REGISTRATION NO. 33-
___________________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
BIRMINGHAM UTILITIES, INC.
(Exact name of registrant as specified in its charter)
Connecticut 06-0878647
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
230 Beaver Street 06401
Ansonia, Connecticut (Zip Code)
(Address of Principal Executive Offices)
Birmingham Utilities, Inc. 1994 Stock Incentive Plan
(Full Title of the Plan)
PAUL V. ERWIN
Treasurer
Birmingham Utilities, Inc.
230 Beaver Street
Ansonia, Connecticut 06401
(Name and address of agent for service)
(203) 735-1888
(telephone number,including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
____________________________________________________________________________
Title of Amount to Proposed Proposed Amount of
Securities be Registered Maximum Maximum registration
to be Aggregate Aggregate fee
Registered Offering Offering
Amount to be Price per Price
Share*
_____________________________________________________________________________
Common Stock,
no par value 35,000 shares $11.00 $385,000 $132.76
_____________________________________________________________________________
*Estimated solely for the purpose of calculating the registration fee in
accordance with Rule 457 under the Securities Act of 1933 based on the
average of high and low prices of the Common Stock reported on the NASDAQ
Small-Cap Market on July 12, 1995.
_____________________________________________________________________________
This registration statement shall become effective in accordance with the
provisions of Section 8(a) of the Securities Act of 1933 and Rule 462
promulgated thereunder.
PART I
Information Required in the Section 10(a) Prospectus
The information required by Items 1 and 2 is not required to be filed
as part of this Registration Statement.
PART II
Information Required in the Registration Statement
Item 3. Incorporation of documents by reference.
The following documents filed by Birmingham Utilities, Inc. (the
"Company") with the Securities and Exchange Commission are incorporated by
reference in this Registration Statement:
(1) the latest annual report of the Company filed pursuant to Section
13(a) or 15(d) of the Securities Exchange Act of 1934 (the
"Exchange Act"), or the latest prospectus filed pursuant to Rule
424(b) under the Securities Act of 1933 (the "Securities Act")
that contains audited financial statements for the Company's
latest fiscal year for which such statements have been filed;
(2) all other reports filed pursuant to Section 13(a) or 15(d) of the
Exchange Act since the end of the fiscal year covered by the
annual report or prospectus referred to in (1) above.
(3) the description of the Company's Common Stock, no par value per
share, contained in a registration statement filed under
Section 12 of the Exchange Act, including any amendment or report
filed for the purpose of updating such description.
In addition, all documents subsequently filed by the Company pursuant
to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the
filing of a post-effective amendment which indicates that all securities
offered hereby have been sold or which deregisters all securities then
remaining unsold, shall be deemed to be incorporated by reference in the
Registration Statement and to be a part thereof from the date of filing of
such documents.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Officers by the Registrant.
Pursuant to the statutes of the State of Connecticut, a director,
officer or employee of a corporation is entitled, under specified
circumstances, to indemnification by the corporation against reasonable
expenses, including attorney's fees, incurred by him in connection with the
defense of a civil or criminal proceeding to which he has been made, or
threatened to be made, a party by reason of the fact that he was a
director, officer or employee. In certain circumstances, indemnity is
provided against judgments, fines and amounts paid in settlement. In
general, indemnification is not available where the director, officer or
employee has been adjudged to have breached his duty to the corporation or
where he did not act in good faith. Specific court approval is required in
some cases. The foregoing statement is subject to the detailed provisions
of Section 33-320a of the Connecticut Stock Corporation Act. Article 9 of
the registrant's by-laws provides that its shareholders, directors,
officers and employees shall be indemnified to the extent allowed in
Section 33-320a of the Connecticut Stock Corporation Act. In addition, the
Company maintains an insurance policy providing coverage for certain
liabilities of directors and officers, including liabilities under the
federal securities laws.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
See Exhibit Index.
Item 9. Undertakings.
(1) The undersigned registrant hereby undertakes:
(a) 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;
(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. Notwithstanding the
foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of
securities offered would not exceed that which was
registered) and any deviation from the low or high
end of the estimated maximum offering range may be
reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) of the
Securities Act if, in the aggregate, the changes
in volume and price represent no more than a 20%
change in the maximum aggregate offering price set
forth in the "Calculation of Registration Fee"
table in the effective 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 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 15(d) of the Exchange Act that are
incorporated by reference in the registration statement.
(b) That, for the purpose of determining any liability under the
Securities Act, 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.
(c) 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.
(2) The undersigned registrant hereby undertakes that, for purposes
of determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of
the Exchange Act (and, where applicable, each filing of an employee benefit
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 the time shall be deemed to be the
initial bona fide offering thereof.
(3) 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 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.
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 City of Ansonia, State of
Connecticut, on the 25th day of July, 1995.
BIRMINGHAM UTILITIES, INC.
(Registrant)
By /s/ Aldore J. Rivers
Aldore J. Rivers
Its duly authorized President
By /s/ Paul V. Erwin
Paul V. Erwin
Its duly authorized Treasurer
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.
SIGNATURES TITLE DATE
/s/ Edward G. Brickett* Director July 25, 1995
Edward G. Brickett
/s/ David Silverstone* Director July 25, 1995
David Silverstone
/s/ James E. Cohen* Director July 25, 1995
James E. Cohen
/s/ Aldore J. Rivers* President July 25, 1995
Aldore J. Rivers and Director
/s/ Charles T. Seccombe* Director July 25, 1995
Charles T. Seccombe
/s/ Stephen P. Ahern* Director July 25, 1995
Stephen P. Ahern
/s/ Kenneth E Schaible* Director July 25, 1995
Kenneth E. Schaible
/s/ Betsy Henley-Cohn Chairwoman of the July 25, 1995
Betsy Henley-Cohn Board of Directors
*Aldore J. Rivers, by signing his/her name hereto, does sign this document
on behalf of the persons indicated above pursuant to powers of attorney
duly executed by such persons.
By /s/ Aldore J. Rivers
Aldore J. Rivers
Attorney-in-Fact
EXHIBIT INDEX
Exhibit
No.
_______
4.1 Certificate of Incorporation of Birmingham Utilities, Inc.
(incorporated by reference to Exhibit (3) of Birmingham Utilities,
Inc. Annual Report on Form 10-K for the period ending December
31, 1994).
4.2 By-Laws of Birmingham Utilities, Inc. (incorporated by reference to
Exhibit (3) of Birmingham Utilities, Inc. Annual Report on Form
10-K for the period ending December 31, 1994).
4.3 Amended and Restated Mortgage Indenture by and between The
Ansonia Derby Water Company and The Connecticut National Bank as
Trustee, dated as of August 9, 1991 (incorporated herein by
reference to Exhibit (4)(i) of The Ansonia Derby Water Company's
Annual Report on Form 10-K for the period ending December 31, 1991).
4.4 Commercial Term and Revolving Loan Agreement by and between
Birmingham Utilities, Inc. and Fleet Bank, N.A., dated April 29,
1994 (incorporated herein by reference to Exhibit 10(1) of
Birmingham Utilities, Inc.'s Quarterly Report on Form 10-Q, as
amended, for the period ended June 30, 1994).
5 Opinion of Tyler Cooper & Alcorn, dated July 25, 1995, as to the
legality of the original issuance of Common Stock offered under
this Registration Statement.
23 Consent of Price Waterhouse, dated July 25, 1995.
23.1 Consent of Tyler Cooper & Alcorn (incorporated by reference to
Exhibit 5 of this Registration Statement).
24 Power of Attorney authorizing the signing of the Registration
Statement and Amendments thereto on behalf of the Directors of
Birmingham Utilities, Inc.
99 Birmingham Utilities, Inc. 1994 Stock Incentive Plan adopted by its
Board of Directors on September 13, 1994.
EXHIBIT 5
July 25, 1995
Securities and Exchange Commission
Division of Corporate Finance
450 Fifth Street, N.W.
Judiciary Plaza
Washington, D.C. 20549-1004
Re: Birmingham Utilities, Inc. 1994 Stock Incentive Plan/Registration
Statement on Form S-8
Ladies and Gentlemen:
We have acted as counsel for Birmingham Utilities, Inc., a Connecticut
corporation (the "Company"), and in that capacity we have examined from time
to time such documents, corporate records and other instruments as we deem
necessary or appropriate to allow us to render the opinion which follows.
More particularly, we are familiar with the Registration Statement on Form
S-8, which the Company is filing to register shares of Birmingham Utilities,
Inc. Common Stock, No Par Value (the "Common Stock"), to be sold pursuant to
the provisions of the Birmingham Utilities, Inc. 1994 Stock Incentive Plan
(the "Plan"), under the Securities Act of 1933, as amended. In rendering
this opinion, we have assumed that there will be no change in applicable
law between the date of this opinion and the date of issuance of the shares
pursuant to such Registration Statement.
On the basis of our examination, we are of the opinion that, when issued
and sold in accordance with the terms of the Plan, the shares of Common Stock
to which such Registration Statement relates will be legally issued, fully
paid and non-assessable.
We hereby consent to the use of this opinion as an exhibit to the
Registration Statement referred to above and to the reference to us under
"Legal Opinions" in the Prospectus.
Very truly yours,
TYLER COOPER & ALCORN
By /s/ Robert J. Metzler, II
Robert J. Metzler, II, a Partner
RJM:ldm
EXHIBIT 23
Consent of Independent Accountants
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated February 24, 1995 which appears
on page 16 of the 1994 Annual Report on Form 10-K of Birmingham Utilities,
Inc. for the year ended December 31, 1994.
Price Waterhouse LLP
New York, New York
July 25, 1995
EXHIBIT 24
POWER OF ATTORNEY
We, the undersigned directors of Birmingham Utilities, Inc., hereby
severally constitute Aldore J. Rivers and Paul V. Erwin, and each of them
singly, our true and lawful attorneys with full power of substitution, to
sign for us and in our names in the capacities listed below, the
Registration Statement on Form S-8 filed herewith and any and all amendments
to such Registration Statement, and generally to do all such things in our
names and on our behalf in our capacities as directors to enable Birmingham
Utilities, Inc. to comply with the provisions of the Securities Act of 1933,
as amended, all requirements of the Securities and Exchange Commission, and
all requirements of any other applicable law or regulation, hereby ratifying
and confirming our signatures as they may be signed by our said attorneys,
or either of them, to such Registration Statement and any and all amendments
thereto, including post-effective amendments.
Signatures Title Date
/s/ Betsy Henley-Cohn Director and Chairman of June 7, 1995
Betsy Henley-Cohn the Board
/s/ Stephen P. Ahern Director June 7, 1995
Stephen P. Ahern
/s/ Edward G. Brickett Director June 7, 1995
Edward G. Brickett
/s/ James E. Cohen Director June 7, 1995
James E. Cohen
/s/ Aldore J. Rivers Director June 7, 1995
Aldore J. Rivers
/s/ Kenneth E. Schaible Director June 7, 1995
Kenneth E. Schaible
/s/ Charles T. Seccombe Director June 7, 1995
Charles T. Seccombe
/s/ David Silverstone Director June 7, 1995
David Silverstone
EXHIBIT 99
BIRMINGHAM UTILITIES, INC.
1994 STOCK INCENTIVE PLAN
ARTICLE I.
Purpose and Scope of the Plan
1.01 Purpose. The purpose of the Birmingham Utilities, Inc. 1994 Stock
Incentive Plan (the "Plan") is to promote the long-term success of Birmingham
Utilities, Inc. by providing financial incentives to key employees who are in
a position to make significant contributions toward such success. The Plan is
designed to attract and retain key employees and to encourage them to acquire
a proprietary interest in the Company and thereby to increase their personal
interest in the long-term success of the Company.
1.02 Definitions. Unless the context clearly indicates otherwise, the
following terms have the meanings set forth below:
"Board of Directors" or "Board" means the Board of Directors of the
Company.
"Business Day" shall mean any day except Saturday, Sunday or a legal
holiday in the State of Connecticut.
"Code" means the Internal Revenue Code of 1986, as amended.
"Committee" means the Personnel and Pension Committee of three or more
members appointed by the Board of Directors and selected from those
directors who are not employees of the Company, its parent or any
Subsidiary, as defined in Section 424(e) and (f) of the Code. The Board
may at any time and from time to time remove any member of the Committee,
with or without cause, appoint additional members to the Committee and
fill vacancies, however caused, in the Committee. A majority of the
members of the Committee shall constitute a quorum. All determinations of
the Committee shall be made by a majority of its members. Any decision or
determination of the Committee reduced to writing and signed by all of the
members of the Committee shall be fully as effective as if it had been
made at a meeting duly called and held.
"Common Stock" means the common stock, without par value, of the
Company.
"Company" means Birmingham Utilities, Inc., a Connecticut corporation.
"Disability", as applied to a Grantee, means permanent and total
disability as defined in Section 22(e)(3) of the Code.
"Employee" means any employee of the Company or any of its Subsidiaries.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Fair Market Value" of a share of Common Stock on any particular date is
the average of the high and low sales price of a share of Common Stock on
the NASDAQ Small Cap Market (or any exchange on which the Common Stock is
then traded) as reported for that date by NASDAQ or, if no sales price is
reported for that date, the average bid quotation for the Common Stock on
that date as reported by NASDAQ; provided, however, that if no such sales
or quotation are reported by NASDAQ for such date, the Fair Market Value
of a share of Common Stock on such date shall be the average of the high
and low sales price or, if no sales price is reported for that date, the
average bid quotation as reported by NASDAQ for the first Business Day
immediately after such date on which such sales or quotation are reported.
"Grant Date," as used with respect to a particular award, means the date
on which such award is granted by the Committee pursuant to the Plan.
"Grantee" means an individual to whom an award has been granted by the
Committee pursuant to the Plan.
"Immediate family members" of a Grantee means the Grantee's children,
grandchildren and spouse.
"Incentive Stock Option" means an Option that qualifies as an Incentive
Stock Option as described in Section 422 of the Code.
"Key Employee" means any Employee who, in the judgment of the Committee,
is in a position to contribute significantly to the growth and prosperity
of the Company.
"Non-qualified Stock Option" means any Option other than an Incentive
Stock Option.
"Option" means an option, granted by the Committee pursuant to Article II,
to purchase shares of Common Stock and which shall be designated as either
an "Incentive Stock Option" or a "Non-qualified Stock Option."
"Option Period" means the period beginning on the Grant Date and ending
such day as determined by the Committee with such day being prior to the
tenth anniversary of the Grant Date.
"Performance Stock" means an award entitling the Grantee to payment of
shares of Common Stock or cash or a combination thereof contingent upon
the attainment of performance objectives determined in the discretion of
the Committee.
"Plan" means the Birmingham Utilities, Inc. 1994 Stock Option Plan as
set forth herein and as amended from time to time.
"Restricted Stock" means an award of Common Stock with such restrictions
placed thereon as the Committee in its discretion deems appropriate.
"Retirement", as applied to an Employee, shall mean a termination of
employment with the Company which qualifies for the payment of retirement
benefits under the qualified pension plan applicable to such employee or
a termination of employment which occurs following the Employee's
attaining age 62 with ten years of service to the Company.
"Subsidiary" shall mean a "subsidiary corporation" of the Company as
defined in Section 425(f) of the Code.
1.03 Aggregate Limitation.
(a) The aggregate number of shares of Common Stock to be delivered
under the Plan shall not exceed 35,000 shares, subject to adjustment in
accordance with Section 3.06.
(b) Any shares of Common Stock to be delivered or purchased or used
for reference purposes under the Plan shall be issued from the Company's
authorized but unissued shares of Common Stock or from shares of Common Stock
held in the treasury, at the discretion of the Board.
(c) If any shares are subject to an award which for any reason
expires or terminates during the term of the Plan prior to the issuance of
such shares or other payment of such awards, the shares subject to but not
delivered under such award shall be available for issuance under the Plan. In
the case of an award of Restricted Stock any part of which is forfeited prior
to full vesting, such shares as are forfeited prior to vesting shall be
available for issuance under the Plan. The shares referenced in an exercised
stock appreciation right, shares in lieu of which an optionee elects to
receive cash, or shares under a related option which is surrendered upon the
exercise of a stock appreciation right shall all be charged against the
aggregate number of shares available for issuance under the Plan.
1.04 Administration of the Plan.
(a) The Committee shall have all the powers vested in it by the
terms of the Plan, including exclusive authority (within the limitations
described herein) to select the employees to be granted awards under the
Plan, to determine the type, size and terms of awards to be made to each
employee selected, to determine the time when awards will be granted to
employees, to establish objectives and conditions, if any, for earning such
awards and to determine whether such awards will be paid after the end of
an award period. The Committee shall have full power and authority to
administer and interpret the Plan, to adopt such rules, regulations,
agreements, guidelines and instruments for the administration of the Plan
and for the conduct of its business as the Committee deems necessary or
advisable, to accelerate the exercisability or vesting of all or any
portion of any Option or to extend the period during which an Option is
exercisable and to make all other determinations necessary or advisable
in order to administer the Plan. The Committee's interpretation of the
Plan and all actions taken and determinations made by the Committee
pursuant to the powers vested in it hereunder shall be conclusive and
binding on all parties concerned, including the Corporation, its
stockholders, any Grantees and any other employee of the Corporation or
any of its subsidiaries.
(b) Options, stock appreciation rights, dividend equivalents,
Restricted Stock and Performance Stock shall be evidenced by written
agreements which shall contain such terms and conditions consistent with
the Plan as may be determined by the Committee. Each agreement shall be
signed on behalf of the Corporation by the Chief Executive Officer or other
duly authorized officer of the Corporation.
(c) All decisions made by the Board of Directors pursuant to the
provisions of the Plan shall be final and conclusive.
1.05 Effective Date and Duration of Plan. The Plan shall become
effective upon its adoption by the Board; provided that no Option or award
granted pursuant to the Plan shall be exercised or will vest prior to the
approval of the Plan by (1) the shareholders of the Company within twelve
(12) months of its adoption by the Board, and (2) the Connecticut Department
of Public Utility Control ("DPUC"). Unless previously terminated by the
Board, the Plan shall terminate, as to any shares as to which Options or
awards have not theretofore been granted, on the tenth anniversary of its
adoption by the Board. Subject to the provisions of Section 2.02(f) hereof,
the period during which an award under the Plan may be exercised shall be
the period, expiring not later than the tenth anniversary of the Grant Date
of the award, as may be determined by the Committee.
1.06 Awards.
(a) Types. Awards under the Plan shall be made with reference
to shares of Common Stock and may include, but need not be limited to,
shares of stock, which may be granted with or without restrictions in the
discretion of the Committee, options, stock appreciation rights, dividend
equivalents and Performance Stock. The Committee may make any other type
of award which it shall determine is consistent with the objectives and
limitations of the Plan.
(b) Performance Goals. The Committee may, but need not,
establish performance goals to be achieved within such performance periods
as may be selected by it in its sole discretion, using such measures of the
performance of the Corporation and/or its subsidiaries as it may select.
(c) Guidelines. From time to time, the Committee may adopt
written policies implementing the Plan. Such policies may include, but need
not be limited to, the type, size and terms of awards to be made to Employees
and the conditions for payment of such awards. The Committee may determine
the amount and form of consideration, if any, payable on the issuance or
exercise of awards of stock, whether granted with or without restrictions,
and awards of Performance Stock. However, Common Stock to be issued for
such awards shall be issued either at no cost, provided the consideration
received for such shares is, in the opinion of counsel to the Company,
adequate under the laws of the Company's state of incorporation, or a price
not to exceed the par value of such shares. Grantees of awards of stock,
whether granted with or without restrictions, and awards of Performance
Stock must accept such awards by execution of a written agreement with the
Company in such form as the Committee determines not more than sixty (60)
days following the award date or else such rights shall expire.
ARTICLE II.
Stock Options and Other Awards
2.01 Grant of Options. Key Employees shall be eligible to receive
Options under the Plan. Directors who are not Employees shall not be
eligible to receive Options.
Each Option shall be exercisable from time to time during such periods
and in such manner and number of shares as determined by the Committee and
set forth in the Agreement evidencing such Option, provided that no Option
granted under the Plan to a person subject to the requirements of Section 16
of the Exchange Act shall be exercisable in whole or in part prior to the
expiration of six (6) months from its Grant Date except in the case of death
or Disability. The date of exercise shall be the date on which payment is
received by the Company. The term of each Option shall be determined and may
be extended by the Committee, but in no event shall the term of an Option
exceed ten (10) years.
2.02 Option Requirements.
(a) Each Option shall be designated as an Incentive Stock Option
or a Non-Qualified Stock Option and shall be evidenced by a written
instrument specifying the number of shares of Common Stock that may be
purchased by its exercise and containing such terms and conditions consistent
with the Plan as the Committee may determine.
(b) An Option shall not be granted on or after the tenth
anniversary of the date upon which the Plan is adopted by the Board or, if
earlier, the tenth anniversary of the date upon which the Plan is approved
by the shareholders of the Company.
(c) An Option shall not be exercisable after the expiration of
the Option Period.
(d) The Committee may provide, in the instrument evidencing an
Option, for the lapse of the Option, prior to the expiration of the Option
Period, upon the occurrence of any event specified by the Committee.
(e) The option price per share of Common Stock shall not be less
than the Fair Market Value of a share of Common Stock on the Grant Date,
provided, however, that the option price per share of Common Stock on the
date of exercise shall not be less than the par value per share of Common
Stock, if any, on the date of exercise.
(f) Upon the termination of a Grantee's employment by the Company
or any of its Subsidiaries for any reason the Grantee may exercise an Option,
to the extent such Option was exercisable on the date of such termination,
until the earlier of the expiration of its original term or:
(i) If such termination is due to Retirement, three (3) months
after such termination in the case of an Incentive Stock
Option and twelve months after such termination in the
case of a Non-Qualified Stock Option;
(ii) If such termination is due to Disability, one (1) year
after such termination in the case of an Incentive Stock
Option and three years after such termination in the
case of a Non-Qualified Stock Option;
(iii) Upon the death of any such Grantee while in active
service or of any such disabled or retired Grantee
within the above-referenced period, the person or
persons to whom the rights under the Option are
transferred by will or the laws of descent and
distribution may, within twelve months after the date
of the Grantee's death, exercise some or all of the
Grantee's Options which were exercisable on the date
of death by the Grantee.
(iv) If such termination is for any other reason, Grantee may,
within three months after the date of such termination,
purchase some or all of the shares covered by the
Grantee's Options which were exercisable immediately
prior to such termination, provided that, notwithstanding
the foregoing, the Options of a Grantee shall
automatically terminate as of the date his or her
employment is terminated, if terminated on account of
any act of (a) fraud or intentional misrepresentation,
or (b) embezzlement, misappropriation or conversion of
assets or opportunities of the Company or any Subsidiary.
(v) An Incentive Stock Option not exercised within three
months (twelve months in the case of Disability) after
the date of termination due to Disability or Retirement
may be exercised within twelve months in the case of
Retirement and three years in the case of Disability
after the date of such termination but no longer will
be eligible for the treatment afforded Incentive
Stock Options under Section 422 of the Code.
Leaves of absence for such periods and purposes conforming to the
personnel policy of the Company as may be approved by the Committee shall not
be deemed terminations or interruptions of employment.
In the event that a Grantee to whom a stock appreciation right has been
granted ceases employment with the Company, its parent and subsidiaries for
any reason, including death, Disability or Retirement, such stock
appreciation right shall be exercisable only to the extent and upon the
conditions that its related Option, if any, is exercisable under this
subparagraph (f) of this Article, or as provided in a stock appreciation
rights agreement, if such right is granted without a related option.
The Committee may adopt rules and regulations, whether or not inconsistent
with this Article, but not inconsistent with the provisions of Section 422 of
the Code, setting forth the terms and conditions of awards relating to the
Grantee's rights in the event of termination of employment.
(g) A person electing to exercise an Option shall give written
notice, in such form as the Committee may require, of such election to the
Company and shall tender to the Company the full purchase price of the shares
of Common Stock for which the election is made. Payment of the purchase
price shall be made in cash or in such other form as the Committee may
approve, including shares of Common Stock valued as provided in Section 3.02
hereof or a combination of cash and/or such other form of property.
2.03 Incentive Stock Option Requirements.
(a) An Option designated by the Committee as an "Incentive Stock
Option" is intended to qualify as an "incentive stock option" within the
meaning of Subsection (b) of Section 422 of the Code and shall satisfy, in
addition to the conditions of Section 2.02, the conditions set forth in this
Section 2.03.
(b) An Incentive Stock Option shall not be granted to an individual
who, on the date of grant, owns stock possessing more than ten percent (10%)
of the total combined voting power of all classes of stock of the Company or
of its parent or any Subsidiary unless the requirements of subsection (c)
hereof are satisfied.
(c) If any employee to whom an Incentive Stock Option is to be
granted pursuant to the provisions of the Plan is on the date of grant the
owner of stock possessing more than ten percent (10%) of the total combined
voting power of all classes of stock of the Company or of its parent or any
Subsidiary, then the following special provisions shall be applicable to the
Incentive Stock Option granted to such individual:
(i) The option price per share of the Common Stock subject to
such Incentive Stock Option shall not be less than one
hundred ten percent (110%) of the Fair Market Value of
one share of Common Stock on the date of grant; and
(ii) The option exercise period shall not exceed five years
from the date of the grant.
In determining whether the ten percent (10%) threshold has been
reached, the stock attribution rules of Section 424(d) of the Code
shall apply.
(d) The aggregate Fair Market Value, determined on the Grant Date,
of the shares of Common Stock with respect to which Incentive Stock Options
are exercisable for the first time by a Grantee during any calendar year
(under all such plans of the Grantee's employer corporation and its parent
and Subsidiary corporations) shall not exceed $100,000.
(e) Except as modified by the preceding provisions of this Section
2.03, all of the provisions of the Plan shall be applicable to Incentive Stock
Options granted hereunder.
2.04 Stock Appreciation Rights.
The Committee may also grant stock appreciation rights to Key Employees.
Stock appreciation rights granted in conjunction with Options under the Plan
may be granted either at the time of grant of such Options pursuant to the
Plan or by subsequent action prior to the exercise, termination or expiration
of such Options. Such stock appreciation rights shall be subject to the same
terms and conditions as the related Options and may be exercised only at a
time when the Fair Market Value of a share of Common Stock exceeds the option
price for such shares, the Options are otherwise exercisable, and if, at the
time of such exercise, the Grantee surrenders the privilege of exercising the
related Options to the extent that the Grantee exercises a stock
appreciation right. In the event of a grant of stock appreciation right
without a related option, the Common Stock price referenced in such grant
shall not be less than the Fair Market Value per share of Common Stock on the
Grant Date.
Upon exercise of a stock appreciation right and surrender of the related
Option (or any portion of such Option), if any, the Grantee shall be entitled
to receive, subject to the provisions of the Plan and such rules and
regulations as may be established by the Committee, a payment equal to the
product of (A) the excess of (i) the Fair Market Value of one share of Common
Stock at the time of such surrender over (ii) the price per share specified
in such related Option or stock appreciation rights agreement, times (B) the
number of such shares called for by the related Option, or portion thereof,
which is so surrendered or specified in such stock appreciation rights
agreement. Such payment shall be made as determined by the Committee, in
its sole discretion, either in (i) cash, or (ii) shares of Common Stock
valued at Fair Market Value as of the date of exercise, or (iii) partly in
cash and partly in shares of Common Stock. Neither a stock appreciation right
held by a Grantee who is an officer or director of the Company, the exercise
of which would result in a cash payment, nor any related Option shall be
exercisable during the first six months of the option period (or during the
first six months from the Grant Date of the stock appreciation right if granted
subsequently to the related Option). If, upon settlement of a stock
appreciation right, a Grantee is to receive payment or a portion thereof in
shares of Common Stock, the number of shares shall be determined by dividing
such payment or portion by the Fair Market Value of a share of Common Stock
on the date of exercise. However, if the Committee, in its discretion,
decides to permit a Grantee who is an officer or director of the Corporation
to elect to receive cash in full or partial settlement of the exercise of a
stock appreciation right, then such election shall be made during the period
beginning on the third business day following the date of release for
publication of quarterly and annual summary statements of sales and earnings
of the Corporation and ending on the twelfth business day following such
date, unless a different period is specified in Rule 16b-3 under the
Exchange Act, as in effect at the time of such exercise, or any law, rule,
regulation or other provision that may hereafter replace such Rule (the
"Window Period").
The Committee shall also determine whether, and if so to what extent,
the exercise of an Option shall be required as a condition to the exercise
of a related stock appreciation right. No stock appreciation right can be
exercised by a Grantee who is an officer or director of the Company unless
the Company has been subject to the reporting requirements of Section 13 of
the Exchange Act for at least one year prior to the date of said exercise
and has filed all reports and statements required to be filed pursuant to
that section during that period.
2.05 Dividend Equivalents.
The Committee may also grant dividend equivalents to employees granted
related awards under the Plan pursuant to rules and regulations adopted by
the Committee. The Committee may require or permit the immediate payment or
the waiver, deferral or investment of (1) dividends paid on awards under the
Plan, and (2) amounts equal to dividends which would have been paid if
shares subject to an award had been outstanding on the dividend record date.
No payment, credits or accruals shall be made on shares subject to an award
which are not yet issued and outstanding on account of the payment of a
stock dividend or other distribution in kind on the Common Stock.
ARTICLE III.
General Provisions
3.01 Exercise of Options and Stock Appreciation Rights and Payment of
Other Awards.
(a) No Option or stock appreciation right may be exercised and no
other award will vest or be paid prior to the approval of the Plan by the
Company's shareholders and the DPUC.
(b) No Option or stock appreciation right may at any time be
exercised with respect to a fractional share or exercised in part with
respect to fewer than twenty-five (25) shares. No fractional shares shall
be issued and the Committee shall determine whether cash shall be paid in
lieu of such fractional shares or such fractional shares shall be eliminated.
(c) No shares shall be delivered pursuant to the exercise of any
Option or in payment of an award, in whole or in part, until qualified for
delivery under such securities laws and regulations as the Committee may
deem to be applicable thereto and until payment in full of the option price
is received by the Company in cash, by check or in stock as provided in
Section 3.02 hereof or, if authorized by the Committee's regulations and
accomplished in accordance therewith, by delivery of a properly executed
exercise notice together with irrevocable instructions to a broker to deliver
promptly to the Company sale or loan proceeds sufficient to pay the option
price. Neither a Grantee nor such Grantee's legal representative, legatee or
distributee shall be or be deemed to be a holder of any shares subject to
such Option unless and until a certificate or certificates therefor is issued
in his or her name or in the name of a person designated by him or her.
3.02 Stock as Form of Exercise Payment. A Grantee may elect to use
Common Stock valued at the Fair Market Value on the last business day
preceding the exercise date to pay all or part of the exercise price of an
award, provided, however, that such form of payment shall not be permitted
unless at least one hundred (100) shares of Common Stock are delivered for
such purpose and the shares delivered have been held by the Grantee for at
least six months.
3.03 Withholding Taxes for Awards. Each Grantee exercising an award as
a condition to such exercise shall pay to the Company the amount, if any,
required to be withheld from distributions resulting from such exercise under
applicable Federal and State income tax laws ("Withholding Taxes"). Such
Withholding Taxes shall be payable as of the date income from such exercise
is includable in the Grantee's gross income for Federal income tax purposes
(the "Tax Date"). The Grantee may satisfy this requirement by electing one
of the following methods (or a combination thereof), which election is
subject to the approval of the Committee:
(i) remitting to the Company in cash or by check the amount of
such Withholding Taxes;
(ii) remitting to the Company a number of shares of Common Stock
having an aggregate Fair Market Value as of the last business
day preceding the Tax Date equal to the amount of such
Withholding Taxes;
(iii) electing to have the Company withhold from such distribution
the number of shares of Common Stock having an aggregate Fair
Market Value as of the last business day preceding the Tax Date
equal to the amount of such Withholding Taxes.
Any election by a Grantee pursuant to clause (ii) or (iii) of this Section
3.03 must be made on or prior to the Tax Date and will be irrevocable. In
addition, if the Grantee is subject to Section 16 of the Exchange Act, an
election pursuant to clause (ii) or (iii) of this Section 3.03 cannot be made
until at least six (6) months after the Grant Date of the Option (except that
this limitation shall not apply in the event the death or Disability of the
Grantee occurs prior to the expiration of the six (6) month period), and such
election must be made either by the date which is at least six (6) months
prior to the Tax Date or during any period beginning prior to the Tax Date
which begins on the third business day following the date of release for
publication by the Company of quarterly or annual summary statements of
earnings and ending on the twelfth business day following such date.
3.04 Transfer of Awards. An award shall not be transferable other than by
will or the laws of descent and distribution or pursuant to a qualified
domestic relations order, as defined in the Code, and, during the Grantee's
lifetime, shall be exercisable only by the Grantee, except that the
Committee may:
(i) permit exercise, during the Grantee's lifetime, by the
Grantee's guardian or legal representative; and
(ii) permit transfer, upon the Grantee's death, to beneficiaries
designated by the Grantee in a manner authorized by the
Committee, provided that the Committee determines that such
exercise and such transfer are consonant with requirements for
exemption from Section 16(b) of the Exchange Act and, with
respect to an Incentive Stock Option, the requirements of
Section 422(b)(5) of the Code.
(iii) grant Non-Qualified Stock Options that are transferable in
accordance with such transferability restrictions, if any, as
may be imposed by Rule 16b-3, as hereafter amended, or amend
outstanding Non-Qualified Stock Options to make them so
transferable, without payment of consideration, to immediate
family members of the Grantee or to trusts or partnerships for
such family members if Rule 16b-3 under the Exchange Act is
amended to permit restricted or unrestricted transfers of
derivative securities granted under plans intended to qualify
for the exemption provided by such rule.
3.05 Change in Ownership. In the event of (x) a dissolution or
liquidation of the Company, (y) a merger or consolidation in which the
Company is not the surviving corporation, or (z) any other capital
reorganization in which more than fifty percent (50%) of the shares of the
Company entitled to vote are exchanged, the Company shall give to each
Grantee, at the time of adoption of the plan for liquidation, dissolution,
merger, consolidation or reorganization, either (i) a reasonable time
thereafter within which to exercise the Option or other award, prior to the
effectiveness of such liquidation, dissolution, merger, consolidation or
reorganization, at the end of which time the Option shall terminate, or
(ii) the right to exercise the Option or award (or a substitute Option or
award) as to an equivalent number of shares of stock of the corporation
succeeding the Company or acquiring its business by reason of such
liquidation, dissolution, merger, consolidation or reorganization.
3.06 Adjustment Upon Changes in Capitalization.
(a) Changes in Capitalization. If the number of shares of Common
Stock of the Company as a whole are increased, decreased or changed into, or
exchanged for, a different number or kind of shares or securities of the
Company, whether through merger, consolidation, reorganization,
recapitalization, reclassification, stock dividend, stock split, combination
of shares, exchange of shares, change in corporate structure or the like, an
appropriate and proportionate adjustment shall be made in the number and
kind of shares subject to this Plan, and in the number, kind, and per share
exercise price of the shares of Common Stock subject to unexercised Options,
rights and other awards or portions thereof granted prior to any such
change. Any such adjustment in an outstanding Option or award, however,
shall be made without a change in the total price applicable to the
unexercised portion of the Option or award but with a corresponding
adjustment in the price for each share covered by the Option or award.
(b) Acquisition. Upon a reorganization, merger or consolidation in
which the Company is not the surviving corporation, or upon the sale of all
or substantially all of the property of the Company to another corporation,
provision shall be made in connection with such transaction for the
assumption of the Plan and the Options and awards theretofore granted by
the successor corporation. Provision may, alternatively, be made for the
substitution for such Options and awards of new options and awards of the
successor corporation or a parent or subsidiary thereof. In any such case,
appropriate adjustment as to the number and kind of shares and the per
share exercise prices shall be made. No fractional shares of stock shall
be issued under the Plan on account of any adjustment specified above.
(c) Dissolution or Liquidation. Upon the dissolution or liquidation
of the Company, this Plan and the Options and issued thereunder shall
terminate.
3.07 Additional Conditions. Any shares of Common Stock issued or
transferred under any provision of the Plan may be issued or transferred
subject to such conditions (including, without limitation, restrictions on
transferability), in addition to those specifically provided in the Plan,
as the Committee may impose.
3.08 No Right to Employment. Nothing in the Plan or any instrument
executed pursuant hereto shall confer upon any Employee any right to continue
in the employ of the Company or any of its Subsidiaries nor shall anything in
the Plan affect the right of the Company or any of its Subsidiaries to
terminate the employment of any Employee, with or without cause.
3.09 Legal Restrictions. The Company will not be obligated to issue
shares of Common Stock or make any payment if counsel to the Company
determines that such issuance or payment would violate any law or regulation
of any governmental authority or any agreement between the Company and any
national securities exchange upon which the Common Stock is listed. In
connection with any stock issuance or transfer, the person acquiring the
shares shall, if requested by the Company, give assurances satisfactory to
counsel to the Company regarding such matters as the Company may deem
desirable to assure compliance with all legal requirements. The Company
shall in no event be obliged to take any action in order to permit the
exercise of any Option.
3.10 No Rights as Shareholders. No Grantee, and no beneficiary or other
person claiming through a Grantee, shall have any interest in any shares of
Common Stock allocated for the purposes of the Plan or subject to any Option
or award until such shares of Common Stock shall have been transferred to
the Grantee or such person. Furthermore, the existence of the Options and
awards shall not affect: the right or power of the Company or its
stockholders to make adjustments, recapitalization, reorganizations or other
changes in the Company's capital structure; the dissolution or liquidation
of the Company, or sale or transfer of any part of its assets or business;
or any other corporate act, whether of a similar character or otherwise.
3.11 Choice of Law. The validity, interpretation and administration of
the Plan and of any rules, regulations, determinations or decisions made
thereunder, and the rights of any and all persons having or claiming to have
any interest therein or thereunder, shall be determined exclusively in
accordance with the laws of the State of Connecticut (regardless of the laws
that might be applicable under principles of conflicts of laws). Without
limiting the generality of the foregoing, the period within which any action
in connection with the Plan must be commenced shall be governed by the laws
of the State of Connecticut (regardless of the laws that might be applicable
under principles of conflicts of laws), without regard to the place where the
act or omission complained of took place, the residence of any party to such
action or the place where the action may be brought.
3.12 Amendment, Suspension and Termination of Plan. The Board may at any
time terminate, suspend or amend the Plan; however, no such amendment shall,
without the approval of the shareholders of the Company:
(i) increase the aggregate number of shares which may be issued in
connection with Options and other awards;
(ii) change the Option exercise price;
(iii) increase the maximum period during which awards may be
exercised;
(iv) extend the effective period of the Plan; or
(v) materially modify the requirements as to eligibility for
participation in the Plan.
