<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 28, 1997
REGISTRATION NO. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
-------------------
AMERICAN SCIENCE AND ENGINEERING, INC.
(Exact Name of Registrant as Specified in Its Charter)
MASSACHUSETTS 04-2440991
------------- ----------
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification. No.)
829 MIDDLESEX TURNPIKE, BILLERICA, MA 01821
-------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
AMERICAN SCIENCE AND ENGINEERING, INC.
1997 NON-QUALIFIED STOCK OPTION PLAN
--------------------------------------
(Full Title of Plan)
JEFFREY A. BERNFELD
AMERICAN SCIENCE AND ENGINEERING, INC.
829 MIDDLESEX TURNPIKE
BILLERICA, MASSACHUSETTS 01821
--------------------------------------
(Name and Address of Agent for Service)
-------------------
(508) 262-8700
--------------
(Telephone Number, Including Area Code, of Agent for Service)
-------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
=================================================================================================================
Proposed Proposed
Amount Maximum Maximum
Title of Securities to be Offering Price Aggregate Offering Amount of
to be Registered Registered Per Share(1) Price Registration Fee
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock,
$.66 2/3 par value 200,000(2) $10.31(3) $2,062,000(3) $624.85
=================================================================================================================
</TABLE>
(1) Estimated solely for the purpose of determining the registration fee
pursuant to Rule 457 under the Securities Act of 1933, as amended.
(2) Such presently indeterminable number of additional shares of Common
Stock are also registered hereunder as may be issued in the event of a merger,
consolidation, reorganization, recapitalization, stock dividend, stock split or
other similar change in Common Stock.
(3) Based upon the average high and low prices for the Registrant's Common
Stock, $.66 2/3 par value (the "Common Stock"), on May 23, 1997 as reported by
the American Stock Exchange.
Total Number of Pages _____ Exhibit Index at Page 8
===============================================================================
<PAGE> 2
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents are hereby incorporated by references into this
Registration Statement:
(a) The Registrant's latest Annual Report filed pursuant to Section 13(a)
or 15(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), or either (i) the latest prospectus filed pursuant to
Rule 424(b) under the Securities Act of 1933, as amended (the
"Securities Act"), that contains audited financial statements for the
Registrant's latest fiscal year for which such statements have been
filed or (ii) the Registrant's effective Registration Statement on
Form 10 filed under the Exchange Act containing audited financial
statements for the Registrant's latest fiscal year;
(b) All other reports filed by the Registrant pursuant to Section 13(a) or
15(d) of the Exchange Act since the end of the fiscal year covered by
the Registrant's documents referred to in (a) above; and
(c) The description of the Registrant's Common Stock contained in the
Registrant's Registration Statement on Form 8-A (File No. 1-06549)
filed under the Exchange Act with the Securities and Exchange
Commission.
All documents filed by the Registrant pursuant to Sections 13(a), 13(c), 14
and 15(d) of the Exchange Act subsequent to the date hereof and prior to the
filing of a post-effective amendment which indicates that all securities offered
have been sold or which deregisters all 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 4. Description of Securities.
Not Applicable.
Item 5. Interests of Named Experts and Counsel.
The validity of the shares of Common Stock to be issued under the American
Science and Engineering, Inc. 1997 Non-Qualified Stock Option Plan has been
passed upon for the Registrant by Brown, Rudnick, Freed & Gesmer, One Financial
Center, Boston, Massachusetts 02111.
-2-
<PAGE> 3
Item 6. Indemnification of Directors and Officers.
Section 67 of Chapter 156B of the Massachusetts General Laws permits the
indemnification of directors and officers to the extent authorized by the
Articles of Organization or By-Laws of a corporation or by a vote of the
stockholders. Except as otherwise provided by the Articles of Organization or
By-Laws, indemnification of persons who are not directors of a corporation may
be provided to the extent authorized by the directors. No indemnification may be
provided for any person with respect to any matter as to which he shall have
been adjudicated in any proceeding not to have acted in good faith in the
reasonable belief that his action was in the best interest of the corporation.
Article VI of the Registrant's By-Laws provides in substance that the
Registrant shall indemnify any person who was or is a party or was threatened to
be made a party to any threatened, pending or completed action or suit, by
reason of the fact that he is or was serving as a director or officer of the
Registrant or is or was serving at the request of the Registrant as a director,
trustee or officer of another corporation or entity, against expenses actually
incurred by such person in connection with any civil action, suit or proceeding
to which such person may be made a party, or by which such person shall be
threatened, by reason of any alleged act or failure to act in his present or
former capacity as a director or officer of the Registrant or as a director,
trustee or officer of such affiliated corporation or entity, provided, however,
that no person has the right to indemnification in relation to any matter as to
which such person shall have been finally adjudged in any legal proceeding not
to have acted in good faith and the reasonable belief that his action was in the
best interest of the Registrant. In the event of any settlement of any action,
suit or proceeding, the right to indemnification is limited to matters as to
which the Registrant is advised by counsel that such settlement is reasonable
and that such person has acted in good faith and the reasonable belief that his
action was in the best interest of the Registrant. The right of indemnification
contained in the Registrant's By-Laws is non-exclusive and is in addition to any
other rights such person may have.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers or controlling persons of the
Registrant pursuant to the Registrant's By-Laws, or otherwise, the Registrant
has been informed that in the opinion of the Commission such indemnification is
against public policy as expressed in the Securities Act and is therefore
unenforceable.
Item 7. Exemption From Registration Claimed.
Not Applicable.
-3-
<PAGE> 4
Item 8. Exhibits.
Exhibit No. Description of Exhibit
4.1 Restated Articles of Organization of the Registrant, as
amended by Articles of Amendment dated October 29, 1976,
Articles of Amendment dated May 17, 1976, Articles of
Amendment dated March 28, 1973, and Articles of Amendment
dated November 5, 1996 (filed as Exhibit 4.1 to the
Registrant's Registration Statement on Form S-8 filed May 28,
1997 with respect to the Registrant's Executive Incentive
Plan and incorporated herein by reference).
4.2 By-Laws of the Registrant, as amended (filed as Exhibit
2(a)(iii) to the Registrant's Registration Statement on Form
S-7 (Registration No. 2-56452) (the "Form S-7"), and
incorporated herein by reference).
4.3 Specimen Certificate of Common Stock (filed as Exhibit 2(a)(i)
to the Form S-7, and incorporated herein by reference).
4.4 Common Stock Purchase Warrant, dated July 18, 1995, issued in
the name of Grayson & Associates (filed as Exhibit 4.6 to the
Registrant's Registration Statement on Form S-3) (Registration
No. 33-61903) (the "Form S-3"), and incorporated herein by
reference).
4.5 Subscription Agreement, dated July 8, 1995, between the
Registrant and Samuel International Investors, L.D.C. (filed
as Exhibit 4.7 to the Form S-3, and incorporated herein by
reference).
4.6 Common Stock Purchase Warrant, in the form issued to certain
of the Registrant's lenders, with schedule of lenders,
exercise prices and share amounts attached (filed as Exhibit
4.8 to the Registrant's Form S-3, and incorporated herein by
reference).
5 Legal Opinion of Brown, Rudnick, Freed & Gesmer
23.1 Consent of Brown, Rudnick, Freed & Gesmer (contained in its
opinion filed as Exhibit 5).
23.2 Consent of Arthur Andersen LLP.
24 Power of Attorney.
99 American Science and Engineering, Inc. 1997 Non-Qualified
Stock Option Plan.
-4-
<PAGE> 5
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:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or the
most recent post-effective amendment thereof) which, individually
or in the aggregate, represent a fundamental change in the
information set forth in the Registration Statement;
(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 (1)(i) and (1)(ii) do not apply if
the Registration Statement is on Form S-3 or Form S-8, and the
information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by the
Registrant pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the
Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall
be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
B. The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
-5-
<PAGE> 6
C. The undersigned Registrant hereby undertakes to deliver or cause to be
delivered with the prospectus, to each person to whom the prospectus is sent or
given, the latest annual report to security-holders that is incorporated by
reference in the prospectus and furnished pursuant to, and meeting the
requirements of, Rule 14a-3 or Rule 14c-3 under the Securities Exchange Act of
1934; and, where interim financial information required to be presented by
Article 3 of Regulation S-X is not set forth in the prospectus, to deliver, or
cause to be delivered to each person to whom the prospectus is sent or given,
the latest quarterly report that is specifically incorporated by reference in
the prospectus to provide such interim financial information.
D. Insofar as indemnification for liabilities arising under the
Securities Act of 1933 (the "Act") may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the provisions described under
"Item 6 --- Indemnification of Directors and Officers" above, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
-6-
<PAGE> 7
SIGNATURES
THE REGISTRANT. 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 Town of Billerica, Commonwealth of Massachusetts, on May
27, 1997.
American Science and Engineering, Inc.
/s/ Ralph S. Sheridan
----------------------------------
By: Ralph S. Sheridan, President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Name Capacity Date
- ---- -------- ----
/s/ Ralph S. Sheridan President and Director May 27, 1997
- -------------------------- (Principal Executive
Ralph S. Sheridan Officer)
/s/ Lee C. Steele Vice President and May 27, 1997
- -------------------------- Treasurer (Principal
Lee C. Steele Financial Officer)
/s/ Herman Feshbach Director May 27, 1997
- --------------------------
Herman Feshbach
/s/ Al Gladen Director May 27, 1997
- --------------------------
Al Gladen
/s/ Hamilton W. Helmer Director May 27, 1997
- --------------------------
Hamilton W. Helmer
Director May 27, 1997
- --------------------------
Donald J. McCarren
/s/ William E. Odom Director May 27, 1997
- --------------------------
William E. Odom
-7-
<PAGE> 8
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit Description of Exhibit Page
- ------- ---------------------- ----
<S> <C> <C>
4.1 Restated Articles of Organization of the Registrant, as
amended by Articles of Amendment dated October 29, 1976,
Articles of Amendment dated May 17, 1976, Articles of
Amendment dated March 28, 1973, and Articles of Amendment
dated November 5, 1996 (filed as Exhibit 4.1 to the
Registrant's Registration Statement on Form S-8 filed May 28,
1997 with respect to the Registrant's Executive Equity
Incentive Plan and incorporated herein by reference). *
4.2 By-Laws of the Registrant, as amended (filed as Exhibit
2(a)(iii) to the Registrant's Registration Statement on Form
S-7) (Registration No. 2-56452) (the "Form S-7"), and
incorporated herein by reference). *
4.3 Specimen Certificate of Common Stock (filed as Exhibit 2(a)(i)
to the Form S-7, and incorporated herein by reference). *
4.4 Common Stock Purchase Warrant, dated July 18, 1995, issued in
the name of Grayson & Associates (filed as Exhibit 4.6 to the
Registrant's Registration Statement on Form S-3)
(Registration No. 33-61903) (the "Form S-3"), and incorporated
herein by reference). *
4.5 Subscription Agreement, dated July 8, 1995, between the
Registrant and Samuel International Investors, L.D.C. (filed
as Exhibit 4.7 to the Form S-3, and incorporated herein by
reference). *
4.6 Common Stock Purchase Warrant, in the form issued to certain
of the Registrant's lenders, with schedule of lenders,
exercise prices and share amounts attached (filed as Exhibit
4.8 to the Registrant's Form S-3, and incorporated herein by
reference). *
5 Opinion of Brown, Rudnick, Freed & Gesmer
23.1 Consent of Brown, Rudnick, Freed & Gesmer (contained in its
opinion filed as Exhibit 5)
23.2 Consent of Arthur Andersen LLP.
24 Power of Attorney.
99 American Science and Engineering, Inc. 1997 Non-Qualified
Stock Option Plan.
</TABLE>
- ----------------------------------
* Incorporated by reference and not filed herewith.
-8-
<PAGE> 1
EXHIBIT 5
May 28, 1997
American Science and Engineering, Inc.
829 Middlesex Turnpike
Billerica, MA 01821
Re: American Science and Engineering, Inc.
Registration Statement on Form S-8
--------------------------------------
Gentlemen:
We are counsel for American Science and Engineering, Inc. (the "Company").
We have been asked to deliver this opinion in connection with the preparation
and filing with the Securities and Exchange Commission under the Securities Act
of 1933, as amended (the "Act"), of a Registration Statement on Form S-8 (this
"Registration Statement") relating to 200,000 shares of the Company's Common
Stock, $.66 2/3 par value (the "Shares"). This opinion letter, together with
Schedule A attached hereto (this "Opinion Letter"), is being rendered in
connection with the filing of the Registration Statement.
The 200,000 Shares covered by the Registration Statement are issuable under
the Company's 1997 Non-Qualified Stock Option Plan (the "Plan").
In connection with this Opinion Letter, we have examined and are familiar
with originals or copies, certified or otherwise identified to our satisfaction,
of the following documents (collectively, the "Documents"):
1. a certificate from the Secretary of State of the Commonwealth of
Massachusetts as of a recent date as to the legal existence and good standing of
the Company;
2. a copy of the Restated Articles of Organization of the Company, as
amended to date, and a certificate of the Clerk that there have been no further
amendments thereto;
3. a copy of the By-laws of the Company, as amended to date, certified by
the Clerk of the Company as presently being in effect;
4. votes of the Board of Directors of the Company relating to the approval
of the Plan, certified by the Clerk of the Company;
<PAGE> 2
May 28, 1997
Page 2
5. the Plan;
6. a letter from the Company's transfer agent as to the issued and
outstanding shares of the Company's Common Stock, $.66 2/3 par value; and
7. the Registration Statement.
We have assumed, for the purposes of our opinions herein, that any
conditions to the issuance of the Shares under the Plan have been or will be
satisfied in full.
We have, without independent investigation, relied upon the representations
and warranties of the various parties as to matters of objective fact contained
in the Documents.
In addition, this Firm, in rendering legal opinions, customarily makes
certain assumptions which are described in Schedule A hereto. In the course of
our representation of the Company in connection with the preparation of the
Registration Statement, nothing has come to our attention which causes us to
believe reliance upon any of these assumptions is inappropriate, and, with your
concurrence, the opinions hereafter expressed are based upon those assumptions.
The Enumerated Party referred to in Schedule A is the Company.
We have not made any independent review or investigation of orders,
judgments, rules or other regulations or decrees by which the Company or any of
its property may be bound, nor have we made any independent investigation as to
the existence of actions, suits, investigations or proceedings, if any, pending
or threatened against the Company.
With your concurrence, our opinion hereafter expressed is based solely upon
(1) our review of the Documents, (2) discussions with those of our attorneys who
have devoted substantive attention to the preparation of the Registration
Statement, and (3) such review of published sources of law as we have deemed
necessary.
Our opinions contained herein are limited to the laws of the Commonwealth
of Massachusetts and the Federal law of the United States of America.
We express no legal opinion upon any matter other than those explicitly
addressed below, and our express opinion therein contained shall not be
interpreted to be an implied opinion upon any other matter.
Based upon and subject to the foregoing, we are of the opinion that the
Shares have been duly authorized and, when issued and paid for in accordance
with the terms and conditions of the Plan, the Shares will be validly issued,
fully paid, and non-assessable.
<PAGE> 3
May 28, 1997
Page 3
We hereby consent to the reference to this firm in the Registration
Statement and to the filing of this opinion as Exhibit(5)(a) to the Registration
Statement.
Very truly yours,
BROWN, RUDNICK, FREED & GESMER
By: Brown, Rudnick, Freed, &
Gesmer, P.C., a Partner
By: /s/ John G. Nossiff
----------------------------
John G. Nossiff, a Member
JGN/SRL
<PAGE> 4
SCHEDULE A
BROWN, RUDNICK, FREED & GESMER
STANDARD ASSUMPTIONS
In rendering legal opinions, Brown, Rudnick, Freed & Gesmer makes certain
customary assumptions described below:
1. Each natural person executing any of the Documents has sufficient legal
capacity to enter into such Documents.
2. Each Document is accurate, complete and authentic, each original is
authentic, each copy conforms to an authentic original and all signatures
are genuine.
3. All official public records are accurate, complete and properly indexed and
filed.
4. There has not been any mutual mistake of fact or misunderstanding, fraud,
duress, or undue influence by or among any of the parties to the Documents.
5. The conduct of the parties to the Documents has complied in the past and
will comply in the future with any requirement of good faith, fair dealing
and conscionability.
6. The Enumerated Party will obtain all permits and governmental approvals
required in the future and take all actions similarly required relevant to
its performance of its obligations under the Documents.
7. All parties to or bound by the Documents will act in accordance with, and
will refrain from taking any action that is forbidden by, the terms and
conditions of the Documents.
8. There are no agreements or understandings among the parties to or bound by
the Documents, and there is no usage of trade or course of prior dealing
among such parties, that would define, modify, waive, or qualify the terms
of any of the Documents.
<PAGE> 1
EXHIBIT 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference in this registration statement on Form S-8 for the American Science
and Engineering, Inc. 1997 Non-Qualified Stock Option Plan to be filed May 28,
1997, of our reports dated June 5, 1996 included in American Science and
Engineering, Inc.'s Annual Report on Form 10-K for the year ended March 29, 1996
and to all references to our Firm included in this registration statement.
Arthur Andersen LLP
Boston, Massachusetts
May 21, 1997
<PAGE> 1
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Ralph S. Sheridan, Lee C. Steele, and Jeffrey
Bernfeld, and each of them, his/her true and lawful attorney-in-fact and agent,
with full power of substitution and resubstitution, for him/her and in his/her
name, place and stead, in any and all capacities to sign any or all amendments,
including post-effective amendments, to the Form S-8 Registration Statement to
which this instrument is attached and to file such amendments, including
post-effective amendments, with all exhibits thereto and other documents in
connection therewith, with the Commission, granting unto each of said
attorneys-in-fact and agents, 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 might or could do in
person, hereby ratifying and confirming all that each of said attorney-in-fact
and agent, or his substitute, may lawfully do or cause to be done by virtue
hereof.
Name Capacity Date
- ---- -------- ----
/s/ Ralph S. Sheridan President and Director May 27, 1997
- -------------------------- (Principal Executive
Ralph S. Sheridan Officer)
/s/ Lee C. Steele Vice President and May 27, 1997
- -------------------------- Treasurer (Principal
Lee C. Steele Financial Officer)
/s/ Herman Feshbach Director May 27, 1997
- --------------------------
Herman Feshbach
/s/ Al Gladen Director May 27, 1997
- --------------------------
Al Gladen
/s/ Hamilton W. Helmer Director May 27, 1997
- --------------------------
Hamilton W. Helmer
Director May 27, 1997
- --------------------------
Donald J. McCarren
/s/ William E. Odom Director May 27, 1997
- --------------------------
William E. Odom
<PAGE> 1
EXHIBIT 99
AMERICAN SCIENCE AND ENGINEERING, INC.
1997 NON-QUALIFIED STOCK OPTION PLAN
SECTION I. PURPOSE OF THE PLAN.
The purposes of this American Science and Engineering, Inc. 1997
Non-Qualified Stock Option Plan (the "1997 Plan") are (i) to provide long-term
incentives and rewards to those key employees (the "Employee Participants") of
American Science and Engineering, Inc. (the "Corporation") and its subsidiaries
(if any), and any other persons (the "Non-employee Participants") who are in a
position to contribute to the long-term success and growth of the Corporation
and its subsidiaries, (ii) to assist the Corporation in retaining and attracting
executives and key employees with requisite experience and ability, and (iii) to
associate more closely the interests of such executives and key employees with
those of the Corporation's stockholders.
SECTION II. DEFINITIONS.
"Common Stock" is the $.66 2/3 par value common stock of the
Corporation.
"Committee" is defined in Section III, paragraph (a).
"Corporation" is defined in Section I.
"Employee Participants" is defined in Section I.
"Fair Market Value" of any property is the value of the property as
reasonably determined by the Committee.
"1997 Plan" is defined in Section I.
"Non-employee Participants" is defined in Section I.
"Non-qualified Option" is a Stock Option which does not qualify as an
Incentive Stock Option or for which the Committee provides, in the terms of
such option and at the time such option is granted, that the option shall
not be treated as an Incentive Stock Option.
"Parent Corporation" has the meaning provided in Section 424(e) of the
Code.
<PAGE> 2
"Participants" are all persons who are either Employee Participants or
Non-employee Participants.
"Permanent and Total Disability" has the meaning provided in Section
22(e)(3) of the Code.
"Rule 16b-3" means Securities and Exchange Commission Rule 16b-3.
"Section 16" means Section 16 of the Securities Exchange Act of 1934,
as amended, or any similar or successor statute, and any rules,
regulations, or policies adopted or applied thereunder.
"Stock Options" are rights granted pursuant to this 1997 Plan to
purchase shares of Common Stock at a fixed price.
"Subsidiary Corporation" has the meaning provided in Section 424(f) of
the Code.
SECTION III. ADMINISTRATION.
(a) The Committee. This 1997 Plan shall be administered by the Board of
Directors or by a compensation committee consisting solely of two or more
"non-employee directors", as defined in Rule 16b-3, who shall be designated by
the Board of Directors of the Corporation (the administering body is hereafter
referred to as the "Committee"). The Committee shall serve at the pleasure of
the Board of Directors, which may from time to time, and in its sole discretion,
discharge any member, appoint additional new members in substitution for those
previously appointed and/or fill vacancies however caused. A majority of the
Committee shall constitute a quorum and the acts of a majority of the members
present at any meeting at which a quorum is present shall be deemed the action
of the Committee. No person shall be eligible to be a member of the Committee if
that person's membership would prevent the plan from complying with Section 16,
if applicable to the Corporation.
(b) Authority and Discretion of the Committee. Subject to the express
provisions of this 1997 Plan and provided that all actions taken shall be
consistent with the purposes of this 1997 Plan, and subject to ratification by
the Board of Directors only if required by applicable law, the Committee shall
have full and complete authority and the sole discretion to: (i) determine those
persons who shall constitute key employees eligible to be Employee Participants;
(ii) select the Participants to whom Stock Options shall be granted under this
1997 Plan; (iii) determine the size and the form of the Stock Options, if any,
to be granted to any Participant; (iv) determine the time or times such Stock
Options shall be granted including the
<PAGE> 3
grant of Stock Options in connection with other awards made, or compensation
paid, to the Participant; (v) establish the terms and conditions upon which such
Stock Options may be exercised and/or transferred, including the exercise of
Stock Options in connection with other awards made, or compensation paid, to the
Participant; (vi) make or alter any restrictions and conditions upon such Stock
Options and the Stock received on exercise thereof, including, but not limited
to, providing for limitations on the Participant's right to keep any Stock
received on termination of employment; (vii) determine whether the Participant
or the Corporation has achieved any goals or otherwise satisfied any conditions
or requirements that may be imposed on or related to the exercise of Stock
Options; and (viii) adopt such rules and regulations, establish, define and/or
interpret these and any other terms and conditions, and make all determinations
(which may be on a case-by-case basis) deemed necessary or desirable for the
administration of this 1997 Plan.
(c) Applicable Law. This 1997 Plan and all Stock Options shall be governed
by the law of the state in which the Corporation is incorporated.
SECTION IV. TERMS OF STOCK OPTIONS.
(a) Agreements. Stock Options shall be evidenced by a written agreement
between the Corporation and the Participant awarded the Stock Option. This
agreement shall be in such form, and contain such terms and conditions (not
inconsistent with this 1997 Plan) as the Committee may determine. The agreement
shall include the following or a similar statement: "This stock option is not
intended to be an Incentive Stock Option, as that term is described in Section
422 of the Internal Revenue Code of 1986, as amended."
(b) Term. Stock Options shall be for such periods as may be determined by
the Committee.
(c) Purchase Price. The purchase price of shares purchased pursuant to any
Stock Option shall be determined by the Committee, and shall be paid by the
Participant or other person permitted to exercise the Stock Option in full upon
exercise, (i) in cash, (ii) by delivery of shares of Common Stock (valued at
their Fair Market Value on the date of such exercise), (iii) any other property
(valued at its Fair Market Value on the date of such exercise), or (iv) any
combination of cash, stock and other property, with any payment made pursuant to
subparagraphs (ii), (iii) or (iv) only as permitted by the Committee, in its
sole discretion. In no event will the purchase price of Common Stock be less
than the par value of the Common Stock.
(d) Restrictions. At the discretion of the Committee, the Common Stock
issued pursuant to the Stock Options granted hereunder may be subject to
restrictions on vesting or transferability. For the purposes of this limitation,
options shall be taken into account in the order granted.
<PAGE> 4
(e) Withholding of Taxes. Pursuant to applicable federal, state, local or
foreign laws, the Corporation may be required to collect income or other taxes
upon the grant of a Stock Option to, or exercise of a Stock Option by, a holder.
The Corporation may require, as a condition to the exercise of a Stock Option,
or demand, at such other time as it may consider appropriate, that the
Participant pay the Corporation the amount of any taxes which the Corporation
may determine is required to be withheld or collected, and the Participant shall
comply with the requirement or demand of the Corporation. In its discretion, the
Corporation may withhold shares to be received upon exercise of a Stock Option
if it deems this an appropriate method for withholding or collecting taxes.
(f) Securities Law Compliance. Upon exercise (or partial exercise) of a
Stock Option, the Participant or other holder of the Stock Option shall make
such representations and furnish such information as may, in the opinion of
counsel for the Corporation, be appropriate to permit the Corporation to issue
or transfer Stock in compliance with the provisions of applicable federal or
state securities laws. The Corporation, in its discretion, may postpone the
issuance and delivery of Stock upon any exercise of this Option until completion
of such registration or other qualification of such shares under any federal or
state laws, or stock exchange listing, as the Corporation may consider
appropriate. Furthermore, the Corporation is not obligated to register or
qualify the shares of Common Stock to be issued upon exercise of a Stock Option
under federal or state securities laws (or to register or qualify them at any
time thereafter), and it may refuse to issue such shares if, in its sole
discretion, registration or exemption from registration is not practical or
available. The Corporation may require that prior to the issuance or transfer of
Stock upon exercise of a Stock Option, the Participant enter into a written
agreement to comply with any restrictions on subsequent disposition that the
Corporation deems necessary or advisable under any applicable federal and state
securities laws. Certificates of Stock issued hereunder shall bear a legend
reflecting such restrictions.
(g) Right to Stock Option. No employee of the Corporation or any other
person shall have any claim or right to be a participant in this 1997 Plan or to
be granted a Stock Option hereunder. Neither this 1997 Plan nor any action taken
hereunder shall be construed as giving any person any right to be retained in
the employ of the Corporation. Nothing contained hereunder shall be construed as
giving any person any equity or interest of any kind in any assets of the
Corporation or creating a trust of any kind or a fiduciary relationship of any
kind between the Corporation and any such person. As to any claim for any unpaid
amounts under this 1997 Plan, any person having a claim for payments shall be an
unsecured creditor.
(h) Indemnity. Neither the Board of Directors nor the Committee, nor any
members of either, nor any employees of the Corporation or any parent,
subsidiary, or other affiliate, shall be liable for any act, omission,
interpretation, construction or determination made in good faith in
<PAGE> 5
connection with their responsibilities with respect to this 1997 Plan, and the
Corporation hereby agrees to indemnify the members of the Board of Directors,
the members of the Committee, and the employees of the Corporation and its
parent or subsidiaries in respect of any claim, loss, damage, or expense
(including reasonable counsel fees) arising from any such act, omission,
interpretation, construction or determination to the full extent permitted by
law.
(i) Participation by Foreigners. Without amending this 1997 Plan, the
Committee may modify grants made to participants who are foreign nationals or
employed outside the United States so as to recognize differences in local law,
tax policy, or custom.
SECTION V. AMENDMENT AND TERMINATION: ADJUSTMENTS UPON CHANGES IN STOCK.
The Board of Directors of the Corporation may at any time, and from time to
time, amend, suspend or terminate this 1997 Plan or any portion thereof,
provided that no amendment shall be made without approval of the Corporation's
stockholders if such approval is necessary to comply with any applicable rules
or regulations of the Securities and Exchange Commission, including Rule 16b-3
(or any successor rule thereunder), or the rules and regulations of any exchange
or stock market on which the Corporation's securities are listed or quoted.
Except as provided herein, no amendment, suspension or termination of this 1997
Plan may affect the rights of a Participant to whom a Stock Option has been
granted without such Participant's consent. If there shall be any change in the
Common Stock or to any Stock Option granted under this 1997 Plan through merger,
consolidation, reorganization, recapitalization, stock dividend, stock split or
other change in the corporate structure of the Corporation, appropriate
adjustments may be made by the Committee (or if the Corporation is not the
surviving corporation in any such transaction, the Board of Directors of the
surviving corporation, or its designee) in the aggregate number and kind of
shares subject to this 1997 Plan, and the number and kind of shares and the
price per share subject to outstanding options. In connection with the
foregoing, the Committee may issue new Stock Options in exchange for outstanding
Stock Options.
SECTION VI. SHARES OF STOCK SUBJECT TO THE PLAN.
The number of shares of Common Stock that may be the subject of awards
under this 1997 Plan shall not exceed an aggregate of 200,000 shares. Shares to
be delivered under this 1997 Plan may be either authorized but unissued shares
of Common Stock or treasury shares. Any shares subject to an option hereunder
which for any reason terminates, is cancelled or otherwise expires unexercised,
and any shares reacquired by the Corporation due to restrictions imposed on the
shares, shares returned because payment is made hereunder in stock of equivalent
value rather than in cash, and/or shares reacquired from a recipient for any
other reason shall, at such time, no longer count towards the aggregate number
of shares which have been the subject of Stock Options issued hereunder, and
such number of shares shall be subject to further awards
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under this 1997 Plan, provided, first, that the total number of shares then
eligible for award under this 1997 Plan may not exceed the total specified in
the first sentence of this Section VI, and second, that the number of shares
subject to further awards shall not be increased in any way that would cause
this 1997 Plan or any Stock Option to not comply with Section 16, if applicable
to the Corporation.
SECTION VII. EFFECTIVE DATE AND TERM OF THIS PLAN.
The effective date of this 1997 Plan is April 10, 1997 (the "Effective
Date") and awards under this 1997 Plan may be made for a period of ten years
commencing on the Effective Date. The period during which a Stock Option may be
exercised may extend beyond that time as provided herein.
DATE OF APPROVAL BY STOCKHOLDERS: N/A
DATE OF APPROVAL BY BOARD OF DIRECTORS: April 10, 1997
