<PAGE>
As filed with the Securities and Exchange Commission on September 24, 1997
Registration No. 333-_________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
-------------------
CITADEL HOLDING CORPORATION
(Exact Name of Registrant as Specified in its Charter)
-------------------
DELAWARE 95-3885184
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
-------------------
550 South Hope Street, Suite 1825
Los Angeles, California 90071
(213) 239-0540
(Address, Including Zip Code, of Registrant's Principal Executive Offices)
-------------------
1996 Nonemployee Director Stock Option Plan
(Full Title of the Plan)
-------------------
S. CRAIG TOMPKINS
Secretary
CITADEL HOLDING CORPORATION
550 South Hope Street, Suite 1825
Los Angeles, California 90071
(213) 239-0540
(Name, Address, and Telephone Number, Including Area Code, of Agent for Service)
-------------------
With a copy to:
DHIYA EL-SADEN, ESQ.
Gibson, Dunn & Crutcher LLP
333 South Grand Avenue
Los Angeles, California 90071
(213) 229-7000
-------------------
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
============================================================================================================
Title of Securities Amount to Proposed Maximum Proposed Maximum Amount of
to be Registered be Registered Offering Price per Aggregate Registration
Share Offering Price Fee
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock 300,000 shares(1) $(2) $1,110,000.00 (2) $338.00 (2)
============================================================================================================
</TABLE>
(1) Pursuant to Rule 416, also being registered are additional shares of common
stock as may become available under the 1996 Nonemployee Director Stock
Option Plan through the operation of anti-dilution provisions.
(2) Price per share and aggregate offering price are estimated solely for the
purpose of calculating the registration fee pursuant to Rule 457(h) and Rule
457(c) of the Securities Act of 1933, as amended, as follows: $19.00 with
respect to 20,000 shares of Common Stock that are currently under option,
based on the price of $3.00 at which the options may be exercised; and
$319.00 with respect to 280,000 shares of Common Stock, based on a price of
$3.75 per share, the average of the high and low prices of the Common Stock
of Citadel Holding Corporation (the "Company"), as reported on the American
Stock Exchange on September 17, 1997.
<PAGE>
EXPLANATORY NOTE
This Registration Statement is being filed by Citadel Holding Corporation
("Citadel" or the "Company") in order to register 300,000 shares of Common Stock
(the "Common Stock" or the "Securities") which have been reserved for issuance
under the Citadel Holding Corporation 1996 Nonemployee Director Stock Option
Plan (the "Plan"). The additional shares of Common Stock that may become
available for purchase in accordance with the provisions of the Plan in the
event of certain changes in the outstanding shares of the Company's Common
Stock, including, among other things, stock dividends, stock splits, reverse
stock splits, reorganizations and recapitalizations, are also being registered.
The material which immediately follows constitutes a reoffer prospectus,
prepared on Form S-3, in accordance with General Instruction C to Form S-8, to
be used in connection with resales of Securities acquired under the Plan by
persons who may be considered affiliates of Citadel, as defined in Rule 405
under the Securities Act of 1933, as amended.
<PAGE>
REOFFER PROSPECTUS
CITADEL HOLDING CORPORATION
COMMON STOCK
($.01 PAR VALUE)
300,000 SHARES
This Prospectus relates to 300,000 shares of Common Stock, par value $.01
per share ("Common Stock" or the "Securities"), of Citadel Holding Corporation,
a Delaware corporation ("Citadel" or the "Company"), which have previously been
issued or may in the future be issued pursuant to awards granted under the 1996
Nonemployee Director Stock Option Plan, as amended (the "Plan"), and which may
be offered for resale from time to time by, certain Nonemployee Directors of the
Company named in "Selling Stockholders" and Annex 1 hereto (the "Selling
Stockholders").
The Company will not receive any of the proceeds from the sale of the
Common Stock offered hereby. The Company will pay all of the expenses associated
with this Prospectus. The Selling Stockholders will pay all selling and other
expenses, if any, associated with any sale of the Securities.
SEE "RISK FACTORS" ON PAGE 2 FOR CERTAIN CONSIDERATIONS RELEVANT TO AN
INVESTMENT IN THE SECURITIES.
The Common Stock is listed on the American Stock Exchange (Symbol: CDL).
________________________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION NOR HAS THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY
OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
_______________________________
THE DATE OF THIS PROSPECTUS IS SEPTEMBER 24, 1997.
<PAGE>
AVAILABLE INFORMATION
The Company has filed a Registration Statement on Form S-8 relating to the
Plan (the "Registration Statement") with the Securities and Exchange Commission
(the "Commission") under the Securities Act of 1933, as amended (the "Securities
Act"), with respect to the Securities covered by this Prospectus. This
Prospectus omits certain information and exhibits included in the Registration
Statement, a copy of which may be obtained upon payment of a fee prescribed by
the Commission or may be examined free of charge at the principal office of the
Commission in Washington, D.C.
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Commission. Such reports, proxy statements and other information filed with the
Commission by the Company can be inspected and copied at the public reference
facilities maintained by the Commission at 450 Fifth Street, N.W., Washington,
D.C. 20549, and at the regional offices of the Commission located at 500 West
Madison Street, Suite 1400, Chicago, Illinois 60606-2511 and at 7 World Trade
Center, Suite 1300, New York, New York 10048. Copies of such material can be
obtained from the Public Reference Section of the Commission at 450 Fifth
Street, N.W., Washington, D.C. 20549, at prescribed rates. The Commission also
maintains a Web site that contains reports, proxy and information statements and
other information regarding registrants that file electronically at
http://www.sec.gov.
The Company's Common Stock is listed on the American Stock Exchange
(Symbol: CDL), and reports and information concerning the Company can be
inspected at such exchange located at 86 Trinity Place, New York, New York
10006.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents heretofore filed by the Company with the Commission
are by this reference incorporated in and made a part of this Prospectus:
(1) The Company's Annual Report on Form l0-K for the fiscal year ended
December 31, 1996, including the Financial Statements and the Financial
Statement Schedule and the Report of Deloitte & Touche LLP, Independent
Auditors;
(2) The Company's Quarterly Reports on Form 10-Q for the quarters ended
March 31, 1997 and June 30, 1997;
(3) The description of the Company's Common Stock contained in the
Company's Registration Statement on Form 8-A; and
(4) All reports and other documents subsequently filed by the Company
pursuant to Section 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 Prospectus and
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.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
or in any other subsequently filed document which also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any
such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus.
Copies of all documents which are incorporated herein by reference (not
including the exhibits to such documents, unless such exhibits are specifically
incorporated by reference into such documents or into this Prospectus) will be
provided without charge to each person, including any beneficial owner, to whom
this Prospectus is delivered, upon a written or oral request to Citadel Holding
Corporation, Attention: Secretary, 550 South Hope Street, Suite 1825, Los
Angeles, California 90071, telephone number (213) 239-0540.
1
<PAGE>
RISK FACTORS
Prospective investors should consider carefully the information
incorporated by reference into this Prospectus before purchasing the Securities
offered hereby.
THE COMPANY
The Company's principal executive offices are located at 550 South Hope
Street, Suite 1825, Los Angeles, California 90071, and its telephone number is
(213) 239-0540. Additional information regarding the Company is set forth in
the Company's Annual Report on Form 10-K for the fiscal year ended December 31,
1996 (which is incorporated herein by reference).
USE OF PROCEEDS
The Company will not receive any of the proceeds from the sale of the
Securities offered hereby.
SELLING STOCKHOLDERS
The table attached as Annex I hereto sets forth, as of September 23, 1997
or a subsequent date if amended or supplemented: (a) the name of each Selling
Stockholder and his or her relationship to the Company during the last three
years; (b) the number of shares of Common Stock each Selling Stockholder
beneficially owned prior to this offering; (c) the number of Securities offered
pursuant to this Prospectus by each Selling Stockholder; and (d) the amount and
the percentage of the Company's Common Stock that would be owned by each Selling
Stockholder after completion of this offering. The information contained in
Annex I may be amended or supplemented from time to time.
PLAN OF DISTRIBUTION
Sales of the Securities offered hereby may be made on the American Stock
Exchange, the over-the-counter market or otherwise at prices and on terms then
prevailing or at prices related to the then current market price, or in
negotiated transactions. In addition, any Securities covered by this Prospectus
which qualify for sale pursuant to Rule 144 may be sold under Rule 144 rather
than pursuant to this Prospectus. The Company will not receive any part of the
proceeds of the sales made hereunder. All expenses associated with this
Prospectus are being borne by the Company, but all selling and other expenses
incurred by a Selling Stockholder will be borne by such Stockholder.
There is no assurance that any of the Selling Stockholders will offer for
sale or sell any or all of the Securities covered by this Reoffer Prospectus.
INTEREST OF NAMED EXPERTS AND COUNSEL
The validity of the shares of Common Stock covered by the Registration
Statement has been passed upon for the Company by Gibson, Dunn & Crutcher LLP.
The financial statements of the Company as of December 31, 1996, 1995 and
1994 and for the years ended December 31, 1996, 1995 and 1994, and the financial
statement schedule of the Company for the three-year period ended December 31,
1996, have been incorporated by reference herein and in the registration
statement in reliance upon the reports of Deloitte & Touche LLP, independent
certified public accountants, dated February 18, 1997, incorporated by reference
herein, and upon the authority of said firm as experts in accounting and
auditing.
2
<PAGE>
ANNEX I
<TABLE>
<CAPTION>
Shares to be Beneficially
Owned upon Completion of
Shares of Common Stock Offering(1)(2)
Relationship to Company During Beneficially Owned as of Shares Offered --------------------------
Selling Stockholder Last Three Years September 23, 1997(1) Hereby(1) Number Percent
- ------------------- ------------------------------ --------------------- --------------- ---------- ---------
<S> <C> <C> <C> <C> <C>
Alfred Villasenor, Director 10,000 10,000 0 0%
Jr.
Ronald I. Simon Director 10,000 10,000 0 0%
</TABLE>
__________________________
(1) All options to acquire shares are exercisable immediately.
(2) Assumes that all outstanding options under the Plan are exercised and all
shares offered hereby are sold, that no additional shares will be acquired
and that no shares other than those offered hereby will be sold.
A-1
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents heretofore filed by the Company with the Commission
are by this reference incorporated in and made a part of this Registration
Statement:
(1) The Company's Annual Report on Form l0-K for the fiscal year ended
December 31, 1996, including the Financial Statements and the Financial
Statement Schedule and the Reports of Deloitte & Touche LLP, Independent
Auditors;
(2) The Company's Quarterly Reports on Form 10-Q for the quarters ended
March 31, 1997 and June 30, 1997;
(3) The description of the Company's Common Stock contained in the
Company's Registration Statement on Form 8-A; and
(4) All reports and other documents subsequently filed by the Company
pursuant to Section 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 Prospectus and
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.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Registration Statement to the extent that a statement
contained herein or in any other subsequently filed document which also is or is
deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Registration
Statement.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the General Corporation Law of Delaware empowers the
Registrant to indemnify, subject to the standards set forth therein, any person
in connection with any action, suit or proceeding brought or threatened by
reason of the fact that the person is or was a director, officer, employee or
agent of the Registrant, or is or was serving as such with respect to another
corporation at the request of the Registrant. The General Corporation Law of
Delaware also provides that the Registrant may purchase insurance on behalf of
any such director, officer, employee or agent. The Registrant's By-laws provide
that the Registrant shall, to the fullest extent permitted by applicable law,
indemnify its directors and officers with respect to certain threatened, pending
or completed actions, suits or proceedings.
The Registrant maintains an insurance policy pursuant to which the
directors and officers of the Registrant are insured, within the limits and
subject to the limitations of the policy, against certain expenses in connection
with the defense of certain claims, actions, suits or proceedings, and certain
liabilities which might be imposed as a result of such claims, actions, suits or
proceedings, which may be brought against them by reason of their being or
having been such directors and officers.
II-1
<PAGE>
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
<TABLE>
<CAPTION>
Exhibit No. Description
----------- -----------
<C> <S>
5.1 Opinion of Gibson, Dunn & Crutcher LLP
23.1 Consent of Deloitte & Touche LLP
23.2 Consent of Gibson, Dunn & Crutcher LLP (included in Exhibit 5.1)
24.1 Power of Attorney (included on Signature Page)
99.1 Citadel Holding Corporation 1996 Nonemployee Director Stock Option Plan
99.2 Form of Citadel Holding Corporation Stock Option Agreement
</TABLE>
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. 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) if, in
the aggregate, the changes in volume and price represent no more than
a 20 percent 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;
(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.
II-2
<PAGE>
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at the time shall be deemed to be
the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the 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.
II-3
<PAGE>
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 and County of Los Angeles, State of California, on this
24th day of September, 1997.
CITADEL HOLDING CORPORATION
By:/s/ S. Craig Tompkins
----------------------------
S. Craig Tompkins
Corporate Secretary/Treasurer and
Principal Accounting Officer
POWER OF ATTORNEY
Each person whose signature appears below constitutes and appoints S. Craig
Tompkins and James J. Cotter his true and lawful attorneys-in-fact and agents,
each acting alone, with full powers of substitution and resubstitution, for him
or her 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 to file the same, with all exhibits thereto, and
other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, each acting alone,
full powers 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 said attorneys-in-fact and agents, each acting alone, or his
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 below by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
- ------------------------------------------- ------------------------------------ -----------------------------------------
<S> <C> <C>
/s/ Steve Wesson
--------------------------- President and Chief Executive September 24, 1997
(Steve Wesson) Officer (Principal Executive
Officer)
/s/ S. Craig Tompkins
--------------------------- Vice Chairman of the Board, September 24, 1997
(S. Craig Tompkins) Corporate Secretary/Treasurer and
Principal Accounting Officer
(Principal Accounting and Financial
Officer)
/s/ James J. Cotter
--------------------------- Director, Chairman of the Board September 24, 1997
(James J. Cotter)
/s/ Alfred Villasenor, Jr.
---------------------------- Director September 24, 1997
(Alfred Villasenor, Jr.)
-----------------------------
(Ronald I. Simon) Director
</TABLE>
II-4
<PAGE>
EXHIBIT 5.1
September 24, 1997
Citadel Holding Corporation
550 South Hope Street
Los Angeles, California 90071
Re: Registration Statement on Form S-8
----------------------------------
Ladies and Gentlemen:
We have acted as counsel for Citadel Holding Corporation, a Delaware
corporation (the "Company"), in connection with the registration of 300,000
shares of Common Stock (the Common Stock") of the Company issuable under its
1996 Nonemployee Director Stock Option Plan, as amended (the "Plan"). In
connection therewith, we have examined, among other things, the Registration
Statement on Form S-8 (the "Registration Statement") proposed to be filed by the
Company with the Securities and Exchange Commission on or about September 24,
1997. We have also examined the proceedings and other actions taken by the
Company in connection with the authorization and reservation of the shares of
Common Stock issuable under the Plan and such other matters as we deemed
necessary for purposes of rendering this opinion.
Based upon the foregoing, and in reliance thereon, we are of the opinion
that the shares of Common Stock issuable under the Plan, when issued, delivered
and paid for in accordance with the Plan and the agreements evidencing awards
thereunder and in the manner described in the Registration Statement, will be
validly issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
GIBSON, DUNN & CRUTCHER LLP
DES/HJH
<PAGE>
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT AND REPORT ON SCHEDULES
To the Board of Directors of Citadel Holding Corporation:
We consent to the incorporation by reference in this Registration Statement
of Citadel Holding Corporation on Form S-8 of our report on the Consolidated
Financial Statements of Citadel Holding Corporation dated March 20, 1997,
appearing in the Annual Report on Form 10-K of Citadel Holding Corporation.
Our audits of the financial statements referred to in our aforementioned
report also included the financial statement schedule of Citadel Holding
Corporation listed in Item 14. This financial statement schedule is the
responsibility of the management of Citadel Holding Corporation. Our
responsibility is to express an opinion based on our audits. In our opinion,
such financial statement schedule, when considered in relation to the basic
financial statements taken as a whole, presents fairly in all material respects
the information set forth therein.
Deloitte & Touche LLP
Los Angeles, California
September 24, 1997
<PAGE>
EXHIBIT 99.1
CITADEL HOLDING CORPORATION
1996 NONEMPLOYEE DIRECTOR STOCK OPTION PLAN
Section 1. PURPOSE OF PLAN
The purpose of this 1996 Nonemployee Director Stock Option Plan
("Plan") of Citadel Holding Corporation, a Delaware corporation (the "Company"),
is to enable the Company and its subsidiaries to attract, retain and motivate
its nonemployee directors and further align their interests with those of the
stockholders of the Company by providing for or increasing the proprietary
interests of such directors in the Company.
SECTION 2. NONEMPLOYEE DIRECTOR OPTIONS
(a) Subject to terms and provisions hereof, on October 3, 1996 (the
"Incumbent Date of Grant") each director of the Company who is not an employee
or officer of the Company or any of its affiliates (for this purpose the
Chairman of the Board and the Principal Accounting Officer shall be deemed
officers of the Company) (a "Nonemployee Director") who is then incumbent at the
effective date of the Plan (the "Incumbent Nonemployee Directors"), consisting
of Ronald I. Simon and Alfred Villasenor, shall receive immediately vested
options (the "Incumbent Nonemployee Director Option") to purchase 10,000 shares
of common stock, par value $.01 per share, of the Company (the "Common Shares")
at an exercise price of $3.00 per share
(b) Subject to the other terms and provisions hereof, upon the date
(each, a "New Date of Grant") as of which a Nonemployee Director not currently
serving on the Board of Directors (a "New Nonemployee Director") becomes a new
member of the Board of Directors, such New Nonemployee Director shall
automatically be granted immediately vested options (a "New Nonemployee Director
Option") to purchase 10,000 Common Shares at an exercise price that is greater
or less than the Fair Market Value per Common Share on the New Date of Grant by
an amount equal to the amount by which $3.00 per share is greater or less than
the Fair Market Value per Common Share on the Incumbent Date of Grant.
(c) If, on any date upon which New Nonemployee Director Options are to
be automatically granted pursuant to Section 2(b), the number of Common Shares
remaining available for option under this Plan is insufficient for the grant to
each New Nonemployee Director of a New Nonemployee Director Option to purchase
the entire number of Common Shares specified in this Section 2, then a New
Nonemployee Director Option to purchase a proportionate amount of such available
number of Common Shares (rounded to the nearest whole share) shall be granted to
each New Nonemployee Director on such date.
(d) Each Nonemployee Director Option granted under this Plan shall
expire upon the first to occur of the following:
(i) The first anniversary of the date upon which the optionee
shall cease to be a Nonemployee Director as a result of death or total
disability;
(ii) The 30th day after the date upon which the optionee shall
cease to be a Nonemployee Director for any reason other than death or total
disability;
(iii) The tenth anniversary of the New Date of Grant, or the
Incumbent Date of Grant, as the case may be, of such Nonemployee Director
Option.
(e) Payment of the exercise price of any Nonemployee Director Option
granted under this Plan shall be made in full in cash concurrently with the
exercise of such Nonemployee Director Option; provided, however, that, the
payment of such exercise price may instead be made:
<PAGE>
(i) in whole or in part, with Common Shares delivered
concurrently with such exercise (such shares to be valued on the basis of
the Fair Market Value of such shares on the date of such exercise),
provided that the Company is not then prohibited from purchasing or
acquiring Common Shares; and/or
(ii) in whole or in part, by the delivery, concurrently with
such exercise and in accordance with Section 220.3(e)(4) of Regulation T
promulgated under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), of a properly executed exercise notice for such
Nonemployee Director Option and irrevocable instructions to a broker
promptly to deliver to the Company a specified dollar amount of the
proceeds of a sale of or a loan secured by the Common Shares issuable upon
exercise of such Nonemployee Director Option.
(f) For purposes of this Section 2, the "Fair Market Value" of a
Common Share or other security on any date (the "Determination Date") shall be
equal to the average of the closing prices per Common Share or unit of such
other security on the ten trading days immediately preceding the Determination
Date on which trades in the Common Shares occurred, as reported in The Wall
Street Journal, Western Edition, or, if no closing price was so reported for any
of such days, the average of the high bid and low asked prices per Common Share
or unit of such other security on the ten trading days immediately preceding the
Determination Date in the over-the-counter market, as reported by a national
quotation system then in use, or, if the Common Shares or such other security
were not quoted by any such organization on such days, the average of the
closing bid and asked prices on such days as furnished by a professional market
maker making a market in the Common Shares or such other security selected by
the Board.
(g) All outstanding Nonemployee Director Options theretofore granted
under this Plan shall terminate upon the first to occur of the following:
(i) the dissolution or liquidation of the Company;
(ii) a reorganization, merger or consolidation of the Company as
a result of which the outstanding securities of the class then subject to
such outstanding Nonemployee Director Options are exchanged for or
converted into cash, property and/or securities not issued by the Company,
unless the terms of such reorganization, merger or consolidation shall
provide otherwise; or
(iii) the sale of substantially all of the property and assets
of the Company.
(h) Each Nonemployee Director Option shall be nontransferable by the
optionee other than by will or the laws of descent and distribution, and shall
be exercisable during the optionee's lifetime only by the optionee or the
optionee's guardian or legal representative.
(i) Nonemployee Director Options are not intended to qualify as
Incentive Stock Options.
(j) Notwithstanding any other provision of this Plan, no person shall
be granted a Nonemployee Director Option and no person shall be entitled to
exercise any rights with respect to a Nonemployee Director Option previously
granted if such grant or exercise would violate any provision of the certificate
of incorporation of the Company, or would violate any additional restriction set
forth in the agreement evidencing such Nonemployee Director Option. Any grant
or exercise of a Nonemployee Director Option in violation of this paragraph (j)
shall be void ab initio and shall not be effective to convey any rights to the
-- ------
person purporting to receive such Nonemployee Director Option or exercise such
rights. The Company may require recipients of Nonemployee Director Options to
make such representations and enter into such covenants as are reasonably deemed
necessary in order to ensure that the grant or exercise of rights with respect
to Nonemployee Director Options will not result in a violation of this paragraph
(j).
<PAGE>
SECTION 3. STOCK SUBJECT TO PLAN
(a) The aggregate number of Common Shares that may be issued pursuant
to all Nonemployee Director Options granted under this Plan shall not exceed
300,000, subject to adjustment as provided in Section 6 hereof.
(b) For purposes of Section 3(a) hereof, the aggregate number of
Common Shares issued and issuable pursuant to all Nonemployee Director Options
granted under this Plan shall at any time be deemed to be equal to the sum of
the following:
(i) the number of Common Shares which were issued prior to such
time pursuant to Nonemployee Director Options granted under this Plan,
other than Common Shares which were subsequently reacquired by the Company
pursuant to the terms and conditions of such Nonemployee Director Options
and with respect to which the holder thereof received no benefits of
ownership such as dividends; plus
(ii) the number of Common Shares which were otherwise issuable
prior to such time pursuant to Nonemployee Director Options granted under
this Plan, but which were withheld by the Company as payment of the
purchase price of the Common Shares issued pursuant to such Nonemployee
Director Options or as payment of the recipient's tax withholding
obligation with respect to such issuance; plus
(iii) the maximum number of Common Shares which are or may be
issuable at or after such time pursuant to Nonemployee Director Options
granted under this Plan prior to such time.
SECTION 4. DURATION OF PLAN
No Nonemployee Director Options shall be granted under this Plan after
October 3, 2006. Although Common Shares may be issued after October 3, 2006
pursuant to Nonemployee Director Options granted prior to such date, no Common
Shares shall be issued under this Plan after October 3, 2016.
SECTION 5. ADMINISTRATION OF PLAN
(a) This Plan shall be administered by the Board.
(b) Subject to the provisions of this Plan, the Board shall be
authorized and empowered to do all things necessary or desirable in connection
with the administration of this Plan, including, without limitation, the
following:
(i) adopt, amend and rescind rules and regulations relating to
this Plan;
(ii) determine which persons are Nonemployee Directors;
(iii) determine the exercise price of Nonemployee Director
Options in accordance with the terms of this Plan;
(iv) determine whether, and the extent to which, adjustments are
required pursuant to Section 6 hereof; and
(v) interpret and construe this Plan and the terms and
conditions of all Nonemployee Director Options granted hereunder.
SECTION 6. ADJUSTMENTS
If the outstanding securities of the class then subject to this Plan
are increased, decreased or exchanged for or converted into cash, property or a
different number or kind of securities, or if cash, property or
<PAGE>
securities are distributed in respect of such outstanding securities, in either
case as a result of a reorganization, merger, consolidation, recapitalization,
restructuring, reclassification, partial or complete liquidation, stock split,
reverse stock split or the like, or if substantially all of the property and
assets of the Company are sold, then, unless the terms of such transaction shall
provide otherwise, the Board shall make appropriate and proportionate
adjustments in (a) the number and type of shares or other securities or cash or
other property that may be acquired pursuant to Nonemployee Director Options
theretofore granted under this Plan and (b) the maximum number and type of
shares or other securities that may be issued pursuant to Nonemployee Director
Options thereafter granted under this Plan.
SECTION 7. AMENDMENT AND TERMINATION OF PLAN
The Board may amend or terminate this Plan at any time and in any
manner, subject to the following limitations:
(a) no such amendment or termination shall deprive the recipient of
any Nonemployee Director Option theretofore granted under this Plan, without the
consent of such recipient, of any of his or her rights thereunder or with
respect thereto; and
(b) Section 2 hereof shall not be amended more than once every six
months, other than to comport with changes in the Internal Revenue Code, the
Employee Retirement Income Security Act, or the rules thereunder.
SECTION 8. EFFECTIVE DATE OF PLAN
This Plan shall be effective as of October 3, 1996, the date upon
which it was approved by the Board.
SECTION 9. INTERPRETATION OF PLAN
With respect to persons subject to Section 16 of the Exchange Act,
transactions under this Plan are intended to comply with all applicable
conditions of Rule 16b-3 or its successors under the Exchange Act. To the extent
any provision of the Plan or action by the Plan administrators fails to so
comply, it shall be deemed null and void, to the extent permitted by law and
deemed advisable by the Plan administrators. It is contemplated that should the
Board decide to qualify a specific Nonemployee Director Option as exempt under
Rule 16b-3 of the Exchange Act, the Board will approve the terms of such
Nonemployee Director Option prior to the grant thereof.
<PAGE>
EXHIBIT 99.2
FORM OF CITADEL HOLDING CORPORATION
STOCK OPTION AGREEMENT
This Non-Qualified Stock Option Agreement ("Agreement") is made and
entered into as of the Date of Grant indicated below by and between Citadel
Holding Corporation, a Delaware corporation (the "Company"), and the person
named below as Optionee.
WHEREAS, Optionee is a nonemployee director ("Nonemployee Director")
of the Company; and
WHEREAS, pursuant to the Company's 1996 Nonemployee Director Stock
Option Plan (the "1996 Plan"), an option to purchase shares of the Common Stock
of the Company (the "Common Shares") has been granted to Optionee, on the terms
and conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing recitals and the
covenants set forth herein, the parties hereto hereby agree as follows:
1. GRANT OF OPTION; CERTAIN TERMS AND CONDITIONS. The Company hereby
---------------------------------------------
grants to Optionee, and Optionee hereby accepts, as of the Date of Grant
indicated below, an option (the "Option") to purchase the number of Common
Shares indicated below (the "Option Shares") at the Exercise Price per share
indicated below. The Option shall expire at 5:00 p.m., Los Angeles time, on the
Expiration Date indicated below and shall be subject to all of the terms and
conditions set forth in the 1996 Plan and this Agreement.
Optionee:________________________________________
Date of Grant:___________________________________
Number of shares purchasable:____________________
Exercise Price per share:________________________
Expiration Date:_________________________________
2. NON-QUALIFIED STOCK OPTION. The Option is not intended to qualify
--------------------------
as an incentive stock option under Section 422 of the Internal Revenue Code (the
"Code").
3. TERMINATION OF OPTION.
---------------------
(a) Expiration of Option. The Option shall expire upon the first to
--------------------
occur of the following:
(i) The first anniversary of the date upon which the Optionee
shall cease to be a Nonemployee Director as a result of death or total
disability;
(ii) The 30th day after the date upon which the Optionee shall
cease to be a Nonemployee Director for any reason other than death or
total disability; or
(iii) The tenth anniversary of the Date of Grant of the Option.
(b) Termination of Option. The Option shall terminate upon the
---------------------
occurrence of a Termination Event. A Termination Event shall mean either:
(i) the dissolution or liquidation of the Company;
<PAGE>
(ii) a reorganization, merger (not including a merger to
effectuate a reincorporation of the Company) or consolidation of the
Company as a result of which the outstanding securities of the class
then subject to this Plan are exchanged for or converted into cash,
property and/or securities not issued by the Company, unless the terms
of such reorganization, merger or consolidation shall provide
otherwise; or
(iii) a sale of all or substantially all of the property and
assets of the Company.
4. ADJUSTMENTS. In the event that the Common Shares are increased,
-----------
decreased or exchanged for or converted into cash, property or a different
number or kind of securities, or if cash, property or securities are distributed
in respect of such outstanding Common Shares, in either case as a result of a
reorganization, merger, consolidation, recapitalization, restructuring,
reclassification, partial or complete liquidation, stock split, reverse stock
split or the like, or if substantially all of the property and assets of the
Company are sold, then, unless such event shall cause the Option to terminate
pursuant to this Agreement, or the terms of such transaction shall provide
otherwise, the Board shall make appropriate and proportionate adjustments in the
number and type of shares or other securities or cash or other property that may
be acquired upon the exercise in full of the Option.
5. EXERCISE. The Option shall be exercisable during Optionee's
--------
lifetime only by Optionee or by his or her guardian or legal representative, and
after Optionee's death only by the person or entity entitled to do so under
Optionee's last will and testament or applicable intestate law. The Option may
only be exercised by the delivery to the Company of a written notice of such
exercise pursuant to the notice procedures set forth in Section 7 hereof, which
notice shall specify the number of Option Shares to be purchased (the "Purchased
Shares") and the aggregate Exercise Price for such shares (the "Exercise
Price"), together with payment in full of such aggregate Exercise Price in cash.
6. PAYMENT OF WITHHOLDING TAXES. If the Company becomes obligated to
----------------------------
withhold an amount on account of any federal, state or local income tax imposed
as a result of the exercise of an option granted under this Plan (such amount
shall be referred to herein as the "Withholding Liability"), the Optionee shall
pay the Withholding Liability to the Company in full in cash on the first date
upon which the Company becomes obligated to pay such amount withheld to the
appropriate taxing authority, and the Company may delay issuing the Common
Shares pursuant to such exercise until it receives the Withholding Liability
from the Optionee.
7. NOTICES. Any notice given to the Company shall be addressed to
-------
the Company at 550 South Hope Street, Suite 1825, Los Angeles, California 90071,
Attention: Corporate Secretary, or at such other address as the Company may
hereinafter designate in writing to Optionee. Any notice given to Optionee
shall be sent to the address set forth below Optionee's signature hereto, or at
such other address as Optionee may hereafter designate in writing to the
Company. Any such notice shall be deemed duly given when sent by prepaid
certified or registered mail and deposited in a post office or branch post
office regularly maintained by the United States Government.
8. STOCK EXCHANGE REQUIREMENTS; APPLICABLE LAWS. Notwithstanding
--------------------------------------------
anything to the contrary in this Agreement, no shares of stock purchased upon
exercise of the Option, and no certificate representing all or any part of such
shares, shall be issued or delivered if (a) such shares have not been admitted
to listing upon official notice of issuance on each stock exchange upon which
shares of that class are then listed or (b) in the opinion of counsel to the
Company, such issuance or delivery would cause the Company to be in violation of
or to incur liability under any federal, state or other securities law, or any
requirement of any stock exchange listing agreement to which the Company is a
party, or any other requirement of law or of any administrative or regulatory
body having jurisdiction over the Company.
9. NONTRANSFERABILITY. Neither the Option nor any interest therein
------------------
may be sold, assigned, conveyed, gifted, pledged, hypothecated or otherwise
transferred in any manner other than by will or the laws of descent and
distribution.
<PAGE>
10. 1996 PLAN. THE OPTION IS GRANTED PURSUANT TO THE 1996 PLAN, AS
---------
IN EFFECT ON THE DATE OF GRANT, AND IS SUBJECT TO ALL THE TERMS AND CONDITIONS
OF THE 1996 PLAN, AS THE SAME MAY BE AMENDED FROM TIME TO TIME; PROVIDED,
HOWEVER, THAT NO SUCH AMENDMENT SHALL DEPRIVE OPTIONEE, WITHOUT HIS OR HER
CONSENT, OF THE OPTION OR OF ANY OF OPTIONEE'S RIGHTS UNDER THIS AGREEMENT. THE
INTERPRETATION AND CONSTRUCTION BY THE BOARD OF THE 1996 PLAN, THIS AGREEMENT,
THE OPTION AND SUCH RULES AND REGULATIONS AS MAY BE ADOPTED BY THE BOARD FOR THE
PURPOSE OF ADMINISTERING THE 1996 PLAN SHALL BE FINAL AND BINDING UPON OPTIONEE.
UNTIL THE OPTION SHALL EXPIRE, TERMINATE OR BE EXERCISED IN FULL, THE COMPANY
SHALL, UPON WRITTEN REQUEST THEREFOR, SEND A COPY OF THE 1996 PLAN, IN ITS THEN-
CURRENT FORM, TO OPTIONEE OR ANY OTHER PERSON OR ENTITY THEN ENTITLED TO
EXERCISE THE OPTION.
11. FRACTIONAL SHARES. The Company shall not be required to issue a
-----------------
fraction of a Common Share in connection with the exercise of the Option. In
any case where the Optionee would be entitled to receive a fraction of a Common
Share upon the exercise of the Option, the Company shall instead, upon the
exercise of the Option, issue the largest whole number of Common Shares
purchasable upon exercise of the Option, and pay to the Optionee in cash the
Fair Market Value (as determined by the Board) of such fraction of a Common
Share at the time of exercise of the Option.
12. STOCKHOLDER RIGHTS. No person or entity shall be entitled to
------------------
vote, receive dividends or be deemed for any purpose the holder of any Option
Shares until the Option shall have been duly exercised to purchase such Option
Shares in accordance with the provisions of this Agreement.
13. GOVERNING LAW. This Agreement and the Option granted hereunder
-------------
shall be governed by and construed and enforced in accordance with the laws of
the State of Delaware.
14. ENTIRE AGREEMENT. This Agreement constitutes the entire
----------------
agreement of the parties with respect to the matters covered herein and
supersedes all prior written or oral agreements or understandings of the parties
with respect to the matters covered herein. Optionee acknowledges that he or
she has no right to receive any additional Options unless and until such time,
if any, that the Board, in its sole discretion, may approve the grant thereof,
and that the Company has not made any representation to the Optionee regarding
future or additional Option grants, or any other option related matters. The
grant of any options must be in writing.
15. REPRESENTATION OF OPTIONEE. Optionee represents to the Company
--------------------------
as follows:
(i) The Option will be taken and received for my own account
and not with a view to or for sale in connection with any distribution
thereof; and
(ii) I have a preexisting personal or business relationship
with the Company or its officers, directors or controlling persons, or
by reason of my business or financial experience, I can protect my own
interests in connection with my receipt and exercise of the Option.
<PAGE>
IN WITNESS WHEREOF, the Company and Optionee have duly executed this
Agreement as of the Date of Grant.
CITADEL HOLDING CORPORATION OPTIONEE
By
-------------------------- ------------------------------
Name: Name
Title:
------------------------------
Street Address
------------------------------
City, State and Zip Code
------------------------------
Social Security Number
