As filed with the Securities and Exchange Commission on May 8, 1997.
Subject to amendment.
Registration No. 333-
===========================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
GUEST SUPPLY, INC.
(Exact name of issuer as specified in its charter)
NEW JERSEY 22-2320483
State or other jurisdiction (I.R.S. Employer
of incorporation or Organization) Identification No.)
===================
4301 U.S. Highway One
Monmouth Junction, New Jersey 08852
(Address of principal executive offices)
===================
GUEST SUPPLY, INC.
1996 LONG TERM INCENTIVE PLAN
(Full title of the plan)
===================
CLIFFORD W. STANLEY
President and Chief Executive Officer
Guest Supply, Inc.
4301 U.S. Highway One
Monmouth Junction, New Jersey 08852
(609) 514-9696
(Name, address and telephone number,
including area code, of agent for service)
===================
Copy to:
THOMAS M. HAYTHE, Esq.
Haythe & Curley
237 Park Avenue
New York, New York 10017
===================
Approximate date of commencement of proposed sale to the public:
As soon as practicable after the
Registration Statement becomes effective.
CALCULATION OF REGISTRATION FEE
Title of Proposed maximum Proposed maximum Amount of
securities to Amount to offering aggregate registration
be registered be registered price per share* offering price* fee
- ------------- ------------- ---------------- ----------------- ------------
Common Stock 400,000 $9.875 3,950,000.00 $1,196.97
(without
par value)
===========================================================================
* Estimated solely for purposes of calculating the registration fee in
accordance with Rule 457(h)(1) under the Securities Act of 1933, as
amended, on the basis of the average of the high and low prices of the
Common Stock on May 6, 1997, as reported on the New York Stock Exchange.
Page 1 of 44 pages<PAGE>
Page 2
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The Company hereby states that (i) the documents listed
in (a) through (c) below are incorporated by reference in this
Registration Statement and (ii) all documents subsequently filed
by the Company pursuant to Sections 13(a), 13(c), 14 and 15(d) of
the Securities Exchange Act of 1934, as amended, prior to the
filing of a post-effective amendment which indicates that all
securities offered have been sold or which deregisters all
securities then remaining unsold, shall be deemed to be
incorporated by reference in this Registration Statement and to
be a part hereof from the date of filing of such documents.
(a) The Company's Annual Report on Form 10-K for the
fiscal year ended September 30, 1996.
(b) Quarterly Report on Form 10-Q for the quarter
ended December 31, 1996.
(c) The description of the Company's Common Stock
contained in the Company's registration statement on Form 8-A,
filed on October 21, 1983.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Thomas M. Haythe, a partner in the law firm of Haythe &
Curley, the Company's counsel, is a director of the Company. As
of May 6, 1997, Mr. Haythe held (i) warrants granted under the
Company's Warrant Plan for Directors to purchase 127,500 shares
of Common Stock, (ii) options granted under the Company's Stock
Option Plan to purchase 7,500 shares of Common Stock and (iii)
owns 29,040 shares of Common Stock.
<PAGE>
Page 3
Item 6. Indemnification of Directors and Officers.
Article SIXTH of the Certificate of Incorporation of
the Company, as permitted by Section 14A:3-5 of the New Jersey
Business Corporation Act, provides that the Company is required
to indemnify and hold harmless any corporate agent from and
against his expenses and liabilities in connection with any
proceeding in which he may become involved by reason of the fact
that he is or was such a corporate agent to the extent that such
corporate agent has been successful on the merits or otherwise,
or in defense of any claim, issue or matter therein.
The Company shall indemnify and hold harmless any
corporate agent from and against his expenses and liabilities in
connection with any proceeding in which he may become involved by
reason of the fact that he is or was such a corporate agent;
provided that a determination is made that (a) such corporate
agent acted in good faith and in a manner which he reasonably
believed to be in or not opposed to the best interests of the
Company and (b) with respect to any criminal proceeding, such
corporate agent was without reasonable cause to believe that his
conduct was unlawful. Any such determination shall be made (i)
by the Board of Directors acting by a quorum consisting of
directors who were not parties to or otherwise involved in the
proceeding, or (ii) if such quorum is unobtainable or, even
if obtainable and a quorum consisting of directors who are not
such parties so directs, by independent legal counsel in a
written opinion, or (iii) by the shareholders of the Company if a
resolution of the Board of Directors or shareholders so directs.
Notwithstanding the foregoing, no corporate agent shall be
entitled to claim such indemnity with respect to any claim, issue
or matter as to which he shall have been finally adjudged, in a
proceeding by or in the right of the Company to procure a
judgment in its favor, to be liable to the Company, unless and
only to the extent that the Court in which such proceeding was
brought shall determine upon application that, despite the
adjudication of liability but in view of all the circumstances of
the case, such corporate agent is fairly and reasonably entitled
to indemnity for such expenses which the Court shall deem proper.
The termination of any proceeding by a judgment, order,
settlement or conviction, or upon a plea of nolo contendere or
its equivalent, shall not, of itself, create a presumption that a
corporate agent did not act in good faith and in a manner which
he reasonably believed to be in or not opposed to the best
interests of the Company or, with respect to any criminal
proceeding had reasonable cause to believe that his conduct was
unlawful. The foregoing right of indemnification shall not be
deemed exclusive of any other right to which corporate agents may
be entitled, and the Company may provide additional indemnity and
rights to corporate agents.
Expenses incurred by a corporate agent in connection
with a proceeding may be paid by the Company in advance of the
final disposition of the proceeding as authorized by the Board of
Directors upon receipt of an undertaking by or on behalf of the
corporate agent to repay the amounts advanced by the Company, if
it shall be ultimately determined that he is not entitled to be
indemnified by the Company.
Page 4
The Company may purchase and maintain insurance on
behalf of any corporate agent against any expenses incurred in
any proceeding and any liabilities asserted against him in his
capacity as corporate agent, whether or not the Company would
have the power to indemnify him against such expenses and
liabilities.
As used herein, (a) "corporate agent" means any person
who is or was a director, officer, employee or agent of the
Company and any person who is or was a director, officer, member,
trustee, employee or agent of any other enterprise, serving as
such at the request of the Company or the legal representative of
any such director, officer, member, trustee, employee or agent,
(b) "other enterprise" means any domestic or foreign corporation,
other than the Company, and any partnership, joint venture, sole
proprietorship, trust, employee benefit plan or other enterprise,
whether or not for profit, served by a corporate agent, (c)
"expenses" means reasonable costs, disbursements and attorneys'
fees, (d) "liabilities" include, without limitation, amounts paid
or incurred in satisfaction of settlements, judgments, fines and
penalties, and (e) "proceeding" means any threatened, pending or
completed civil, criminal, administrative or arbitrative action,
suit or proceeding, and any appeal therein and any inquiry or
investigation which could lead to any such action, suit or
proceeding.
Insofar as indemnification for liabilities arising
under the Securities Act may be permitted to directors, officers
and controlling persons of the Company pursuant to provisions of
its Certificate of Incorporation and By-Laws, or otherwise, the
Company 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 Company
of expenses incurred or paid by a director, officer or
controlling person of the Company 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 Company 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.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
The Exhibits required to be filed as part of this
Registration Statement are listed in the attached Index to Exhibits.
<PAGE>
Page 5
Item 9. Undertakings.
The undersigned Registrant hereby undertakes, except as
otherwise specifically provided in the rules of the Securities
and Exchange Commission promulgated under the Securities Act of
1933:
(1) To file, during any period in which offers or
sales are being made, a post-effective amendment to this
Registration Statement:
(i) To include any prospectus required by section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of this Registration
Statement (or the most recent post-effective amendment hereof)
which, individually or in the aggregate, represent a fundamental
change in the information set forth in this Registration
Statement;
(iii) To include any material information with
respect to the plan of distribution not previously disclosed in
this Registration Statement or any material change to such
information in this Registration Statement;
provided, however, that paragraphs (1)(i) and (1)(ii) do not
apply if this Registration Statement is on Form S-3 or Form S-8
and the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports
filed by the Registrant pursuant to section 13 or section 15(d)
of the Securities Exchange Act of 1934 that are incorporated by
reference in this Registration Statement;
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such post-effective
amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of
such securities at that time shall be deemed to be the initial
bona fide offering thereof; 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.
The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of
1933, each filing of the Registrant's annual report pursuant to
section 13(a) or section 15(d) of the Securities Exchange Act of
1934 that is incorporated by reference in this 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.
<PAGE>
Page 6
Insofar as indemnification for liabilities arising
under the Securities Act of 1933 may be permitted to directors,
officers and controlling persons of the registrant pursuant to
the foregoing provisions, or otherwise, the registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities
(other than the payment by the registrant of expenses incurred or
paid by a director, officer or controlling person of the
registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.<PAGE>
Page 7
POWER OF ATTORNEY
The Registrant and each person whose signature appears
below hereby appoints Clifford W. Stanley and Thomas M. Haythe,
as attorneys-in-fact with full power of substitution, severally,
to execute in the name and on behalf of the Registrant and each
such person, individually and in each capacity stated below, one
or more amendments (including post-effective amendments) to this
Registration Statement as the attorney-in-fact acting in the
premises deems appropriate and to file any such amendment to this
Registration Statement with the Securities and Exchange
Commission.
SIGNATURES
Pursuant to the requirements of the Securities Act of
1933, the Registrant certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on
Form S-8 and has duly caused this Registration Statement to be
signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Monmouth Junction and State of New
Jersey on the 7th day of May, 1997.
GUEST SUPPLY, INC.
By /s/ Clifford W. Stanley
------------------------
Clifford W. Stanley
President
Pursuant to the requirements of the Securities Act of
1933, this Registration Statement has been signed below by the
following persons in the capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ Clifford W. Stanley President, Principal Executive May 7, 1997
- ------------------------ Officer and Director
Clifford W. Stanley
/s/ Paul T. Xenis Vice President - Finance May 7, 1997
- ------------------------ and Principal Financial and
Paul T. Xenis Accounting Officer
/s/ Thomas M. Haythe Director May 7, 1997
- ------------------------
Thomas M. Haythe
Page 8
Signature Title Date
--------- ----- ----
/s/ Peter L. Richard Director May 7, 1997
- -----------------------
Peter L. Richard
/s/ Teri E. Unsworth Director May 7, 1997
- -----------------------
Teri E. Unsworth
/s/ Edward J. Walsh Director May 7, 1997
- ----------------------
Edward J. Walsh
/s/ George S. Zabrycki Director May 7, 1997
- ----------------------
George S. Zabrycki
<PAGE>
Page 9
CONSENT OF INDEPENDENT ACCOUNTANTS
[LETTERHEAD OF KPMG PEAT MARWICK]
The Board of Directors
Guest Supply, Inc.:
We consent to the use of our report incorporated herein by reference.
/s/ KPMG Peat Marwick LLP
-------------------------
KPMG Peat Marwick LLP
Short Hills, New Jersey
May 7, 1997<PAGE>
Page 10
CONSENT OF COUNSEL
The consent of Haythe & Curley is contained in
their opinion filed as Exhibit 5 to this Registration
Statement.
<PAGE>
Page 11
INDEX TO EXHIBITS
Number Description of Exhibit Page
------ ---------------------- ----
4(i) - Copy of the Plan 12
4(ii) - Form of Stock Option Certificate 25
4(iii) - Form of Incentive Stock Option Certificate 33
5 - Opinion of Haythe & Curley 44
23(i) - Consent of KPMG Peat Marwick LLP 9
(See "Consent of Independent
Accountants" in the Registration
Statement)
23(ii) - Consent of Haythe & Curley
(contained in Exhibit 5)
24 - Power of Attorney (See "Power 7
of Attorney" in the Registration
Statement)
EXHIBIT 4(i)
GUEST SUPPLY, INC.
1996 LONG TERM INCENTIVE PLAN
SECTION 1. Purpose. The purposes of this Guest Supply,
Inc. 1996 Long Term Incentive Plan (the "Plan") are to encourage selected
employees, officers, directors and consultants of, and other individuals
providing services to, Guest Supply, Inc. (together with any successor
thereto, the "Company") and its Affiliates (as defined below) to acquire a
proprietary interest in the growth and performance of the Company, to
generate an increased incentive to contribute to the Company's future
success and prosperity thus enhancing the value of the Company for the
benefit of its shareholders, and to enhance the ability of the Company and
its Affiliates to attract and retain exceptionally qualified individuals
upon whom, in large measure, the sustained progress, growth and
profitability of the Company depend.
SECTION 2. Definitions. As used in the Plan, the following
terms shall have the meanings set forth below:
"Affiliate" shall mean (i) any entity that, directly or
through one or more intermediaries, is controlled by the Company and (ii)
any entity in which the Company has a significant equity interest, as
determined by the Committee.
"Award" shall mean any Option, Stock Appreciation Right,
Restricted Security, Performance Award, or Other Stock-Based Award granted
under the Plan.
"Award Agreement" shall mean any written agreement, contract
or other instrument or document evidencing any Award granted under the
Plan.
"Board" shall mean the Board of Directors of the Company.
"Cause", as used in connection with the termination of a
Participant's employment, shall mean (i) with respect to any Participant
employed under a written employment agreement with the Company or an
Affiliate of the Company which agreement includes a definition of "cause,"
"cause" as defined in such agreement or, if such agreement contains no such
definition, a material breach by the Participant of such agreement, or (ii)
with respect to any other Participant, the failure to perform adequately in
carrying out such Participant's employment responsibilities, including any
directives from the Board, or engaging in such behavior in his personal or
business life as to lead the Committee in its reasonable judgment to
determine that it is in the best interests of the Company to terminate his
employment.
"Common Stock" shall mean the common stock of the Company,
without par value.
"Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time, and the regulations promulgated thereunder.
"Committee" shall mean the Stock Option Committee or any
other committee of the Board designated by the Board to administer the Plan
and composed of not less than three outside directors, as described in
Section 162(m) of the Code, each of whom, to the extent necessary to comply
with Rule 16b-3 only, is a "disinterested person" within the meaning of
Rule 16b-3 as in effect at April 30, 1991.
"Common Shares" shall mean any or all, as applicable, of the
Common Stock and such other securities or property as may become the
subject of Awards, or become subject to Awards,
pursuant to an adjustment made under Section 4(b) of the Plan and any
other securities of the Company or any Affiliate or any successor that may
be so designated by the Committee.
"Employee" shall mean any employee of the Company or of any
Affiliate.
"Exchange Act" shall mean the Securities Exchange Act of
1934, as amended.
"Fair Market Value" shall mean (A) with respect to any
property other than the Common Shares, the fair market value of such
property determined by such methods or procedures as shall be established
from time to time by the Committee; and (B) with respect to the Common
Shares, the last sale price regular way on the date of reference, or, in
case no sale takes place on such date, the average of the high bid and low
asked prices, in either case on the principal national securities exchange
on which the Common Shares are listed or admitted to trading, or if the
Common Shares are not listed or admitted to trading on any national
securities exchange, the last sale price reported on the National Market
System of the National Association of Securities Dealers Automated
Quotation System ("NASDAQ") on such date, or the average of the closing
high bid and low asked prices in the over-the-counter market reported on
NASDAQ on such date, whichever is applicable, or if there are no such
prices reported on NASDAQ on such date, as furnished to the Committee by
any New York Stock Exchange member selected from time to time by the
Committee for such purpose. If there is no bid or asked price reported on
any such date, the Fair Market Value shall be determined by the Committee
in accordance with the regulations promulgated under Section 2031 of the
Code, or by any other appropriate method selected by the Committee.
"Good Reason", as used in connection with the termination of
a Participant's employment, shall mean (i) with respect to any Participant
employed under a written employment agreement with the Company or an
Affiliate of the Company, "good reason" as defined in such written
agreement or, if such agreement contains no such definition, a material
breach by the Company of such agreement, or (ii) with respect to any other
Participant, a failure by the Company to pay such Participant any amount
otherwise vested and due and a continuation of such failure for 30 business
days following notice to the Company thereof.
"Incentive Stock Option" shall mean an option granted under
Section 6(a) of the Plan that is intended to meet the requirements of
Section 422 of the Code or any successor provision thereto.
"Non-Qualified Stock Option" shall mean an option granted
under Section 6(a) of the Plan that is not intended to be an Incentive
Stock Option. Any stock option granted by the Committee which is not
designated an Incentive Stock Option shall be deemed a Non-Qualified Stock
Option.
"Option" shall mean an Incentive Stock Option or a
Non-Qualified Stock Option.
"Other Stock-Based Award" shall mean any right granted under
Section 6(e) of the Plan.
"Participant" shall mean any individual granted an Award
under the Plan.
"Performance Award" shall mean any right granted under
Section 6(d) of the Plan.
"Person" shall mean any individual, corporation,
partnership, association, joint-stock company, trust, unincorporated
organization, or government or political subdivision thereof.
"Released Securities" shall mean securities that were
Restricted Securities but with respect to which all applicable restrictions
have expired, lapsed or been waived in accordance with the terms of the
Plan or the applicable Award Agreement.
"Restricted Securities" shall mean any Common Shares granted
under Section 6(c) of the Plan, any right granted under Section 6(c) of the
Plan that is denominated in Common Shares or any other Award under which
issued and outstanding Common Shares are held subject to certain
restrictions.
"Rule 16b-3" shall mean Rule 16b-3 promulgated by the
Securities and Exchange Commission under the Exchange Act, or any successor
rule or regulation thereto as in effect from time to time.
"Securities Act" shall mean the Securities Act of 1933, as
amended.
"Stock Appreciation Right" shall mean any right granted
under Section 6(b) of the Plan.
SECTION 3. Administration. The Plan shall be administered
by the Committee. Subject to the terms of the Plan and applicable law, and
in addition to other express powers and authorizations conferred on the
Committee by the Plan, the Committee shall have full power and authority
to: (i) designate Participants; (ii) determine the type or types of Awards
to be granted to an eligible Employee or other individual under the Plan;
(iii) determine the number and classification of Common Shares to be
covered by (or with respect to which payments, rights or other matters are
to be calculated in connection with) Awards; (iv) determine the terms and
conditions of any Award; (v) determine whether, to what extent, and under
what circumstances Awards may be settled or exercised in cash, Common
Shares, other securities, other Awards or other property, or canceled,
forfeited or suspended, and the method or methods by which Awards may be
settled, exercised, canceled, forfeited or suspended; (vi) determine
requirements for the vesting of Awards or performance criteria to be
achieved in order for Awards to vest; (vii) determine whether, to what
extent and under what circumstances cash, Common Shares, other securities,
other Awards, other property and other amounts payable with respect to an
Award under the Plan shall be deferred either automatically or at the
election of the holder thereof or of the Committee; (viii) interpret and
administer the Plan and any instrument or agreement relating to, or Award
made under, the Plan; (ix) establish, amend, suspend or waive such rules
and regulations and appoint such agents as it shall deem appropriate for
the proper administration of the Plan; and (x) make any other determination
and take any other action that the Committee deems necessary or desirable
for the administration of the Plan. Unless otherwise expressly provided in
the Plan, all designations, determinations, interpretations and other
decisions under or with respect to the Plan or any Award shall be within
the sole discretion of the Committee, may be made at any time and shall be
final, conclusive and binding upon all Persons, including the Company, any
Affiliate, any Participant, any holder or beneficiary of any Award, any
shareholder and any Employee. Notwithstanding the foregoing, the maximum
number of Awards which may be granted to any one Participant under this
Plan in any two-year period shall not exceed 100,000 Common Shares, subject
to the adjustments provided in Section 4(b) hereof and no Awards under this
Plan shall be granted after December 31, 2005.
SECTION 4. Common Shares Available for Awards.
(a) Common Shares Available. Subject to adjustment as
provided in Section 4(b):
(i) Calculation of Number of Common Shares Available.
The number of Common Shares available for granting Awards under the Plan
shall be 400,000, any or all of which may be or may be based on Common
Stock, any other security which becomes the subject of Awards, or any
combination thereof. Initially 400,000 shares of Common Stock shall be
reserved for Awards hereunder. Further, if, after the effective date of
the Plan, any Common Shares covered by an Award granted under the Plan or
to which such an Award relates, are forfeited, or if an Award otherwise
terminates or is canceled without the delivery of Shares or of other
consideration, then the Common Shares covered by such Award or to which
such Award relates, or the number of Common Shares otherwise counted
against the aggregate number of Common Shares available under the Plan with
respect to such Award, to the extent of any such forfeiture, termination or
cancellation, shall again be, or shall become, available for granting
Awards under the Plan.
(ii) Accounting for Awards. For purposes of this
Section 4,
(A) if an Award is denominated in or based upon Common
Shares, thenumber of Common Shares covered by such Award or to which such
Award relates shall be counted on the date of grant of such Award against
the aggregate number of Common Shares available for granting Awards under
the Plan and against the maximum number of Awards available to any
Participant; and
(B) Awards not denominated in Common Shares may be
counted against the aggregate number of Common Shares available for
granting Awards under the Plan and against the maximum number of Awards
available to any participant in such amount and at such time as the
Committee shall determine under procedures adopted by the Committee
consistent with the purposes of the Plan;
provided, however, that Awards that operate in tandem with
(whether granted simultaneouslywith or at a different time from), or that
are substituted for, other Awards may be counted or not counted under
procedures adopted by the Committee in order to avoid double counting. Any
Common Shares that are delivered by the Company, and any Awards that are
granted by, or become obligations of, the Company, through the assumption
by the Company or an Affiliate of, or in substitution for, outstanding
awards previously granted by an acquired company shall, in the case of
Awards granted to Participants who are officers or directors of the Company
for purposes of Section 16 of the Exchange Act, be counted against the
Common Shares available for granting Awards under the Plan.
(iii) Sources of Common Shares Deliverable Under Awards.
Any Common Shares delivered pursuant to an Award may consist, in whole or
in part, of authorized and unissued Common Shares or of treasury Common
Shares.
(b) Adjustments. In the event that the Committee shall
determine that any dividend or other distribution (whether in the form of
cash, Common Shares, other securities or other property), recapitalization,
stock split, reverse stock split, reorganization, merger, consolidation,
split-up, spin-off, combination, repurchase or exchange of Common Shares or
other securities of the Company, issuance of warrants or other rights to
purchase Common Shares or other securities of the Company, or other similar
corporate transaction or event affects the Common Shares such that an
adjustment is determined by the Committee to be appropriate in order to
prevent dilution or enlargement of the benefits or potential benefits
intended to be made available under the Plan, then the Committee shall, in
such manner as it may deem equitable, adjust any or all of (i) the number
and kind of Common Shares (or other securities or property) which
thereafter may be made the subject of Awards, (ii) the number and kind of
Common Shares (or other securities or property) subject to outstanding
Awards, and (iii) the grant or exercise price with respect to any Award or,
if deemed appropriate, make provision for a cash payment to the holder of
an outstanding Award; provided, however, that the number of Common Shares
subject to any Award denominated in Common Shares shall always be a whole
number.
In connection with any merger or consolidation in which the
Company is not the surviving corporation and which results in the holders
of the outstanding voting securities of the Company (determined immediately
prior to such merger or consolidation) owning less than a majority of the
outstanding voting securities of the surviving corporation (determined
immediately following such merger or consolidation), or any sale or
transfer by the Company of all or substantially all its assets or any
tender offer or exchange offer for or the acquisition, directly or
indirectly, by any person or group of all or a majority of the then
outstanding voting securities of the Company, all outstanding Options under
the Plan shall become exercisable in full, notwithstanding any other
provision of the Plan or of any outstanding Options granted thereunder, on
and after (i) the fifteenth day prior to the effective date of such merger,
consolidation, sale, transfer or acquisition or (ii) the date of
commencement of such tender offer or exchange offer, as the case may be.
The provisions of the foregoing sentence shall apply to any outstanding
Options which are Incentive Stock Options to the extent permitted by
Section 422(d) of the Code and such outstanding Options in excess thereof
shall, immediately upon the occurrence of the event described in clause (i)
or (ii) of the foregoing sentence, be treated for all purposes of the Plan
as Non-Qualified Stock Options and shall be immediately exercisable as such
as provided in the foregoing sentence.
SECTION 5. Eligibility. Any Employee, including any
officer or employee-director of the Company or of any Affiliate, and any
consultant of, or other individual providing services to, the Company or
any Affiliate shall be eligible to be designated a Participant. A
non-employee director shall be eligible to receive Non-Qualified Stock
Options under the Plan.
SECTION 6. Awards.
(a) Options. The Committee is hereby authorized to grant
to eligible individuals options to purchase Common Shares (each, an
"Option") which shall contain the following terms and conditions and with
such additional terms and conditions, in either case not inconsistent with
the provisions of the Plan, as the Committee shall determine:
(i) Exercise Price. The purchase price per Common
Share purchasable under an Option shall be determined by the Committee;
provided, however, that such purchase price shall not be less than one
hundred percent (100%) of the Fair Market Value of a Common Share on the
date of grant of such Option, or such other price as required under
Subsection 6(a)(iv) hereof.
(ii) Time and Method of Exercise. Subject to the terms
of Section 6(a)(iii), the Committee shall determine the time or times at
which an Option may be exercised in whole or in part, and the method or
methods by which, and the form or forms (including, without limitation,
cash, Common Shares, outstanding Awards, or other property, or any
combination thereof, having a Fair Market Value on the exercise date equal
to the relevant exercise price) in which, payment of the exercise price
with respect thereto may be made or deemed to have been made.
(iii) Exercisability Upon Death, Retirement and
Termination of Employment. Subject to the condition that no Option may be
exercised in whole or in part after the expiration of the Option period
specified in the applicable Award Agreement:
(A) Subject to the terms of paragraph (D) below, upon
the death of a Participant while employed or within 3 months of retirement
or disability as defined in paragraph (B) below, the Person or Persons to
whom such Participant's rights with respect to any Option held by such
Participant are transferred by will or the laws of descent and distribution
may, prior to the expiration of the earlier of: (1) the outside exercise
date determined by the Committee at the time of granting the Option, or (2)
nine months after such Participant's death, purchase any or all of the
Common Shares with respect to which such Participant was entitled to
exercise such Option immediately prior to such Participant's death, and any
Options not so exercisable will lapse on the date of such Participant's
death;
(B) Subject to the terms of paragraph (D) below, upon
termination of a Participant's employment with the Company (x) as a result
of retirement pursuant to a retirement plan of the Company or an Affiliate
or disability (as determined by the Committee) of such Participant, (y) by
the Company other than for Cause, or (z) by the Participant with Good
Reason, such Participant may, prior to the expiration of the earlier of:
(1) the outside exercise date determined by the Committee at the time of
granting the Option, or (2) three months after the date of such
termination, purchase any or all of the Common Shares with respect to which
such Participant was entitled to exercise any Options immediately prior to
such termination, and any Options not so exercisable will lapse on such
date of termination;
(C) Subject to the terms of paragraph (D) below, upon
termination of a Participant's employment with the Company under any
circumstances not described in paragraphs (A) or (B) above, such
Participant's Options shall be canceled to the extent not theretofore
exercised;
(D) Upon (i) the death of the Participant, or (ii)
termination of the Participant's employment with the Company (x) by the
Company other than for Cause (y) by the Participant with Good Reason or (z)
as a result of retirement or disability as defined in paragraph (B) above,
the Company shall have the right to cancel all of the Options such
Participant was entitled to exercise at the time of such death or
termination (subject to the terms of paragraphs (A) or (B) above) for a
payment in cash equal to the excess, if any, of the Fair Market Value of
one Common Share on the date of death or termination over the exercise
price of such Option for one Common Share times the number of Common Shares
subject to the Option and exercisable at the time of such death or
termination; and
(E) Upon expiration of the respective periods set
forth in each of paragraphs (A) through (C) above, the Options of a
Participant who has died or whose employment has been terminated shall be
canceled to the extent not theretofore canceled or exercised.
(F) For purposes of paragraphs (A) through (D) above,
the period of service of an individual as a director or consultant of the
Company or an Affiliate shall be deemed the period of employment.
(iv) Incentive Stock Options. The following provisions
shall apply only to Incentive Stock Options granted under the Plan:
(A) No Incentive Stock Option shall be granted to any
eligible Employee who, at the time such Option is granted, owns securities
possessing more than ten percent (10%) of the total combined voting power
of all classes of securities of the Company or of any Affiliate, except
that such an Option may be granted to such an Employee if at the time the
Option is granted the option price is at least one hundred ten percent
(110%) of the Fair Market Value of the Common Shares (determined in
accordance with Section 2) subject to the Option, and the Option by its
terms is not exercisable after the expiration of five (5) years from the
date the Option is granted; and (B) To the extent that the aggregate Fair
Market Value of the Common Shares with respect to which Incentive Stock
Options (without regard to this subsection) are exercisable for the first
time by any individual during any calendar year (under all plans of the
Company and its Affiliates) exceeds $100,000, such Options shall be treated
as Non-Qualified Stock Options. This subsection shall be applied by taking
Options into account in the order in which they were granted. If some but
not all Options granted on any one day are subject to this subsection, then
such Options shall be apportioned between Incentive Stock Option and
Non-Qualified Stock Option treatment in such manner as the Committee shall
determine. For purposes of this subsection, the Fair Market Value of any
Common Shares shall be determined, in accordance with Section 2, as of the
date the Option with respect to such Common Shares is granted.
(v) Terms and Conditions of Options Granted to
Directors.
Notwithstanding any provision contained in the Plan to the
contrary, during any period when any member of the Committee shall not be a
"disinterested person" as defined in Rule 16b-3, as such Rule was in effect
at April 30, 1991, then, the terms and conditions of Options granted under
the Plan to any director of the Company during such period shall be as
follows:
(A) The price at which each Common Share subject to an
option may be purchased shall, subject to any adjustments which may be made
pursuant to Section 4, in no event be less than the Fair Market Value of a
Common Share on the date of grant, and provided further that in the event
the option is intended to be an Incentive Stock Option and the optionee
owns on the date of grant securities possessing more than ten percent (10%)
of the total combined voting power of all classes of securities of the
Company or of any Affiliate, the price per share shall not be less than one
hundred ten percent (110%) of the Fair Market Value per Common Share on the
date of grant.
(B) The Option may be exercised to purchase Common
Shares covered by the Option not sooner than six (6) months following the
date of grant. The Option shall terminate and no Common Shares may be
purchased thereunder more than ten (10) years after the date of grant,
provided that if the Option is intended to be an Incentive Stock Option and
the Optionee owns on the date of grant securities possessing more than ten
percent (10%) of the total combined voting power of all classes of
securities of the Company or of any Affiliate, the Option shall terminate
and no Common Shares may be purchased thereunder more than five (5) years
after the date of grant.
(C) The maximum number of Common Shares which may be
subject to options granted to all directors pursuant to this Section
6(a)(v) shall be 300,000 shares in the aggregate. The maximum number of
Common Shares which may be subject to options granted to any director of
the Company who is an Employee shall be 100,000 shares and the maximum
number of Common Shares which may be subject to options granted to any
director of the Company who is not an Employee shall be 20,000 shares.
(b) Stock Appreciation Rights. The Committee is hereby
authorized to grant to eligible Employees "Stock Appreciation Rights."
Each Stock Appreciation Right shall consist of a right to receive the
excess of (i) the Fair Market Value of one Common Share on the date of
exercise or, if the Committee shall so determine in the case of any such
right other than one related to any Incentive Stock Option, at any time
during a specified period before or after the date of exercise over (ii)
the grant price of the right as specified by the Committee, which shall not
be less than one hundred percent (100%) of the Fair Market Value of one
Common Share on the date of grant of the Stock Appreciation Right (or, if
the Committee so determines, in the case of any Stock Appreciation Right
retroactively granted in tandemwith or in substitution for another Award,
on the date of grant of such other Award). Subject to the terms of the
Plan and any applicable Award Agreement, the grant price, term, methods of
exercise, methods of settlement, and any other terms and conditions of any
Stock Appreciation Right granted under the Plan shall be as determined by
the Committee. The Committee may impose such conditions or restrictions on
the exercise of any Stock Appreciation Right as it may deem appropriate.
(c) Restricted Securities.
(i) Issuance. The Committee is hereby authorized to
grant to eligible Employees "Restricted Securities" which shall consist of
the right to receive, by purchase or otherwise, Common Shares which are
subject to such restrictions as the Committee may impose (including,
without limitation, any limitation on the right to vote such Common Shares
or the right to receive any dividend or other right or property), which
restrictions may lapse separately or in combination at such time or times,
in such installments or otherwise, as the Committee may deem appropriate.
(ii) Registration. Restricted Securities granted under
the Plan may be evidenced in such manner as the Committee may deem
appropriate, including, without limitation, book-entry registration or
issuance of a stock certificates or certificates. In the event any stock
certificate is issued in respect of Restricted Securities granted under the
Plan, such certificate shall be registered in the name of the Participant
and shall bear an appropriate legend referring to the terms, conditions and
restrictions applicable to such Restricted Securities.
(iii) Forfeiture. Except as otherwise determined by the
Committee, upon termination of a Participant's employment for any reason
during the applicable restriction period, all of such Participant's
Restricted Securities which had not become Released Securities by the date
of termination of employment shall be forfeited and reacquired by the
Company; provided, however, that the Committee may, when it finds that a
waiver would be in the best interests of the Company, waive in whole or in
part any or all remaining restrictions with respect to such Participant's
Restricted Securities. Unrestricted Common Shares, evidenced in such
manner as the Committee shall deem appropriate, shall be issued to the
holder of Restricted Securities promptly after such Restricted Securities
become Released Securities.
(d) Performance Awards. The Committee is hereby authorized
to grant to eligible Employees "Performance Awards." Each Performance Award
shall consist of a right, (i) denominated or payable in cash, Common
Shares, other securities or other property (including, without limitation,
Restricted Securities), and (ii) which shall confer on the holder thereof
rights valued as determined by the Committee and payable to, or exercisable
by, the holder of the Performance Award, in whole or in part, upon the
achievement of such performance goals during such performance periods as
the Committee shall establish. Subject to the terms of the Plan and any
applicable Award Agreement, the performance goals to be achieved during any
performance period, the length of any performance period, the amount of any
Performance Award granted, the termination of a Participant's employment
and the amount of any payment or transfer to be made pursuant to any
Performance Award shall be determined by the Committee and by the other
terms and conditions of any Performance Award. The Committee shall issue
performance goals prior to the commencement of the performance period to
which such performance goals pertain.
(e) Other Stock-Based Awards. The Committee is hereby
authorized to grant to eligible Employees "Other Stock-Based Awards." Each
Other Stock-Based Award shall consist of a right (i) which is other than an
Award or right described in Section 6(a), (b), (c) or (d) above and (ii)
which is denominated or payable in, valued in whole or in part by reference
to, or otherwise based on or related to, Common Shares (including, without
limitation, securities convertible into Common Shares) as are deemed by the
Committee to be consistent with the purposes of the Plan; provided,
however, that such right shall comply, to the extent deemed desirable by
the Committee, with Rule 16b-3 and applicable law. Subject to the terms of
the Plan and any applicable Award Agreement, the Committee shall determine
the terms and conditions of Other Stock-Based Awards. Common Shares or
other securities delivered pursuant to a purchase right granted under this
Section 6(e) shall be purchased for such consideration, which may be paid
by such method or methods and in such form or forms, including, without
limitation, cash, Common Shares, other securities, other Awards, other
property, or any combination thereof, as the Committee shall determine.
(f) General.
(i) No Cash Consideration for Awards. Awards may be
granted for no cash consideration or for such minimal cash consideration as
may be required by applicable law.
(ii) Awards May Be Granted Separately or Together.
Awards may, in the discretion of the Committee, be granted either alone or
in addition to, in tandem with, or in substitution for any other Award,
except that in no event shall an Incentive Stock Option be granted together
with a Non-Qualified Stock Option in such a manner that the exercise of one
Option affects the right to exercise the other. Awards granted in addition
to or in tandem with other Awards may be granted either at the same time as
or at a different time from the grant of such other awards.
(iii) Forms of Payment Under Awards. Subject to the
terms of the Plan and of any applicable Award Agreement, payments or
transfers to be made by the Company or an Affiliate upon the grant,
exercise or payment of an Award may be made in such form or forms as the
Committee shall determine, including, without limitation, cash, Common
Shares, other securities, other Awards, or other property, or any
combination thereof, and may be made in a single payment or transfer, in
installments, or on a deferred basis, in each case in accordance with rules
and procedures established by the Committee. Such rules and procedures may
include, without limitation, provisions for the payment or crediting of
reasonable interest on installment or deferred payments. In accordance
with the above, the Committee may elect (i) to pay a Participant (or such
Participant's permitted transferee) upon the exercise of an Option in whole
or in part, in lieu of the exercise thereof and the delivery of Common
Shares thereunder, an amount of cash equal to the excess, if any, of the
Fair Market Value of one Common Share on the date of such exercise over the
exercise price of such Option for one Common Share times the number of
Common Shares subject to the Option or portion thereof so exercised or (ii)
to settle other stock denominated Awards in cash.
(iv) Limits on Transfer of Awards.
(A) No award (other than Released Securities), and no
right under any such Award, may be assigned, alienated, pledged,
attached, sold or otherwise transferred or encumbered by a Participant
otherwise than by will or by the laws of descent and distribution (or, in
the case of Restricted Securities, to the Company) and any such purported
assignment, alienation, pledge, attachment, sale or other transfer or
encumbrance shall be void and unenforceable against the Company or any
Affiliate.
(B) Each award, and each right under any Award, shall
be exercisable, during the Participant's lifetime only by the Participant
or if permissible under applicable law, by the Participant's guardian or
legal representative.
(v) Terms of Awards. The term of each Award shall be
for such period as may be determined by the Committee; provided, however,
that in no event shall the term of any Option exceed a period of ten years
from the date of its grant.
(vi) Rule 16b-3 Six-Month Limitations. To the extent
required in order to maintain the exemption provided under Rule 16b-3 only,
any equity security offered pursuant to the Plan must be held for at least
six months after the date of grant, and with respect to any derivative
security issued pursuant to the Plan, at least six months must elapse from
the date of acquisition of such derivative security to the date of
disposition of the derivative security (other than upon exercise or
conversion) or its underlying equity security. Terms used in the preceding
sentence shall, for the purposes of such sentence only, have the meanings,
if any, assigned or attributed to them under Rule 16b-3.
(vii) Common Share Certificates. All certificates for
Common Shares delivered under the Plan pursuant to any Award or the
exercise thereof shall be subject to such stop transfer orders and other
restrictions as the Committee may deem advisable under the Plan or the
rules, regulations, and other requirements of the Securities and Exchange
Commission, any stock exchange upon which such Common Shares are then
listed, and any applicable Federal or state securities laws, and the
Committee may cause a legend or legends to be put on any such certificates
to make appropriate reference to such restrictions.
(viii) Delivery of Common Shares or Other Securities
and Payment by Participant of Consideration. No Common Shares or other
securities shall be delivered pursuant to any Award until payment in full
of any amount required to be paid pursuant to the Plan or the applicable
Award Agreement is received by the Company. Such payment may be made by
such method or methods and in such form or forms as the Committee shall
determine, including, without limitation, cash, Common Shares, other
securities, other Awards or other property, or any combination thereof;
provided that the combined value, as determined by the Committee, of all
cash and cash equivalents and the Fair Market Value of any such Common
Shares or other property so tendered to the Company, as of the date of such
tender, is at least equal to the full amount required to be paid pursuant
to the Plan or the applicable Award Agreement to the Company.
SECTION 7. Amendments; Adjustments and Termination. Except
to the extent prohibited by applicable law and unless otherwise expressly
provided in an Award Agreement or in the Plan:
(a) Amendments to the Plan. The Board may amend, alter,
suspend, discontinue, or terminate the Plan without the consent of any
shareholder, Participant, other holder or beneficiary of an Award, or other
Person; provided, however, that, subject to the Company's rights to adjust
Awards under Sections 7(c) and (d), any amendment, alteration, suspension,
discontinuation, or termination that would impair the rights of any
Participant, or any other holder or beneficiary of any Award theretofore
granted, shall not to that extent be effective without the consent of such
Participant, other holder or beneficiary of an Award, as the case may be;
and provided further, however, that notwithstanding any other provision of
the Plan or any Award Agreement, without the approval of the shareholders
of the Company no such amendment, alteration, suspension, discontinuation,
or termination shall be made that would:
(i) increase the total number of Common Shares
available for Awards under the Plan, except as provided in Section 4
hereof; or (ii) otherwise cause the Plan to cease to comply with any tax or
regulatory requirement, including for these purposes any approval or other
requirement which is or would be a prerequisite for exemptive relief from
Section 16(b) of the Exchange Act.
(b) Amendments to Awards. The Committee may waive any
conditions or rights under, amend any terms of, or alter, suspend,
discontinue, cancel or terminate, any Award theretofore granted,
prospectively or retroactively; provided, however, that, subject to the
Company's rights to adjust Awards under Sections 7(c) and (d), any
amendment, alteration, suspension, discontinuation, cancellation or
termination that would impair the rights of any Participant or holder or
beneficiary of any Award theretofore granted, shall not to that extent be
effective without the consent of such Participant or holder or beneficiary
of an Award, as the case may be.
(c) Adjustment of Awards Upon Certain Acquisitions. In the
event the Company or any Affiliate shall assume outstanding employee awards
or the right or obligation to make future such awards in connection with
the acquisition of another business or another corporation or business
entity, the Committee may make such adjustments, not inconsistent with the
terms of the Plan, in the terms of Awards as it shall deem appropriate in
order to achieve reasonable comparability or other equitable relationship
between the assumed awards and the Awards granted under the Plan as so
adjusted.
(d) Adjustments of Awards Upon the Occurrence of Certain
Unusual or Non-recurring Events. The Committee is hereby authorized to
make adjustments in the terms and conditions of, and the criteria included
in, Awards in recognition of unusual or non-recurring events (including,
without limitation, the events described in Section 4(b) hereof) affecting
the Company, any Affiliate, or the financial statements of the Company or
any Affiliate, or of changes in applicable laws, regulations, or accounting
principles, whenever the Committee determines that such adjustments are
appropriate in order to prevent dilution or enlargement of the benefits or
potential benefits intended to be made available under the Plan.
SECTION 8. General Provisions.
(a) No Right to Awards. No Employee or other Person shall
have any claim to be granted any Award under the Plan, and there is no
obligation for uniformity of treatment of Employees, or holders or
beneficiaries of Awards under the Plan. The terms and conditions of Awards
need not be the same with respect to each recipient.
(b) Delegation. Subject to the terms of the Plan and
applicable law, the Committee may delegate to one or more officers or
managers of the Company or any Affiliate, or to a committee of such
officers or managers, the authority, subject to such terms and limitations
as the Committee shall determine, to grant Awards to, or to cancel, modify,
waive rights with respect to, alter, discontinue, suspend, or terminate
Awards; provided, however, that, no such delegation shall be permitted with
respect to Awards held by Employees who are officers or directors of the
Company for purposes of Section 16 of the Exchange Act, or any successor
section thereto or who are otherwise subject to such Section.
(c) Correction of Defects, Omissions, and Inconsistencies.
The Committee may correct any defect, supply any omission, or reconcile any
inconsistency in the Plan or any Award in the manner and to the extent it
shall deem desirable to carry the Plan into effect.
(d) Withholding. The Company or any Affiliate shall be
authorized to withhold from any Award granted, from any payment due or
transfer made under any Award or under the Plan or from any compensation or
other amount owing to a Participant the amount (in cash, Common Shares,
other securities, other Awards, or other property) of withholding taxes due
in respect of an Award, its exercise, or any payment or transfer under such
Award or under the Plan and to take such other action as may be necessary
in the opinion of the Company or Affiliate to satisfy all obligations for
the payment of such taxes.
(e) No Limit on Other Compensation Arrangements. Nothing
contained in the Plan shall prevent the Company or any Affiliate from
adopting or continuing in effect other or additional compensation
arrangements, and such arrangements may be either generally applicable or
applicable only in specific cases.
(f) No Right to Employment. The grant of an Award shall
not be construed as giving a Participant the right to be retained in the
employ of the Company or any Affiliate. Further, the Company or an
Affiliate may at any time dismiss a Participant from employment, free from
any liability, or any claim under the Plan, unless otherwise expressly
provided in the Plan or in any Award Agreement.
(g) Governing Law. The validity, construction, and effect
of the Plan and any rules and regulations relating to the Plan shall be
determined in accordance with the laws of the State of New Jersey and
applicable Federal law.
(h) Severability. If any provision of the Plan or any
Award is or becomes or is deemed to be invalid, illegal or unenforceable in
any jurisdiction or as to any Person or Award under any law deemed
applicable by the Committee, such provision shall be construed or deemed
amended to conform to applicable laws, or if it cannot be construed or
deemed amended without, in the determination of the Committee, materially
altering the intent of the Plan or the Award, such provision shall be
stricken as to such jurisdiction, Person or Award and the remainder of the
Plan and any such Award shall remain in full force and effect.
(i) No Trust or Fund Created. Neither the Plan nor any
Award shall create or be construed to create a trust or separate fund of
any kind or a fiduciary relationship between the Company or any Affiliate
and a Participant or any other Person. To the extent that any Person
acquires a right to receive payments from the Company or any Affiliate
pursuant to an Award, such right shall be no greater than the right of any
unsecured general creditor of the Company or any Affiliate.
(j) No Fractional Common Shares. No fractional Common
Shares shall be issued or delivered pursuant to the Plan or any Award, and
the Committee shall determine whether cash, other securities, or other
property shall be paid or transferred in lieu of any fractional Common
Shares or whether such fractional Common Shares or any rights thereto shall
be canceled, terminated, or otherwise eliminated.
(k) Headings. Headings are given to the Sections and
subsections of the Plan solely as a convenience to facilitate reference.
Such headings shall not be deemed in any way material or relevant to the
construction or interpretation of the Plan or any provision thereof.
SECTION 9. Adoption, Approval and Effective Date of the
Plan. The Plan shall be considered adopted and shall become effective on
the date the Plan is approved by the Board; provided, however, that the
Plan and any Awards granted under the Plan shall be void, if the
shareholders of the Company shall not have approved the adoption of the
Plan within twelve (12) months after the effective date, by a majority of
votes cast thereon at a meeting of shareholders duly called and held for
such purpose.
EXHIBIT 4(ii)
GUEST SUPPLY, INC.
Stock Option Certificate
Under the
1996 Long Term Incentive Plan
Date of Grant:
Name of Optionee:
Number of Shares:
Price Per Share:
This is to certify that, effective on the date of
grant specified above, the Stock Option Committee (the
"Committee") of the Board of Directors of Guest Supply, Inc.
(the "Company") has granted to the above-named optionee (the
"Optionee") an option to purchase from the Company, for the
price per share set forth above, the number of shares of
Common Stock, without par value (the "Stock"), of the
Company set forth above pursuant to the Guest Supply, Inc.
1996 Long Term Incentive Plan (the "Plan"). Capitalized
terms used and not otherwise defined herein shall have the
meaning set forth in the Plan. This option is not intended
to be treated as an Incentive Stock Option within the
meaning of Section 422 of the Internal Revenue Code of 1986,
as amended (the "Code").
The terms and conditions of the option granted
hereby, in addition to the terms and conditions contained in
the Plan, are as follows:
1. The price at which each share of Stock
subject to this option may be purchased shall be the price
set forth above, subject to any adjustments which may be
made pursuant to Section 9 hereof, provided that it shall in
no event be less than the Fair Market Value per share of
Stock on the date of grant.
2. Subject to the terms and conditions set forth
herein, this option may be exercised at any time to purchase
shares of Stock covered by this option only in accordance
with the following schedule:
Cumulative Percentage
of Aggregate Number of
Shares of Stock Covered
by Option Which May Be
Exercise Period Purchased
Within one year from date of
grant........................ 0%
Beginning one year from date
of grant..................... 20%
Beginning two years from date
of grant..................... 40%
Beginning three years from date
of grant..................... 60%
Beginning four years from date
of grant..................... 80%
Beginning five years from date
of grant..................... 100%
less, in the case of each exercise period, the number of
shares of Stock, if any, previously purchased hereunder.
This option shall terminate and no shares of Stock may be
purchased hereunder more than ten (10) years after the date
of grant.
3. Except as provided in Section 7 hereof, this
option may not be exercised unless the Optionee is in the
employ of the Company or an Affiliate at the time of such
exercise and shall have been such an employee continuously
since the date of grant of this option. For purposes of
this option, service as a director, officer or consultant of
the Company or an Affiliate shall be considered employment.
4. Subject to the terms and conditions set forth
herein, the Optionee may exercise this option at any time as
to all or any of the shares of Stock by delivering to the
Company written notice specifying:
(i) the number of whole shares of Stock to be
purchased together with payment in full of the aggregate
option price of such shares, provided that this option
may not be exercised for less than ten (10) shares of
Stock or the number of shares of Stock remaining subject
to option, whichever is smaller;
(ii) the name or names in which the stock
certificate or certificates are to be registered;
(iii) the address to which dividends, notices,
reports, etc. are to be sent; and
(iv) the Optionee's social security number.
Only one stock certificate will be issued unless the
Optionee otherwise requests in writing. Payment shall be in
cash, or by certified or bank cashier's check payable to the
order of the Company, free from all collection charges. If
the Optionee so requests, shares of Stock purchased upon
exercise of an option may be issued in the name of the
Optionee or another person. No Optionee shall be entitled
to any rights as a stockholder of the Company in respect of
any shares of Stock covered by this option until such shares
of Stock shall have been paid for in full and issued to the
Optionee.
5. As soon as practicable after the Company
receives payment for shares of Stock covered by this option,
it shall deliver a certificate or certificates representing
the shares of Stock so purchased to the Optionee. Such
certificate shall be registered in the name of the Optionee,
or in such other name or names as the Optionee shall
request.
6. This option is personal to the Optionee and
during the Optionee's lifetime may be exercised only by the
Optionee. This option shall not be assigned, alienated,
pledged, attached, sold or otherwise transferred or
encumbered by the Optionee otherwise than by will or by the
laws of descent and distribution and any such purported
assignment, alienation, pledge, attachment, sale or other
transfer or encumbrance shall be void and unenforceable
against the Company or any Affiliate.
7. Subject to the condition that this option
shall in no event be exercisable after the date of
termination of such option specified in Section 2 hereof:
(i) Subject to the terms of paragraph (iv) below,
upon the death of the Optionee while employed or within
three (3) months of retirement or disability as defined
in paragraph (ii) below, the person or persons to whom
the Optionee's rights with respect to this option are
transferred by will or the laws of descent and
distribution may, prior to the earlier of: (1) the
expiration date of this option, or (2) nine (9) months
after the Optionee's death, purchase any or all of the
Stock with respect to which the Optionee was entitled to
exercise this option immediately prior to the Optionee's
death, and this option will lapse on the date of the
Optionee's death to the extent not so exercisable;
(ii) Subject to the terms of paragraph (iv) below,
upon termination of the Optionee's employment with the
Company (x) as a result of retirement pursuant to a
retirement plan of the Company or an Affiliate or
disability (as determined by the Committee) of the
Optionee, (y) by the Company other than for Cause, or
(z) by the Optionee with Good Reason, the Optionee may,
prior to the earlier of: (1) the expiration date of this
option, or (2) three (3) months after the date of such
termination, purchase any or all of the Stock with
respect to which the Optionee was entitled to exercise
this option immediately prior to such termination, and
this option will lapse on such date of termination to
the extent not so exercisable;
(iii) Subject to the terms of paragraph (iv)
below, upon termination of the Optionee's employment
with the Company under any circumstances not described
in paragraphs (i) or (ii) above, this option shall be
canceled to the extent not theretofore exercised;
(iv) Upon the death of the Optionee, or
termination of the Optionee's employment with the
Company (x) by the Company other than for Cause (y) by
the Optionee with Good Reason or (z) as a result of
retirement or disability as defined in paragraph (ii)
above, the Company shall have the right to cancel this
option (subject to the terms of paragraphs (i) or (ii)
above) for a payment in cash equal to the excess, if
any, of the Fair Market Value of one share of Stock on
the date of death or termination over the exercise price
of this option for one share of Stock times the number
of shares of Stock subject to this Option and
exercisable at the time of such death or termination;
and
(v) Upon expiration of the respective periods set
forth in each of paragraphs (i) through (iii) above, the
option of an Optionee who has died or whose employment
has been terminated shall be canceled to the extent not
theretofore canceled or exercised.
For purposes of this Section 7, the period of
service of an individual as a director or consultant of the
Company or an Affiliate shall be deemed the period of
employment.
8. This option does not confer on the Optionee
any right to continue in the employ of the Company or
interfere in any way with the right of the Company to
determine the terms of the Optionee's employment.
9. In the event that the Committee shall
determine that any dividend or other distribution (whether
in the form of cash, Common Shares, other securities or
other property), recapitalization, stock split, reverse
stock split, reorganization, merger, consolidation,
split-up, spin-off, combination, repurchase or exchange of
Stock, or other similar corporate transaction or event
affects the Stock such that an adjustment is determined by
the Committee to be appropriate in order to prevent dilution
or enlargement of the benefits or potential benefits
intended to be made available under this option, then the
Committee shall, in such manner as it may deem equitable,
adjust any or all of (i) the number and kind of Common
Shares (or other securities or property) subject to this
option and (ii) the exercise price of this option.
10. In connection with any merger or consolidation
in which the Company is not the surviving corporation and
which results in the holders of the outstanding voting
securities of the Company (determined immediately prior to
such merger or consolidation) owning less than a majority of
the outstanding voting securities of the surviving
corporation (determined immediately following such merger or
consolidation), or any sale or transfer by the Company of
all or substantially all of its assets or any tender offer
or exchange offer for or the acquisition, directly or
indirectly, by any person or group of all or a majority of
the then outstanding voting securities of the Company, this
option shall become exercisable in full, notwithstanding any
other provision of the Plan or of any outstanding Options
granted thereunder, on and after (i) the fifteenth day prior
to the effective date of such merger, consolidation, sale,
transfer or acquisition or (ii) the date of commencement of
such tender offer or exchange offer, as the case may be.
Notwithstanding the foregoing, in no event shall this option
be exercisable after the date of termination of the exercise
period of this option specified in Sections 2 and 7 hereof.
11. This option shall be subject to the
requirement that if at any time the Board of Directors shall
determine that the registration, listing or qualification of
the shares of Stock covered hereby upon any securities
exchange or under any federal or state law, or the consent
or approval of any governmental regulatory body is necessary
or desirable as a condition of, or in connection with, the
granting of this option or the purchase of shares of Stock
hereunder, this option may not be exercised unless and until
such registration, listing, qualification, consent or
approval shall have been effected or obtained free of any
conditions not acceptable to the Board of Directors. The
Committee may require that the person exercising this option
shall make such representations and agreements and furnish
such information as it deems appropriate to assure
compliance with the foregoing or any other applicable legal
requirements.
12. This option and the terms and conditions
herein set forth are subject in all respects to the terms
and conditions of the Plan, which shall be controlling. All
interpretations or determinations of the Committee shall be
binding and conclusive upon the Optionee and his legal
representatives on any question arising hereunder or under
the Plan.
13. It shall be a condition to the obligation of
the Company to issue shares of Stock upon exercise of this
option, that the Optionee (or any beneficiary or person
entitled to act under Section 7 hereof) pay to the Company,
upon its demand, such amount as may be requested by the
Company for the purpose of satisfying any liability to
withhold federal, state or local income or other taxes.
14. All notices hereunder to the Company shall be
delivered or mailed to the following address:
Guest Supply, Inc.
720 U.S. Highway No. 1
North Brunswick, New Jersey 08902
Attention: Secretary
Such address for the service of notices may be changed at
any time provided notice of such change is furnished in
advance to the Optionee.
GUEST SUPPLY, INC.
By
EXHIBIT 4(iii)
GUEST SUPPLY, INC.
Incentive Stock Option Certificate
Under the
1996 Long Term Incentive Plan
Date of Grant:
Name of Optionee:
Number of Shares:
Price Per Share:
This is to certify that, effective on the date of
grant specified above, the Stock Option Committee (the
"Committee") of the Board of Directors of Guest Supply, Inc.
(the "Company") has granted to the above-named optionee (the
"Optionee") an option to purchase from the Company, for the
price per share set forth above, the number of shares of
Common Stock, without par value (the "Stock"), of the
Company set forth above pursuant to the Guest Supply, Inc.
1996 Long Term Incentive Plan (the "Plan"). Capitalized
terms used and not otherwise defined herein shall have the
meaning set forth in the Plan. This option is intended to
be treated as an Incentive Stock Option within the meaning
of Section 422 of the Internal Revenue Code of 1986, as
amended (the "Code").
The terms and conditions of the option granted
hereby, in addition to the terms and conditions contained in
the Plan, are as follows:
1. The price at which each share of Stock
subject to this option may be purchased shall be the price
set forth above, subject to any adjustments which may be
made pursuant to Section 9 hereof, provided that it shall in
no event be less than the Fair Market Value per share of
Stock on the date of grant, and provided further that in the
event the Optionee owns on the date of grant securities
possessing more than ten percent (10%) of the total combined
voting power of all classes of securities of the Company or
of an Affiliate, the price per share shall not be less than
one hundred ten percent (110%) of the Fair Market Value per
share of Stock on the date of grant.
2. Subject to the terms and conditions set forth
herein, this option may be exercised at any time to purchase
shares of Stock covered by this option only in accordance
with the following schedule:
Cumulative Percentage
of Aggregate Number of
Shares of Stock Covered
by Option Which May Be
Exercise Period Purchased
Within one year from date of
grant........................ 0%
Beginning one year from date
of grant..................... 20%
Beginning two years from date
of grant..................... 40%
Beginning three years from date
of grant..................... 60%
<PAGE>
Beginning four years from date
of grant..................... 80%
Beginning five years from date
of grant..................... 100%
less, in the case of each exercise period, the number of
shares of Stock, if any, previously purchased hereunder.
This option shall terminate and no shares of Stock may be
purchased hereunder more than ten (10) years after the date
of grant, provided that if the Optionee owns on the date of
grant securities possessing more than ten percent (10%) of
the total combined voting power of all classes of securities
of the Company or of an Affiliate, this Option shall
terminate and no shares of Stock may be purchased hereunder
more than five (5) years after the date of grant.
3. Except as provided in Section 7 hereof, this
option may not be exercised unless the Optionee is in the
employ of the Company or an Affiliate at the time of such
exercise and shall have been such an employee continuously
since the date of grant of this option.
4. Subject to the terms and conditions set forth
herein, the Optionee may exercise this option at any time as
to all or any of the shares of Stock by delivering to the
Company written notice specifying:
(i) the number of whole shares of Stock to be
purchased together with payment in full of the aggregate
option price of such shares, provided that this option
may not be exercised for less than ten (10) shares of
Stock or the number of shares of Stock remaining subject
to option, whichever is smaller;
(ii) the name or names in which the stock
certificate or certificates are to be registered;
(iii) the address to which dividends, notices,
reports, etc. are to be sent; and
(iv) the Optionee's social security number.
Only one stock certificate will be issued unless the
Optionee otherwise requests in writing. Payment shall be in
cash, or by certified or bank cashier's check payable to the
order of the Company, free from all collection charges. If
the Optionee so requests, shares of Stock purchased upon
exercise of an option may be issued in the name of the
Optionee or another person. No Optionee shall be entitled
to any rights as a stockholder of the Company in respect of
any shares of Stock covered by this option until such shares
of Stock shall have been paid for in full and issued to the
Optionee.
5. As soon as practicable after the Company
receives payment for shares of Stock covered by this option,
it shall deliver a certificate or certificates representing
the shares of Stock so purchased to the Optionee. Such
certificate shall be registered in the name of the Optionee,
or in such other name or names as the Optionee shall
request.
6. This option is personal to the Optionee and
during the Optionee's lifetime may be exercised only by the
Optionee. This option shall not be assigned, alienated,
pledged, attached, sold or otherwise transferred or
encumbered by the Optionee otherwise than by will or by the
laws of descent and distribution and any such purported
assignment, alienation, pledge, attachment, sale or other
transfer or encumbrance shall be void and unenforceable
against the Company or any Affiliate.
7. Subject to the condition that this option
shall in no event be exercisable after the date of
termination of such option specified in Section 2 hereof:
(i) Subject to the terms of paragraph (iv) below,
upon the death of the Optionee while employed or within
three (3) months of retirement or disability as defined
in paragraph (ii) below, the person or persons to whom
the Optionee's rights with respect to this option are
transferred by will or the laws of descent and
distribution may, prior to the earlier of: (1) the
expiration date of this option, or (2) nine (9) months
after the Optionee's death, purchase any or all of the
Stock with respect to which the Optionee was entitled to
exercise this option immediately prior to the Optionee's
death, and this option will lapse on the date of the
Optionee's death to the extent not so exercisable;
(ii) Subject to the terms of paragraph (iv) below,
upon termination of the Optionee's employment with the
Company (x) as a result of retirement pursuant to a
retirement plan of the Company or an Affiliate or
disability (as determined by the Committee) of the
Optionee, (y) by the Company other than for Cause, or
(z) by the Optionee with Good Reason, the Optionee may,
prior to the earlier of: (1) the expiration date of this
option, or (2) three (3) months after the date of such
termination, purchase any or all of the Stock with
respect to which the Optionee was entitled to exercise
this option immediately prior to such termination, and
this option will lapse on such date of termination to
the extent not so exercisable;
(iii) Subject to the terms of paragraph (iv)
below, upon termination of the Optionee's employment
with the Company under any circumstances not described
in paragraphs (i) or (ii) above, this option shall be
canceled to the extent not theretofore exercised;
(iv) Upon the death of the Optionee, or
termination of the Optionee's employment with the
Company (x) by the Company other than for Cause (y) by
the Optionee with Good Reason or (z) as a result of
retirement or disability as defined in paragraph (ii)
above, the Company shall have the right to cancel this
option (subject to the terms of paragraphs (i) or (ii)
above) for a payment in cash equal to the excess, if
any, of the Fair Market Value of one share of Stock on
the date of death or termination over the exercise price
of this option for one share of Stock times the number
of shares of Stock subject to this Option and
exercisable at the time of such death or termination;
and
(v) Upon expiration of the respective periods set
forth in each of paragraphs (i) through (iii) above, the
option of an Optionee who has died or whose employment
has been terminated shall be canceled to the extent not
theretofore canceled or exercised.
8. This option does not confer on the Optionee
any right to continue in the employ of the Company or
interfere in any way with the right of the Company to
determine the terms of the Optionee's employment.
9. In the event that the Committee shall
determine that any dividend or other distribution (whether
in the form of cash, Common Shares, other securities or
other property), recapitalization, stock split, reverse
stock split, reorganization, merger, consolidation,
split-up, spin-off, combination, repurchase or exchange of
Stock, or other similar corporate transaction or event
affects the Stock such that an adjustment is determined by
the Committee to be appropriate in order to prevent dilution
or enlargement of the benefits or potential benefits
intended to be made available under this option, then the
Committee shall, in such manner as it may deem equitable,
adjust any or all of (i) the number and kind of Common
Shares (or other securities or property) subject to this
option and (ii) the exercise price of this option.
10. In connection with any merger or consolidation
in which the Company is not the surviving corporation and
which results in the holders of the outstanding voting
securities of the Company (determined immediately prior to
such merger or consolidation) owning less than a majority of
the outstanding voting securities of the surviving
corporation (determined immediately following such merger or
consolidation), or any sale or transfer by the Company of
all or substantially all of its assets or any tender offer
or exchange offer for or the acquisition, directly or
indirectly, by any person or group of all or a majority of
the then outstanding voting securities of the Company, this
option shall become exercisable in full, notwithstanding any
other provision of the Plan or of any outstanding Options
granted thereunder, on and after (i) the fifteenth day prior
to the effective date of such merger, consolidation, sale,
transfer or acquisition or (ii) the date of commencement of
such tender offer or exchange offer, as the case may be.
The provisions of the foregoing sentence shall apply to any
outstanding Options which are Incentive Stock Options to the
extent permitted by Section 422(d) of the Code and such
outstanding Options in excess thereof shall, immediately
upon the occurrence of the event described in clause (i) or
(ii) of the foregoing sentence, be treated for all purposes
of the Plan as Non-Qualified Stock Options and shall be
immediately exercisable as such as provided in the foregoing
sentence. Notwithstanding the foregoing, in no event shall
this option be exercisable after the date of termination of
the exercise period of this option specified in Sections 2
and 7 hereof.
11. This option shall be subject to the
requirement that if at any time the Board of Directors shall
determine that the registration, listing or qualification of
the shares of Stock covered hereby upon any securities
exchange or under any federal or state law, or the consent
or approval of any governmental regulatory body is necessary
or desirable as a condition of, or in connection with, the
granting of this option or the purchase of shares of Stock
hereunder, this option may not be exercised unless and until
such registration, listing, qualification, consent or
approval shall have been effected or obtained free of any
conditions not acceptable to the Board of Directors. The
Committee may require that the person exercising this option
shall make such representations and agreements and furnish
such information as it deems appropriate to assure
compliance with the foregoing or any other applicable legal
requirements.
12. This option and the terms and conditions
herein set forth are subject in all respects to the terms
and conditions of the Plan, which shall be controlling. All
interpretations or determinations of the Committee shall be
binding and conclusive upon the Optionee and his legal
representatives on any question arising hereunder or under
the Plan.
13. By acceptance of this option, the Optionee
agrees that in the event the Optionee sells or otherwise
disposes of any shares of Stock subject to this option on or
prior to (i) the date two years from the date of the grant
of this option, or (ii) the date one year from the date of
the transfer of any of such shares to him pursuant to the
exercise of this option or any portion thereof, the Optionee
shall promptly upon the occurrence of any such event (x)
give notice to the Company of the occurrence thereof, which
notice shall specify the manner in which such shares of
Stock were sold or disposed of and the consideration
received therefor, (y) furnish to the Company such other
information as may reasonably be requested by the Company,
and (z) pay to the Company, upon its demand, such amount as
may be requested by the Company for the purpose of
satisfying any liability to withhold federal, state or local
income or other taxes.
14. All notices hereunder to the Company shall be
delivered or mailed to the following address:
Guest Supply, Inc.
720 U.S. Highway No. 1
North Brunswick, New Jersey 08902
Attention: Secretary
Such address for the service of notices may be changed at
any time provided notice of such change is furnished in
advance to the Optionee.
GUEST SUPPLY, INC.
By
EXHIBIT 5
[LETTERHEAD OF HAYTHE & CURLEY]
May 7, 1997
Guest Supply, Inc.
4301 U.S. Highway One
Monmouth Junction, New Jersey 08852
Dear Sirs:
We have acted as counsel for Guest Supply, Inc., a
New Jersey corporation (the "Company"), in connection with
the registration statement on Form S-8 being filed by the
Company under the Securities Act of 1933 with respect to
400,000 shares (the "Option Shares") of the Company's common
stock, without par value (the "Common Stock"), which have
been or are to be offered by the Company pursuant to the
Company's 1996 Long Term Incentive Plan (the "Long Term
Incentive Plan").
In connection with such registration statement, we
have examined such records and documents and such questions
of law as we have deemed appropriate for purposes of this
opinion. On the basis of such examination, we advise you
that in our opinion the Option Shares have been duly and
validly authorized and, when issued and paid for in
accordance with the terms of the Long Term Incentive Plan
and stock options duly granted or to be granted thereunder,
will be validly issued, fully paid and non-assessable.
We hereby consent to the filing of this opinion as an
exhibit to the foregoing registration statement.
Very truly yours,
/s/ Haythe & Curley
