3 enacted after the effective date of
the Plan.
(aa)"Subsidiary" means an entity of which the Company
owns 50% or more of the total combined voting power of all
classes of stock.
(ab)"10% Shareholder" means a person who owns,
directly or indirectly, stock possessing more than 10% of
the total combined voting power of all classes of stock of
the Company or any Parent or Subsidiary of the Company.
Indirect ownership of stock shall be determined in
accordance with Code section 424(d).
3. General. The following types of Awards may be granted
under the Plan: Options, Restricted Stock and Incentive Stock.
Options granted under the Plan may be Incentive Stock Options or
Nonstatutory Stock Options.
4. Stock. Subject to Section 15 of the Plan, there shall
be reserved for issuance under the Plan an aggregate of 5,146,774
shares of Company Stock, which shall be authorized, but unissued,
shares. The 5,146,774 shares reserved for issuance under the
Plan include 1,466,774 shares available for the grant of options
under the Company's 1987 Stock Option Plan (the "1987 Plan") that
will not be granted and 1,000,000 shares reserved for issuance
under the Company's Deferred Stock Plan which will not be
awarded. The 5,146,774 shares reserved also includes 2,000,000
shares allocable to Options that are expected to expire or
otherwise terminate unexercised under the 1987 Plan and awards
under the Deferred Stock Plan that are expected to be forfeited.
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Shares allocable to Options granted under the Plan that expire or
otherwise terminate unexercised and shares that are forfeited
pursuant to restrictions on Restricted Stock or Incentive Stock
awarded under the Plan may again be subjected to an Award under
this Plan. For purposes of determining the number of shares that
are available for Awards under the Plan, such number shall, if
permissible under Rule 16b-3, include the number of shares
surrendered by a Participant or retained by the Company in
payment of Applicable Withholding Taxes.
5. Eligibility.
(a) Any employee of the Company or a Subsidiary or
Foreign Affiliate who, in the judgment of the Committee, has
contributed or can be expected to contribute to the profits or
growth of the Company shall be eligible to receive Awards under
the Plan. Directors of the Company who are employees and are not
members of the Committee are eligible to participate in the Plan.
The Committee shall have the power and complete discretion, as
provided in Section 16, to select eligible employees to receive
Awards and to determine for each employee the terms, conditions
and nature of the Award and the number of shares to be allocated
to each employee as part of the Award. The Committee is
expressly authorized to make an Award to a Participant
conditioned upon the surrender for cancellation of an existing
Award.
(b) The grant of an Award shall not obligate the
Company or any Subsidiary or Foreign Affiliate to pay an employee
any particular amount of remuneration, to continue the employment
of the employee after the grant or to make further grants to the
employee at any time thereafter.
(c) When granting Awards to employees of a Foreign
Affiliate, the Committee shall have complete discretion and
authority to grant such Awards in compliance with all present and
future laws of the country or countries that may apply to the
grant of the Award or the issuance of Company Stock pursuant to
the Award. Such authorization shall extend to and includes
establishing one or more separate sub-plans which include
provisions not inconsistent with the Plan that comply with
statutory or regulation requirements imposed by the foreign
country or countries of the Foreign Affiliate or in which
Participants employed by the Foreign Affiliate reside.
6. Stock Options.
(a) Whenever the Committee deems it appropriate to
grant Options, notice shall be given to the eligible employee
stating the number of shares for which Options are granted, the
Option price per share, whether the Options are Incentive Stock
Options or Nonstatutory Stock Options, and the conditions to
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which the grant and exercise of the Options are subject. This
notice, when duly accepted in writing by the Participant, shall
become a stock option agreement between the Company and the
Participant.
(b) The Committee shall establish the exercise price
of Options. The exercise price of a Nonstatutory Stock Option
shall be not less than 85% of the Fair Market Value of the
shares of Company Stock covered by the Option on the Date of
Grant. The exercise price of an Incentive Stock Option shall be
not less than 100% of the Fair Market Value of such shares on the
Date of Grant; provided that if the Participant is a 10%
Shareholder, the exercise price of an Incentive Stock Option
shall be not less than 110% of the Fair Market Value of such
shares on the Date of Grant.
(c) An employee may not receive awards of Options
under the Plan with respect to more than 300,000 shares of
Company Stock during any calendar year.
(d) Options may be exercised in whole or in part at
such times as may be specified by the Committee in the
Participant's stock option agreement. The Committee may impose
such vesting conditions and other requirements as the Committee
deems appropriate, and the Committee may include such provisions
regarding a Change of Control or Corporate Change as the
Committee deems appropriate.
(e) The Committee shall establish the term of each
Option in the Participant's stock option agreement. The term of
an Incentive Stock Option shall not be longer than ten years from
the Date of Grant, except that an Incentive Stock Option granted
to a 10% Shareholder may not have a term in excess of five years.
No Option may be exercised after the expiration of its term or,
except as set forth in the Participant's stock option agreement,
after the termination of the Participant's employment. The
Committee shall set forth in the Participant's stock option
agreement when, and under what circumstances, an Option may be
exercised after termination of the Participant's employment.
(f) An Incentive Stock Option, by its terms, shall be
exercisable in any calendar year only to the extent that the
aggregate Fair Market Value (determined at the Date of Grant) of
the Company Stock with respect to which Incentive Stock Options
are exercisable by the Participant for the first time during the
calendar year does not exceed $100,000 (the "Limitation Amount").
Incentive Stock Options granted after 1986 under the Plan and all
other plans of the Company and any parent or Subsidiary of the
Company shall be aggregated for purposes of determining whether
the Limitation Amount has been exceeded. The Board may impose
such conditions as it deems appropriate on an Incentive Stock
Option to ensure that the foregoing requirement is met. If
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Incentive Stock Options that first become exercisable in a
calendar year exceed the Limitation Amount, the excess Options
will be treated as Nonstatutory Stock Options to the extent
permitted by law.
(g) If a Participant dies and if the Participant's
stock option agreement provides that part or all of the Option
may be exercised after the Participant's death, then such portion
may be exercised by the personal representative of the
Participant's estate during the time period specified in the
stock option agreement.
(h) The Committee may, in its discretion, grant
Options containing a Replacement Feature as described in Section
9(b) and may amend previously granted Nonstatutory Stock Options
to provide such a Replacement Feature.
7. Restricted Stock Awards.
(a) Whenever the Committee deems it appropriate to
grant a Restricted Stock Award, notice shall be given to the
Participant stating the number of shares of Restricted Stock for
which the Award is granted and the terms and conditions to which
the Award is subject. This notice, when accepted in writing by
the Participant, shall become an Award agreement between the
Company and the Participant. Certificates representing the
shares shall be issued in the name of the Participant, subject to
the restrictions imposed by the Plan and the Committee. A
Restricted Stock Award may be made by the Committee in its
discretion without cash consideration.
(b) The Committee may place such restrictions on the
transferability and vesting of Restricted Stock as the Committee
deems appropriate, including restrictions relating to continued
employment and financial performance goals. Without limiting the
foregoing, the Committee may provide performance acceleration
parameters under which all, or a portion, of the Restricted Stock
will vest on the Company's achievement of established performance
objectives. Restricted Stock may not be sold, assigned,
transferred, disposed of, pledged, hypothecated or otherwise
encumbered until the restrictions on such shares shall have
lapsed or shall have been removed pursuant to subsection (c)
below.
(c) The Committee may provide in a Restricted Stock
Award, or subsequently, that the restrictions will lapse if a
Change of Control or Corporate Change occurs. The Committee may
at any time, in its sole discretion, accelerate the time at which
any or all restrictions will lapse or may remove restrictions on
Restricted Stock as it deems appropriate.
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(d) A Participant shall hold shares of Restricted
Stock subject to the restrictions set forth in the Award
agreement and in the Plan. In other respects, the Participant
shall have all the rights of a shareholder with respect to the
shares of Restricted Stock, including, but not limited to, the
right to vote such shares and the right to receive all cash
dividends and other distributions paid thereon. Certificates
representing Restricted Stock shall bear a legend referring to
the restrictions set forth in the Plan and the Participant's
Award agreement. If stock dividends are declared on Restricted
Stock, such stock dividends or other distributions shall be
subject to the same restrictions as the underlying shares of
Restricted Stock.
(e) The number of shares of Restricted Stock subject
to outstanding awards at any time may not exceed 1,584,108 less
the number of shares of Restricted Stock with respect to which
restrictions have previously lapsed (other than through
forfeiture).
8. Incentive Stock Awards.
(a) Incentive Stock may be issued pursuant to the Plan
in connection with incentive programs established from time to
time by the Committee. The Committee shall establish such
performance criteria as it deems appropriate as a prerequisite
for the issuance of Incentive Stock. A Participant who is
eligible to receive Incentive Stock will have no rights as a
shareholder before receipt of the Incentive Stock certificates.
Incentive Stock may be issued without cash consideration. A
Participant's interest in an incentive program or the contingent
right to receive Incentive Stock may not be sold, assigned,
transferred, pledged, hypothecated, or otherwise encumbered.
(b) The Committee may provide in the incentive
program, or subsequently, that Incentive Stock will be issued if
a Change of Control or Corporate Change occurs, even though the
performance goals set by the Committee have not been met.
9. Method of Exercise of Options.
(a) Options may be exercised by giving written notice
of the exercise to the Company, stating the number of shares the
Participant has elected to purchase under the Option. Such
notice shall be effective only if accompanied by the exercise
price in full in cash; provided that, if the terms of an Option
so permit, the Participant may (i) deliver Company Stock that the
Participant has owned for at least six months (valued at Fair
Market Value on the date of exercise), or cause shares of Company
Stock (valued at their Fair Market Value on the date of exercise)
to be withheld in satisfaction of all or any part of the exercise
price, (ii) deliver a properly executed exercise notice together
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with irrevocable instructions to a broker to deliver promptly to
the Company, from the sale or loan proceeds with respect to the
sale of Company Stock or a loan secured by Company Stock, the
amount necessary to pay the exercise price and, if required by
the Committee, Applicable Withholding Taxes, or (iii) deliver an
interest bearing promissory note, payable to the Company, in
payment of all or part of the exercise price, together with such
collateral and subject to such terms as may be required by the
Committee at the time of exercise. The interest rate under any
such promissory note shall be equal to the minimum interest rate
required at the time to avoid imputed interest to the Participant
under the Code.
(b) If a Participant exercises an Option that has a
Replacement Feature by delivering already owned shares of Company
Stock, the Participant shall automatically be granted a
Replacement Option. The Replacement Option shall be subject to
the following provisions:
(i) The Replacement Option shall cover the number
of shares of Company Stock delivered by the Participant
to exercise the Option;
(ii) The Replacement Option will not have a
Replacement Feature;
(iii) The exercise price of shares of Company Stock
covered by a Replacement Option shall be not less than
100% of the Fair Market Value of such shares on the
date the Participant delivers shares of Company Stock
to exercise the Option; and
(iv) The Replacement Option shall be subject to
the same restrictions on exercisability as those
imposed on the underlying Option and such other
restrictions as the Committee deems appropriate.
(c) Notwithstanding anything herein to the contrary,
Awards shall always be granted and exercised in such a manner as
to conform to the provisions of Rule 16b-3.
10. Deferral of Payment.
(a) Regardless of whether provided for in the Award
agreement, the Committee may defer payment of a Participant's
benefit under the Plan if and to the extent that the sum of (i)
the Participant's Plan benefit, plus (ii) all other compensation
paid or payable to the Participant for the fiscal year in which
the Plan benefit would otherwise be paid exceeds the maximum
amount of compensation that the Company may deduct under Code
section 162(m) with respect to the Participant for the year. If
deferred by the Committee, the benefit shall be paid in the first
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fiscal year of the Company in which the sum of the Participant's
Plan benefit and all other compensation paid or payable to the
Participant does not exceed the maximum amount of compensation
deductible by the Company under Code section 162(m). This
Section shall only apply to Participants and Plan benefits
covered by Code section 162(m).
(b) The Committee may defer payment of part or all of
a Plan benefit with respect to a Participant who is an Insider,
to the extent necessary or appropriate to comply with Rule 16b-3.
(c) The Committee shall have sole discretion to
determine whether and to what extent Plan benefits are to be
deferred pursuant to this Section, how such deferred amounts are
to be calculated and when deferred amounts shall be paid. The
Committee's determination shall be final and binding.
11. Applicable Withholding Taxes. Each Participant shall
agree, as a condition of receiving an Award, to pay to the
Company, or make arrangements satisfactory to the Company
regarding the payment of, all Applicable Withholding Taxes with
respect to the Award. Until the Applicable Withholding Taxes
have been paid or arrangements satisfactory to the Company have
been made, no stock certificates (or, in the case of Restricted
Stock, no stock certificates free of a restrictive legend) shall
be issued to the Participant. As an alternative to making a cash
payment to the Company to satisfy Applicable Withholding Tax
obligations, the Committee may establish procedures permitting
the Participant to elect to (a) deliver shares of already owned
Company Stock or (b) have the Company retain that number of
shares of Company Stock that would satisfy all or a specified
portion of the Applicable Withholding Taxes. Any such election
shall be made only in accordance with procedures established by
the Committee and, in the case of an Insider, in accordance with
Rule 16b-3.
12. Nontransferability of Awards.
(a) In general Awards, by their terms, shall not be
transferable by the Participant except by will or by the laws of
descent and distribution or except as described below. Options
shall be exercisable, during the Participant's lifetime, only by
the Participant or by his guardian or legal representative.
(b) Notwithstanding the provisions of (a) and subject
to applicable securities laws, the Committee may grant
Nonstatutory Stock Options that permit, or amend Nonstatutory
Stock Options to permit, a Participant to transfer the Options to
one or more immediate family members, to a trust for the benefit
of immediate family members or to a partnership whose only
partners are immediate family members. Consideration may not be
paid for the transfer of Options. The transferee of an Option
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shall be subject to all conditions applicable to the Option prior
to its transfer. The agreement granting the Option shall set
forth the transfer conditions and restrictions. The Committee
may impose on any transferable Option and on stock issued upon
the exercise of an Option such limitations and conditions as the
Committee deems appropriate. Except to the extent otherwise
permitted by Rule 16b-3, Options that are intended to be exempt
from Section 16(b) of the Act pursuant to Rule 16b-3 may not be
transferable except by will or by the laws of descent and
distribution.
13. Effective Date of the Plan. This Plan shall be
effective February 15, 1996, subject to approval by the Company's
shareholders. Until the Plan is approved by the Company's
shareholders and all applicable federal and state securities laws
have been complied with and the shares of Company Stock have been
listed on the stock exchange or exchanges where traded, no
Options shall be exercisable and no Award shall be made that
would result in the issuance of shares of Company Stock.
14. Termination, Modification, Change. If not sooner
terminated by the Board, this Plan shall terminate at the close
of business on February 14, 2006. No Awards shall be made under
the Plan after its termination. The Board may terminate the Plan
or may amend the Plan in such respects as it shall deem
advisable; provided, that, if and to the extent required by Rule
16b-3, no change shall be made that increases the total number of
shares of Company Stock reserved for issuance pursuant to Awards
granted under the Plan (except pursuant to Section 15), expands
the class of persons eligible to receive Awards, or materially
increases the benefits accruing to Participants under the Plan,
unless such change is authorized by the shareholders of the
Company. Notwithstanding the foregoing, the Board may
unilaterally amend the Plan and Awards as it deems appropriate to
ensure compliance with Rule 16b-3 and to cause Incentive Stock
Options to meet the requirements of the Code and regulations
thereunder. Except as provided in the preceding sentence, a
termination or amendment of the Plan shall not, without the
consent of the Participant, adversely affect a Participant's
rights under an Award previously granted to him.
15. Change in Capital Structure.
(a) In the event of a stock dividend, stock split or
combination of shares, spin-off, reclassification, recapitaliza-
tion, merger or other change in the Company's capital stock
(including, but not limited to, the creation or issuance to
shareholders generally of rights, options or warrants for the
purchase of common stock or preferred stock of the Company), the
number and kind of shares of stock or securities of the Company
to be issued under the Plan (under outstanding Awards and Awards
to be granted in the future), the exercise price of Options, and
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other relevant provisions shall be appropriately adjusted by the
Committee, whose determination shall be binding on all persons.
If the adjustment would produce fractional shares with respect to
any Award, the Committee may adjust appropriately the number of
shares covered by the Award so as to eliminate the fractional
shares.
(b) In the event the Company distributes to its
shareholders a dividend, or sells or causes to be sold to a
person other than the Company or a Subsidiary shares of stock in
any corporation (a "Spinoff Company") which, immediately before
the distribution or sale, was a majority owned Subsidiary of the
Company, the Committee shall have the power, in its sole
discretion, to make such adjustments as the Committee deems
appropriate. The Committee may make adjustments in the number
and kind of shares or other securities to be issued under the
Plan (under outstanding Awards and Awards to be granted in the
future), the exercise price of Options, and other relevant
provisions, and, without limiting the foregoing, may substitute
securities of a Spinoff Company for securities of the Company.
The Committee shall make such adjustments as it determines to be
appropriate, considering the economic effect of the distribution
or sale on the interests of the Company's shareholders and the
Participants in the businesses operated by the Spinoff Company.
The Committee's determination shall be binding on all persons.
If the adjustment would produce fractional shares with respect to
any Award, the Committee may adjust appropriately the number of
shares covered by the Award so as to eliminate the fractional
shares.
(c) If a Change of Control or Corporate Change occurs,
the Committee may take such actions with respect to outstanding
Awards as the Committee deems appropriate. These actions may
include, but shall not be limited to, accelerating the vesting
and payment of Awards, releasing restrictions on Awards, and
accelerating the expiration dates of Options. The effectiveness
of such acceleration or release of restrictions shall be
conditioned upon the consummation of the applicable Change of
Control or Corporate Change.
(d) Notwithstanding anything in the Plan to the
contrary, the Committee may take the foregoing actions without
the consent of any Participant, and the Committee's determination
shall be conclusive and binding on all persons for all purposes.
The Committee shall make its determinations consistent with Rule
16b-3 and the applicable provisions of the Code.
16. Administration of the Plan.
(a) The Plan shall be administered by a Committee
consisting of two or more outside directors of the Company, who
shall be appointed by the Board. The Board may designate the
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Compensation Committee of the Board, or a subcommittee of the
Compensation Committee, to be the Committee for purposes of the
Plan. If and to the extent required by Rule 16b-3, all members
of the Committee shall be "disinterested persons" as that term is
defined in Rule 16b-3, and the Committee shall be comprised
solely of two or more "outside directors" as that term is defined
for purposes of Code section 162(m). If any member of the
Committee fails to qualify as an "outside director" or (to the
extent required by Rule 16b-3) a "disinterested person," such
person shall immediately cease to be a member of the Committee
and shall not take part in future Committee deliberations. The
Committee from time to time may appoint members of the Committee
and may fill vacancies, however caused, in the Committee.
(b) The Committee shall have the authority to impose
such limitations or conditions upon an Award as the Committee
deems appropriate to achieve the objectives of the Award and the
Plan. Without limiting the foregoing and in addition to the
powers set forth elsewhere in the Plan, the Committee shall have
the power and complete discretion to determine (i) which eligible
employees shall receive an Award and the nature of the Award,
(ii) the number of shares of Company Stock to be covered by each
Award, (iii) whether Options shall be Incentive Stock Options or
Nonstatutory Stock Options, (iv) whether to include a Replacement
Feature in an Option and the conditions of any Replacement
Feature, (v) the Fair Market Value of Company Stock, (vi) the
time or times when an Award shall be granted, (vii) whether an
Award shall become vested over a period of time, according to a
performance-based vesting schedule or otherwise, and when it
shall be fully vested, (viii) the terms and conditions under
which restrictions imposed upon an Award shall lapse, (ix)
whether a Change of Control or Corporate Change exists, (x) the
terms of incentive programs, performance criteria and other
factors relevant to the issuance of Incentive Stock or the lapse
of restrictions on Restricted Stock or Options, (xi) when Options
may be exercised, (xii) whether to approve a Participant's
election with respect to Applicable Withholding Taxes, (xiii)
conditions relating to the length of time before disposition of
Company Stock received in connection with an Award is permitted,
(xiv) notice provisions relating to the sale of Company Stock
acquired under the Plan, and (xv) any additional requirements
relating to Awards that the Committee deems appropriate.
Notwithstanding the foregoing, no "tandem stock options" (where
two stock options are issued together and the exercise of one
option affects the right to exercise the other option) may be
issued in connection with Incentive Stock Options.
(c) When granting Awards to employees of a Foreign
Affiliate, the Committee shall have complete discretion and
authority to grant such Awards in compliance with all present and
future laws of the country or countries that may apply to the
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grant of the Award or the issuance of Company Stock pursuant to
the Award.
(d) The Committee shall have the power to amend the
terms of previously granted Awards so long as the terms as
amended are consistent with the terms of the Plan and, where
applicable, consistent with the qualification of an Option as an
Incentive Stock Option. The consent of the Participant must be
obtained with respect to any amendment that would adversely
affect the Participant's rights under the Award, except that such
consent shall not be required if such amendment is for the
purpose of complying with Rule 16b-3 or any requirement of the
Code applicable to the Award.
(e) The Committee may adopt rules and regulations for
carrying out the Plan. The Committee shall have the express
discretionary authority to construe and interpret the Plan and
the Award agreements, to resolve any ambiguities, to define any
terms, and to make any other determinations required by the Plan
or an Award agreement. The interpretation and construction of
any provisions of the Plan or an Award agreement by the Committee
shall be final and conclusive. The Committee may consult with
counsel, who may be counsel to the Company, and shall not incur
any liability for any action taken in good faith in reliance upon
the advice of counsel.
(f) A majority of the members of the Committee shall
constitute a quorum, and all actions of the Committee shall be
taken by a majority of the members present. Any action may be
taken by a written instrument signed by all of the members, and
any action so taken shall be fully effective as if it had been
taken at a meeting.
17. Issuance of Company Stock. The Company shall not be
required to issue or deliver any certificate for shares of
Company Stock before (i) the admission of such shares to listing
on any stock exchange on which the Company Stock may then be
listed, (ii) receipt of any required registration or other
qualification of such shares under any state or federal law or
regulation that the Company's counsel shall determine is
necessary or advisable, and (iii) the Company shall have been
advised by counsel that all applicable legal requirements have
been complied with. The Company may place on a certificate
representing Company Stock any legend required to reflect
restrictions pursuant to the Plan, and any legend deemed
necessary by the Company's counsel to comply with federal or
state securities laws. The Company may require a customary
written indication of a Participant's investment intent. Until a
Participant has been issued a certificate for the shares of
Company Stock acquired, the Participant shall possess no
shareholder rights with respect to the shares.
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18. Rights Under the Plan. Title to and beneficial
ownership of all benefits described in the Plan shall at all
times remain with the Company. Participation in the Plan and the
right to receive payments under the Plan shall not give a
Participant any proprietary interest in the Company or any
Subsidiary or any of their assets. No trust fund shall be
created in connection with the Plan, and there shall be no
required funding of amounts that may become payable under the
Plan. A Participant shall, for all purposes, be a general
creditor of the Company. The interest of a Participant in the
Plan cannot be assigned, anticipated, sold, encumbered or pledged
and shall not be subject to the claims of his creditors.
19. Beneficiary. A Participant may designate, on a form
provided by the Committee, one or more beneficiaries to receive
any payments under Awards of Restricted Stock or Incentive Stock
after the Participant's death. If a Participant makes no valid
designation, or if the designated beneficiary fails to survive
the Participant or otherwise fails to receive the benefits, the
Participant's beneficiary shall be the first of the following
persons who survives the Participant: (a) the Participant's
surviving spouse, (b) the Participant's surviving descendants,
per stirpes, or (c) the personal representative of the
Participant's estate.
20. Notice. All notices and other communications required
or permitted to be given under this Plan shall be in writing and
shall be deemed to have been duly given if delivered personally
or mailed first class, postage prepaid, as follows (a) if to the
Company - at its principal business address to the attention of
the Secretary; (b) if to any Participant - at the last address of
the Participant known to the sender at the time the notice or
other communication is sent.
21. Interpretation. The terms of this Plan and Awards
granted pursuant to the Plan are subject to all present and
future regulations and rulings of the Secretary of the Treasury
or his delegate relating to the qualification of Incentive Stock
Options under the Code or compliance with Code section 162(m), to
the extent applicable, and they are subject to all present and
future rulings of the Securities Exchange Commission with respect
to Rule 16b-3. If any provision of the Plan or an Award
conflicts with any such regulation or ruling, to the extent
applicable, the Committee shall cause the Plan to be amended, and
shall modify the Award, so as to comply, or if for any reason
amendments cannot be made, that provision of the Plan and/or the
Award shall be void and of no effect.
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