<PAGE> 1
As Filed With the Securities and Exchange Commission on June 3, 1998
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON. D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
THE COAST DISTRIBUTION SYSTEM, INC.
(Exact name of registrant as specified in its charter)
Delaware 94-2490990
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1982 Zanker Road, San Jose, California 95112
(Address of Principal Executive Offices) (Zip Code)
----------
1993 STOCK OPTION AND INCENTIVE PLAN
(Full title of the plan)
----------
Thomas R. McGuire
Chief Executive Officer
The Coast Distribution System, Inc.
1982 Zanker Road, San Jose, California 95112
(Name and address of agent for service)
(408) 436-8611
(Telephone number, including area code, of agent for service)
Copy to:
Ben A. Frydman, Esq.
Stradling Yocca Carlson & Rauth, a Professional Corporation
660 Newport Center Drive, Suite 1600
Newport Beach, California 92660
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
======================================================================================================
Title of Amount To Be Proposed Maximum Proposed Maximum Amount of
Securities Registered(1) Offering Aggregate Offering Registration Fee
To Be Registered (2) Price Price
Per Share(3)
======================================================================================================
<S> <C> <C> <C> <C>
Common Stock,
par value 250,000 shares $3.75 $937,500(3) $276.57
$.001 per share
======================================================================================================
</TABLE>
(1) Includes additional shares of Common Stock that may become issuable pursuant
to the anti-dilution adjustment provisions of the Registrant's 1993 Stock
Option and Incentive Plan (the "1993 Plan").
(2) As permitted by General Instruction E to Form S-8 under the Securities Act
of 1933, this Registration Statement also relates to an aggregate of 250,000
shares of the Registrant's Common Stock previously registered pursuant to
Registration Statement on Form S-8 (Registration No. 33-64582), as amended
by Post-Effective Amendment No. 1 thereto. The contents of such earlier
Registration Statement, as amended, are incorporated herein by this
reference.
(3) In accordance with Rule 457(h), the aggregate offering price of shares of
Common Stock registered is estimated, solely for purposes of calculating the
registration fee, on the basis of the price of securities of the same class,
as determined in accordance with Rule 457(c), using the average of the high
and low prices reported by the American Stock Exchange for the Common Stock
on May 27, 1998, which was $3.75 per share.
<PAGE> 2
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed with the Securities and Exchange
Commission (the "Commission") are incorporated by reference in this registration
statement:
(a) The Registrant's Annual Report on Form 10-K, filed on March 31,
1998.
(b) All other reports filed by the Registrant pursuant to Section 13(a)
or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), since the end of the fiscal year covered by the document referred to in
(a) above.
(c) The description of the Registrant's Common Stock which is contained
in Part II of the Registrant's Quarterly Report on Form 10Q for the quarter
ended March 31, 1998, as filed with the Commission under the Exchange Act as of
May 14, 1998.
All documents subsequently filed by the Registrant pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act, 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 such documents, except as to any portion of any
future annual or quarterly report to stockholders or document which is not
deemed filed under such provisions. For the purposes of this registration
statement, any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded to
the extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this registration statement.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Ben A. Frydman, a member of the Board of Directors, assistant secretary
and a shareholder of the Registrant, is a member and shareholder of the law firm
of Stradling Yocca Carlson & Rauth, a Professional Corporation, which provided
legal services to the Registrant during 1997 and 1996 and issued the opinion of
counsel included as Exhibit 5.1 hereto.
II-1
<PAGE> 3
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
(a) As permitted by the Delaware General Corporation Law, the
Registrant's Certificate of Incorporation eliminates the liability of directors
to the Registrant or its stockholders for monetary damages for breach of
fiduciary duty as a director, except to the extent otherwise required by the
Delaware General Corporation Law.
(b) The Registrant's Bylaws provide that the Registrant will indemnify
each person who was or is made a party to any proceeding by reason of the fact
that such person is or was a director or officer of the Registrant against all
expense, liability and loss reasonably incurred or suffered by such person in
connection therewith to the fullest extent authorized by the Delaware General
Corporation Law.
(c) The Registrant's Bylaws also give the Registrant the ability to
enter into indemnification agreements with each of its directors and officers.
The Registrant has entered into indemnification agreements with each of its
directors and officers, which provide for the indemnification of such directors
and officers against any and all expenses, judgments, fines, penalties and
amounts paid in settlement, to the fullest extent permitted by law.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not Applicable.
ITEM 8. EXHIBITS.
The following exhibits are filed as part of this Registration Statement:
<TABLE>
<CAPTION>
Number Description
------ ------------
<S> <C>
4.1 The Coast Distribution System, Inc. 1993 Stock
Option and Incentive Plan, as amended.
5.1 Opinion of Stradling Yocca Carlson & Rauth, a
Professional Corporation, Counsel to the
Registrant.
23.1 Consent of Stradling Yocca Carlson & Rauth, a
Professional Corporation (included in Exhibit
5.1).
23.2 Consent of Grant Thornton LLP.
24.1 Power of Attorney (included on signature page).
</TABLE>
II-2
<PAGE> 4
ITEM 9. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of this registration statement (or the
most recent post-effective amendment thereof) which, individually
or in the aggregate, represents 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 (a)(1)(i) and (a)(1)(ii) do not apply
if 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.
(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) 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 herein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(h) 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 provisions referred to in Item 6
hereof, or otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy
as expressed in the Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the Registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
II-3
<PAGE> 5
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing 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 San Jose, State of California, on the 27th day of
May, 1998.
THE COAST DISTRIBUTION SYSTEM, INC.
By: /s/ THOMAS R. McGUIRE
--------------------------------
Thomas R. McGuire, Chairman and
Chief Executive Officer
POWER OF ATTORNEY
We, the undersigned officers and directors of The Coast Distribution
System, Inc. do hereby constitute and appoint Thomas R. McGuire and Sandra A.
Knell, or either of them, our true and lawful attorneys-in-fact and agents, each
with full power of substitution and resubstitution, for him and in his name,
place and stead, in any and all capacities, to sign any and all amendments to
this Registration Statement, and to file the same, with 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 or necessary to be done in and about the premises, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that each of said attorneys-in-fact and agents, or his substitute
or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ THOMAS R. McGUIRE Chief Executive Officer May 27, 1998
- ------------------------------------- and Chairman (Principal
Thomas R. McGuire Executive Officer)
/s/ SANDRA A. KNELL Chief Financial Officer and May 27, 1998
- ------------------------------------- Executive Vice President
Sandra A. Knell (Principal Financial and
Principal Accounting Officer)
Director , 1998
- -------------------------------------
Louis B. Sullivan
/s/ JOHN E. TURCO Director May 27, 1998
- -------------------------------------
John E. Turco
Director , 1998
- -------------------------------------
Brian P. Friedman
/s/ BEN A. FRYDMAN Director May 27, 1998
- -------------------------------------
Ben A. Frydman
/s/ ROBERT S. THROOP Director May 27, 1998
- -------------------------------------
Robert S. Throop
</TABLE>
S-1
<PAGE> 6
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Description
------- ------------
<S> <C>
4.1 The Coast Distribution System, Inc. 1993 Stock Option and
Incentive Plan, as amended.
5.1 Opinion of Stradling Yocca Carlson & Rauth, a Professional
Corporation.
23.1 Consent of Stradling Yocca Carlson & Rauth, a Professional
Corporation (included in Exhibit 5.1).
23.2 Consent of Grant Thornton LLP.
24.1 Power of Attorney (included on the signature page).
</TABLE>
E-1
<PAGE> 1
EXHIBIT 4.1
THE COAST DISTRIBUTION SYSTEM, INC.
1993 STOCK OPTION AND INCENTIVE PLAN, AS AMENDED
1. PURPOSES OF THE PLAN.
The purposes of this 1993 Stock Option and Incentive Plan (the "Plan")
are to attract, retain and motivate high quality personnel and to provide
incentives to such personnel and other selected persons to promote the business
and financial success of The Coast Distribution System, Inc., a Delaware
corporation (the "Company").
2. TYPES OF STOCK OPTIONS AND GRANTS.
To accomplish the purposes of the Plan set forth in Section 1, the
Company is authorized under this Plan to:
(a) Grant incentive stock options ("Incentive Options") within the
meaning of Section 422 of the Internal Revenue Code of 1986, as amended
(the "Code");
(b) Grant stock options that do not qualify as Incentive Options
("Nonqualified Options"); and
(c) Grant rights to purchase, or award, Common Stock subject to
restrictions as more fully described in Section 8 of the Plan
("Restricted Stock").
Unless the context indicates otherwise, the term "Option" shall mean an
option to purchase Common Stock of the Company and shall include both Incentive
Options and Nonqualified Options.
3. SHARES SUBJECT TO THE PLAN.
The stock issuable under this Plan shall be shares of the Company's
authorized but unissued or reacquired Common Stock ("Common Stock"). The total
number of shares of Common Stock which may be issued under this Plan shall not
exceed, in the aggregate, 500,000 shares, subject to adjustment as provided in
Section 9 below. If any Option or right to purchase Restricted Stock granted
under this Plan can no longer be exercised for any reason, the shares of Common
Stock allocable to the unexercised portion of such Option or right may again be
subject to grant or issuance under the Plan.
4. ELIGIBILITY.
(a) Incentive Options. Officers and other key employees of the Company
or any parent or subsidiary corporation of the Company (including directors of
the Company if they are also employees of the Company, or a parent or subsidiary
corporation) are eligible for selection to receive Incentive Options under the
Plan.
(b) Nonqualified Options and Rights to Purchase Restricted Stock.
Officers, key employees, members of the Board of Directors (whether or not
employed by the Company), or of any parent or subsidiary corporation of the
Company, are eligible to be selected to receive Nonqualified Options or rights
to purchase Restricted Stock under the Plan.
5. ADMINISTRATION OF THE PLAN.
(a) Committee. This Plan shall be administered by the Board of Directors
of the Company (the "Board") or by a committee consisting of two (2) or more
directors (the "Committee") appointed from time to time by the Board. As
hereinafter used in this Plan, the term "Committee" shall refer to the Board if
no Committee is then designated.
(b) Powers of the Committee. The Committee shall have full authority, in
its discretion: (i) to determine the persons to whom, and the time or times at
which, Incentive Options, Nonqualified Options and rights to purchase Restricted
Stock shall be granted, the number of shares to be included therein and the
consideration to be received by the Company upon the exercise thereof; (ii) to
interpret the Plan; (iii) to prescribe, amend and rescind rules and regulations
relating to the Plan; (iv) to determine the form, content, terms and conditions
of Options and rights to purchase Restricted Stock to be offered under the Plan,
including without
<PAGE> 2
limitation any provisions with respect to vesting thereof; (v)
to determine the identity or capacity of any persons who may be entitled to
exercise a participant's rights under the Plan; (vi) to correct any defect or
supply any omission or reconcile any inconsistency in the Plan or in any grant
thereunder; (vii) to modify or amend any Option or Restricted Stock agreement
(with the consent of the holder thereof) including, without limitation, the
acceleration of vesting; and (viii) to make all other determinations necessary
or advisable for the administration of the Plan, but only to the extent not
contrary to the express provisions of the Plan. Any action, interpretation or
determination by the Committee with respect to the Plan shall be final and
binding on all participants and prospective participants.
6. TERMS AND CONDITIONS OF OPTIONS.
Each Option granted pursuant to this Plan shall be evidenced by a
written agreement ("Option Agreement") which shall specify whether the Option is
an Incentive Option or Nonqualified Option, the number of shares included
therein and the exercise price per share. Each Option Agreement shall be in such
form (which need not be the same for each optionee) and contain such provisions
as the Committee shall from time to time approve, but shall comply with and be
subject to the following terms and conditions:
(a) Price. The exercise price of options shall not be less than 100% of
the fair market value of such shares on the date the Option is granted.
Notwithstanding the foregoing, (i) the exercise price of an Incentive Option
granted under the Plan to any person who, at the time of grant, owns stock
possessing more than 10% of the total combined voting power of all classes of
stock of the Company or any parent or subsidiary corporation of the Company (a
"Ten Percent Shareholder"), shall not be less than 110% of the fair market value
of such shares on the date such Incentive Option is granted; and (ii)
Nonqualified Options may be granted on terms which will permit the optionee to
forego other compensation that would be payable to him or her by the Company, or
by any subsidiary or parent corporation of the Company, in exchange for a
reduction in the aggregate exercise price of such options equal to the amount of
other compensation which such optionee agrees to forego. The exercise price
shall be subject to adjustment as provided in Section 9 below.
(b) Fair Market Value. The "fair market value" of a share of Common
Stock on a specified date shall be determined by the Committee. If the shares of
Common Stock are publicly traded, the "fair market value" as of such date shall
be the closing price of a share of Common Stock on the principal exchange on
which shares of Common Stock are listed on such date, or if shares were not
traded on such date, then on the next preceding day during which a sale
occurred; or, if the shares are not so listed but are traded in the
over-the-counter market, the closing sale price in the NASDAQ National Market
System or the average of the closing bid and asked prices on such date as
reported by NASDAQ or similar entity; or, if none of the above is applicable,
the value of a share as established by the Committee for such date using any
reasonable method of evaluation.
(c) Payment of Exercise Price. The form of consideration payable upon
exercise of an Option, including the method of payment, shall be determined by
the Committee in its sole discretion (and, in the case of an Incentive Option,
shall be determined at the time of grant) and may consist of: (i) cash; (ii)
check; (iii) with the consent of the Company's Board of Directors, other shares
of Common Stock owned by the optionee having a fair market value on the date of
exercise equal to the aggregate exercise price of the shares as to which such
Option is exercised; (iv) with the consent of the Company's Board of Directors,
cancellation of indebtedness of the Company to the optionee; (v) provided that a
public market for the Common Stock exists, through a "same day sale" commitment
from the optionee and a broker-dealer that is a member of the National
Association of Securities Dealers (an "NASD Dealer") whereby the optionee
irrevocably elects to exercise the Option and to sell a portion of the shares so
purchased to pay for the exercise price and whereby the NASD Dealer irrevocably
commits upon receipt of such shares to forward the exercise price directly to
the Company; (vi) provided that a public market for the Common Stock exists,
through a "margin" commitment from the optionee and an NASD Dealer whereby the
optionee irrevocably elects to exercise the Option and to pledge the shares so
purchased to the NASD Dealer in a margin account as security for a loan from the
NASD Dealer in the amount of the exercise price, and whereby the NASD Dealer
irrevocably commits upon receipt of such shares to forward the exercise price
directly to the Company; or (vii) any combination of the foregoing methods of
payment and/or any other consideration or method of payment as shall be
permitted by the Board or Committee and applicable corporate law.
(d) Term of Option. Each Option granted under the Plan shall expire
within a period of not more than ten (10) years from the date of grant;
provided, however, that an Incentive Option granted to a Ten Percent Shareholder
shall expire within a period of not more than five (5) years from the date of
grant.
(e) Vesting of Options. Each Option shall vest (i.e., become
exercisable) in one or more installments at such times and under such conditions
as shall be determined by the Committee and specified in the Option Agreement.
Vesting may be based upon tenure of employment or affiliation with the Company,
or any subsidiary or parent of the Company, upon achievement of specified goals,
upon certain events (including, without limitation,
2
<PAGE> 3
a change of control of the Company) or upon such other events as the Committee
determines. In addition, the Committee may, at any time, in its sole
discretion, accelerate the vesting of Options.
(f) Nontransferability of Options. No Option shall be assignable or
transferable except by will or the laws of descent and distribution, and during
the life of the optionee shall be exercisable only by such optionee; provided,
however, that a Nonqualified Option may be transferred pursuant to a "qualified
domestic relations order" (as defined in the Code).
(g) Limitation on Incentive Options. Notwithstanding any other
provisions of the Plan, the aggregate fair market value (determined in
accordance with the provisions of Section 6(b) above, at the time the Option is
granted) of the shares of Common Stock with respect to which Incentive Options
become exercisable for the first time by an optionee in any calendar year (under
this Plan and all other incentive stock option plans of the Company and its
parent and subsidiary corporations) shall not exceed $100,000.
(h) Other Provisions. Any Option Agreement may contain such other terms,
provisions and conditions which are not inconsistent with the provisions of this
Plan, as the Committee in its discretion may determine.
7. FORMULA GRANTS TO NON-EMPLOYEE DIRECTORS.
Notwithstanding any other provision of the Plan, each incumbent director
of the Company who is neither an employee nor executive officer of the Company
(a "non-employee director") shall automatically be granted Nonqualified Options
to purchase two thousand (2,000) shares of the Company's Common Stock each year
on his or her re-election, by the shareholders, to the Board of Directors,
commencing in 1993; except that on the date any individual, who was not formerly
an officer or employee of the Company or any parent or subsidiary of the
Company, becomes a non-employee director of the Company for the first time, he
or she shall automatically be granted Nonqualified Options to purchase two
thousand (2,000) shares of common stock of the Company. Nonqualified Options to
be granted to non-employee directors of the Company pursuant to this Section 7
shall (i) have an exercise price equal to one hundred percent (100%) of the fair
market value on the date of grant of the options, as determined in accordance
with the terms of the Plan; (ii) have a term of ten (10) years; and (iii)
otherwise be subject to the terms and provisions of the Plan. The Options
granted upon the initial commencement of service as a non-employee director
shall vest on the first anniversary of the date of grant. The Options
automatically granted to non-employee incumbent directors on their re-election
to the Board shall vest six months after grant. Notwithstanding any other term
or provision contained in the Plan, neither the Board of Directors nor the
Committee may amend the amount, price or timing of Options granted under this
Section 7 more frequently than every six (6) months, except to comport with
changes in the Code, the Employee Retirement Income Security Act, or Rule 16b-3
promulgated under the Exchange Act.
8. TERMS AND CONDITIONS APPLICABLE TO RESTRICTED STOCK.
Rights to purchase Restricted Stock and Restricted Stock granted
pursuant to this Plan shall be evidenced by a written Restricted Stock Agreement
which shall specify the number of shares included therein and the purchase
price, if any, per share. Each Restricted Stock Agreement shall be in such form
(which need not be the same for each participant) and contain such provisions as
the Committee shall from time-to-time approve, but shall comply with and be
subject to the following terms and conditions:
(a) Price; Legal Consideration. The purchase price of Restricted Stock
shall be fixed by the Committee, and may in the Committee's discretion, be
issued for no monetary consideration.
(b) Payment of Purchase Price. The form of consideration payable for
Restricted Stock, and the method of payment, if any, shall be determined by the
Committee in its sole discretion. With the approval of the Company's Board of
Directors, such consideration may consist of one or more promissory notes,
either secured or unsecured, as the Board of Directors shall determine.
(c) Restrictions, Repurchase, Forfeiture. Restricted Stock may not be
sold, assigned, transferred, pledged, hypothecated or otherwise encumbered or
disposed of until the restrictions thereon are removed or expire. The Committee
may require that the certificates representing Restricted Stock remain in the
physical custody of an escrow holder or the Company until all restrictions are
removed or expire. Each certificate representing Restricted Stock will bear such
legend or legends making reference to the restrictions imposed upon such
Restricted Stock as the Committee in its discretion deems necessary or
appropriate to enforce such restrictions. The Committee may impose such other
conditions on Restricted Stock as it may deem appropriate including, without
limitation, restrictions under federal and state securities laws. A Restricted
Stock Agreement may provide that upon termination of employment, or such other
events as the Committee determines, all Restricted Stock remaining
3
<PAGE> 4
subject to restrictions hereunder may, at the Company's sole election, be
repurchased by the Company at the purchase price paid by the holder of such
Restricted Stock, if any, or if such shares were issued to the holder without
payment of any purchase price, forfeited.
(d) Lapse of Restrictions. Restrictions imposed upon Restricted Stock
pursuant to Section 8(c) above will lapse in accordance with such schedule or
other conditions as are determined by the Committee and set forth in the
Restricted Stock Agreement, which may include, without limitation, restrictions
which lapse upon tenure of employment or affiliation with the Company, upon
achievement of specified goals, upon certain events, upon death, disability or
retirement, or upon such other events as the Committee determines. In addition,
the Committee may at any time, in its sole discretion, accelerate the time at
which all restrictions with respect to any Restricted Stock will lapse or remove
any and all such restrictions.
9. ADJUSTMENTS UPON CHANGES IN CAPITAL STRUCTURE, MERGER, ETC.
(a) In the event that the number of outstanding shares of Common Stock
of the Company are increased, decreased, changed into or exchanged for a
different number or kind of shares or other securities of the Company by reason
of a stock split, reverse stock split, stock dividend, reclassification or
similar change in the capital structure of the Company, appropriate adjustments
shall be made by the Committee in the aggregate number and kind of shares
subject to this Plan, and the number and kind of shares and the price per share
subject to outstanding Options, to preserve, but not to increase, the benefits
to persons then holding Options.
(b) In the event that the Company at any time proposes to merge into,
consolidate with or to enter into any other reorganization in which the Company
is not the surviving corporation, or in which the Company is the surviving
corporation but as a result of which the holders of the shares of voting stock
of this Corporation immediately prior to such merger or consolidation will own,
immediately after the effectiveness thereof, less than 50% of the outstanding
voting stock of this Corporation, then the Plan and all unexercised Options
shall terminate upon the effectiveness of such transaction unless a successor
corporation assumes the outstanding Options, provides substantially similar
consideration to the Option holders as was provided to the shareholders of the
Company (after taking into account the existing provisions of the Option
holders' Options) or substitutes substantially equivalent options covering
shares of the successor corporation. If provision is not made for the assumption
of or substitution for outstanding Options, or for the payment of substantially
equivalent consideration to the Option holders, then (i) the Committee shall
cause written notice of the proposed transaction to be given to the persons
holding Options not less than thirty (30) days prior to the anticipated
effective date of the proposed transaction; (ii) all Options which are then
vested and exercisable may be exercised or purchased concurrently with the
effectiveness of the proposed transaction, by such persons; and (iii) the
Committee shall have the right, but not the obligation, with respect to any
Option granted under the Plan, to provide that all Options shall be accelerated
in any event upon the effectiveness of the proposed transaction. The Committee
shall also have the right with respect to any Restricted Stock, to provide that
all restrictions shall lapse upon the effectiveness of the proposed transaction.
Notwithstanding anything to the contrary contained elsewhere herein or in any
option agreement entered into with any optionee pursuant to this Plan, the
failure to provide the 30-day notice specified in clause (i) of this Paragraph
9(b) shall not affect the validity of or be a basis for preventing or delaying
the consummation of any merger, consolidation or other reorganization to which
the Company is a party.
10. CONDITIONS TO ISSUANCE OF STOCK.
(a) The Company shall not be required to issue or deliver any shares
with respect to an Option or right to purchase Restricted Stock unless the
exercise of such Option or right to purchase Restricted Stock and the issuance
and delivery of such shares pursuant thereto shall comply with all relevant
provisions of law, including, without limitation, state securities laws, the
Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as
amended, the rules and regulations promulgated thereunder, and the requirements
of any stock exchange upon which the Company's Common Stock may then be listed.
(b) As a condition to the exercise of an Option or right to purchase
Restricted Stock, the Company may require the person exercising such Option or
right to purchase Restricted Stock to represent and warrant at the time of any
such exercise that the shares are being purchased for investment only and
without any present intention to sell or distribute such shares if, in the
opinion of counsel for the Company, such a representation is required by any of
the aforementioned relevant provisions of law.
11. RIGHTS AS SHAREHOLDER.
A person to whom an Option or right to purchase Restricted Stock has
been granted shall have no rights or privileges as a shareholder with respect to
any shares covered by such Option or right to purchase until
4
<PAGE> 5
certificates representing such shares have been issued by the Company,
notwithstanding the exercise of such Option or right to purchase Restricted
Stock. No adjustment will be made for dividends or other rights for which the
record date is prior to the date the stock certificate is issued, except as
provided in Section 9 of this Plan.
12. CONTINUANCE OF EMPLOYMENT.
Nothing in this Plan or the granting of any Option or right to purchase
Restricted Stock shall confer on any optionee or offeree any right to continue
in the employment of, or other relation with, the Company or any parent or
subsidiary corporation of the Company, or limit in any way the right of the
Company or any parent or subsidiary corporation of the Company to terminate the
optionee's or offeree's employment or other relationship at any time, with or
without cause.
13. TAX WITHHOLDING.
The Company shall have the power to withhold, or require a participant
to remit to the Company, an amount sufficient to satisfy Federal, state, and
local withholding tax requirements with respect to any Options exercised or
Restricted Stock granted under the Plan. To the extent permissible under
applicable tax, securities, and other laws, the Committee may, in its sole
discretion, permit the participant to satisfy an obligation to pay any such tax,
up to an amount determined on the basis of the highest marginal tax rate
applicable to such participant, in whole or in part, by (i) directing the
Company to apply shares of Common Stock to which the participant is entitled as
a result of the exercise of an Option or as a result of the lapse of
restrictions on Restricted Stock, or (ii) delivering to the Company shares of
Common Stock owned by the participant.
14. EFFECTIVE DATE AND DURATION OF PLAN.
This Plan shall become effective upon the earlier of either its adoption
by the Board of Directors or its approval by the shareholders of the Company.
However, unless the Plan is approved by the shareholders of the Company within
twelve (12) months before or after the date of the Board's adoption of the Plan,
the Plan and all Options and rights to purchase Restricted Stock granted
hereunder shall be cancelled. No Option or right to purchase Restricted Stock
may be exercised prior to and unless such shareholder approval is obtained.
Unless previously terminated by the Board, the Plan shall terminate within ten
(10) years after it becomes effective, and no Option or right to purchase
Restricted Stock may be granted under the Plan thereafter, but such termination
shall not affect any Option or right to purchase Restricted Stock granted prior
to such date.
15. AMENDMENT AND TERMINATION OF THE PLAN.
The Board of Directors may at any time amend, modify, suspend or
terminate the Plan. In addition, to the extent necessary and desirable to comply
with Rule 16b-3 under the Securities Exchange Act of 1934, as amended, or with
Section 422 of the Code (or any other applicable law or regulation), the Company
shall obtain shareholder approval of any amendment or modification to the Plan
in such manner and to such degree required. No amendment, modification or
termination of the Plan shall affect or impair any rights or obligations under
any Option or right to purchase Restricted Stock granted prior to the date of
such amendment, modification or termination without the consent of the holder of
such Option or right to purchase Restricted Stock.
-------------------
DATES OF ADOPTION/AMENDMENT; DATE OF TERMINATION
<TABLE>
<S> <C> <C>
Dates of Adoption: By the Board of Directors: February 25, 1993
-----------------
By the Shareholders: May 20, 1993
Dates of Amendment: By the Board of Directors July 3, 1996
------------------
By the Shareholders August 8, 1996
Date of Termination: January 31, 2003
-------------------
</TABLE>
5
<PAGE> 1
[STRADLING YOCCA CARLSON & RAUTH LETTERHEAD]
May 29, 1998
The Coast Distribution System, Inc.
1982 Zanker Road
San Jose, California 95112
Re: Registration Statement on Form S-8 for 1993 Stock
Option and Incentive Plan
Ladies and Gentlemen:
We have acted as counsel for The Coast Distribution System, Inc., a
Delaware corporation (the "Company"), in connection with the preparation of a
Registration Statement on Form S-8 (the "Registration Statement") which the
Company intends to file with the Securities and Exchange Commission pursuant to
the Securities Act of 1933, as amended (the "Act"). The Registration Statement
relates to an additional 250,000 shares of the Company's Common Stock, $.001 par
value (the "Shares"), which may be issued and sold by the Company upon the
exercise of options granted and to be granted under The Coast Distribution
System, Inc. 1993 Stock Option and Incentive Plan, as amended (the "Plan").
We have reviewed the corporate action of the Company in connection with
this matter and have examined such documents, corporate records and other
instruments as we have deemed necessary for the purpose of this opinion.
Based upon the foregoing, it is our opinion that the Shares have been
duly authorized and, upon issuance and delivery and payment therefor in
accordance with the provisions of the Plan, will be duly and validly issued,
fully paid and nonassessable.
We hereby consent to the filing of this opinion with the Securities and
Exchange Commission in connection with the filing of the Registration Statement.
Very truly yours,
STRADLING YOCCA CARLSON & RAUTH
EXHIBIT 5.1
<PAGE> 1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Registration
Statement on Form S-8 (File No. 333-________), being filed with the Securities
and Exchange Commission (the "Commission") by The Coast Distribution System,
Inc. pertaining to The Coast Distribution System, Inc. 1993 Stock Option and
Incentive Plan, of our report dated February 27, 1998, with respect to the
consolidated balance sheets of The Coast Distribution System and Subsidiaries as
of December 31, 1997 and 1996, and the related consolidated statements of
operations, shareholders' equity, and cash flows for each of the three years in
the period ended December 31, 1997 included in the Annual Report on Form 10-K of
The Coast Distribution System for the year ended December 31, 1997, filed with
the Commission on March 31, 1998.
GRANT THORNTON LLP
San Jose, California
May 29, 1998
Exhibit 23.2
