<PAGE> 1
As filed with the Securities and Exchange Commission on October 17, 1996
Registration No. 333-11803-01
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------
POST-EFFECTIVE AMENDMENT
NO. 1
ON
FORM S-8
TO
FORM S-4
REGISTRATION STATEMENT
Under
The Securities Act of 1933*
---------------
Cardinal Health, Inc.
(Exact name of registrant as specified in its charter)
<TABLE>
<CAPTION>
<S> <C>
Ohio 31-0958666
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
</TABLE>
5555 Glendon Court, Dublin, Ohio 43016
(Address of Principal Executive Offices) (Zip Code)
---------------
PCI SERVICES, INC. STOCK OPTION PLAN, AS AMENDED
(Full title of the plan)
---------------
George H. Bennett, Jr.,
Executive Vice President, Secretary and General Counsel
Cardinal Health, Inc.
5555 Glendon Court
Dublin, Ohio 43016
(Name and address of agent for service)
(614) 717-5000
(Telephone number, including area code, of agent for service)
---------------
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
- ---------------------------------------------------------------------------------------------------
Title of Amount Proposed Proposed Amount of
securities to to be maximum offering maximum aggregate registration
be registered registered(1) price per share(1) offering price fee
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Shares,
without par value 152,880 (2) (2) (2)
- ---------------------------------------------------------------------------------------------------
</TABLE>
(1) Also includes an indeterminable number of additional shares that may
become issuable pursuant to the anti-dilution provisions of the Plan.
(2) Not applicable. All filing fees payable in connection with the
registration of the issuance of these securities were paid in
connection with the filing of (a) preliminary proxy materials on
Schedule 14A of PCI Services, Inc. on September 13, 1996, and (b) the
Registrant's Form S-4 Registration Statement (33-11803) on September
11, 1996.
* Filed as a Post-Effective Amendment on Form S-8 to such Form S-4
Registration Statement pursuant to the procedure described in Part II
under "Introductory Statement."
<PAGE> 2
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
INTRODUCTORY STATEMENT
Cardinal Health, Inc. (the "Company" or the "Registrant") hereby amends
its Registration Statement on Form S-4 (No.33-11803) (the "Form S-4") by filing
this Post-Effective Amendment No. 1 on Form S-8 ("Amendment No. 1") with respect
to up to 152,880 of the Registrant's Common Shares, without par value ("Common
Shares"), issuable in connection with the PCI Services, Inc. ("PCI") Stock
Option Plan, as amended (the "Plan"). All such Common Shares were previously
included in the Form S-4.
On October 11, 1996, Panther Merger Corp., a Delaware corporation and a
wholly owned subsidiary of the Registrant ("PMC"), was merged with and into PCI
(the "Merger") pursuant to an Agreement and Plan of Merger dated July 23, 1996,
among the Registrant, PMC and PCI (the "Merger Agreement"). As a result of the
Merger, each outstanding share of PCI Common Stock (with certain specified
exceptions) was converted into Common Shares of the Registrant pursuant to the
exchange ratio (the "Exchange Ratio") set forth in the Merger Agreement. Also as
a result of the Merger, shares of PCI Common Stock are no longer issuable upon
the exercise of options to purchase PCI Common Stock ("PCI Options") pursuant to
the Plan. Instead, participants in the Plan will receive in lieu of PCI Common
Stock that number of Common Shares of the Registrant equal to the number of
shares of PCI Common Stock issuable immediately prior to the effective time of
the Merger upon exercise of a PCI Option multiplied by the Exchange Ratio, with
an exercise price for such option equal to the exercise price which existed
under the corresponding PCI Option divided by the Exchange Ratio.
The designation of Amendment No. 1 as Registration No. 33-11803-01
denotes that Amendment No. 1 relates only to the Common Shares issuable pursuant
to the Plan and that this is the first Post-Effective Amendment to the S-4 filed
with respect to such shares.
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The documents listed below are incorporated by reference in the
registration statement. All documents filed by the Company pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), subsequent to the date of the filing of this registration
statement and prior to the filing of a post-effective amendment that indicates
that all securities registered hereunder have been sold, or that de-registers
all securities then remaining unsold, shall be deemed to be incorporated by
reference in the registration statement and to be a part hereof from the date of
the filing of such documents.
(a) The Annual Report on Form 10-K of the Company for the fiscal year
ended June 30, 1996 filed with the Commission on August 26, 1996;
(b) The description of the Company's Common Shares contained in the
Company's Registration Statement on Form 8-A dated August 19, 1994, pursuant to
Section 12 of the Exchange Act; and
(c) The information contained in the Company's Proxy Statement dated
September 27, 1996 for its Annual Meeting of Shareholders to be held on October
29, 1996 that was filed with the Commission on Schedule 14A on September 27,
1996, other than the information contained therein under the captions "Report of
the Committee on Executive Compensation" and "Performance Graphs."
ITEM 5. INTEREST OF NAMED EXPERTS AND COUNSEL.
The legality of the Common Shares offered hereby has been passed upon
for the Company by Paul S. Williams, Assistant General Counsel of the Company.
Mr. Williams holds unvested options to purchase Common Shares of the Company.
<PAGE> 3
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 1701.13(E) of the Ohio Revised Code sets forth conditions and
limitations governing the indemnification of officers, directors, and other
persons.
Article 6 of the Company's Restated Code of Regulations ("Code of
Regulations"), as amended, contains certain indemnification provisions adopted
pursuant to authority contained in Section 1701.13(E) of the Ohio Revised Code.
The Company's Code of Regulations provides for the indemnification of its
officers, directors, employees, and agents against all expenses with respect to
any judgments, fines, and amounts paid in settlement, or with respect to any
threatened, pending, or completed action, suit, or proceeding to which they were
or are parties or are threatened to be made parties by reason of acting in such
capacities, provided that it is determined, either by a majority vote of a
quorum of disinterested directors of the Company or the shareholders of the
Company or otherwise as provided in Section 1701.13(E) of the Ohio Revised Code,
that (a) they acted in good faith and in a manner they reasonably believed to be
in or not opposed to the best interest of the Company; (b) in any action, suit,
or proceeding by or in the right of the Company, they were not, and have not
been adjudicated to have been, negligent or guilty of misconduct in the
performance of their duties to the Company; and (c) with respect to any criminal
action or proceeding, that they had no reasonable cause to believe that their
conduct was unlawful. Section 1701.13(E) provides that to the extent a director,
officer, employee, or agent has been successful on the merits or otherwise in
defense of any such action, suit, or proceeding, he shall be indemnified against
expenses reasonably incurred in connection therewith. At present there are no
material claims, actions, suits, or proceedings pending where indemnification
would be required under these provisions, and the Company does not know of any
such threatened claims, actions, suits, or proceedings which may result in a
request for such indemnification.
The Company has entered into indemnification contracts with each of its
directors and executive officers. These contracts generally: (i) confirm the
existing indemnity provided to them under the Company's Code of Regulations and
assure that this indemnity will continue to be provided; (ii) provide that if
the Company does not maintain directors' and officers' liability insurance, the
Company will, in effect, become a self-insurer of the coverage; and (iii)
provide that, in addition, the directors and officer shall be indemnified to the
fullest extent permitted by law against all expenses (including legal fees),
judgments, fines, and settlement amounts paid or incurred by them in any action
or proceeding, including any action by or in the right of the Company, on
account of their service as a director, officer, employee, or agent of the
Company or at the request of the Company as a director, officer, employee, or
agent of another corporation or enterprise. Coverage under the contracts is
excluded: (A) on account of conduct which is finally adjudged to be knowingly
fraudulent, deliberately dishonest, or willful misconduct; or (B) if a final
court of adjudication shall determine that such indemnification is not lawful;
or (C) in respect of any suit in which judgment is rendered for violations of
Section 16(b) of the Securities and Exchange Act of 1934, as amended, or similar
provisions of any federal, state, or local statutory law; or (D) on account of
any remuneration paid which is finally adjudged to have been in violation of
law; or (E) as to officers who are not directors, with respect to any act or
omission which is finally adjudged to have been a violation, other than in good
faith, of the Company's Standards of Business Conduct of which the officer then
most recently has received written notice. The indemnification agreements are
applicable to claims asserted after their effective date, whether arising from
acts or omissions occurring before or after their effective date, and associated
legal expenses.
ITEM 8. EXHIBITS.
Exhibit Number Description of Exhibit
5 Opinion of Paul S. Williams as to legality of the Common Shares
being registered
23(a) Consent of Deloitte & Touche LLP
23(b) Consent of Ernst & Young LLP
23(c) Consent of Paul S. Williams (included in Opinion filed as Exhibit
5 hereto)
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<PAGE> 4
24 Power of attorney (included on the Signature Page of this Form
S-8)
99 PCI Services, Inc. Stock Option Plan, as amended
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, as amended (the "Securities Act"); (ii) to reflect in the prospectus any
facts or events arising after the effective date of the registration statement
(or the most recent post-effective amendment thereof) which, individually or in
the aggregate, represent a fundamental change in the information set forth in
the registration statement; and (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 clauses (i) and (ii) do not apply if the
information required to be included in a post-effective amendment by those
clauses is contained in periodic reports filed with or furnished to the
Securities and Exchange Commission by the Registrant pursuant to Section 13 or
Section 15(d) of the Exchange Act that are incorporated by reference in the
registration statement;
(2) That, for the purpose of determining any liability under
the Securities Act, each such post-effective amendment 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; and
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
B. The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act that is incorporated by reference in the registration statement
shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
C. Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the provisions described under Item 6 above or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Securities 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
Securities Act and will be governed by the final adjudication of such issue.
-3-
<PAGE> 5
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 this Post-Effective Amendment No.1 on Form S-8 to
Form S-4 Registration Statement and has duly caused this registration statement
to be signed on its behalf by the undersigned, thereunto duly authorized, in the
City of Dublin, State of Ohio, on the 16th day of October, 1996.
CARDINAL HEALTH, INC.
By: /s/ Robert D. Walter
-------------------------------------
Robert D. Walter, Chairman
and Chief Executive Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Robert D. Walter, George H. Bennett, Jr.,
and Paul S. Williams, and each of them, severally, as his/her attorney-in-fact
and agent, with full power of substitution and resubstitution, for him/her and
in his/her name, place, and stead, in any and all capacities, to sign any and
all pre- or post-effective amendments to this Registration Statement, and to
file the same with all exhibits hereto, and other documents with the Securities
and Exchange Commission, granting unto said attorney-in-fact and agent, and each
of them, full power and authority to do and perform each and every act and thing
requisite or necessary to be done in and about the premises, as fully to all
intents and purposes as he/she might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, or their
or his substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Post-Effective Amendment No.1 on Form S-8 to Form S-4 Registration Statement has
been signed by the following persons in the capacities indicated on the 16th day
of October, 1996.
<TABLE>
<CAPTION>
Signature Title
<S> <C>
/s/ Robert D. Walter Chairman and Chief Executive
- ---------------------------------- Officer (principal executive officer) and Director
Robert D. Walter
/s/ David Bearman Executive Vice President, Chief
- ---------------------------------- Financial Officer and Chief Accounting Officer
David Bearman
/s/ John F. Finn Director
- ----------------------------------
John F. Finn
</TABLE>
-4-
<PAGE> 6
<TABLE>
<CAPTION>
<S> <C>
/s/ Robert L. Gerbig Director
- ----------------------------------
Robert L. Gerbig
/s/ John F. Havens Director
- ----------------------------------
John F. Havens
/s/ Regina E. Herzlinger Director
- ----------------------------------
Regina E. Herzlinger
/s/ John C. Kane Director
- ----------------------------------
John C. Kane
/s/ J. Michael Losh Director
- ----------------------------------
J. Michael Losh
/s/ George R. Manser Director
- ----------------------------------
George R. Manser
/s/ John B. McCoy Director
- ----------------------------------
John B. McCoy
/s/ Jerry E. Robertson Director
- ----------------------------------
Jerry E. Robertson
/s/ L. Jack Van Fossen Director
- ----------------------------------
L. Jack Van Fossen
/s/ Melburn G. Whitmire Director
- ----------------------------------
Melburn G. Whitmire
</TABLE>
-5-
<PAGE> 7
EXHIBIT INDEX
EXHIBIT
NUMBER EXHIBIT DESCRIPTION
5 Opinion of Paul S. Williams as to legality of the Common Shares
being registered
23(a) Consent of Deloitte & Touche LLP
23(b) Consent of Ernst & Young LLP
23(c) Consent of Paul S. Williams (included in Opinion filed as Exhibit
5 hereto)
24 Power of Attorney (included on the Signature Page of this Form
S-8)
99 PCI Services, Inc. Stock Option Plan, as amended
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<PAGE> 1
EXHIBIT 5
October 17, 1996
Cardinal Health, Inc.
5555 Glendon Court
Dublin, OH 43016
Gentlemen:
I have acted as counsel to Cardinal Health, Inc., an Ohio
corporation (the "Company"), in connection with Post-Effective Amendment No. 1
on Form S-8 to the Company's Registration Statement on Form S-4 (the
"Registration Statement") filed under the Securities Act of 1933 (the "Act")
relating to the issuance of up to 152,880 Common Shares, without par value (the
"Common Shares"), of the Company pursuant to the PCI Services, Inc. Stock Option
Plan, as amended (the "Plan").
In connection with the foregoing, I have examined: (a) the
Amended and Restated Articles of Incorporation, as amended, and Restated Code of
Regulations, as amended, of the Company, (b) the Plan, and (c) such records of
the corporate proceedings of the Company and such other documents as I deemed
necessary to render this opinion.
Based on such examination, I am of the opinion that the Common
Shares available for issuance under the Plan, when issued, delivered and paid
for in accordance with the terms and conditions of the Plan, will be legally
issued, fully paid and nonassessable.
I hereby consent to the filing of this Opinion as Exhibit 5 to
the Registration Statement and the reference to me in Item 5 of Part II of the
Registration Statement.
Very truly yours,
/s/ Paul S. Williams
Paul S. Williams, Esq.
-7-
<PAGE> 1
EXHIBIT 23(a)
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Cardinal Health, Inc. on Form S-8 filed as a Post Effective Amendment to Form
S-4 Registration Statement No. 33-11803 of our report dated August 13, 1996,
appearing in the Annual Report on From 10-K of Cardinal Health, Inc. for the
year ended June 30, 1996.
/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Columbus, Ohio
October 14, 1996
-8-
<PAGE> 1
EXHIBIT 23(b)
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement (Post
Effective Amendment No. 1 on Form S-8 to Form S-4 No. 33-11803) of Cardinal
Health, Inc. pertaining to the PCI Services, Inc. Stock Option Plan, as amended,
of our report dated August 2, 1996, with respect to the consolidated financial
statements of Pyxis Corporation included in the Annual Report (Form 10-K) of
Cardinal Health, Inc. for the year ended June 30, 1996.
/s/ Ernst & Young LLP
ERNST & YOUNG LLP
San Diego, California
October 15, 1996
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<PAGE> 1
EXHIBIT 99
PCI SERVICES, INC.
STOCK OPTION PLAN
DATED: September 20, 1991
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C> <C>
1. Definitions............................................................................................ 1
2. Purpose................................................................................................ 3
3. Plan Adoption and Term................................................................................. 4
4. Administration of Plan................................................................................. 4
5. Eligibility............................................................................................ 5
6. Options................................................................................................ 6
7. Option Price........................................................................................... 6
8. Duration of Options.................................................................................... 7
9. Conditions Relating to Exercise of Options............................................................. 7
10. Effect of Termination of Employment or Death........................................................... 10
11. No Special Employment Rights........................................................................... 11
12. Rights as a Shareholder................................................................................ 12
13. Anti-dilution Provision................................................................................ 12
14. Withholding Taxes...................................................................................... 13
15. Amendment of the Plan.................................................................................. 13
16. Miscellaneous.......................................................................................... 14
</TABLE>
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<PAGE> 3
PCI SERVICES, INC. STOCK OPTION PLAN
1. Definitions
As used in this Plan, the following definitions apply to the
terms indicated below:
(a) "Board" means the Board of Directors of the Company.
(b) "Committee" means the Stock Option Committee appointed by
the Board from time to time to administer the Plan. The Committee shall consist
of at least three persons, who shall be directors of the Company, and who shall
not be or have been eligible, while serving on the Committee or within one year
prior thereto, to receive grants of Options pursuant to this Plan or any plan of
the Company or any of its affiliates entitling the participants therein to
acquire stock, stock options, or stock appreciation rights of the Company or any
of its affiliates.
(c) "Company" means PCI Services, Inc.
(d) "Fair Market Value" of a Share on a given day means the
mean between the highest and lowest quoted selling prices of a Share as reported
on the principal securities exchange on which the Shares are then listed or
admitted to trading, or if not so reported, the mean between the highest and
lowest selling prices as reported on the National Association of Securities
Dealers Automated Quotation System, or if not so reported, as furnished by any
members of the National Association of Securities Dealers, Inc. selected by the
Committee. If the price of a Share shall not be so quoted, the Fair Market Value
shall be determined by the Committee taking into account all relevant facts and
circumstances.
(e) "Grantee" means a person who is either an Optionee or an
Optionee-Shareholder.
<PAGE> 4
(f) "Incentive Stock Option" means an Option that qualifies as
an incentive stock option within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended.
(g) "Nonqualified Option" means an Option that is not an
Incentive Stock Option.
(h) "Option" means a right to purchase Shares under the terms
and conditions of this Plan as evidenced by an option certificate or agreement
for Shares in such form, not inconsistent with this Plan, as the Committee may
adopt for general use or for specific cases from time to time.
(i) "Optionee" means a person other than an
Optionee-Shareholder to whom an option is granted under this Plan.
(j) "Optionee-Shareholder" means a person to whom an option is
granted under this Plan, and who at the time such option is granted owns,
actually or constructively, stock of the Company possessing more than ten
percent (10%) of the total combined voting power of all classes of stock of the
Company, or its parent or subsidiary corporations.
(k) "Plan" means this Stock Option Plan, including any
amendments to the Plan.
(l) "Share" means a share of the Company's common stock, par
value $0.001 per share, now or hereafter owned by the Company as treasury stock,
or authorized but unissued shares of the Company's common stock, subject to
adjustment as provided in this Plan.
(m) "Subsidiary" means any corporation, now or hereafter
existing, in an unbroken chain of corporations beginning with the Company if, at
the time of granting an Option,
-2-
<PAGE> 5
each of the corporations in the unbroken chain owns stock possessing fifty
percent (50%) or more of the total combined voting power of all classes of stock
in one of the other corporations in the chain.
(n) Options shall be deemed "granted" under this Plan on the
date on which the Committee, by appropriate action, approves the grant of an
Option hereunder, or on such subsequent date as the Committee may designate.
(o) As used herein, the masculine includes the feminine, the
plural includes the singular, and the singular includes the plural.
2. Purpose
The purposes of the Plan are as follows:
(a) To secure for the Company and its shareholders the
benefits arising from share ownership by those directors, officers and key
employees of the Company and its Subsidiaries who will be responsible for the
Company's future growth and continued success. The Plan is intended to provide
an incentive to directors, officers and key employees by providing them with an
opportunity to acquire an equity interest, or increase an existing equity
interest, in the Company, thereby increasing their personal stake in its
continued success and progress.
(b) To enable the Company and its Subsidiaries to obtain and
retain the services of key employees, by providing such key employees with an
opportunity to acquire Shares under the terms and conditions of, and in the
manner contemplated by, this Plan.
-3-
<PAGE> 6
3. Plan Adoption and Term
(a) This Plan shall become effective upon its adoption by the
Board, and Options may be issued upon such adoption and from time to time
thereafter; provided, however, that the Plan, if adopted by the Committee, shall
be submitted to the Board for its approval at its next regularly scheduled
meeting; and provided further, that the Plan shall be submitted to the Company's
shareholders for their approval at the next annual meeting of shareholders, or
prior thereto at a special meeting of shareholders expressly called for such
purpose; and provided further, that the approval of the Company's shareholders
shall be obtained within 12 months after the date of adoption of the Plan. If
the Plan is not approved at such a meeting by the affirmative vote of a majority
of all shares entitled to vote upon the matter, then this Plan and all Options
then outstanding under it shall forthwith automatically terminate and be of no
force and effect.
(b) Subject to the provisions hereinafter contained relating
to amendment or discontinuance, this Plan shall continue to be in effect for ten
(10) years after the date of the aforesaid shareholder approval, or the date of
adoption by the Board, whichever is earlier. No Options may be granted hereunder
except within such period of ten (10) years.
4. Administration of Plan
(a) This Plan shall be administered by the Committee. Except
as otherwise expressly provided in this Plan, the Committee shall have the
authority to interpret the provisions of the Plan, to construe the terms of any
Option, to prescribe, amend and rescind rules and regulations relating to the
Plan, to determine the terms and provisions of Options granted hereunder, and to
make all other determinations which shall, in the judgment of the Committee, be
necessary or
-4-
<PAGE> 7
desirable for the administration of the Plan. Without limiting the foregoing,
the Committee, shall, to the extent and in the manner contemplated herein,
exercise the discretion granted to it to determine who shall participate in the
Plan, how many Shares shall be sold to each such participant, and the prices at
which Shares shall be sold to participants. The Committee may correct any defect
or supply any omission or reconcile any inconsistency in the Plan or in any
Option in the manner and to the extent it shall deem expedient to carry the Plan
into effect, and shall be the sole and final judge of such expediency.
(b) No member of the Committee shall be liable for any action
taken or omitted, or any determination made, by such member in good faith
relating to the Plan, and the Company shall indemnify and hold harmless each
member of the Committee and each other director or employee of the Company to
whom any duty or power relating to the administration or interpretation of the
Plan has been delegated, against any cost or expense (including counsel fees) or
liability (including any sum paid in settlement of a claim with the approval of
the Committee, which approval shall not be unreasonably withheld) arising out of
any act or omission in connection with the Plan, unless arising out of such
person's own fault or bad faith.
5. Eligibility
Directors, Officers and key employees of the Company and Subsidiaries
shall be eligible for selection by the Committee to participate in the Plan. No
member of the Committee shall be eligible to participate in the Plan. An
employee who has been granted an Option may, if he or she is otherwise eligible,
be granted an additional Option or Options if the Committee shall so determine.
-5-
<PAGE> 8
6. Options
(a) Subject to adjustment as provided in Paragraph 13 hereof,
Options may be issued pursuant to the Plan for the purchase of not more than
600,000 Shares; provided, however, that if, prior to the termination of the
Plan, an Option shall expire or terminate for any reason without having been
exercised in full, the unpurchased Shares subject thereto shall be available for
reissuance under the Plan.
(b) All Options granted under the Plan shall be clearly
identified either as Incentive Stock Options or as Nonqualified Options. Each
Option granted under the Plan shall be evidenced by an option certificate in
such form, not inconsistent with this Plan, as the Committee may adopt for
general use or for specific cases from time to time.
(c) The aggregate Fair Market Value (determined as of the time
Options are granted) of the Shares with respect to which incentive stock options
are exercisable for the first time by an Optionee during any calendar year
(whether granted under this Plan or any other plan of the Company or any parent
or Subsidiary of the Company under which incentive stock options may be
granted), shall not exceed $100,000.
7. Option Price
(a) The purchase price per Share deliverable upon the exercise
of an Option shall be determined by the Committee; provided, however, that the
purchase price per Share at which Shares may be purchased pursuant to any
Incentive Stock Option shall not be less than 100% of the Fair Market Value of
such Shares on the date an Option is granted to an Optionee, and shall
-6-
<PAGE> 9
not be less than 110% of the Fair Market Value of such Shares on the date an
Option is granted to an Optionee-Shareholder.
(b) Payment for Shares purchased by exercise of an Option may
be made (i) in cash; (ii) in Shares valued at their Fair Market Value on the
date of exercise, or (iii) in a combination of cash and Shares.
8. Duration of Options
Each Incentive Stock Option and all rights thereunder shall
expire, and such Incentive Stock Option shall no longer be exercisable, on a
date not later than ten (10) years from the date on which the Incentive Stock
Option was granted. Each Nonqualified Option and all rights thereunder shall
expire, and such Nonqualified Option shall no longer be exercisable, on a date
not later than ten (10) years and one (1) day from the date on which the
Nonqualified Option was granted. Options may expire and cease to be exercisable
on such earlier date as the Committee may determine at the time of grant.
Anything hereinabove to the contrary notwithstanding, an Incentive Stock Option
granted to an Optionee-Shareholder and all rights thereunder shall expire, and
such Incentive Stock Option shall no longer be exercisable, on a date not later
than five (5) years after the date on which such Incentive Stock Option was
granted. All Options, regardless of to whom granted, shall be subject to earlier
termination as provided herein.
9. Conditions Relating to Exercise of Options
(a) The Shares subject to any Option may be purchased at any
time during the term of the Option, unless, at the time an Option is granted,
the Committee shall have fixed a specific period or periods in which exercise
must take place. To the extent an Option is not
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<PAGE> 10
exercised when it becomes initially exercisable, or is exercised only in part,
the Option or remaining part thereof shall not expire, but shall be carried
forward and shall be exercisable until the expiration or termination of the
Option. Partial exercise shall be permitted from time to time; provided,
however, that no partial exercise of an Option shall be for a number of Shares
having a purchase price of less than $1,000.
(b) No Option shall be transferable by the Grantee thereof
other than by will or by the laws of descent and distribution, and Options shall
be exercisable during the lifetime of a Grantee only by such Grantee or, to the
extent that such exercise would not prevent an Option from qualifying as an
incentive stock option under the Internal Revenue Code, by his or her guardian
or legal representative.
(c) Certificates for Shares purchased upon exercise of Options
shall be issued either in the name of the Grantee, or in the name of the Grantee
and another person jointly with the right of survivorship. Such certificates
shall be delivered as soon as practicable following the date the Option is
exercised.
(d) An Option shall be exercised by the delivery to the
Company at its principal office, to the attention of its Secretary, of written
notice of the number of Shares with respect to which the Option is being
exercised, and of the name or names in which the certificate for the Shares is
to be issued, and by paying the purchase price for the Shares in accordance with
Paragraph 7 hereof.
(e) Notwithstanding any other provision in this Plan, no
Option may be exercised unless and until (i) this Plan has been approved by the
Board and by the shareholders of
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the Company, and (ii) the Shares to be issued upon the exercise thereof have
been registered under the Securities Act of 1933 and applicable state securities
laws, or are, in the opinion of counsel to the Company, exempt from such
registration. The Company shall not be under any obligation to register under
applicable Federal or state securities laws any Shares to be issued upon the
exercise of an Option granted hereunder, or to comply with an appropriate
exemption from registration under such laws, in order to permit the exercise of
an Option or the issuance and sale of Shares subject to such Option. If the
Company chooses to comply with such an exemption from registration, the
certificates for Shares issued under the Plan may, at the direction of the
Committee, bear an appropriate restrictive legend restricting the transfer or
pledge of the Shares represented thereby, and the Committee may also give
appropriate stop-transfer instructions to the transfer agent of the Company;
provided, however, that if the operation of this Paragraph 9(e) would cause
Incentive Stock Options to become exercisable in such a way as to violate
Paragraph 6(c) hereof, the exercisability of such Incentive Stock Options shall
be delayed as necessary to avoid such a violation.
(f) Any person exercising an Option or transferring or
receiving Shares pursuant to the exercise of an Option, shall comply with all
regulations and requirements of all governmental authorities having jurisdiction
over the issuance, transfer, or sale of securities of the Company, and the
requirements of any securities exchange on which the Shares are then listed, and
as a condition to receiving any such Shares, shall execute all such instruments
as the Committee, in its sole discretion, may deem necessary or advisable.
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<PAGE> 12
(g) Each Option shall be subject to the requirement that if
the Committee shall determine that the listing, registration or qualification of
the Shares subject to such Option upon any securities exchange or under any
state or Federal law, or the consent or approval of any governmental or
regulatory body, is necessary or desirable as a condition of, or in connection
with, the granting of such Option or the issuance or purchase of Shares
thereunder, such Option may not be exercised in whole or in part unless such
listing, registration, qualification, consent or approval shall have been
effective or obtained, free of any conditions not acceptable to the Committee.
(h) Any optionee who disposes of shares of Common Stock
acquired in the exercise of an incentive stock option by sale or exchange either
(a) within two years after the date of the grant of the option under which the
stock was acquired, or (b) within one year after the acquisition of such shares,
shall immediately notify the Company of such disposition, and of the amount
realized, and of the optionee's adjusted basis in such shares.
(i) Any optionee who disposes of shares of Common Stock
acquired in the exercise of a non-qualified stock option at any time, shall
immediately notify the Company of such disposition, and of the amount realized,
and of the optionee's adjusted basis in such shares.
10. Effect of Termination of Employment or Death
(a) If the employment of a Grantee with the Company or a
Subsidiary shall at any time be terminated for cause, then and in that event all
rights of any kind under any Option then held by such Grantee shall immediately
lapse and terminate.
(b) If a Grantee shall at any time cease to be employed by the
Company for any reason other than the termination of the Grantee's employment
for cause or the death of the
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<PAGE> 13
Grantee, then and in that event the term of each Option held by such Grantee
shall expire on the earlier of (i) the termination date set forth in the Option,
or (ii) three (3) months after the date on which employment terminates. During
such period, the Option shall be exercisable only to the extent it was
exercisable at the time of termination of employment. If, however, the death of
the Grantee should occur before the date on which the Option would terminate
hereunder, the termination of the Option will be governed by subparagraph 10(c)
below.
(c) Upon the death of any Grantee, any Option then held by
such Grantee which shall not have lapsed or terminated prior to the Grantee's
death, shall, notwithstanding the termination date stated in such Option, be
exercisable by the executors, administrators, legatees or distributees of the
Grantee's estate for a period of six (6) months after the Grantee's death, as to
that number of Shares which were purchasable by the Grantee at the time of his
or her death; provided, however, that in no case shall an Incentive Stock Option
granted to an Optionee remain exercisable after a date ten (10) years after the
date on which such Incentive Stock Option was granted; nor in any case shall an
Incentive Stock Option granted to an Optionee-Shareholder remain exercisable
after a date five (5) years from the date on which such Incentive Stock Option
was granted.
(d) In the case of the exercise of an option by a person or
estate acquiring the right to exercise by bequest or inheritance, the Committee
may require reasonable evidence as to the ownership of the option, and may
require such consents and releases of taxing authorities as it may deem
advisable.
11. No Special Employment Rights
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<PAGE> 14
Nothing contained in the Plan or in any Option shall confer
upon any Grantee any right with respect to the continuation of his or her
employment by the Company, or interfere in any way with the rights of the
Company, subject to the terms of any separate employment agreement to the
contrary, at any time to terminate such employment or to increase or decrease
the compensation of the Grantee from the rate in existence at the time of the
grant of an Option, or to add, reduce, expand or eliminate employee benefits to
which the Grantee shall otherwise be entitled. Whether an authorized leave of
absence, or absence in military or government service, shall constitute a
termination of employment shall be determined by the Committee at the time.
12. Rights as a Shareholder
The Grantee of an Option shall have no rights as a shareholder
with respect to any Shares covered by the Option until the date such Option is
exercised. Except as otherwise expressly provided in the Plan no adjustment
shall be made for dividends or other rights, for which the record date occurs
prior to the date of exercise.
13. Anti-dilution Provision
Except as otherwise expressly provided herein, the following
provisions shall apply to all Shares authorized for issuance and optioned,
granted or awarded under the Plan:
(a) In case the Company shall (i) declare a dividend or
dividends on its Shares payable in shares of its capital stock, (ii) subdivide
its outstanding Shares, (iii) combine its outstanding Shares into a smaller
number of shares, or (iv) issue any shares of capital stock by reclassification
of its Shares (including any such reclassification in connection with a
consolidation or merger in which the Company is the continuing corporation), the
number of shares of capital
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<PAGE> 15
stock authorized under the Plan will be adjusted proportionately. Similarly, in
any such event, there will be a proportionate adjustment in the number of shares
of capital stock subject to unexercised Options (but without adjustment to the
aggregate option price for such Option).
(b) In the event that the outstanding common stock of the
Company is changed or converted into, or exchanged for, a different number or
kind of shares or other securities of the Company or of another corporation, by
reason of reorganization, merger, consolidation or combination, appropriate
adjustment will be made by the Committee in the number and kind of Shares for
which Options may or may have been awarded under the Plan, to the end that the
proportionate interests of Grantees shall be maintained as before the occurrence
of such event; provided, however, that in the event of any kind of delayed
transaction which may constitute a change in control of the Company, the
Committee, with the approval of the majority of the members of the Board who are
not then holding Options, may modify any and all outstanding Options so as to
accelerate, as a consequence of or in connection with such transaction, a
Grantee's right to exercise any such option.
14. Withholding Taxes
Whenever an Option is to be exercised under the Plan, the
Company shall have the right to require the Grantee, as a condition of exercise
of the Option, to remit to the Company an amount sufficient to satisfy the
Company's (or a Subsidiary's), Federal, state and local withholding tax
obligation, if any, that will, in the sole opinion of the Committee, result from
such exercise.
15. Amendment of the Plan
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<PAGE> 16
The Plan may at any time or from time to time be terminated,
modified or amended by a majority of the shareholders of the Company. The Board
may at any time and from time to time modify or amend the Plan in any respect,
except that, without shareholder approval, the Board may not (a) materially
increase the benefits accruing to participants under the Plan, (b) increase the
number of Shares which may be issued under the Plan, or (c) modify the
requirements as to eligibility for participation under the Plan. The termination
or modification or amendment of the Plan shall not, without the consent of a
Grantee, affect his rights under an Option previously granted to him or her.
With the consent of the Grantee, the Board may amend outstanding options in a
manner not inconsistent with the Plan.
16. Miscellaneous
(a) It is expressly understood that this Plan grants powers to
the Committee, but does not require their exercise; nor shall any person, by
reason of the adoption of this Plan, be deemed to be entitled to the grant of
any Option, nor shall any rights begin to accrue under the Plan except as
Options may be granted hereunder.
(b) All expenses of the Plan, including the cost of
maintaining records, shall be borne by Company.
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<PAGE> 17
PCI SERVICES, INC.
STOCK OPTION PLAN
AMENDMENT NO. 1
PCI Services, Inc., a Delaware corporation (the "Company"), heretofore
adopted the PCI Services, Inc. Stock Option Plan (the "Plan") as an additional
incentive to key employees and members of the Board of Directors to enter into
or remain in the service of the Company and to devote themselves to the
Company's success by providing them with an opportunity to acquire or increase
their proprietary interest in the Company. By action of its Board of Directors,
the Company has amended the Plan, effective on Wednesday, February 5, 1992 (the
"Effective Date"), as hereinafter set forth:
Section 4(a) of the Plan is hereby amended in its entirety to read as
follows:
4. Administration of Plan
(a) (i) This Plan shall be administered by the
Committee. Except as otherwise expressly provided in this Plan, the Committee
shall have the authority to interpret the provisions of the Plan, to construe
the terms of any Option, to prescribe, amend and rescind rules and regulations
relating to the Plan, to determine the terms and provisions of Options granted
hereunder, and to make all other determinations which shall, in the judgment of
the Committee, be necessary or desirable for the administration of the Plan.
Without limiting the foregoing, and subject to subsection (ii) of this Section
4(a), the Committee, shall, to the extent and in the manner contemplated herein,
exercise the discretion granted to it to determine who shall participate in the
Plan, how many Shares shall be sold to each such participant, and the prices at
which Shares shall be sold to participants. The Committee may correct any defect
or supply any omission or reconcile
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<PAGE> 18
any inconsistency in the Plan or in any Option in the manner and to the extent
it shall deem expedient to carry the Plan into effect, and shall be the sole and
final judge of such expediency.
(ii) Notwithstanding the foregoing, with
respect to each member of the Board of Directors of the Company who is not an
employee of the Company ("Non-employee Director"), options shall be granted
without any further action by the Committee, in accordance with the following
subclauses of this subsection (ii), and there shall be no grant of options under
this Plan to a Non-employee Director other than in accordance with the following
subclauses:
(A) Each Non-employee Director serving
on the Board of Directors on the Effective Date shall be granted an Option to
purchase, at a price equal to the public offering price of shares of Common
Stock, 25,000 Shares, such Option to be exercisable in cumulative installments
of (I) one-fifth of the number of Shares granted under the Option on or after
the date of grant, and (II) one-fifth of the number of Shares under the Option
on or after each of the next four anniversary dates of the date of grant.
Executed this 5th day of February, 1992.
PCI SERVICES, INC.
Attest:
/s/ Eugene M. Schloss, Jr. By:/s/Daniel F. Gerner
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Eugene M. Schloss, Jr. Daniel F. Gerner
Secretary President
[Corporate Seal]
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