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As filed with the Securities and Exchange Commission on September 27, 1995
Registration No. 33-_____________
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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NORSTAN, INC.
(Exact name of issuer as specified in its charter)
MINNESOTA 41-0835746
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
605 NORTH HIGHWAY 169, PLYMOUTH, MINNESOTA 55441
(Address of principal executive offices, including Zip Code)
NORSTAN, INC. 1995 LONG-TERM INCENTIVE PLAN
(Full title of the plan)
RICHARD COHEN Copy to:
VICE CHAIRMAN OF THE BOARD
AND CHIEF FINANCIAL OFFICER WINSTON E. MUNSON
NORSTAN, INC. MACKALL, CROUNSE & MOORE
605 NORTH HIGHWAY 169 1400 AT&T TOWER
PLYMOUTH, MINNESOTA 55441 MINNEAPOLIS, MINNESOTA 55402
(Name and address of agent for service)
(612) 513-4500
(Telephone number, including area code, of agent for service)
Approximate date of commencement of proposed sale:
FROM TIME TO TIME AFTER THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT.
CALCULATION OF REGISTRATION FEE
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Proposed Proposed
Title of Maximum Maximum
Securities Amount Offering Aggregate Amount of
to be to be Price Offering Registration
Registered Registered Per Share (1) Price (1) Fee
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COMMON STOCK, 600,000 $25.00 $15,000,000 $5,172.41
$.10 PAR VALUE (2) SHARES
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(1) Estimated solely for the purpose of determining the registration fee
pursuant to Rule 457(c), based upon the average of the high and low prices
for such Common Stock on September 25, 1995, as reported on NASDAQ.
(2) Includes associated Common Stock Rights referred to herein.
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PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Documents containing the information specified in this Part I will be sent
or given to participants as specified by Rule 428(b)(1). Such documents need
not be filed with the Securities and Exchange Commission either as part of this
registration statement or as prospectuses or prospectus supplements pursuant to
Rule 424. Such documents and the documents incorporated by reference in this
registration statement pursuant to Item 3 of Part II, taken together, constitute
a prospectus that meets the requirements of Section 10(a) of the Securities Act
of 1933.
ITEM 1. PLAN INFORMATION.
ITEM 2. REGISTRANT INFORMATION AND PLAN ANNUAL INFORMATION.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents are incorporated herein by reference:
a. Annual Report on Form 10-K of Norstan, Inc. ("Company") for the fiscal
year ended April 30, 1995, filed with the Securities and Exchange Commission
pursuant to Sections 13 or 15(d) of the Exchange Act.
b. All other reports filed by the Company with the Securities and
Exchange Commission since April 30, 1995, pursuant to Sections 13 or 15(d) of
the Exchange Act.
c. Description of the Company Common Stock, contained in the Company's
Registration Statement on Form S-8 (Registration No. 33-30323), filed with the
Securities and Exchange Commission, and the Company's Shareholder Rights Plan,
contained in the Company's Registration Statement on Form 8-A (File No. 0-8141),
filed May 25, 1988, with the Securities and Exchange Commission.
d. All documents filed by the Company pursuant to Sections 13(a), 13(c),
14 and 15(d) of the Exchange Act subsequent to the date of this registration
statement and prior to the filing of a post-effective amendment which indicates
that all securities offered hereby have been sold or which deregisters all such
securities then remaining to be sold.
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ITEM 4. DESCRIPTION OF SECURITIES.
The common stock, par value $.10 per share, (the "Common Stock") of
the Company offered pursuant to this registration statement is registered under
Section 12(g) of the Securities Exchange Act of 1934. The description of the
Company Common Stock is incorporated by reference pursuant to Item 3.c. above.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Legal matters in connection with the Common Stock offered pursuant to
the Plan have been passed upon for the Company by Messrs. Mackall, Crounse &
Moore, PLC, Minneapolis, Minnesota. Winston E. Munson, of counsel to Mackall,
Crounse & Moore, PLC, is a director, shareholder, optionee under the Restated
Non-Employee Directors' Stock Plan and Secretary of the Company.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
As permitted by Section 302A.251 of the Minnesota Statutes, Article
XII of the Restated Articles of Incorporation of the Company provides that a
director of the Company shall not be personally liable to the Company or its
stockholders for monetary damages for certain types of breaches of fiduciary
duty as a director.
Section 302A.521 of the Minnesota Statutes provides that a Minnesota
business corporation shall indemnify directors, officers, employees and agents
in certain circumstances and under certain conditions. In addition, the
Articles of Incorporation and the Bylaws of the Company specifically address
indemnification in accordance with the Minnesota Business Corporation Act. The
Company also maintains an insurance policy that will indemnify directors and
officers against certain liabilities.
Article VI of the Bylaws of the Company provides as follows:
a. The Company shall indemnify a person made or threatened to be made a
party to a proceeding by reason of the former or present official capacity of
the person with the Company in accordance with, and to the fullest extent
permitted by, the provisions of Chapter 302A, Minnesota Statutes.
b. The Company may purchase and maintain insurance at its expense to
protect itself or on behalf of a person in that person's official capacity with
the Company or a subsidiary, against any liability asserted against and incurred
by the person in or arising from that capacity, whether or not the Company would
be required by law to indemnify the person against the liability.
Information with respect to the Company's Articles of Incorporation
and the Minnesota Business Corporation Act relating to indemnification of
directors and officers is set forth in the Company's Registration Statement on
Form S-8 (Registration No. 33-30323), filed with the
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Securities and Exchange Commission on August 2, 1989, under Item 19 -
"Indemnification of Directors and Officers," at page II-1 thereof, and is
incorporated herein by reference.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
EXHIBIT
NUMBER DESCRIPTION PAGE
- ------ ----------- ----
4.1 Rights Agreement, dated as of May 17, 1988, between Norstan, Inc.
and Norwest Bank Minnesota, N.A. [incorporated by reference to
Exhibit 1 to the Company's Registration Statement on Form 8-A,
File No. 0-8141, (filed May 25, 1988)].
5.1 Opinion of Mackall, Crounse & Moore, PLC, as to the legality of
Common Stock of the Company . . . . . . . . . . . . . . . . . . . . . 9
23.1 Consent of Arthur Andersen LLP . . . . . . . . . . . . . . . . . . .11
23.2 Consent of Mackall, Crounse & Moore, PLC [included in its opinion
filed as Exhibit 5.1].
25.1 Powers of Attorney [included as part of signature page].
28.1 Norstan, Inc. 1995 Long-Term Incentive Plan, as amended . . . . . . .12
ITEM 9. UNDERTAKINGS.
(a) RULE 415 OFFERING.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most
recent post-effective amendment thereof) which,
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individually or in the aggregate, represent a fundamental change
in the information set forth in the registration statement; and
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not
apply if the registration statement is on Form S-3 or Form S-8, and
the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed by the
registrant pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the
registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the
termination of the offering.
(b) FILINGS INCORPORATING SUBSEQUENT EXCHANGE ACT DOCUMENTS BY REFERENCE.
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 or Section 15(d) of
the Securities Exchange Act of 1934 (and, where applicable, each filing of
an employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide
offering thereof.
(h) STATEMENT REQUIRED IN CONNECTION WITH FILING OF REGISTRATION STATEMENT ON
FORM S-8.
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
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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.
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SIGNATURES
THE REGISTRANT
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Plymouth, State of Minnesota on September 27, 1995.
NORSTAN, INC.
By /s/ Paul Baszucki
----------------------------------------
Paul Baszucki
Director, Co-Chairman of the Board and
Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Paul Baszucki, Richard Cohen and Winston
E. Munson, or such officer of Norstan, Inc. as any of them may designate, or any
one of them, his or her true and lawful attorneys-in-fact and agents, with full
power of substitution and resubstitution, for him or her and in his or her name,
place and stead, in any and all capacities, to sign any and all amendments or
post-effective amendments to this Registration Statement, and to file the same
with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he or she might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents or any one of them, or their or his substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
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Pursuant to the requirements of the Securities Act of 1933 this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
- --------- ----- ----
/s/ Paul Baszucki Co-Chairman of the Board, September 27, 1995
- ------------------------- Chief Executive Officer
Paul Baszucki and Director
/s/ Sidney R. Cohen Co-Chairman of the Board September 27, 1995
- ------------------------- and Director
Sidney R. Cohen
/s/ Richard Cohen Vice Chairman of the Board, September 27, 1995
- ------------------------- Chief Financial Officer and
Richard Cohen Director (Principal Financial
and Accounting Officer)
/s/ Max Mayer President, Chief Operating September 27, 1995
- ------------------------- Officer and Director
Max Mayer
/s/ Winston E. Munson Secretary and Director September 27, 1995
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Winston E. Munson
/s/ Arnold Lehrman Director September 27, 1995
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Arnold Lehrman
/s/ Connie M. Levi Director September 27, 1995
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Connie M. Levi
/s/ Gerald D. Pint Director September 27, 1995
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Gerald D. Pint
/s/ Stanley H. Schweitzer Director September 27, 1995
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Stanley H. Schweitzer
- ------------------------- Director September __, 1995
Jagdish N. Sheth
/s/ Herbert F. Trader Director September 27, 1995
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Herbert F. Trader
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[MACKALL CROUNSE & MOORE PLC LETTERHEAD]
September 27, 1995
EXHIBIT 5.1
Norstan, Inc.
605 North Highway 169
Plymouth, MN 55441
Re: Norstan, Inc. 1995 Long-Term Incentive Plan
Registration Statement on Form S-8
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Ladies and Gentlemen:
We have examined (a) the Registration Statement on Form S-8 (the
"Registration Statement") to be filed by you with the Securities and Exchange
Commission under the Securities Act of 1933, as amended, and the Prospectus to
be used in connection therewith (the "Prospectus"), relating to the issuance by
you of up to 600,000 shares of your common stock, par value $.10 per share, (the
"Common Stock") in the manner set forth in the Registration Statement and the
Prospectus; (b) your Certificate of Incorporation and your Bylaws, both as
amended to date; and (c) your corporate proceedings relative to your
organization and to the issuance of the Common Stock.
In addition to the examination outlined above, we have reviewed such
other proceedings, documents, and records and have ascertained or verified such
additional facts as we deem necessary or appropriate for purposes of this
opinion.
Based upon the foregoing, we are of the opinion that:
1. Norstan, Inc. has been legally incorporated and is validly
existing under the laws of the State of Minnesota.
2. The Common Stock will, when issued by you as contemplated in the
Registration Statement and the Prospectus, be legally issued, fully paid,
and nonassessable.
We hereby consent to the use of this opinion as an exhibit to the
Registration Statement and to the references to our firm under the caption
"Legal Opinion" in the Prospectus. In giving this consent, we do not admit
hereby that we come within the
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Norstan, Inc.
September 27, 1995
Page 10
category of persons whose consent is required under Section 7 of the Securities
Act of 1933 or the rules and regulations of the Securities and Exchange
Commission thereunder.
Very truly yours,
/s/ Mackall, Crounse & Moore, PLC
---------------------------------
MACKALL, CROUNSE & MOORE, PLC
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Exhibit 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our report dated June 14, 1995
included in Norstan, Inc.'s Form 10-K for the year ended April 30, 1995, and to
all references to our Firm included in this registration statement.
ARTHUR ANDERSEN LLP
Minneapolis, Minnesota
September 27, 1995
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Exhibit 28.1
NORSTAN, INC. 1995 LONG-TERM INCENTIVE PLAN
12
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NORSTAN, INC.
1995 LONG-TERM INCENTIVE PLAN
SECTION 1. PURPOSE; EFFECT ON PRIOR PLANS.
(a) PURPOSE. The purpose of the Plan is to promote the interests of the
Company and its stockholders by aiding the Company in attracting and retaining
personnel capable of assuring the future success of the Company, to offer such
personnel incentives to put forth maximum efforts for the success of the
Company's business and to afford such personnel an opportunity to acquire a
proprietary interest in the Company.
(b) EFFECT ON PRIOR PLANS. From and after the date on which the Company's
stockholders approve this Plan, no stock options, restricted stock awards, stock
appreciation rights, performance awards or other awards shall be granted or
awarded under the Company's 1986 Long-Term Incentive Plan, as amended ("1986
Plan"). All outstanding stock options, restricted stock awards, stock
appreciation rights and performance awards granted under the 1986 Plan prior to
the date on which the Company's stockholders approve this Plan shall continue
and remain outstanding in accordance with the terms thereof.
SECTION 2. DEFINITIONS.
As used in the Plan, the following terms shall have the meanings set forth
below:
(a) "AFFILIATE" shall mean (i) any entity that, directly or indirectly
through one or more intermediaries, is controlled by the Company and (ii) any
entity in which the Company has a significant equity interest, in each case as
determined by the Committee.
(b) "AWARD" shall mean any Option, Stock Appreciation Right, Restricted
Stock, Performance Award, or Other Award granted under the Plan.
(c) "AWARD AGREEMENT" shall mean any written agreement, contract or other
instrument or document evidencing any Award granted under the Plan.
(d) "CODE" shall mean the internal Revenue Code of 1986, as amended from
time to time, and any regulations promulgated thereunder.
(e) "COMMITTEE" shall mean a committee of the Board of Directors of the
Company designated by such Board to administer
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the Plan, which shall consist of members appointed from time to time by the
Board of Directors and shall be comprised of not less than such number of
directors as shall be required to permit the Plan to satisfy the requirements of
Rule 16b-3. Each member of the Committee shall be a "disinterested person"
within the meaning of Rule 16b-3.
(f) "COMPANY" shall mean NORSTAN, INC., a Minnesota corporation, and
any successor corporation.
(g) "ELIGIBLE PERSON" shall mean any employee, or any consultant or advisor
providing bonafide services to the Company or any Affiliate who the Committee
determines to be an Eligible Person. A director of the Company who is not also
an employee of the Company or an Affiliate shall not be an Eligible Person.
(h) "FAIR MARKET VALUE" shall mean, with respect to any property
(including, without limitation, any Shares or other securities), the fair market
value of such property determined by such methods or procedures as shall be
established from time to time by the Committee.
(i) "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.
(j) "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.
(k) "OPTION" shall mean an Incentive Stock Option or a Non-Qualified Stock
Option.
(l) "OTHER (STOCK-BASED) AWARD" shall mean any right granted under Section
6(f) of the Plan.
(m) "PARTICIPANT" shall mean an Eligible Person designated to be granted
an Award under the Plan.
(n) "PERFORMANCE AWARD" shall mean any right granted under Section 6(c) of
the Plan.
(o) "PLAN" shall mean this 1995 Long-Term Incentive Plan, as amended from
time to time.
(p) "RESTRICTED STOCK" shall mean any Share granted under Section 6(b) of
the Plan.
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(q) "RULE 16b-3" shall mean Rule 16b-3 promulgated by the Securities and
Exchange Commission under the Securities Exchange Act of 1934, as amended, or
any successor rule or regulation.
(r) "SHARES" shall mean shares of Common Stock, $.10 par value, of the
Company or such other securities or property as may become subject to Awards
pursuant to an adjustment made under Section 4(c) of the Plan.
(s) "STOCK APPRECIATION RIGHT" shall mean any right granted under Section
6(e) of the Plan.
SECTION 3. ADMINISTRATION.
(a) POWER AND AUTHORITY OF THE COMMITTEE. The Plan shall be administered
by the Committee. Subject of the express provisions of the Plan and to
applicable law, the Committee shall have full power and authority to: (i)
designate Participants; (ii) determine the type or types of Awards to be granted
to each Participant under the Plan; (iii) determine the number of Shares to be
covered by (or with respect to which payments, rights or other matters are to be
calculated in connection with) each Award; (iv) determine the terms and
conditions of any Award or Award Agreement; (v) amend the terms and conditions
of any Award or Award Agreement and accelerate the exercisability of Options or
the lapse of restrictions relating to Restricted Stock or other Awards;
provided, however, that the Committee shall not have the authority to adjust or
amend the exercise price of any Option, whether through amendment or
cancellation grants of any additional Options; (vi) determine whether, to what
extent and under what circumstances Awards may be exercised in cash, Shares,
other securities, other Awards or other property, or canceled, forfeited or
suspended; (vii) determine whether, to what extent and under what circumstances
cash, 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 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 any Participant, any holder or beneficiary of any Award and any employee of
the Company or any Affiliate.
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SECTION 4. SHARES AVAILABLE FOR AWARDS.
(a) SHARES AVAILABLE. Subject to adjustment as provided in Section 4(c),
the number of Shares initially available for granting Awards under the Plan
shall be 600,000 provided, however, that in each fiscal year of the Company
during any part of which the Plan is effective commencing with the fiscal year
beginning May 1, 1996, the total number of shares authorized will be increased
by a number of shares equal to one percent (1%) of the total outstanding shares
of the Company as of the first day of such fiscal year, such increases to be
cumulative. No more than 600,000 shares shall be cumulatively available for the
grant of Incentive Stock Options under the Plan. If any Shares covered by an
Award or to which an Award relates are not purchased or are forfeited, or if an
Award otherwise terminates without delivery of any Shares, then the number of
Shares counted against the aggregate number of Shares available under the Plan
with respect to such Award, to the extent of any such forfeiture or termination,
shall again be available for granting Awards under the Plan.
(b) ACCOUNTING FOR AWARDS. For purposes of this Section 4, if an Award
entitles the holder thereof to receive or purchase Shares, the number of 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 Shares available for
granting Awards under the Plan.
(c) ADJUSTMENTS. In the event that the Committee shall determine that any
dividend or other distribution (whether in the form of cash, Shares, other
securities or other property), recapitalization, stock split, reverse stock
split, reorganization, merger, consolidation, split-up, spinoff, combination,
repurchase or exchange of Shares or other securities of the Company, issuance of
warrants or other rights to purchase Shares or other securities of the Company
or other similar corporate transaction or event affects the 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 type of Shares (or
other securities or other property) which thereafter may be made the subject of
Awards, (ii) the number and type of Shares (or other securities or other
property) subject to outstanding Awards and (iii) the purchase or exercise price
with respect to any Award; provided, however, that the number of Shares covered
by any Award or to which such Award relates shall always be a whole number.
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(d) AWARD LIMITATIONS UNDER THE PLAN. No Eligible Person may be granted
any Award or Awards, the value of which Awards are based solely on an increase
in the value of the Shares after the date of grant of such Awards, for more than
100,000 Shares, in the aggregate, in any fiscal year of the Company. The
foregoing limitation specifically includes the grant of any "performance-based"
Awards within the meaning of Section 162(m) of the Code.
SECTION 5. ELIGIBILITY.
Any Eligible Person, including any Eligible Person who is an officer or
director of the Company or any Affiliate, shall be eligible to be designated a
Participant. In determining which Eligible Persons shall receive an Award and
the terms of any Award, the Committee may take into account the nature of the
services rendered by the respective Eligible Persons, their present and
potential contributions to the success of the Company or such other factors as
the Committee, in its discretion, shall deem relevant. Notwithstanding the
foregoing, an Incentive Stock Option may only be granted to full or part-time
employees (which term as used herein includes, without limitation, officers and
directors who are also employees) and an incentive Stock Option shall not be
granted to an employee of an Affiliate unless such Affiliate is also a
"subsidiary corporation" of the Company within the meaning of Section 424(f) of
the Code or any successor provision.
SECTION 6. AWARDS.
(a) OPTIONS. The Committee is hereby authorized to grant Options to
Participants with the following terms and conditions and with such additional
terms and conditions not inconsistent with the provisions of the Plan as the
Committee shall determine:
(i) EXERCISE PRICE. The purchase price per Share purchasable under an
Option shall be determined by the Committee; provided, however, that such
purchase price shall not be less than 100% of the Fair Market Value of a
Share on the date of grant of such Option.
(ii) OPTION TERM. The term of each Option shall be fixed by the
Committee but shall not exceed ten years from the date such option is
granted.
(iii) TIME AND METHOD OF EXERCISE. 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, Shares, promissory notes, other securities, other
Awards or other property, withholding of Shares that would otherwise be
issued, cashless exercise program of a broker
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or agent, 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.
(b) RESTRICTED STOCK. The Committee is hereby authorized to grant Awards
of Restricted Stock to Participants with the following terms and conditions and
with such additional terms and conditions not inconsistent with the provisions
of the Plan as the Committee shall determine:
(i) RESTRICTIONS. Shares of Restricted Stock shall be subject to
such restrictions as the Committee may impose (including, without
limitation, any limitation on the right to vote a Share of Restricted Stock
or the right to receive any dividend or other right or property with
respect thereto, 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) STOCK CERTIFICATES. Any Restricted Stock granted under the Plan
shall be evidenced by issuance of a stock certificate or certificates,
which certificate or certificates shall be held by the Company. Such
certificate or certificates 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 Stock.
(iii) FORFEITURE; DELIVERY OF SHARES. Except as otherwise determined
by the Committee, upon termination of employment (as determined under
criteria established by the Committee) during the applicable restriction
period, all Shares of Restricted Stock at such time subject to restriction
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
interest of the Company, waive in whole or in part any or all remaining
restrictions with respect to Shares of Restricted Stock. Any Share
representing Restricted Stock that is no longer subject to restrictions
shall be delivered to the holder thereof promptly after the applicable
restrictions lapse or are waived.
(c) PERFORMANCE AWARDS. The committee is hereby authorized to grant
Performance Awards to Participants subject to the terms of the Plan and any
applicable Award Agreement. A Performance Award granted under the Plan (i) may
be denominated or payable in cash, Shares, other securities, other Awards or
other property and (ii) shall confer on the holder thereof the right to receive
payments, in whole or in part, upon the achievement of such
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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
amount of any payment or transfer to be made pursuant to any Performance Award
and any other terms and conditions of any Performance Award shall be determined
by the Committee.
(d) STOCK APPRECIATION RIGHTS. The Committee is hereby authorized to grant
Stock Appreciation Rights to Participants subject to the terms of the Plan and
any applicable Award Agreement. A Stock Appreciation Right granted under the
Plan shall confer on the holder thereof a right to receive upon exercise thereof
the excess of (i) the Fair Market Value of one Share on the date of exercise
(or, if the Committee shall so determine, at any time during a specified period
before or after the date of exercise) over (ii) the grant price of the Stock
Appreciation Right as specified by the Committee, which price shall not be less
than 100% of the Fair Market Value of one Share on the date of grant of the
Stock Appreciation Right. Subject to the terms of the Plan and any applicable
Award Agreement, the grant price, term, methods of exercise, dates of exercise,
methods of settlement and any other terms and conditions of any Stock
Appreciation Right 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.
(e) OTHER STOCK-BASED AWARDS. The Committee is hereby authorized to grant
to Participants such other Awards that are denominated or payable in, valued in
whole or in part by reference to, or otherwise based on or related to, Shares
(including, without limitation, securities convertible into Shares), as are
deemed by the Committee to be consistent with the purpose of the Plan; provided,
however, that such grants must comply 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 such Awards. 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, Shares, promissory notes, other securities, other Awards or other
property, withholding of Shares that would otherwise be issued, cashless
exercise program of a broker or agent, or any combination thereof), as the
Committee shall determine, the value of which consideration, as established by
the Committee shall not be less than 100% of the Fair Market Value of such
Shares or other securities as of the date such purchase right is granted.
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(f) GENERAL
(i) NO CASH CONSIDERATION FOR AWARDS. Awards shall 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 or any award granted
under any plan of the Company or any Affiliate other than the Plan. Awards
granted in addition to or in tandem with other Awards or in addition to or
in tandem with awards granted under any such other plan of the Company or
any Affiliate may be granted either at the same time as or at a different
time from the grant of such other Awards or 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, Shares, promissory notes, 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.
(iv) LIMITS ON TRANSFER OF AWARDS. No Award and no right under any
such Award shall be transferable by a Participant otherwise than by will or
by the laws of descent and distribution; provided, however, that, if so
determined by the Committee, a Participant may, in the manner established
by the Committee, designate a beneficiary or beneficiaries to exercise the
rights of the Participant and receive any property distributable with
respect to any Award upon the death of the Participant. Each Award or right
under any Award shall be exercisable during the Participant's lifetime only
by the Participant. No Award or right under any such Award may be pledged,
alienated, attached or otherwise encumbered, and any purported pledge,
alienation, attachment or encumbrance thereof shall be void and
unenforceable against the Company or any Affiliate.
(v) TERM OF AWARDS. The term of each Award shall be for such period
as may be determined by the Committee.
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(vi) RESTRICTIONS; SECURITIES EXCHANGE LISTING. All certificates for
Shares or other securities 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 and any applicable federal or state securities laws,
and the Committee may cause a legend or legends to be placed on any such
certificates to make appropriate reference to such restrictions. If the
Shares or other securities are traded on a securities exchange, the Company
shall not be required to deliver any Shares or other securities covered by
an Award unless and until such Shares or other securities have been
admitted for trading on such securities exchange.
SECTION 7. AMENDMENT AND TERMINATION; ADJUSTMENTS.
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 of Directors of the Company may
amend, alter, suspend, discontinue or terminate the Plan; provided, however,
that, notwithstanding any other provision of the Plan or any Award Agreement,
without the approval of the stockholders of the Company, no such amendment,
alteration, suspension, discontinuation or termination shall be made that,
absent such approval:
(i) would cause Rule 16b-3 to become unavailable with respect to the
Plan;
(ii) would violate the rules or regulations of the National
Association of Securities Dealers, Inc. or any securities exchange that are
applicable to the Company; or
(iii) would cause the Company to be unable, under the Code, to grant
incentive Stock Options under the Plan.
(b) AMENDMENTS TO AWARDS. The Committee may waive any conditions of or
rights of the Company under any outstanding Award, prospectively or
retroactively. The Committee may not amend, alter, suspend, discontinue or
terminate any outstanding Award, prospectively or retroactively, without the
consent of the Participant or holder or beneficiary thereof, except as otherwise
herein provided.
(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
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manner and to the extent it shall deem desirable to carry the Plan into effect.
SECTION 8. CHANGE IN CONTROL.
In case of a "Change in Control" (as such term is hereinafter defined),
each Participant shall be fully vested (as of the date of the Change in Control)
in all shares of Restricted Stock, Performance Awards, Stock Appreciation
Rights, Options and Other Awards granted or awarded under this Plan and any and
all restrictions or performance requirements on the issuance, exercise or sale
of said grants, awards, shares or rights under said Restricted Stock awards,
Stock Performance Awards, Stock Appreciation Rights, Options and Other Awards
shall be waived or removed as of the date of the Change in Control. For
purposes of this Plan, a Change in Control shall be deemed to occur when and if:
(a) any Person (meaning any individual, firm, Corporation, partnership,
trust or other entity, and includes a "group" (as that term is used in Sections
13(d) and 14(d) of the Act), but excludes Continuing Directors (as defined
below) and benefit plans sponsored by the Company):
(i) makes a tender or exchange offer for any shares of the Company's
outstanding voting securities at any point in time (the "Company Stock")
pursuant to which any shares of the Company's Stock are purchased; or
(ii) together with its "affiliates" and "associates" (as those terms
are defined in Rule 12b-2 under the Securities Exchange Act of 1934 (the "Act"))
becomes the "beneficial owner" (within the meaning of Rule 13d-3 under the Act)
of at least 20% of Company's Stock; or
(b) the stockholders of the Company approve a definitive agreement or plan
to merge or consolidate the Company with or into another unaffiliated
corporation, to sell or otherwise dispose of all or substantially all of its
assets, or to liquidate the Company; or
(c) a majority of the members of the Board become individuals other than
Continuing Directors (as defined below).
A "Continuing Director" means: (a) any member of the Board as of June
8, 1995, and (b) any other member of the Board, from time to time, who was (i)
nominated for election by the Board, or (ii) appointed by the Board to fill a
vacancy on the Board or to fill a newly-created directorship, in each case
excluding any individual nominated or appointed (y) at a Board meeting at which
the majority of directors present are not
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Continuing Directors or (z) by unanimous written action of the Board unless a
majority of the directors taking such action are Continuing Directors.
SECTION 9. INCOME TAX WITHHOLDING.
In order to comply with all applicable federal or state income tax laws or
regulations, the Company may take such action as it deems appropriate to ensure
that all applicable federal or state payroll, withholding, income or other
taxes, which are the sole and absolute responsibility of a Participant, are
withheld or collected from such Participant. In order to assist a Participant in
paying all or a portion of the federal and state taxes to be withheld or
collected upon exercise or receipt of (or the lapse of restrictions relating to)
an Award, the Committee, in its discretion and subject to such additional terms
and conditions as it may adopt, may permit the Participant to satisfy such tax
obligation by (i) electing to have the Company withhold a portion of the Shares
otherwise to be delivered upon exercise or receipt of (or the lapse of
restrictions relating to) such Award with a Fair Market Value equal to the
amount of such taxes or (ii) delivering to the Company Shares other than Shares
issuable upon exercise or receipt of (or the lapse of restrictions relating to)
such Award with a Fair Market Value equal to the amount of such taxes.
SECTION 10. GENERAL PROVISIONS.
(a) NO RIGHTS TO AWARDS. No Eligible Person, Participant 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 Eligible Persons, Participants or
holders or beneficiaries of Awards under the Plan. The terms and conditions of
Awards need not be the same with respect to any Participant or with respect to
different Participants.
(b) AWARD AGREEMENTS. No Participant will have rights under an Award
granted to such Participant unless and until an Award Agreement shall have been
duly executed on behalf of the Company.
(c) 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.
(d) NO RIGHT TO EMPLOYMENT. The grant of an Award shall not be construed
as giving Participant the right to be retained in the employ of the Company or
any Affiliate, nor will it affect in any way the right of the Company or an
Affiliate to terminate
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such employment at any time, with or without cause. In addition, 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.
(e) GOVERNING LAW. The validity, construction and effect of the Plan or
any Award, and any rules and regulations relating to the Plan or any Award,
shall be determined in accordance with the laws of the State of Minnesota.
(f) 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
would disqualify the Plan or any 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 so construed or deemed amended without, in
the determination of the Committee, materially altering the purpose or intent of
the Plan or the Award, such provision shall be stricken as to such jurisdiction
or Award, and the remainder of the Plan or any such Award shall remain in full
force and effect.
(g) 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.
(h) NO FRACTIONAL SHARES. No fractional Shares shall be issued or
delivered pursuant to the Plan or any Award, and the Committee shall determine
whether cash shall be paid in lieu of any fractional Shares or whether such
fractional Shares or any rights thereto shall be canceled, terminated or
otherwise eliminated.
(i) 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 11. SECTION 16(b) COMPLIANCE.
The Plan is intended to comply in all respects with Rule 16b-3 or any
successor provision, as in effect from time to time and in all events the Plan
shall be construed in accordance with the requirements of Rule 16b-3. If any
Plan provision does not
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comply with Rule 16b-3 as hereafter amended or interpreted, the provision shall
be deemed inoperative. Moreover, in the event the Plan does not include a
provision required by Rule 16b-3 to be stated therein, such provision (other
than one relating to eligibility requirements, or the price and amount of
awards) shall be deemed automatically to be incorporated by reference into the
Plan insofar as Participants subject to Section 16 are concerned. The Board, in
its absolute discretion, may bifurcate the Plan so as to restrict, limit or
condition the use of any provision of the Plan to participants who are officers
or directors subject to Section 16 of the Securities and Exchange Act of 1934,
as amended, without so restricting, limiting or conditioning the Plan with
respect to other participants.
SECTION 12. EFFECTIVE DATE OF THE PLAN.
The Plan shall be effective as of August 8, 1995, subject to approval by
the shareholders of the Company within one year thereafter.
SECTION 13. TERM OF THE PLAN.
Awards shall only be granted under the Plan during a ten-year period
beginning on the effective date of the Plan. However, unless otherwise
expressly provided in the Plan or in an applicable Award Agreement, any Award
theretofore granted may extend beyond the end of such ten-year period, and the
authority of the Committee provided for hereunder with respect to the Plan and
any Awards, and the authority of the Board of Directors of the Company to amend
the Plan, shall extend beyond the end of such period.
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