<PAGE>
As filed with the Securities and Exchange Commission
on June 22, 1995
Registration No. 33-
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-------------------------
FORM S-8
REGISTRATION STATEMENT
under
THE SECURITIES ACT OF 1933
-------------------------
A.L. PHARMA INC.
(Exact Name of Registrant as Specified in Its Charter)
-------------------------
Delaware 22-2095212
(State or Other Jurisdiction of (IRS Employer Identification No.)
Incorporation)
-------------------------
One Executive Drive, P.O. Box 1399, Fort Lee, New Jersey 07024
(Address of Principal Executive Offices) (Zip Code)
-------------------------
A.L. PHARMA INC. 1983 INCENTIVE STOCK OPTION PLAN
(Full Title of the Plan)
-------------------------
Beth P. Hecht
Corporate Counsel and Secretary
A.L. Pharma Inc.
One Executive Drive
Fort Lee, New Jersey 07024
(201) 947-7774
(Name, Address, and Telephone Number, Including Area Code, of Agent for Service)
-------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
================================================================================
Proposed Proposed
Maximum Maximum
Amount to Offering Aggregate Amount of
Title of Securities be Price Per Offering Registration
to be Registered Registered Share (1) Price (1) Fee
- -------------------------- ------------ ---------- ----------- -------------
<S> <C> <C> <C> <C>
Class A Common Stock, par 1,000,000 $17.31 $17,312,500 $5,972.81
value $.20 per share (the shares
"Class A Common Stock")
================================================================================
</TABLE>
(1) Computed on the basis of the price at which stock of the same class was
sold on June 21, 1995, pursuant to Rule 457(h) of the Securities Act of
1933, as amended, solely for the purpose of calculating the amount of the
registration fee.
-------------------------
<PAGE>
AVAILABLE INFORMATION
A.L. Pharma Inc., formerly known as A.L. Laboratories, Inc. (the "Company"
or the "Registrant"), is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements and other information with
the Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information filed by the Company with the Commission can be
inspected and copied at the public reference facilities maintained by the
Commission at Judiciary Plaza, 450 Fifth Street, N.W., Room 1024, Washington,
D.C. 20549 and at its regional offices at Citicorp Center, 300 West Madison
Street, Chicago, Illinois 60661, and Seven World Trade Center, New York, New
York 10048. Copies of such material can be obtained at prescribed rates from
the Public Reference Section of the Commission, Room 1024, 450 Fifth Street,
N.W., Washington, D.C. 20549. The Company's Class A Common Stock is listed on
the New York Stock Exchange, and copies of reports, proxy statements and other
information concerning the Company can be inspected at the offices of the New
York Stock Exchange at 20 Broad Street, New York, New York 10005. In addition,
certain of such materials are also available through the Commission's Electronic
Data Gathering and Retrieval System ("EDGAR").
<PAGE>
PART I. INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Item 1(b). Securities to be Offered.
- --------- ------------------------
The Company hereby registers 1,000,000 shares of the Company's Class A
Common Stock, par value $.20 per share (the "Class A Common Stock"), in
connection with two amendments to the A.L. Pharma Inc. 1983 Incentive Stock
Option Plan (the "Plan"). The first amendment ("1993 Amendment") was approved
by the Company's stockholders at the Company's Annual Meeting of Stockholders on
May 19, 1993, and increased the number of shares of Class A Common Stock
available for grants under such Plan from 1,500,000 to 1,650,000 shares. The
second amendment ("1995 Amendment") was approved by the Company's Stockholders
at the Company's Annual Meeting of Stockholders on June 7, 1995, and increased
the number of shares of Class A Common Stock available for grants under the plan
from 1,650,000 to 2,500,000.
PART II. INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
- ------ ---------------------------------------
The Company previously registered under the Securities Act of 1933, as
amended (the "Securities Act"), an aggregate of 1,500,000 shares of Class A
Common Stock offered pursuant to the Plan pursuant to registration statements on
Form S-8 (the "Previous Registration Statements") filed with the Commission on
May 17, 1985 (Registration No. 2-97830), May 26, 1987 (Registration No. 33-
14625), April 19, 1989 (Registration No. 33-28221), and April 7, 1992
(Registration No. 33-46860). The Previous Registration Statements are
incorporated in this Registration Statement by reference. The registration
statement on Form 8-A filed with the Commission as of the date hereof
(Registration No. __________) is incorporated in this Registration Statement by
reference. The Company's Annual Report on Form 10-K for the year ended December
31, 1994 filed by the Company with the Commission is incorporated in this
Registration Statement by reference. All other reports filed by the Company
pursuant to Sections 13(a) or 15(d) of the Exchange Act since the end of such
fiscal year are also incorporated in this Registration Statement by reference.
In addition, 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 to
this Registration Statement which indicates that all securities offered have
been sold or which deregisters all securities then remaining unsold, shall be
deemed to be incorporated herein by reference and to be a part hereof from the
date of filing of such documents.
Any statement contained in any document incorporated, or deemed to be
incorporated, by reference herein shall be deemed to be modified or superseded
for purposes of this Registration Statement to the extent that a statement
contained herein or in any subsequently filed document which also is, or is
deemed to be, incorporated by reference herein modifies or supersedes such
statement. Except as so modified or superseded, such statement shall not be
deemed to constitute a part of this Registration Statement.
-2-
<PAGE>
Item 4. Description of Securities.
- ------ -------------------------
The Company's authorized capital stock consists of (i) 40,000,000 shares of
Class A Stock, of which 13,397,622 shares were issued and outstanding as of May
31, 1995; (ii) 15,000,000 shares of Class B Stock, of which 8,226,562 shares
were issued and outstanding as of May 31, 1995, and (iii) 500,000 shares of
Preferred Stock, par value $1.00 per share, of which none were outstanding as of
May 31, 1995.
Item 5. Interests of Named Experts and Counsel.
- ------ --------------------------------------
The professional corporation of Glen E. Hess, who is an Assistant Secretary
and a Director of the Company, is a partner of Kirkland & Ellis, a law firm
which since 1978 has performed and continues to perform significant legal
services for the Company.
Item 8. Exhibits.
- ------ --------
See Exhibit Index.
Item 9. Undertakings.
- ------ ------------
(a) Rule 415 offerings.
------------------
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;
(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,
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;
-3-
<PAGE>
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 Exchange Act that are incorporated by reference in the
registration statement.
(2) That, for the purpose of determining any liability under the Securities
Act, each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(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, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the of the Exchange Act) 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.
(c) Filing of Registration Statement on Form S-8.
--------------------------------------------
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
-4-
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act the Company 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 on Form
S-8 to be signed on its behalf by the undersigned, thereunto duly authorized, in
the City of Fort Lee, State of New Jersey, on June 15, 1995.
A.L. PHARMA INC.
By: /s/ Jeffrey E. Smith
----------------------------------
Name: Jeffrey E. Smith
Title: Vice President, Finance
and Chief Financial Officer
Pursuant to the requirements of the Securities Act this Registration
Statement and power of attorney have been signed by the following persons in
the capacities and on the dates indicated.
By his signature, each of the following persons authorizes Jeffrey E. Smith
and Beth P. Hecht or any of them, with full power of substitution, to execute
in his name and on his behalf, and to file any amendments (including, without
limitation, post-effective amendments) to this Registration Statement necessary
or advisable in the opinion of any of them to enable the Company to comply with
the Securities Act, and any rules, regulations and requirements of the
Commission thereunder, in connection with the registration of the additional
securities which are the subject of this Registration Statement.
Date: June 15, 1995 /s/ Einar W. Sissener
--------------------------------------------
Einar W. Sissener
Chairman, Director and Chief Executive
Officer (Principal Executive Officer)
Date: June 15, 1995 /s/ Jeffrey E. Smith
--------------------------------------------
Jeffrey E. Smith
Vice President, Finance and Chief Financial
Officer (Principal Financial Officer and
Principal Accounting Officer)
-5-
<PAGE>
Date: June 7, 1995 /s/ James Balog
--------------------------------------------
James Balog
Director, Chairman of Audit Committee
Date: June 7, 1995 /s/ I. Roy Cohen
--------------------------------------------
I. Roy Cohen
Director, Chairman of Executive Committee
Date: June 7, 1995 /s/ Thomas G. Gibian
--------------------------------------------
Thomas G. Gibian
Director, Chairman of Compensation
Committee
Date: June 7, 1995 /s/ Glen E. Hess
--------------------------------------------
Glen E. Hess
Director
Date: June 7, 1995 /s/ Gert W. Munthe
--------------------------------------------
Gert W. Munthe
Director
Date: June 7, 1995 /s/ Georg W. Sverdrup
--------------------------------------------
Georg W. Sverdrup
Director
Date: June 7, 1995 /s/ Erik G. Tandberg
--------------------------------------------
Erik G. Tandberg
Director
Date: June 7, 1995 /s/ Peter G. Tombros
--------------------------------------------
Peter G. Tombros
Director
-6-
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Sequentially
Exhibit Number Exhibit Numbered Page
- -------------- --------------------------------------------- ----------------
<C> <S> <C>
5 Opinion of Kirkland & Ellis re: legality of
securities being registered
23.1 Consent of Coopers & Lybrand L.L.P.
23.2 Consent of Kirkland & Ellis (included in --
Exhibit 5)
24 Power of Attorney (included on signature pages --
of this Registration Statement)
99 A.L. Pharma Inc. 1983 Incentive Stock Option
Plan, as amended
</TABLE>
<PAGE>
EXHIBIT 5
---------
KIRKLAND & ELLIS
Citicorp Center
153 East 53rd Street
New York, New York 10022-4675
(212) 446-4800
June 22, 1995
A.L. Pharma Inc.
One Executive Drive
P.O. Box 1399
Fort Lee, N.J. 07024
Ladies and Gentlemen:
We have acted as counsel to A.L. Pharma Inc., a Delaware corporation
formerly known as A.L. Laboratories, Inc. (the "Company"), in connection with
the filing of the Company's registration statement on Form S-8 with the
Securities and Exchange Commission on or about June 22, 1995, (the
"Registration Statement") under the Securities Act of 1933, as amended. The
Registration Statement is being filed in connection with the Company's offering
of 1,000,000 additional shares of Class A Common Stock ($.20 par value per
share) (the "Additional Plan Shares") pursuant to the Company's 1983 Incentive
Stock Option Plan, as amended (the "Plan"). The Additional Plan Shares increase
the aggregate number of shares available for grants under the Plan from
1,500,000 to 2,500,000.
We are familiar with the proceedings to date with respect to such offering
and have examined such records, documents and matters of law and satisfied
ourselves as to such matters of fact as we have considered relevant for
purposes of this opinion.
For purposes of this opinion, we have assumed the authenticity of all
documents submitted to us as originals and the conformity to the originals of
all documents submitted to us as copies. We have also assumed the genuineness
of the signatures of persons signing all documents in connection with which
this opinion is rendered, the authority of such persons signing on behalf of
the parties thereto, and the due authorization, execution and delivery of all
documents by the parties thereto.
<PAGE>
A.L. Pharma Inc.
June 22, 1995
Page 2
We are of the opinion that when the Additional Plan Shares shall have been
issued and sold on the terms contemplated by the Plan and the Registration
Statement shall have become effective, the Additional Plan Shares will be
legally issued, fully paid and non-assessable.
This opinion shall be limited to the laws of the State of New York, the
General Corporation Law of the State of Delaware and the federal laws of the
United States of America.
We hereby consent to the use of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
/s/ Kirkland & Ellis
KIRKLAND & ELLIS
<PAGE>
EXHIBIT 23.1
------------
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this registration statement on
Form S-8 (File No. 33- ) of our report dated March 1, 1995, on our audits of
the consolidated financial statements and financial statement schedule of A. L.
Pharma Inc. and subsidiaries as of December 31, 1994 and 1993 and for each of
the three years in the period ended December 31, 1994, which report is included
in the Company's Annual Report on Form 10-K for the year ended December 31,
1994.
/s/ Coopers & Lybrand L.L.P.
Coopers & Lybrand L.L.P.
Parsippany, New Jersey
June 15, 1995
<PAGE>
EXHIBIT 99
----------
A.L. Pharma Inc. - 1983 Incentive
Stock Option Plan, as amended
1. Purpose of the Plan.
-------------------
This 1983 Incentive Stock Option Plan (the "Plan") of A.L. Pharma Inc. (the
"Company"), is designed to provide incentive to present and future executive,
managerial, marketing, technical and other key employees of the Company and of
its subsidiaries (hereinafter referred to as "Employees") by affording such
Employees an opportunity to acquire or increase their proprietary interest in
the Company through the acquisition of shares of its Class A Common Stock. By
encouraging stock ownership by such Employees, the Company seeks to attract and
retain in its and its subsidiaries' employ persons of exceptional competence and
seeks to furnish an added incentive for them to increase their efforts on behalf
of the Company.
2. Administration.
--------------
This Plan shall be administered by a committee of the Board of Directors of
the Company consisting of two or more directors (the "Options Committee")
appointed for such purpose; provided that if at any time Rule 16b-3 or any
successor rule ("Rule 16b-3") under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and Section 162(m) ("Section 162(m)") of the
Internal Revenue Code of 1986, as amended, or any successor statutory provision
thereof (the "Code"), and any implementing regulations (and any successor
provisions thereof), so permit without adversely affecting the ability of the
Plan to comply with the conditions for exemption from Section 16 of the Exchange
Act (or any successor provision) provided by Rule 16b-3 and the exemption from
the limitations on the deductibility of certain executive compensation provided
by Section 162(m), the Options Committee may delegate the administration of the
Plan in whole or in part, on such terms and conditions, to such other person or
persons as it may determine in its discretion. The membership of the Options
Committee or such successor committee shall be constituted so as to comply at
all times with the applicable requirements of Rule 16b-3 and Section 162(m). No
member of the Options Committee shall have within one year prior to his
appointment received awards under the Plan or under any other plan, program or
arrangement of the Company or any of its affiliates if such receipt would cause
such member to cease to be a "disinterested person" under Rule 16b-3; provided
that if at any time Rule 16b-3 so permits without adversely affecting the
ability of the Plan to comply with the conditions for exemption from Section 16
of the Exchange Act (or any successor provision) provided by Rule 16b-3, one or
more members of the Options Committee may cease to be a "disinterested person."
All questions of interpretation and application of this Plan, of options
granted hereunder (the "Options"), of any related agreements and instruments,
and of the value of shares
<PAGE>
of Class A Common Stock subject to Options, shall be subject to the good faith
determination of the Options Committee, which shall be final and binding. If
for any reason an Options Committee shall not have been appointed, all authority
and duties of the Options Committee under this Plan shall be vested in and
exercised by the Board of Directors of the Company.
3. Option Shares.
-------------
The stock subject to the Options and other provisions of this Plan shall be
shares of the Company's Class A Common Stock, par value $.20 per share
(hereinafter referred to as the "Common Stock"). The total amount of the Common
Stock with respect to which Options may be granted shall not exceed in the
aggregate 2,500,000/1/ shares; provided, however, that the type and aggregate
number of shares which may be subject to Options granted hereunder shall be
subject to adjustment in accordance with the provisions of paragraph 16 hereof,
and further provided that if Incentive Stock Options (as defined below) are
granted, the aggregate fair market value (determined as of the time the option
is granted) of the Stock with respect to which Options are exercisable for the
first time by any single Employee during any calendar year shall not exceed
$100,000. The maximum number of shares of Common Stock which any single
Employee may acquire pursuant to a grant of Options (including under the
alternative cash settlement right described below) in any one taxable year of
the Company shall not exceed 100,000 shares of Common Stock (subject to
adjustment in accordance with the provisions of paragraph 16 hereof). Such
shares may be treasury shares or authorized but unissued shares.
If for any reason the full number of shares covered by any Option are not
issued before the Option expires or terminates, shares not issued under such
Option shall again be available for the grant of Options under this Plan.
4. Authority to Grant Options.
--------------------------
The Options Committee may grant Options from time to time to such eligible
Employees as it shall determined; provided, however, that no Options may be
granted to any person who is a member of the Options Committee at the time of
such grant. Subject only to any applicable limitations set forth in this Plan,
the number of shares of Common Stock which may be purchased pursuant to any
Option shall be as determined by the Options Committee.
In the discretion of the Options Committee, Options granted under this Plan
may be "incentive stock options" as such term is defined in Section 422A of the
Internal Revenue Code of 1986 ("Incentive Stock Options"), or Options which do
not meet such definition. The option agreement with respect to any Option
intended to qualify as an Incentive Stock Option shall so identify such Option.
- -------------------
/1/ Reflects 1985, 1986 and 1991 stock splits, additional shares approved at
the 1986, 1988, 1989, 1991, 1993 and 1995 stockholders' meetings.
<PAGE>
5. Limitation on Value of Shares Covered by Incentive Stock Options Granted to
---------------------------------------------------------------------------
any Employee.
------------
The aggregate fair market value (determined as of the time the Option is
granted) of the Common Stock with respect to which any employee may be granted
Incentive Stock Options under this Plan and any other plans of the Company or
any parent or subsidiary of the Company shall not exceed the amount permitted by
Section 422A of the Internal Revenue Code of 1986.
6. Eligibility.
-----------
The individuals who shall be eligible to participate in the Plan shall be
such Employees from the class of executive, managerial, marketing, technical and
other key employees as the Options Committee shall determine from time to time.
7. Option Price.
------------
The price at which shares may be purchased pursuant to any Option shall be
specified by the Options Committee at the time the Option is granted, and shall
be equal to or greater than the fair market value, as determined by the Options
Committee, of the shares of Common Stock on the date the Option is granted.
8. Terms of the Options; Vesting.
-----------------------------
The Options Committee shall determine the term of each Option which shall
in no event exceed ten years and one month from the date of grant. Unless the
Committee shall otherwise determine at the time of grant, Options shall vest at
the rate of 25% per year that the Employee holds such Option so that Options
shall not become fully exercisable until four years from the date of grant.
Accordingly, unless the Committee shall otherwise determine at the time of
grant, Options cannot be exercised until one year after the Option has been
granted and then 25% of the Option Shares may be purchased during the second
year, 50% during the third year, 75% during the fourth year, and 100% after four
years. Subject to the limitations contained in paragraph 12 hereof, the Options
Committee may, in its discretion: (a) accelerate the time at which any
outstanding Option or part thereof shall become exercisable and (b) extend the
time during which any outstanding Option may be exercised, provided that no
Option may be exercised more than ten years and one month after the date of
grant. There shall be deemed to be part of the conditions and terms of every
Option granted hereunder as an Incentive Stock Option each condition, term,
limitation or restriction which is required under Section 422A of the Internal
Revenue Code and the applicable regulations for such Option to qualify as an
Incentive Stock Option.
<PAGE>
9. Amount Exercisable.
------------------
Each Option may be exercised, so long as it has vested and is valid and
outstanding, from time to time, in part or in whole, subject to any limitations
with respect to the number of shares for which the Option may be exercised at a
particular time and to such other conditions as the Options Committee in its
discretion, may specify.
10. Exercise of Options.
-------------------
Options shall be exercised by the delivery of written notice to the Company
(Attention: Treasurer) setting forth the number of shares with respect to which
the Option is to be exercised and the address to which the certificates for such
shares are to be mailed, together with (i) cash (including checks, bank drafts
or postal or express money orders payable to the order of the Company) or (ii),
if permitted by the Options Committee and in accordance with Section 10C, shares
of Common Stock previously acquired, in an aggregate amount equal to the option
price of such shares. As promptly as practicable after receipt of such written
notification and payment and subject to Section 10B, the Company shall deliver
to the optionee certificates for the number of shares with respect to which such
Option has been so exercised, issued in the optionee's name; provided, that such
delivery shall be deemed effected for all purposes when such certificates shall
have been deposited in the United States mail, addressed to the optionee, at the
address specified pursuant to this paragraph. For all purposes, an optionee
shall be deemed to have exercised an Option and to have purchased and become the
holder of the Option Shares as of the date the Company receives written
notification of exercise and payment as provided herein and in Section 10B.
10A. Alterative Cash Settlement Method.
---------------------------------
The Options Committee, in its discretion, may confer upon the grantee of
any Option granted pursuant to this Plan the right to exercise, with respect to
shares of Common Stock which could be purchased under an Option otherwise
exercisable hereunder, an alternative cash settlement right as set forth below
in lieu of purchasing shares under such Option. Such right may be conferred at
the time the Options are granted or with respect to outstanding Options.
The alternative cash settlement right shall mean the right, in lieu of
purchasing shares under an Option which is otherwise exercisable under this
Plan, to receive a payment in cash equal to the excess of the value of one share
of Common Stock over the option price set forth in the Option times the number
of shares as to which the alternative cash settlement right is exercised.
Notwithstanding the other provisions of this Plan, exercise of an alternative
cash settlement right (i) shall be subject to the approval of the Committee at
the time of such exercise and (ii) may only be exercised in connection with and
at the same time that an Option is being exercised under Section 10 of this Plan
and may not be exercised with respect to more shares of Common Stock than are
then being purchased upon such exercise under Section 10. For
<PAGE>
purposes of determining an alternative cash settlement, the value per share of
Common Stock shall be the closing price on the principal stock exchange on which
the Common Stock is listed for trading on the date of the exercise of the Option
(or, if no such closing price is available, the value shall be determined in
such other manner as the Options Committee may deem appropriate).
Exercise of alternative cash settlement rights shall be made by notice
delivered to the Company as provided in Section 10 of this Plan. Exercise of an
Option through exercise of an alternative cash settlement right shall for
purposes of this Plan have the same effect as if the shares of Common Stock as
to which such right was exercised were issued under this Plan; accordingly there
shall be a decrease in the number of shares of Common Stock which thereafter may
be available for purposes of granting Options under this Plan by the number of
shares of Common Stock as to which an alternative cash settlement right is
exercised.
10B. Withholding Tax Requirements.
----------------------------
It shall be a condition of exercise of any Option (including any exercise
of an alternative cash settlement right) that the Employee exercising the Option
make appropriate payment or other provision acceptable to the Company with
respect to any withholding tax requirement arising from such exercise. The
amount of withholding tax required, if any, with respect to any Option exercise
(the "Withholding Amount") shall be determined by the Treasurer or other
appropriate officer of the Company, and the Employee shall furnish such
information and make such representations as such officer requires to make such
determination. In the event of an exercise involving an alternative cash
settlement right, the Company shall withhold the Withholding Amount from the
amount otherwise payable to the Employee. If the Company determines that
withholding tax is required with respect to any Option exercise not involving an
alternative case settlement right, the Company shall notify the Employee of the
Withholding Amount, and the Employee shall pay to the Company, by check or other
means acceptable to the Company, an amount not less than the Withholding Amount.
In lieu of making such payment, the Employee may elect to pay the Withholding
Amount by either (i) delivering to the Company a number of shares of Common
Stock having an aggregate value (determined as set forth in Section 10A) as of
the "measurement date" (as hereinafter defined) not less than the Withholding
Amount or (ii) directing the Company to withhold (and not to deliver or issue to
Employee) a number of shares of Common Stock otherwise issuable upon the Option
exercise having an aggregate value (determined as set forth in Section 10A) as
of the measurement date not less than the Withholding Amount; provided that if
the Employee is an officer or director subject to Section 16(b) of the Exchange
Act, the election to meet withholding tax requirements by the delivery or
direction to withhold shares of Common Stock may only be exercised (i) during a
ten-day "window" period specified in Rule 16b-3 or (ii) at least six months
prior to the measurement date or (iii) at such other time as will not, in the
opinion of counsel for the Company, result in any liability of such Employee
under said Section 16(b). If the Company approves, an Employee may elect
pursuant to the prior sentence to deliver or direct the withholding of shares of
Common Stock having an aggregate value in excess of the minimum
<PAGE>
Withholding Amount but not in excess of the Employee's applicable highest
marginal combined federal income and state income tax rate, as estimated in good
faith by the Employee. Any fractional share interests resulting from the
delivery or withholding of shares of Common Stock to meet withholding tax
requirements shall be settled in cash. All amounts paid to or withheld by the
Company and the value of all shares of Common Stock delivered to or withheld by
the Company pursuant to this Section 10B shall be deposited in accordance with
applicable law by the Company as withholding tax for the Employee's account. If
the Treasurer or other appropriate officer of the Company determines that no
withholding tax is required with respect to the exercise of any Option (because
such Option is an Incentive Stock Option or otherwise), but subsequently it is
determined that the exercise resulted in taxable income as to which withholding
is required (as a result of a disposition of shares or otherwise), the Employee
shall promptly, upon being notified of the withholding requirement, pay to the
Company by means acceptable to the Company the amount required to be withheld;
and at its election the Company may condition any transfer of shares issued upon
exercise of an Incentive Stock Option upon receipt of such payment. The term
"measurement date" as used in this Section 10B shall mean the date on which any
taxable income resulting from the exercise of an Option is determined under
applicable federal income tax provisions.
10C. Exchange of Previously Acquired Stock.
-------------------------------------
The Options Committee, in its discretion, may (subject to the provisos to
this sentence) permit the option price for the shares being acquired upon the
exercise of an Option to be paid, in full or in part, by the delivery to the
Company of a number of shares of Common Stock having an aggregate value
(determined as set forth in Section 10A) as of the "exercise measurement date"
(as hereinafter defined) equal to the exercise price for the shares being
acquired; provided that if the Employee exercising the Option is an officer or
director subject to Section 16(b) of the Exchange Act and such Employee is
permitted by the Options Committee to pay the exercise price under an Option by
delivery of previously acquired Common Stock, the election to deliver such
Common Stock may only be made (i) during a ten-day "window" period specified in
Rule 16(b)-3 or (ii) at least six months prior to the exercise measurement date
or (iii) as such other time as will not, in the opinion of counsel for the
Company, result in any liability of such Employee under said Section 16(b);
provided further that if the shares of Common Stock being delivered as payment
for all or part of the exercise price under an Option were acquired pursuant to
the exercise of another Option, such Common Stock must have been owned by the
Employee for at least six months preceding the exercise measurement date; and
provided further that this Section 10C shall only be available for, and
applicable to, Options granted subsequent to September 30, 1986. The term
"exercise measurement date" as used in this Section 10C shall mean the date on
which the Option is exercised in accordance with Section 10.
11. Transferability of Options.
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<PAGE>
Options shall not be transferable otherwise than by will or the laws of
descent and distribution and shall be exercisable during the optionee's lifetime
only by him or by his guardian or legal representative.
12. Termination of Employment or Death of Optionee.
----------------------------------------------
Except as expressly provided herein, Options shall terminate on the
earlier of:
1. the date of expiration thereof, specified pursuant to paragraph 8 of
this Plan;
2. immediately upon termination of the employment relationship between the
Company and the optionee for cause, or
3. thirty (30) days or, if the written option agreement (as specified
pursuant to paragraph 18 hereof) specifically provides, for a longer
period not to exceed one year after termination of the employment
relationship between the Company and the optionee without cause, other
than death or retirement in good standing from the employ of the Company
for reasons of age or disability under then established rules of the
Company or the subsidiary employing the optionee.
Whether authorized leave of absence, or absence on military or government
service, shall constitute termination of the employment's relationship shall be
determined by the Options Committee.
In the event of the death of the holder of an Option while in the employ of
the Company and before the date of expiration of such Option, such Option shall
terminate on the earlier of such date of expiration or one year following the
date of such death. After the death of the optionee, his executors,
administrators, or any person or persons to whom his Option may be transferred
by will or by the laws of descent and distribution, shall have the right, at any
time prior to such termination to exercise such Option which shall have vested
immediately prior to his death. If, before the date of expiration of an Option,
the optionee shall be retired in good standing from the employee of the Company
for reasons of age or disability under the then established rules of the
Company, such Option shall terminate on the earlier of such date of expiration
or 90 days after the date of such retirement unless the written option agreement
specifically provides for a longer period not to exceed one year after the date
of such retirement unless the written option agreement specifically provides for
a longer period not to exceed one year after the date of such retirement. In
the event of such retirement, the optionee shall have the right prior to the
termination of such Option to exercise the Option to the extent to which he was
entitled to exercise such Option immediately prior to such retirement.
For all purposes of this Plan, an employment relationship between the
Company and the optionee shall be deemed to exist during any period in which the
optionee is employed by the Company or by any subsidiary of the Company.
<PAGE>
13. Requirements Imposed by Law.
---------------------------
The Company shall not be required to sell or issue any shares under any
Option if the issuance of such shares shall constitute a violation by the
optionee or by the Company of any provisions of any law or regulation of any
governmental authority. Any determination in this connection by the Options
Committee shall be final, binding and conclusive.
The Company shall not be required to issue any shares upon exercise of any
Option unless the Company has received the optionee's representation or other
evidence satisfactory to it to the effect that the holder of such Option will
not transfer such Shares in any manner which would constitute a violation of any
securities or other law, or which would not be in compliance with such other
conditions as the Options Committee may deem appropriate.
14. No Rights as Stockholders.
-------------------------
No optionee shall have rights as a stockholder with respect to shares
covered by his Option until the date of exercise of such Option; and, except as
otherwise provided in paragraph 16 hereof, no adjustment for dividends, or
otherwise, shall be made if the record date therefor is prior to the date of
such exercise of such Option.
15. No Employment Obligation.
------------------------
The granting of any Option shall not impose upon the Company any obligation
to employ or continue to employ any optionee; and the right of the Company to
terminate the employment of any officer or other employee shall not be
diminished or affected by reason of the fact that an Option has been granted to
him.
16. Changes in the Firm's Capital Structure.
---------------------------------------
The existence of outstanding Options shall not affect in any way the right
or power of the Company or its stockholders to make or authorize any or all
adjustments, recapitalizations, reorganizations, or other changes in the
Company's capital structure or its business, or any merger or consolidation of
the Company, or any issue of bonds, debentures, or preferred or prior preference
stock senior to or otherwise affecting the Common Stock or the rights thereof,
or the dissolution or liquidation of the Company, or any sale or transfer of all
or any part of its assets or business, or any other corporate act or proceeding,
whether of a similar character or otherwise.
If the Company shall effect a subdivision or consolidation of shares or
other capital readjustment, or pay a dividend in shares of its Class A or Class
B Common Stock, then (a) the number, type, and per share price of shares of
stock subject to outstanding Options hereunder shall be appropriately adjusted
in such a manner as to entitle each optionee to receive upon exercise of his
Option, for the same aggregate consideration, the same total number and
<PAGE>
type of shares as he would have received as a result of the event requiring the
adjustment had he exercised his Option in full immediately prior to such event;
provided, however, that, if any such adjustment would result in the right to
purchase a fractional share, the number of shares subject to the Option will be
decreased to the next lower whole number; (b) the number and type of shares then
reserved for issuance under the Plan shall be adjusted by substituting for the
total number of shares of Common Stock then reserved that number and type of
shares of stock that would have been received by the owner of an equal number of
outstanding shares of Common Stock as the result of the event requiring the
adjustment; and (c) the maximum number of shares of Common Stock that any
Employee may acquire pursuant to a grant of Options (including under the
alternative cash settlement right) in any one taxable year of the Company as set
forth in the third sentence of the first paragraph of paragraph 3 shall be
adjusted by substituting for such number of shares that number of shares of
stock that would have been received by the owner of an equal number of
outstanding shares of Common Stock as the result of the event requiring
adjustment.
If the Company shall be a party to any merger or consolidation or effect
any recapitalization which causes a change in the Common Stock which does not
effect an adjustment under the prior paragraph, the Options Committee, in its
discretion, may, if it considers it to be appropriate to carry out the intent
and purpose of the Plan, make such adjustments in the nature or amount of
securities subject to the Options or the Option price as it considers
appropriate, and such adjustments shall be binding and conclusive on all holders
of Options.
Except as expressly provided herein, the issue by the Company of shares of
stock of any class, or securities convertible into shares of stock of any class,
for cash or property, or for labor or services either upon direct sale, or upon
the exercise of rights or warrants to subscribe therefore, or upon conversion of
other securities, shall not affect, and no adjustment by reason thereof shall be
made with respect to, the number or price of shares of Common Stock then subject
to outstanding Options.
17. Amendment or Termination of Plan.
--------------------------------
The Board of the Directors of the Company may modify revise or terminate
this Plan at any time and from time to time, except that neither the aggregate
number of shares issuable pursuant to this Plan nor the minimum option price
specified in paragraph 7 of this Plan shall, other than by operation of
paragraph 16, hereof, be adjusted without the consent of the holders of Class A
and Class B Common Stock having a majority of the voting power.
18. Written Agreement.
-----------------
Each Option granted hereunder shall be embodied in a written option
agreement which shall be subject to the terms and conditions prescribed above
and shall be signed by the optionee and by the President or a Vice President of
the Company for and in the name and on
<PAGE>
behalf of the Company. Such an option agreement shall contain such other
provisions as the Options Committee in its discretion shall deem advisable.
19. Director and Stockholder Approval; Duration of Plan.
---------------------------------------------------
This Plan was initially duly adopted by the Board of Directors on September
26, 1983 and approved by the stockholders of the Company on January 25, 1984.
Amendments to this Plan since such dates have been duly approved by the Board of
Directors and, as required by this Plan or Rule 16b-3 or Section 162(m) as in
effect from time to time, have been approved by the stockholders of the Company.
Options may not be granted under this Plan after September 26, 2003. This Plan
shall terminate (a) when the total amount of Common Stock with respect to which
Options may be granted shall have been issued upon the exercise of Options, or
(b) by action of the Board of Directors pursuant to paragraph 17 hereof,
whichever shall first occur.
