<PAGE> 1
As filed with the Securities and Exchange Commission on March 19, 1997
Registration No. 333-21631-01
===============================================================================
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)
Ohio 31-0958666
---- ----------
(State or other jurisdiction (I.R.S. Employer Identification No.)
of incorporation or organization)
5555 Glendon Court, Dublin, Ohio 43016
-------------------------------- -----
(Address of Principal Executive Offices) (Zip Code)
-------------------
OWEN HEALTHCARE, INC. 1987 STOCK OPTION PLAN
OWEN HEALTHCARE, INC. 1992 STOCK OPTION PLAN
OWEN HEALTHCARE, INC. 1992 NONEMPLOYEE DIRECTORS' STOCK OPTION PLAN
OWEN HEALTHCARE, INC. 1996 STOCK OPTION PLAN
-------------------
(Full title of the plans)
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)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
==================================================================================================
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 748,029 (2) (2) (2)
==================================================================================================
<FN>
(1) Also includes an indeterminable number of additional shares that may
become issuable pursuant to the anti-dilution provisions of the Plans.
(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 Owen Healthcare, Inc. on December 24, 1996, and (b) the
Registrant's Form S-4 Registration Statement (333-21631) on February
12, 1997.
* 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."
</TABLE>
<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. 333-21631) (the "Form S-4") by filing
this Post-Effective Amendment No. 1 on Form S-8 ("Amendment No. 1") with respect
to up to 748,029 of the Registrant's Common Shares, without par value ("Common
Shares"), issuable in connection with the following plans (collectively, the
"Plans") of Owen Healthcare, Inc. ("Owen"): 1987 Stock Option Plan, 1992 Stock
Option Plan, 1992 Nonemployee Directors' Stock Option Plan and 1996 Stock Option
Plan. All such Common Shares were previously included in the Form S-4.
On March 18 1997, Owl Merger Corp., a Texas corporation and a wholly
owned subsidiary of the Registrant ("OMC"), was merged with and into Owen (the
"Merger") pursuant to an Agreement and Plan of Merger dated November 27, 1996,
among the Registrant, OMC and Owen (the "Merger Agreement"). As a result of the
Merger, each outstanding share of Owen Common Stock (with certain specified
exceptions) was converted into .45 of a Common Share 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 Owen Common Stock are no longer
issuable upon the exercise of options to purchase Owen Common Stock ("Owen
Options") pursuant to the Plans. Instead, participants in the Plans will
receive in lieu of Owen Common Stock that number of Common Shares of the
Registrant equal to the number of shares of Owen Common Stock issuable
immediately prior to the effective time of the Merger upon exercise of an Owen
Option multiplied by the Exchange Ratio, with an exercise price for such option
equal to the exercise price which existed under the corresponding Owen Option
divided by the Exchange Ratio.
The designation of Amendment No. 1 as Registration No. 333-21631-01 denotes
that Amendment No. 1 relates only to the Common Shares issuable pursuant to the
Plans 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 information contained in the Company's Proxy Statement dated
September 27, 1996 for its Annual Meeting of Shareholders 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";
(c) The Current Report on Form 8-K of the Company filed with the Commission
on October 18, 1996;
(d) The Quarterly Report on Form 10-Q of the Company for the fiscal quarter
ended September 30, 1996 filed with the Commission on November 6, 1996;
(e) The Quarterly Report on Form 10-Q of the Company for the fiscal quarter
ended December 31, 1996 filed with the Commission on February 6, 1997;
(f) The Current Report on Form 8-K of the Company filed with the Commission
on March 4, 1997; and
<PAGE> 3
(g) 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.
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.
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 certain 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 officers 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.
-2-
<PAGE> 4
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)
24 Power of attorney (included on the Signature Page of this
Form S-8)
99(a) Owen Healthcare, Inc. 1987 Stock Option Plan
99(b) Owen Healthcare, Inc. 1992 Stock Option Plan
99(c) Owen Healthcare, Inc. 1992 Nonemployee Directors' Stock Option
Plan
99(d) Owen Healthcare, Inc. 1996 Stock Option Plan
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 plans 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
-3-
<PAGE> 5
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.
-4-
<PAGE> 6
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 19th day of March, 1997.
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 19th
day of March, 1997.
Signature Title
- --------- -----
/s/ Robert D. Walter Chairman and Chief Executive
- ------------------------- Officer (principal executive officer)
Robert D. Walter and Director
/s/ David Bearman Executive Vice President and Chief
- ------------------------- Financial Officer (principal financial
David Bearman officer)
/s/Richard J. Miller Vice President, Controller and Principal
- ------------------------- Accounting Officer
Richard J. Miller
/s/ John F. Finn Director
- -------------------------
John F. Finn
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<PAGE> 7
/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
-6-
<PAGE> 8
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(a) Owen Healthcare, Inc. 1987 Stock Option Plan
99(b) Owen Healthcare, Inc. 1992 Stock Option Plan
99(c) Owen Healthcare, Inc. 1992 Nonemployee Directors' Stock Option Plan
99(d) Owen Healthcare, Inc. 1996 Stock Option Plan
-7-
<PAGE> 1
EXHIBIT 5
March 18, 1997
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 748,029 Common Shares, without par value (the "Common Shares"), of the
Company pursuant to the following plans (collectively, the "Plans") of Owen
Healthcare, Inc.: 1987 Stock Option Plan, 1992 Stock Option Plan, 1992
Nonemployee Directors' Stock Option Plan, and 1996 Stock Option 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 Plans, 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 Plans, when issued, delivered and paid for in
accordance with the terms and conditions of the Plans, 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.
-8-
<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 Post Effective Amendment No. 1 to
Form S-4 Registration Statement No. 333-21631 of our report dated August 13,
1996, appearing in the Annual Report on Form 10-K of Cardinal Health, Inc.
for the year ended June 30, 1996.
/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Columbus, Ohio
March 18, 1997
-9-
<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. 333-21631) of Cardinal
Health, Inc. pertaining to the Owen Healthcare, Inc. 1987 Stock Option Plan,
1992 Stock Option Plan, 1992 Nonemployee Directors' Stock Option Plan, and 1996
Stock Option Plan, 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,
filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
ERNST & YOUNG LLP
San Diego, California
March 18, 1997
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<PAGE> 1
EXHIBIT 99(a)
OWEN HEALTHCARE, INC.
STOCK OPTION PLAN
I. PURPOSE OF THE PLAN
-------------------
The Owen Healthcare, Inc. Stock Option Plan (the "Plan") is intended to provide
a means whereby certain employees and/or directors of Owen Healthcare, Inc. (the
"Company"), and its subsidiaries may develop a sense of proprietorship and
personal involvement in the development and financial success of the Company,
and to encourage them to remain with and devote their best efforts to the
business of the Company, thereby advancing the interests of the Company and its
shareholders. Accordingly, the Company may grant to certain employees and/or
directors the option ("Option") to purchase shares of the $1.00 stated value
common stock of the Company ("Stock"), as hereinafter set forth. Options granted
under the Plan may be either incentive stock options within the meaning of
section 422A(B) of the Internal Revenue Code of 1986, as amended (the "Code")
("Incentive Stock Options") or options which do not constitute Incentive Stock
Options.
II. ADMINISTRATION
--------------
The Plan shall be administered by the Board of Directors (the "Board") of the
Company or by a Committee appointed by the Board from among its members (the
"Committee"). The Board or the Committee shall have sole authority to select the
employees and/or directors who are to be granted Options from among those
eligible hereunder and to establish the number of shares which may be issued
under each Option. The Board or the Committee is authorized to interpret the
Plan and may from time to time adopt such rules and regulations, not
inconsistent with the provisions of the Plan, as it may deem advisable to carry
out the Plan. All decisions made by the Board or the Committee in selecting the
employees and/or directors to whom Options shall be granted, in establishing the
number of shares which may be issued under each Option, and in construing the
provisions of the Plan shall be final.
III. OPTION AGREEMENTS
-----------------
Each Option shall be evidenced by an Option Agreement and shall contain terms
and conditions, and may be exercisable for such periods, as may be approved by
the Board or the Committee. The terms and conditions of the respective Option
Agreements need not be identical. Specifically, an Option Agreement may provide
for the payment of the option price, in whole or in part, by the delivery of a
number of shares of Stock (plus cash if necessary) having a fair market value
equal to such option price. Each
<PAGE> 2
Option and all rights granted thereunder shall not be transferable 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.
IV. ELIGIBILITY OF OPTIONEE
-----------------------
Options may be granted only to directors and individuals who are key employees
of the Company or any parent or subsidiary corporation (as defined in section
425 of the Code) of the Company at the time the Option is granted. Options may
be granted to the same employee on more than one occasion. The aggregate fair
market value (determined at the time the Option is granted) of the Shares with
respect to which Incentive Stock Options under the Plan are exercisable for the
first time by an individual during any calendar year plus the aggregate fair
market value (determined at the time of option grant) of stock with respect to
which other incentive stock options within the meaning of section 422A(B) of the
Code granted after December 31, 1986 under any other stock option plans of the
Company and any parent and subsidiary of the Company are exercisable for the
first time by such individual during such calendar year shall not exceed
$100,000. Options of an individual which are subject to the foregoing limitation
and which may become exercisable in any year pursuant to their terms shall
become exercisable in ascending order of option price. The Committee shall
determine which of an Optionee's Incentive Stock Options will not become
exercisable during a year because of such limitation and shall notify the
Optionee of such determination as soon as practicable after the beginning of
such year. Further, no Incentive Stock Option shall be granted to an individual
who owns stock possessing more than 10% of the total combined voting power of
all classes of Stock of the Company of its parent or any subsidiary corporation,
within the meaning of section 422A(b)(6) of the Code, unless (i) at the time
such Option is granted the option price is at least 110% of the fair market
value of the Stock subject to the Option and (ii) such Option by its terms is
not exercisable after the expiration of five years from the date of grant. No
Incentive Stock Option may be granted to a Non-Employee Director. In regards to
Non-Statutory Stock Options; a reference to "Employee" shall mean either an
employee or a member of the Board of Directors of the Company or its
subsidiaries.
V. SHARES SUBJECT TO THE PLAN
--------------------------
The aggregate number of shares which may be issued under Options granted under
the Plan shall not exceed 150,000 shares of Stock. Such shares may consist of
authorized but unissued shares of Stock or previously issued shares of Stock
reacquired by the Company. Any of such shares which remain unissued and which
are
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<PAGE> 3
not subject to outstanding Options at the termination of the Plan shall cease to
be subject to the Plan, but until termination of the Plan, the Company shall at
all times make available a sufficient number of shares to meet the requirements
of the Plan. Should any Option hereunder expire or terminate prior to its
exercise in full, the shares theretofore subject to such Option may again be
subject to an Option granted under the Plan. The aggregate number of shares
which may be issued under the Plan shall be subject to adjustment as provided in
Paragraph VIII hereof. Exercise of an option in any manner, including an
exercise involving an election of an alternative settlement method referred to
in Paragraph III hereof, shall result in a decrease in the number of shares of
Stock which may thereafter be available, both for purposes of the Plan and for
sale to any one employee, by the number of shares as to which the Option is
exercised. Separate stock certificates shall be issued by the Company for those
shares acquired pursuant to the exercise of an Incentive Stock Option and for
those shares acquired pursuant to the exercise of any Option which does not
constitute an Incentive Stock Option.
VI. OPTION PRICE
------------
The purchase price of Stock issued under each Option shall be determined by the
Board or the Committee, but in the case of an Incentive Stock Option, such
purchase price shall not be less than the fair market value of Stock subject to
the Option on the date the Option is granted.
VII. TERM OF PLAN
------------
The Plan shall be effective upon the date of its adoption by the Board of
Directors, provided the plan is subsequently approved by the shareholders of the
Company within 12 months thereafter. Except with respect to Options then
outstanding, if not sooner terminated under the provisions of Paragraph IX
hereof, the Plan shall terminate upon and no further Options shall be granted
after the expiration of ten years from the date of its adoption by the Board of
Directors.
VIII. RECAPITALIZATION OR REORGANIZATION
----------------------------------
(a) The existence of the Plan and the Options granted hereunder shall not affect
in any way the right or power of the Board or the stockholders of the Company to
make or authorize any adjustment, recapitalization, reorganization or other
change in the Company's capital structure or its business, any merger or
consolidation of the Company, any issue of bonds, debentures, preferred or prior
preference stocks ahead of or affecting Stock or the rights thereof, the
dissolution or liquidation of the
-3-
<PAGE> 4
Company or any sale or transfer of all or any part of its assets or business, or
any other corporate act or proceeding.
(b) The shares with respect to which Options may be granted are shares of Stock
as presently constituted, but if, and whenever, prior to the expiration of an
Option theretofore granted, the Company shall effect a subdivision or
consolidation of shares of Stock or the payment of a stock dividend on Stock
without receipt of consideration by the Company, the number of shares of Stock
with respect to which such Option may thereafter be exercised (i) in the event
of an increase in the number of outstanding shares shall be proportionately
increased, and the purchase price per share shall be proportionately reduced,
and (ii) in the event of a reduction in the number of outstanding shares shall
be proportionately reduced, and the purchase price per share shall be
proportionately increased.
(c) If the Company recapitalizes or otherwise changes its capital structure,
thereafter upon any exercise of an Option theretofore granted the optionee shall
be entitled to purchase under such Option, in lieu of the number of shares of
Stock as to which such Option shall then be exercisable, the number and class of
shares of stock and securities to which the optionee would have been entitled
pursuant to the terms of such recapitalization if, immediately prior to such
recapitalization, the optionee had been the holder of record of the number of
shares of Stock as to which such Option is then exercisable. If the Company
shall not be the surviving corporation in any merger or consolidation, or if the
Company is to sell all or substantially all of its assets, if the ownership of
more than 50% of the outstanding shares of Stock shall change as a result of a
concerted action by one or more persons or corporations, or if an attempt is so
made to effect such a change of ownership, or if the Company is to be dissolved
and liquidated (each such event is referred to as a "Corporate Change"), then
the Board or the Committee, in order to protect the rights of holders of
outstanding Options, in its sole discretion may (i) accelerate the time at which
Options then outstanding may be exercised so that such Options may be exercised
in full on or before a date (before or after such Corporate Change) fixed by the
Board or the Committee, (ii) provide for the purchase, before or after such
Corporate Change, of each Option then outstanding for an amount of cash equal to
the excess of the fair market value of the shares subject to such Option (which
in the event of a change in the ownership of more than 50% of the outstanding
shares of Stock shall be not less than the amount of cash and the fair market
value of other consideration tendered for such outstanding shares) over the
aggregate option price of such shares, (iii) make such adjustments to Options
then outstanding as the Board or the Committee deems appropriate to reflect such
Corporate Change, or (iv) cause Options then outstanding to be assumed, or new
options substituted therefor, by any surviving corporation in such Corporate
Change. For purposes of this paragraph VIII, the
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Company shall be considered to be the surviving corporation in a merger the
result of which is a change in the ownership of more than 50% of the outstanding
shares of Stock.
(d) Notwithstanding anything to the contrary herein, no adjustment shall be made
if such adjustment would result in a modification of an Option (within the
meaning of section 425 of the Code), or cause such Option to fail to continue to
qualify as an incentive stock option under section 422A(b) of the Code.
(e) Except as hereinbefore expressly provided, the issuance by the Company of
shares of stock of any class or securities convertible into shares of stock of
any class, for cash, property, labor or services, upon direct sale, upon the
exercise of rights or warrants to subscribe therefor, or upon conversion of
shares or obligations of the Company convertible into such shares or other
securities, and in any case whether or not for fair value, shall not affect, and
no adjustment by reason thereof shall be made with respect to, the number of
shares of Stock subject to Options theretofore granted or the purchase price per
share.
IX. AMENDMENT OR TERMINATION OF THE PLAN
------------------------------------
The Board in its discretion may terminate the Plan at any time with respect to
any shares for which Options have not theretofore been granted. The Board shall
have the right to alter or amend the Plan or any part thereof from time to time;
provided, that no change in any Option theretofore granted may be made which
would impair the rights of the optionee without the consent of such optionee;
and provided further, that the Board may not make any alteration or amendment
which would materially increase the benefits accruing to participants under the
Plan, increase the aggregate number of shares which may be issued pursuant to
the provisions of the Plan, change the class of employees eligible to receive
Options under the Plan, or extend the term of the Plan, without the approval of
the shareholders of the Company.
X. SECURITIES LAWS
---------------
The Company shall not be obligated to issue any Stock pursuant to any Option
granted under the Plan at any time when the shares covered by such Option have
not been registered under the Securities Act of 1933 and such other state and
federal laws, rules or regulations as the Company or the Committee deems
applicable and in the opinion of legal counsel for the Company there is no
exemption from the registration requirements of such laws, rules or regulations
available for the issuance of such shares. In such circumstances, the Company
will use reasonable efforts to obtain such registration or such exemption as
soon as practicable.
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<PAGE> 1
EXHIBIT 99(b)
OWEN HEALTHCARE, INC.
1992 STOCK OPTION PLAN
I. PURPOSE OF THE PLAN
The OWEN HEALTHCARE, INC. 1992 STOCK OPTION PLAN (the "PLAN") is intended
to provide a means whereby certain employees of OWEN HEALTHCARE, INC., a Texas
corporation (the "COMPANY"), and its subsidiaries may develop a sense of
proprietorship and personal involvement in the development and financial success
of the Company, and to encourage them to remain with and devote their best
efforts to the business of the Company, thereby advancing the interests of the
Company and its shareholders. Accordingly, the Company may grant to certain
employees ("OPTIONEES") the option ("OPTION") to purchase shares of the common
stock of the Company ("STOCK"), as hereinafter set forth. Options granted under
the Plan may be either incentive stock options ("INCENTIVE STOCK OPTIONS"),
within the meaning of section 422(b) of the Internal Revenue Code of 1986, as
amended (the "CODE"), or options which do not constitute Incentive Stock
Options.
II. ADMINISTRATION
The Plan shall be administered by a committee (the "COMMITTEE") which shall
be appointed by the Board of Directors of the Company (the "BOARD"); provided,
however, that if and when the Company becomes subject to Section 16 of the
Securities Exchange Act of 1934, as amended (the "1934 Act"), then, from and
after such time the Committee shall be constituted so as to permit the Plan to
comply with Rule 16b-3, as then in effect or as thereafter modified or amended
("RULE 16b-3"), promulgated under the 1934 Act. The Committee shall have sole
authority to select the Optionees from among those individuals eligible
hereunder and to establish the number of shares which may be issued under each
Option. In making such determination, the Committee may take into account the
nature of the services rendered by such individuals, their present and potential
contributions to the Company's success and such other factors as the Committee
in its discretion shall deem relevant. The Committee is authorized to interpret
the Plan and may from time to time adopt such rules and regulations, consistent
with the provisions of the Plan, as it may deem advisable to carry out the Plan.
All decisions made by the Committee in selecting the Optionees, in establishing
the number of shares which may be issued under each Option and in construing the
provisions of the Plan shall be final.
<PAGE> 2
III. OPTION AGREEMENTS
(a) Each Option shall be evidenced by a written agreement between the
Company and the Optionee ("OPTION AGREEMENT") which shall contain such terms and
conditions as may be approved by the Committee. The terms and conditions of the
respective Option Agreements need not be identical. Specifically, an Option
Agreement may provide for the surrender of the right to purchase shares under
the Option in return for a payment in cash or shares of Stock or a combination
of cash and shares of Stock equal in value to the excess of the fair market
value of the shares with respect to which the right to purchase is surrendered
over the option price therefor ("STOCK APPRECIATION RIGHTS"), on such terms and
conditions as the Committee in its sole discretion may prescribe; provided,
that, from and after the time the Company becomes subject to Section 16 of the
1934 Act, with respect to Stock Appreciation Rights granted to employees who are
subject to Section 16 of the 1934 Act, except as provided in Subparagraph
VIII(c) hereof, the Committee shall retain final authority (i) to determine
whether an Optionee shall be permitted, or (ii) to approve an election by an
Optionee, to receive cash in full or partial settlement of Stock Appreciation
Rights. Moreover, an Option Agreement may provide for the payment of the option
price, in whole or in part, by the delivery of a number of shares of Stock (plus
cash if necessary) having a fair market value equal to such option price.
(b) For all purposes under the Plan, the fair market value of a share of
Stock on a particular date shall be equal to the mean of the reported high and
low sales prices of the Stock on the stock exchange composite tape on that date,
or if no prices are reported on that date, on the last preceding date on which
such prices of the Stock are so reported. If the Stock is traded over the
counter at the time a determination of its fair market value is required to be
made hereunder, its fair market value shall be deemed to be equal to the average
between the reported high and low or closing bid and asked prices of Stock on
the most recent date on which Stock was publicly traded. In the event Stock is
not publicly traded at the time a determination of its value is required to be
made hereunder, the determination of its fair market value shall be made by the
Committee in such manner as it deems appropriate.
(c) Each Option and all rights granted thereunder shall not be transferable
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.
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<PAGE> 3
IV. ELIGIBILITY OF OPTIONEE
Options may be granted only to individuals who are employees (including
officers and directors who are also employees) of the Company or any parent or
subsidiary corporation (as defined in section 424 of the Code) of the Company at
the time the Option is granted; provided, however, that, from and after the time
the Company becomes subject to Section 16 of the 1934 Act, members of the
Committee shall not be eligible to be granted Options. Options may be granted to
the same individual on more than one occasion. No Incentive Stock Option shall
be granted to an individual if, at the time the Option is granted, such
individual owns stock possessing more than 10% of the total combined voting
power of all classes of stock of the Company or of its parent or subsidiary
corporation, within the meaning of section 422(b)(6) of the Code, unless (i) at
the time such Option is granted the option price is at least 110% of the fair
market value of the Stock subject to the Option and (ii) such Option by its
terms is not exercisable after the expiration of five years from the date of
grant. To the extent that the aggregate fair market value (determined at the
time the respective Incentive Stock Option is granted) of stock with respect to
which Incentive Stock Options are exercisable for the first time by an
individual during any calendar year under all incentive stock option plans of
the Company and its parent and subsidiary corporations exceeds $100,000, such
excess Incentive Stock Options shall be treated as Options which do not
constitute Incentive Stock Options. The Committee shall determine, in accordance
with applicable provisions of the Code, Treasury Regulations and other
administrative pronouncements, which of an Optionee's Incentive Stock Options
will not constitute Incentive Stock Options because of such limitation and shall
notify the Optionee of such determination as soon as practicable after such
determination.
V. SHARES SUBJECT TO THE PLAN
The aggregate number of shares which may be issued under Options granted
under the Plan shall not exceed 200,000 shares of Stock. Such shares may
consist of authorized but unissued shares of Stock or previously issued shares
of Stock reacquired by the Company. Any of such shares which remain unissued and
which are not subject to outstanding Options at the termination of the Plan
shall cease to be subject to the Plan, but, until termination of the Plan, the
Company shall at all times make available a sufficient number of shares to meet
the requirements of the Plan. Should any Option hereunder expire or terminate
prior to its exercise in full, the shares theretofore subject to such Option may
again be subject to an Option granted under the Plan (but only to the extent
permitted under Rule 16b-3 with respect to shares subject to an Option which
expires or terminates on or after the time the Company becomes subject to
Section 16 of the 1934 Act). The aggregate number of shares which may be issued
under the Plan shall be subject to adjustment in the same manner as provided in
Paragraph VIII hereof with respect to shares of Stock subject to Options then
outstanding. Exercise of an Option in
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<PAGE> 4
any manner, including an exercise involving a Stock Appreciation Right, shall
result in a decrease in the number of shares of Stock which may thereafter be
available, both for purposes of the Plan and for sale to any one individual, by
the number of shares as to which the Option is exercised. Separate stock
certificates shall be issued by the Company for those shares acquired pursuant
to the exercise of an Incentive Stock Option and for those shares acquired
pursuant to the exercise of any Option which does not constitute an Incentive
Stock Option.
VI. OPTION PRICE
The purchase price of Stock issued under each Option shall be determined
by the Committee, but (i) in the case of an Incentive Stock Option, such
purchase price shall not be less than the fair market value of Stock subject to
the Option on the date the Option is granted, and (ii) in the case of an option
that does not constitute an Incentive Stock Option, such purchase price shall
not be less than 80% of the fair market value of Stock subject to the Option on
the date the Option is granted.
VII. TERM OF PLAN
The Plan shall be effective upon the date of its adoption by the Board,
provided the Plan is approved by the shareholders of the Company within twelve
months thereafter. Except with respect to Options then outstanding, if not
sooner terminated under the provisions of Paragraph IX, the Plan shall terminate
upon and no further Options shall be granted after the expiration of ten years
from the date of its adoption by the Board.
VIII. RECAPITALIZATION OR REORGANIZATION
(a) The existence of the Plan and the Options granted hereunder shall not
affect in any way the right or power of the Board or the shareholders of the
Company to make or authorize any adjustment, recapitalization, reorganization
or other change in the Company's capital structure or its business, any merger
or consolidation of the Company, any issue of debt or equity securities, the
dissolution or liquidation of the Company or any sale, lease, exchange or other
disposition of all or any part of its assets or business or any other corporate
act or proceeding.
(b) The shares with respect to which Options may be granted are shares of
Stock as presently constituted, but if, and whenever, prior to the expiration
of an Option theretofore granted, the Company shall effect a subdivision or
consolidation of shares of Stock or the payment of a stock dividend on Stock
without receipt of consideration by the Company, the number of shares of Stock
with respect to which such Option may thereafter be exercised (i) in the event
of an increase in the number of outstanding shares shall be proportionately
increased, and the purchase price per share shall be proportionately
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<PAGE> 5
reduced, and (ii) in the event of a reduction in the number of outstanding
shares shall be proportionately reduced, and the purchase price per share shall
be proportionately increased.
(c) If the Company recapitalizes or otherwise changes its capital
structure, thereafter upon any exercise of an Option theretofore granted the
Optionee shall be entitled to purchase under such Option, in lieu of the number
and class of shares of Stock then covered by such Option, the number and class
of shares of stock and securities to which the Optionee would have been
entitled pursuant to the terms of the recapitalization if, immediately prior to
such recapitalization, the Optionee had been the holder of record of the number
of shares of Stock then covered by such Option. If (i) the Company shall not be
the surviving entity in any merger, consolidation or other reorganization (or
survives only as a subsidiary of an entity other than a previously wholly-owned
subsidiary of the Company), (ii) the Company sells, leases or exchanges or
agrees to sell, lease or exchange all or substantially all of its assets to any
other person or entity (other than a wholly-owned subsidiary of the Company),
(iii) the Company is to be dissolved and liquidated, (iv) any person or entity,
including a "group" as contemplated by Section 13(d)(3) of the 1934 Act, except
an underwriter or similar entity in connection with a public offering of Stock,
acquires or gains ownership or control (including, without limitation, power to
vote) of more than 50% of the outstanding shares of Stock, or (v) as a result
of or in connection with a contested election of directors, the persons who
were directors of the Company before such election shall cease to constitute a
majority of the Board (each such event is referred to herein as a "CORPORATE
CHANGE"), then effective as of a date (selected by the Committee) within (a)
ten days after the approval by the shareholders of the Company of such merger,
consolidation, reorganization, sale, lease or exchange of assets or dissolution
or such election of directors or (b) thirty days of such change of control, the
Committee, acting in its sole discretion without the consent or approval of any
Optionee, shall effect one or more of the following alternatives, which may
vary among individual Optionees: (1) accelerate the time at which Options then
outstanding may be exercised so that such Options may be exercised in full for
a limited period of time on or before a specified date (before or after such
Corporate Change) fixed by the Committee, after which specified date all
unexercised Options and all rights of Optionees thereunder shall terminate, (2)
require the mandatory surrender to the Company by selected Optionees of some or
all of the outstanding Options held by such Optionees (irrespective of whether
such Options are then exercisable under the provisions of the Plan) as of a
date, before or after such Corporate Change, specified by the Committee, in
which event the Committee shall thereupon cancel such Options and pay to each
Optionee an amount of cash per share equal to the excess of the amount
calculated in Subparagraph (d) below (the "CHANGE OF CONTROL VALUE") of the
shares subject to such Option over the exercise price(s) under such Options for
such shares, (3) make such adjustments to Options then outstanding as the
Committee deems appropriate to reflect such Corporate Change (provided,
however, that the Committee may determine in its sole discretion that no
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<PAGE> 6
adjustment is necessary to Options then outstanding) or (4) provide that
thereafter upon any exercise of an Option theretofore granted the Optionee
shall be entitled to purchase under such Option, in lieu of the number of
shares of Stock as to which such Option shall then be exercisable, the number
and class of shares of stock or other securities or property to which the
Optionee would have been entitled pursuant to the terms of the agreement of
merger, consolidation or sale of assets and dissolution if, immediately prior
to such merger, consolidation or sale of assets and dissolution the Optionee
had been the holder of record of the number of shares of Stock as to which such
Option is then exercisable.
(d) For the purposes of clause (2) in Subparagraph (c) above, the "CHANGE
OF CONTROL VALUE" shall equal the amount determined in clause (i), (ii) or
(iii), whichever is applicable, as follows: (i) the per share price offered to
shareholders of the Company in any such merger, consolidation, reorganization,
sale of assets or dissolution transaction, (ii) the price per share offered to
shareholders of the Company in any tender offer or exchange offer whereby a
Corporate Change takes place, or (iii) if such Corporate Change occurs other
than pursuant to a tender or exchange offer, the fair market value per share of
the shares into which such Options being surrendered are exercisable, as
determined by the Committee as of the date determined by the Committee to be the
date of cancellation and surrender of such Options. In the event that the
consideration offered to shareholders of the Company in any transaction
described in this Subparagraph (d) or Subparagraph (c) above consists of
anything other than cash, the Committee shall determine the fair cash equivalent
of the portion of the consideration offered which is other than cash.
(e) Any adjustment provided for in Subparagraphs (b) or (c) above shall be
subject to any required shareholder action.
(f) Except as hereinbefore expressly provided, the issuance by the Company
of shares of stock of any class or securities convertible into shares of stock
of any class, for cash, property, labor or services, upon direct sale, upon the
exercise of rights or warrants to subscribe therefor, or upon conversion of
shares or obligations of the Company convertible into such shares or other
securities, and in any case whether or not for fair value, shall not affect,
and no adjustment by reason thereof shall be made with respect to, the number
of shares of Stock subject to Options theretofore granted or the purchase price
per share.
IX. AMENDMENT OR TERMINATION OF THE PLAN
The Board in its discretion may terminate the Plan at any time with
respect to any shares for which Options have not theretofore been granted. The
Board shall have the right to alter or amend the Plan or any part thereof from
time to time; provided, that no change in any Option theretofore granted may be
made which would impair the rights of
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the Optionee without the consent of such Optionee; and provided, further, that
(i) the Board may not make any alteration or amendment on or after the time the
Company becomes subject to Section 16 of the 1934 Act which would decrease any
authority granted to the Committee hereunder in contravention of Rule 16b-3 and
(ii) the Board may not make any alteration or amendment which would materially
increase the benefits accruing to participants under the Plan, increase the
aggregate number of shares which may be issued pursuant to the provisions of
the Plan, change the class of individuals eligible to receive Options under the
Plan or extend the term of the Plan, without the approval of the shareholders
of the Company.
X. SECURITIES LAW
(a) The Company shall not be obligated to issue any Stock pursuant to any
Option granted under the Plan at any time when the offering of the shares
covered by such Option have not been registered under the Securities Act of
1933 and such other state and federal laws, rules or regulations as the Company
or the Committee deems applicable and, in the opinion of legal counsel for the
Company, there is no exemption from the registration requirements of such laws,
rules or regulations available for the offering and sale of such shares.
(b) From and after the time the Company becomes subject to Section 16 of
the 1934 Act, it is intended that the Plan and any grant of an Option made to a
person subject to Section 16 of the 1934 Act meet all of the requirements of
Rule 16b-3. If any provision of the Plan or any such Option would disqualify
the Plan or such Option under, or would otherwise not comply with, Rule 16b-3,
such provision or Option shall be construed or deemed amended to conform to
Rule 16b-3.
<PAGE> 1
EXHIBIT 99(c)
OWEN HEALTHCARE, INC.
1992 NONEMPLOYEE DIRECTORS' STOCK OPTION PLAN
I. PURPOSE OF THE PLAN
The OWEN HEALTHCARE, INC. 1992 NONEMPLOYEE DIRECTORS' STOCK OPTION PLAN
(the "Plan") is intended to promote the interests of OWEN HEALTHCARE, INC., a
Texas corporation (the "Company"), and its shareholders by helping to award and
retain highly-qualified independent directors, and allowing them to develop a
sense of proprietorship and personal involvement in the development and
financial success of the Company. Accordingly, the Company shall grant to
directors of the Company who are not employees of the Company or any of its
subsidiaries ("Nonemployee Directors") the option ("Option") to purchase shares
of the Common Stock, no par value per share, of the Company ("Stock"), as
hereinafter set forth. Options granted under the Plan shall be options which do
not constitute incentive stock options, within the meaning of section 422(b) of
the Internal Revenue Code of 1986, as amended.
II. OPTION AGREEMENTS
Each Option shall be evidenced by a written agreement in the form
attached to the Plan.
III. ELIGIBILITY OF OPTIONEE
Options shall be granted only to individuals who are Nonemployee
Directors of the Company. Each Nonemployee Director who is elected or appointed
to the Board of Directors of the Company (the "Board") for the first time after
the effective date of the Plan shall receive, as of the date of his or her
election or appointment and without the exercise of the discretion of any person
or persons, an Option exercisable for 5,000 shares of Stock (subject to
adjustment in the same manner as provided in Paragraph VII hereof with respect
to shares of Stock subject to Options then outstanding). Thereafter and for as
long as the Plan is in effect as provided in Paragraph VI hereof, on the later
of the date of the third anniversary of (i) his or her election or appointment
to the Board, and (ii) the effective date of the Plan, and on each subsequent
third anniversary of such date, each Nonemployee Director who is serving on the
Board as of such date shall receive, without the exercise of the discretion of
any person or persons, an Option exercisable for 2,500 shares of Stock (subject
to adjustment in the same manner as provided in Paragraph VII hereof with
respect to shares of Stock subject to Options then outstanding). If, as of any
date that the Plan is in effect, there are not sufficient shares of Stock
available under the Plan to allow for the grant to each Nonemployee Director of
an Option for the number of shares provided herein on the applicable date, then
all Nonemployee
<PAGE> 2
Directors who are entitled to a grant on such date shall share ratably in the
total number of shares of Stock then available under the Plan. A Nonemployee
Director shall be ineligible to receive a grant provided for in the Plan unless,
as of the date of such grant, the director has not been an employee of the
Company or any subsidiary of the Company for any part of the Company's preceding
fiscal year. All Options granted under the Plan shall be at the Option price set
forth in Paragraph V hereof and shall be subject to adjustment as provided in
Paragraph VII hereof.
IV. SHARES SUBJECT TO THE PLAN
The aggregate number of shares which may be issued under Options
granted under the Plan shall not exceed 120,000 shares of Stock. Such shares may
consist of authorized but unissued shares of Stock or previously issued shares
of Stock reacquired by the Company. Any of such shares which remain unissued and
which are not subject to outstanding Options at the termination of the Plan
shall cease to be subject to the Plan, but, until termination of the Plan, the
Company shall at all times make available a sufficient number of shares to meet
the requirements of the Plan. Should any Option hereunder expire or terminate
prior to its exercise in full, the shares theretofore subject to such Option may
again be subject to an Option granted under the Plan. The aggregate number of
shares which may be issued under the Plan shall be subject to adjustment in the
same manner as provided in Paragraph VII hereof with respect to shares of Stock
subject to Options then outstanding. Exercise of an Option shall result in a
decrease in the number of shares of Stock which may thereafter be available,
both for purposes of the Plan and for sale to any one individual, by the number
of shares as to which the Option is exercised.
V. OPTION PRICE
The purchase price of Stock issued under each Option shall be the fair
market value of Stock subject to the Option on the date the Option is granted.
For all purposes under the Plan, the fair market value of a share of Stock on a
particular date shall be equal to the average of the high and low sales prices
of the Stock (i) as reported by the National Market System of NASDAQ on that
date if the Stock is listed thereon, or (ii) on the stock exchange composite
tape on that date if the Stock is listed on a national exchange; or if in either
case no prices are reported on that date, on the last preceding date on which
such prices of the Stock are so reported. If the Stock is traded over the
counter at the time a determination of its fair market value is required to be
made hereunder, its fair market value shall be deemed to be equal to the average
between the reported high and low sales prices or closing bid and asked prices
of Stock on the most recent date on which Stock was publicly traded. In the
event Stock is not publicly
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<PAGE> 3
traded at the time a determination of its value is required to be made
hereunder, the determination of its fair market value shall be made by the Board
in such manner as it deems appropriate.
VI. TERM OF PLAN
The Plan shall be effective on the date the Plan is approved by the
shareholders of the Company. Except with respect to Options then outstanding, if
not sooner terminated under the provisions of Paragraph VIII, the Plan shall
terminate upon and no further Options shall be granted after the expiration of
ten years from the date of its approval by the shareholders of the Company.
VII. RECAPITALIZATION OR REORGANIZATION
(a) The existence of the Plan and the Options granted hereunder shall
not affect in any way the right or power of the Board or the shareholders of the
Company to make or authorize any adjustment, recapitalization, reorganization or
other change in the Company's capital structure or its business, any merger or
consolidation of the Company, any issue of debt or equity securities, the
dissolution or liquidation of the Company or any sale, lease, exchange or other
disposition of all or any part of its assets or business or any other corporate
act or proceeding.
(b) The shares with respect to which Options may be granted are shares
of Stock as presently constituted, but if, and whenever, prior to the expiration
of an Option theretofore granted, the Company shall effect a subdivision or
consolidation of shares of Stock or the payment of a stock dividend on Stock
without receipt of consideration by the Company, the number of shares of Stock
with respect to which such Option may thereafter be exercised (i) in the event
of an increase in the number of outstanding shares shall be proportionately
increased, and the purchase price per share shall be proportionately reduced,
and (ii) in the event of a reduction in the number of outstanding shares shall
be proportionately reduced, and the purchase price per share shall be
proportionately increased.
(c) If the Company recapitalizes or otherwise changes its capital
structure, thereafter upon any exercise of an Option theretofore granted the
optionee shall be entitled to purchase under such Option, in lieu of the number
and class of shares of Stock then covered by such Option, the number and class
of shares of stock and securities to which the optionee would have been entitled
pursuant to the terms of the recapitalization if, immediately prior to such
recapitalization, the optionee had been the holder of record of the number of
shares of Stock then covered by such Option. If (i) the Company shall not be the
surviving entity in any merger, consolidation or other reorganization (or
survives only as a subsidiary of an entity other than a previously
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<PAGE> 4
wholly-owned subsidiary of the Company), (ii) the Company sells, leases or
exchanges or agrees to sell, lease or exchange all or substantially all of its
assets to any other person or entity (other than a wholly-owned subsidiary of
the Company), (iii) the Company is to be dissolved and liquidated, (iv) any
person or entity, including a "group" as contemplated by Section 13(d)(3) of the
Securities and Exchange Act of 1934, as amended (the "1934 Act"), except an
underwriter or similar entity in connection with a public offering of Stock,
acquires or gains ownership or control (including, without limitation, power to
vote) of more than 50% of the outstanding shares of Stock, or (v) as a result of
or in connection with a contested election of directors, the persons who were
directors of the Company before such election shall cease to constitute a
majority of the Board (each such event is referred to herein as a "Corporate
Change"), then effective as of a date (selected by the Board) within (a) ten
days after the approval by the shareholders of the Company of such merger,
consolidation, reorganization, sale, lease or exchange of assets or dissolution
or such election of directors or (b) thirty days of such change of control, all
Options then outstanding will become fully vested and thereafter, upon any
exercise of an Option theretofore granted, the Optionee shall be entitled to
purchase under such Option, in lieu of the number of shares of Stock as to which
such Option shall then be exercisable, the number and class of shares of stock
or other securities or property to which the Optionee would have been entitled
pursuant to the terms of the agreement of merger, consolidation or sale of
assets and dissolution if, immediately prior to such merger, consolidation or
sale of assets and dissolution the Optionee had been the holder of record of the
number of shares of Stock as to which such Option is then exercisable.
(d) Any adjustment provided for in Subparagraphs (b) or (c)
above shall be subject to any required shareholder action.
(e) Except as hereinbefore expressly provided, the issuance by the
Company of shares of stock of any class or securities convertible into shares of
stock of any class, for cash, property, labor or services, upon direct sale,
upon the exercise of rights or warrants to subscribe therefor, or upon
conversion of shares or obligations of the Company convertible into such shares
or other securities, and in any case whether or not for fair value, shall not
affect, and no adjustment by reason thereof shall be made with respect to, the
number of shares of Stock subject to Options theretofore granted or the purchase
price per share.
VIII. AMENDMENT OR TERMINATION OF THE PLAN
The Board in its discretion may terminate the Plan at any time with
respect to any shares for which Options have not theretofore been granted. The
Board shall not have the right to alter or amend the Plan or any part thereof
without the approval of the
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shareholders of the Company, except for amendments that are necessary in order
for the Plan to meet all of the requirements of Rule 16b-3 promulgated under the
1934 Act, and as such rule may be amended from time to time.
IX. SECURITIES LAWS
(a) The Company shall not be obligated to issue any Stock pursuant to
any Option granted under the Plan at any time when the offering of the shares
covered by such Option have not been registered under the Securities Act of 1933
and such other state and federal laws, rules or regulations as the Company deems
applicable and, in the opinion of legal counsel for the Company, there is no
exemption from the registration requirements of such laws, rules or regulations
available for the offering and sale of such shares.
(b) If the Company becomes subject to Section 16 of the 1934 Act then,
from and after such time, it is intended that the Plan and any grant of an
Option made to a person subject to Section 16 of the 1934 Act, meet all of the
requirements of Rule 16b-3, as then in effect or as thereafter modified or
amended ("Rule 16b-3"), promulgated under the 1934 Act. If any provision of the
Plan or any such Option would disqualify the Plan or such Option under, or would
otherwise not comply with, Rule 16b-3, such provision or Option shall be
construed or deemed amended to conform to Rule 16b-3.
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EXHIBIT 99(d)
OWEN HEALTHCARE, INC.
1996 STOCK OPTION PLAN
I. PURPOSE OF THE PLAN
The OWEN HEALTHCARE, INC. 1996 STOCK OPTION PLAN (the "Plan") is
intended to provide a means whereby certain employees of OWEN HEALTHCARE, INC.,
a Texas corporation (the "Company"), and its subsidiaries may develop a sense of
proprietorship and personal involvement in the development and financial success
of the Company, and to encourage them to remain with and devote their best
efforts to the business of the Company, thereby advancing the interests of the
Company and its shareholders. Accordingly, the Company may grant to certain
employees ("Optionees") the option ("Option") to purchase shares of the common
stock of the Company ("Stock"), as hereinafter set forth. Options granted under
the Plan may be either incentive stock options, within the meaning of section
422(b) of the Internal Revenue Code of 1986, as amended (the "Code"),
("Incentive Stock Options") or options which do not constitute Incentive Stock
Options.
II. ADMINISTRATION
The Plan shall be administered by a committee (the "Committee") of, and
appointed by, the Board of Directors of the Company (the "Board"), and the
Committee shall be (a) comprised solely of two or more outside directors (within
the meaning of section 162(m) of the Code and applicable interpretive authority
thereunder), and (b) constituted so as to permit the Plan to comply with Rule
16b-3, as currently in effect or as hereinafter modified or amended ("Rule
16b-3"), promulgated under the Securities Exchange Act of 1934, as amended (the
"1934 Act"). The Committee shall have sole authority to select the Optionees
from among those individuals eligible hereunder and to establish the number of
shares which may be issued under each Option; provided, however, that,
notwithstanding any provision in the Plan to the contrary, the maximum number of
shares that may be subject to Options granted under the Plan to an individual
Optionee during any calendar year may not exceed 100,000 (subject to adjustment
in the same manner as provided in Paragraph VIII hereof with respect to shares
of Stock subject to Options then outstanding). The limitation set forth in the
preceding sentence shall be applied in a manner which will permit compensation
generated under the Plan to constitute "performance-based" compensation for
purposes of section 162(m) of the Code, including, without limitation, counting
against such maximum number of shares, to the extent required under section
162(m) of the Code and applicable interpretive authority thereunder, any shares
subject to Options that are canceled or repriced. In selecting the Optionees
from among individuals eligible hereunder and in establishing the number of
shares that may be issued under each Option, the Committee may take into account
the nature of the services rendered by such individuals, their present and
potential contributions to the Company's success and such other factors as the
Committee in its discretion
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shall deem relevant. The Committee is authorized to interpret the Plan and may
from time to time adopt such rules and regulations, consistent with the
provisions of the Plan, as it may deem advisable to carry out the Plan. All
decisions made by the Committee in selecting the Optionees, in establishing the
number of shares which may be issued under each Option and in construing the
provisions of the Plan shall be final.
III. OPTION AGREEMENTS
(a) Each Option shall be evidenced by a written agreement between the
Company and the Optionee ("Option Agreement") which shall contain such terms and
conditions as may be approved by the Committee. The terms and conditions of the
respective Option Agreements need not be identical. Specifically, an Option
Agreement may provide for the surrender of the right to purchase shares under
the Option in return for a payment in cash or shares of Stock or a combination
of cash and shares of Stock equal in value to the excess of the fair market
value of the shares with respect to which the right to purchase is surrendered
over the option price therefor ("Stock Appreciation Rights"), on such terms and
conditions as the Committee in its sole discretion may prescribe; provided,
that, except as provided in Subparagraph VIII(c) hereof, the Committee shall
retain final authority (i) to determine whether an Optionee shall be permitted,
or (ii) to approve an election by an Optionee, to receive cash in full or
partial settlement of Stock Appreciation Rights. Moreover, an Option Agreement
may provide for the payment of the option price, in whole or in part, by the
delivery of a number of shares of Stock (plus cash if necessary) having a fair
market value equal to such option price.
(b) For all purposes under the Plan, the fair market value of a share
of Stock on a particular date shall be equal to the mean of the high and low
sales prices of the Stock (i) reported by the National Market System of NASDAQ
on that date or (ii) if the Stock is listed on a national stock exchange,
reported on the stock exchange composite tape on that date; or, in either case,
if no prices are reported on that date, on the last preceding date on which such
prices of the Stock are so reported. If the Stock is traded over the counter at
the time a determination of its fair market value is required to be made
hereunder, its fair market value shall be deemed to be equal to the average
between the reported high and low or closing bid and asked prices of Stock on
the most recent date on which Stock was publicly traded. In the event Stock is
not publicly traded at the time a determination of its value is required to be
made hereunder, the determination of its fair market value shall be made by the
Committee in such manner as it deems appropriate.
(c) Each Option and all rights granted thereunder shall not be
transferable other than by will or the laws of descent and distribution or
pursuant to a qualified domestic relations order as defined by the Code or Title
I of the Employee Retirement Income Security Act of 1974, as amended, or the
rules thereunder, and shall be exercisable during the Optionee's lifetime only
by the Optionee or the Optionee's guardian or legal representative.
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IV. ELIGIBILITY OF OPTIONEE
Options may be granted only to individuals who are key employees
(including officers and directors who are also key employees) of the Company or
any parent or subsidiary corporation (as defined in section 424 of the Code) of
the Company at the time the Option is granted. Options may be granted to the
same individual on more than one occasion. No Incentive Stock Option shall be
granted to an individual if, at the time the Option is granted, such individual
owns stock possessing more than 10% of the total combined voting power of all
classes of stock of the Company or of its parent or subsidiary corporation,
within the meaning of section 422(b)(6) of the Code, unless (i) at the time such
Option is granted the option price is at least 110% of the fair market value of
the Stock subject to the Option and (ii) such Option by its terms is not
exercisable after the expiration of five years from the date of grant. To the
extent that the aggregate fair market value (determined at the time the
respective Incentive Stock Option is granted) of stock with respect to which
Incentive Stock Options are exercisable for the first time by an individual
during any calendar year under all incentive stock option plans of the Company
and its parent and subsidiary corporations exceeds $100,000, such excess
Incentive Stock Options shall be treated as Options which do not constitute
Incentive Stock Options. The Committee shall determine, in accordance with
applicable provisions of the Code, Treasury Regulations and other administrative
pronouncements, which of an Optionee's Incentive Stock Options will not
constitute Incentive Stock Options because of such limitation and shall notify
the Optionee of such determination as soon as practicable after such
determination.
V. SHARES SUBJECT TO THE PLAN
The aggregate number of shares which may be issued under Options
granted under the Plan shall not exceed 900,000 shares of Stock. Such shares may
consist of authorized but unissued shares of Stock or previously issued shares
of Stock reacquired by the Company. Any of such shares which remain unissued and
which are not subject to outstanding Options at the termination of the Plan
shall cease to be subject to the Plan, but, until termination of the Plan, the
Company shall at all times make available a sufficient number of shares to meet
the requirements of the Plan. Should any Option hereunder expire or terminate
prior to its exercise in full, the shares theretofore subject to such Option may
again be subject to an Option granted under the Plan to the extent permitted
under Rule 16b-3. The aggregate number of shares which may be issued under the
Plan shall be subject to adjustment in the same manner as provided in Paragraph
VIII hereof with respect to shares of Stock subject to Options then outstanding.
Exercise of an Option in any manner, including an exercise involving a Stock
Appreciation Right, shall result in a decrease in the number of shares of Stock
which may thereafter be available, both for purposes of the Plan and for sale to
any one individual, by the number of shares as to which the Option is exercised.
Separate stock certificates shall be issued by the Company for those shares
acquired pursuant to the exercise of an Incentive Stock Option and for those
shares acquired pursuant to the exercise of any Option which does not constitute
an Incentive Stock Option.
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VI. OPTION PRICE
The purchase price of Stock issued under each Option shall be
determined by the Committee, but (i) in the case of an Incentive Stock Option,
such purchase price shall not be less than the fair market value of Stock
subject to the Option on the date the Option is granted, and (ii) in the case of
an option that does not constitute an Incentive Stock Option, such purchase
price shall not be less than 85% of the fair market value of Stock subject to
the Option on the date the Option is granted.
VII. TERM OF PLAN
The Plan shall be effective upon the date of its adoption by the Board,
provided the Plan is approved by the shareholders of the Company within twelve
months thereafter. Notwith standing any provision in this Plan or in any Option
Agreement, no Option shall be exercisable prior to such shareholder approval.
Except with respect to Options then outstanding, if not sooner terminated under
the provisions of Paragraph IX, the Plan shall terminate upon and no further
Options shall be granted after the expiration of ten years from the date of its
adoption by the Board.
VIII. RECAPITALIZATION OR REORGANIZATION
(a) The existence of the Plan and the Options granted hereunder shall
not affect in any way the right or power of the Board or the shareholders of the
Company to make or authorize any adjustment, recapitalization, reorganization or
other change in the Company's capital structure or its business, any merger or
consolidation of the Company, any issue of debt or equity securities, the
dissolution or liquidation of the Company or any sale, lease, exchange or other
disposition of all or any part of its assets or business or any other corporate
act or proceeding.
(b) The shares with respect to which Options may be granted are shares
of Stock as presently constituted, but if, and whenever, prior to the expiration
of an Option theretofore granted, the Company shall effect a subdivision or
consolidation of shares of Stock or the payment of a stock dividend on Stock
without receipt of consideration by the Company, the number of shares of Stock
with respect to which such Option may thereafter be exercised (i) in the event
of an increase in the number of outstanding shares shall be proportionately
increased, and the purchase price per share shall be proportionately reduced,
and (ii) in the event of a reduction in the number of outstanding shares shall
be proportionately reduced, and the purchase price per share shall be
proportionately increased.
(c) If the Company recapitalizes, reclassifies its capital stock, or
otherwise changes its capital structure (a "recapitalization"), the number and
class of shares of Stock covered by an Option theretofore granted shall be
adjusted so that such Option shall thereafter cover the number and class of
shares of stock and securities to which the Optionee would have been entitled
pursuant to the terms of the recapitalization if, immediately prior to the
recapitalization, the Optionee had been the holder of record of the number of
shares of Stock then covered by such Option. If (i) the
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Company shall not be the surviving entity in any merger, consolidation or other
reorganization (or survives only as a subsidiary of an entity other than a
previously wholly-owned subsidiary of the Company), (ii) the Company sells,
leases or exchanges all or substantially all of its assets to any other person
or entity (other than a wholly-owned subsidiary of the Company), (iii) the
Company is to be dissolved and liquidated, (iv) any person or entity, including
a "group" as contemplated by Section 13(d)(3) of the 1934 Act, acquires or gains
ownership or control (including, without limitation, power to vote) of more than
50% of the outstanding shares of the Company's voting stock (based upon voting
power), or (v) as a result of or in connection with a contested election of
directors, the persons who were directors of the Company before such election
shall cease to constitute a majority of the Board (each such event is referred
to herein as a "Corporate Change"), no later than (a) ten days after the
approval by the shareholders of the Company of such merger, consolidation,
reorganization, sale, lease or exchange of assets or dissolution or such
election of directors or (b) thirty days after a change of control of the type
described in Clause (iv), the Committee, acting in its sole discretion without
the consent or approval of any Optionee, shall act to effect one or more of the
following alternatives, which may vary among individual Optionees and which may
vary among Options held by any individual Optionee: (1) accelerate the time at
which Options then outstanding may be exercised so that such Options may be
exercised in full for a limited period of time on or before a specified date
(before or after such Corporate Change) fixed by the Committee, after which
specified date all unexercised Options and all rights of Optionees thereunder
shall terminate, (2) require the mandatory surrender to the Company by selected
Optionees of some or all of the outstanding Options held by such Optionees
(irrespective of whether such Options are then exercisable under the provisions
of the Plan) as of a date, before or after such Corporate Change, specified by
the Committee, in which event the Committee shall thereupon cancel such Options
and the Company shall pay to each Optionee an amount of cash per share equal to
the excess, if any, of the amount calculated in Subparagraph (d) below (the
"Change of Control Value") of the shares subject to such Option over the
exercise price(s) under such Options for such shares, (3) make such adjustments
to Options then outstanding as the Committee deems appropriate to reflect such
Corporate Change (provided, however, that the Committee may determine in its
sole discretion that no adjustment is necessary to Options then outstanding) or
(4) provide that the number and class of shares of Stock covered by an Option
theretofore granted shall be adjusted so that such Option shall thereafter cover
the number and class of shares of stock or other securities or property
(including, without limitation, cash) to which the Optionee would have been
entitled pursuant to the terms of the agreement of merger, consolidation or sale
of assets and dissolution if, immediately prior to such merger, consolidation or
sale of assets and dissolution, the Optionee had been the holder of record of
the number of shares of Stock then covered by such Option.
(d) For the purposes of clause (2) in Subparagraph (c) above, the
"Change of Control Value" shall equal the amount determined in clause (i), (ii)
or (iii), whichever is applicable, as follows: (i) the per share price offered
to shareholders of the Company in any such merger, consolidation,
reorganization, sale of assets or dissolution transaction, (ii) the price per
share offered to shareholders of the Company in any tender offer or exchange
offer whereby a Corporate Change takes place, or (iii) if such Corporate Change
occurs other than pursuant to a tender or exchange offer, the fair market value
per share of the shares into which such Options being surrendered are
exercisable, as determined by the Committee as of the date determined by the
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Committee to be the date of cancellation and surrender of such Options. In the
event that the consideration offered to shareholders of the Company in any
transaction described in this Subparagraph (d) or Subparagraph (c) above
consists of anything other than cash, the Committee shall determine the fair
cash equivalent of the portion of the consideration offered which is other than
cash.
(e) Any adjustment provided for in Subparagraphs (b) or (c) above shall
be subject to any required shareholder action.
(f) Except as hereinbefore expressly provided, the issuance by the
Company of shares of stock of any class or securities convertible into shares of
stock of any class, for cash, property, labor or services, upon direct sale,
upon the exercise of rights or warrants to subscribe therefor, or upon
conversion of shares or obligations of the Company convertible into such shares
or other securities, and in any case whether or not for fair value, shall not
affect, and no adjustment by reason thereof shall be made with respect to, the
number of shares of Stock subject to Options theretofore granted or the purchase
price per share.
IX. AMENDMENT OR TERMINATION OF THE PLAN
The Board in its discretion may terminate the Plan at any time with
respect to any shares for which Options have not theretofore been granted. The
Board shall have the right to alter or amend the Plan or any part thereof from
time to time; provided, that no change in any Option theretofore granted may be
made which would impair the rights of the Optionee without the consent of such
Optionee; and provided, further, that (i) the Board may not make any alteration
or amendment which would decrease any authority granted to the Committee
hereunder in contravention of Rule 16b-3 and (ii) the Board may not make any
alteration or amendment which would materially increase the benefits accruing to
participants under the Plan, increase the aggregate number of shares which may
be issued pursuant to the provisions of the Plan, change the class of
individuals eligible to receive Options under the Plan or extend the term of the
Plan, without the approval of the shareholders of the Company.
X. SECURITIES LAWS
(a) The Company shall not be obligated to issue any Stock pursuant to
any Option granted under the Plan at any time when the offering of the shares
covered by such Option have not been registered under the Securities Act of 1933
and such other state and federal laws, rules or regulations as the Company or
the Committee deems applicable and, in the opinion of legal counsel for the
Company, there is no exemption from the registration requirements of such laws,
rules or regulations available for the offering and sale of such shares.
(b) It is intended that the Plan and any grant of an Option made to a
person subject to Section 16 of the 1934 Act meet all of the requirements of
Rule 16b-3. If any provision of the Plan or any such Option would disqualify the
Plan or such Option under, or would otherwise not
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comply with, Rule 16b-3, such provision or Option shall be construed or deemed
amended to conform to Rule 16b-3.
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