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As filed with the Securities and Exchange Commission on June 6, 1996
File No. 2-93124
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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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SGI INTERNATIONAL
(Exact Name of Registrant as Specified in its Charter)
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UTAH 33-0119035
(State or Other Jurisdiction (I.R.S. Employer
of Incorporation) Identification No.)
1200 PROSPECT STREET, SUITE 325 92037
LA JOLLA, CALIFORNIA (Zip Code)
(Address of Registrant's Principal Executive Office)
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EMPLOYMENT AGREEMENTS DATED AS OF MARCH 1, 1994, MARCH 31, 1994
AUGUST 15, 1994, DECEMBER 1, 1994, MARCH 16, 1995,JUNE 12, 1995, MARCH 1, 1996,
AMENDMENTS TO EMPLOYMENT AGREEMENTS DATED AS OF MARCH 31, 1993, MARCH 31, 1994
MARCH 31, 1995, JULY 15, 1995, OCTOBER 31, 1995, CONSULTING AGREEMENT DATED
AS OF JUNE 1, 1995.
(Full title of the plan)
MR. LYNN MABEY
MURPHY, TOLBOE & MABEY
124 SOUTH 600 EAST, SUITE 100
SALT LAKE CITY, UTAH 84102
(Name and Address of Agent for Service)
(801) 533-8505
(Telephone number, including area code, of agent for service)
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Copies of correspondence to:
David A. Fisher
Fisher Thurber, LLP
4225 Executive Square, Suite 1600
La Jolla, California 92037-1483
(619) 535-9400
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<TABLE>
<CAPTION>
Calculation of Registration Fee
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Proposed Maximum Proposed Maximum Amount of
Title of Securities Amount to be Offering Price Aggregate Offering Registration
to be Registered Registered(1) per Share (2) Price (2) Fee
----------------- ------------- ------------- --------- ---
<S> <C> <C> <C> <C>
Common Stock, No 606,341 Shares $1.32 $800,370 $275.99
Par Value
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</TABLE>
(1) Includes 320,341 shares previously issued.
(2) Solely for the purpose of determining the registration fee, based on
the average price of the Common Stock issued, and to be issued upon
exercise of the Warrants which were granted in connection with the
referenced Employment Agreements, Amended Employment Agreements and
Consulting Agreements.
ii
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PART II
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents which have been filed with the Securities and
Exchange Commission are incorporated by reference as of their respective dates
and are a part hereof:
(a) The Company's Annual Report on Form 10-K for the year ended
December 31, 1995;
(b) The Quarterly Report on Form 10-Q/A for the quarter ended
March 31, 1996; and
(c) The description of the Common Stock contained in the Company's
Registration Statement on Form 8-A dated April 6, 1988, as amended by an
amendment to Application or Report on Form 8 dated April 13, 1988.
Additionally, all documents subsequently filed by the Company pursuant
to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), prior to the filing of a post-effective
amendment hereto which indicates that all of the shares of the Common Stock
offered hereby have been sold or which deregisters all such shares then
remaining unsold, shall be deemed to be incorporated by reference herein and to
be part hereof from the date of filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
None.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Bylaws of the Company provide that, subject to any limitations
imposed by the Utah Revised Business Corporation Act, the officers and directors
of the Company shall be indemnified by the Company against expenses, including
attorneys' fees, reasonably incurred in connection with or resulting from the
defense of any action, suit or proceeding, whether civil, criminal,
administrative or investigative, to which such person becomes or is threatened
to be made part of by reason of his position as an officer, director, employee
or agent of the Company or his service at the request of the Company as an
officer, director, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, provided that, in the context of such
action, such officer or director acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
Company, and with respect to any criminal action or proceeding, such officer or
director had no reasonable cause to believe his conduct was unlawful.
Any indemnification made pursuant to the Bylaws shall be made only upon
the determination by a majority vote of a quorum of the Board of Directors,
provided, however, that such indemnification shall be made without such
determination to the extent that the officer or director is successful in the
defense of the action at issue. Additionally, any expenses incurred in defense
of an action against an officer or director shall be paid in advance of final
disposition of the action upon receipt of an undertaking by or on behalf of such
officer or director to repay the amount advanced if it is ultimately determined
that he is not entitled to be indemnified for such expenses.
The Utah Revised Business Corporation Act (the "Code") permits the
Company to indemnify an Officer or Director who was or is a party or is
threatened to be made a party to any proceeding because of his or her position,
if the Officer or Director acted in good faith and in a manner he or she
reasonably believed to be in the best interests of the
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Company. The Code authorizes the Company to advance expenses incurred in
defending any such proceeding under certain circumstances, and if the Officer or
Director is successful on the merits, it authorizes the Company to indemnify the
Officer or Director against all expenses, including attorneys' fees, incurred in
connection with any such proceeding.
The Company's Bylaws reflect the indemnification provisions contained
in the Utah Revised Business Corporation Act, except that pursuant to the Utah
Revised Business Corporation Act no indemnification may be made to an officer or
director in connection with an action by or in the right of the Company.
Additionally, no indemnification may be made where the officer or director has
been adjudged to be liable to the Company, unless and only to the extent that
the court in which the action or suit was brought shall determine upon
application that such person is fairly and reasonably entitled to indemnity for
such expenses as the court considers proper.
Registrant has currently in effect a claims made directors and officers
liability insurance and company reimbursement insurance policy protecting its
directors and officers against liability by reason of their being or having been
directors or officers. The directors and officers liability portion of such
policy covers all directors and officers of the registrant and of certain
subsidiary companies. The policy provides for a payment on behalf of the
directors and officers up to the policy limits for all Losses (as defined) which
the directors and officers, or any of them, shall become legally obligated to
pay, from claims made against them during the policy period for defined Wrongful
Acts. The directors and officers or any of them shall become legally obligated
to pay, from claims made against them during the policy period for defined
wrongful acts, which include; errors, misstatements, misleading statements, acts
or omissions, neglect or breach of duty by the directors or officers in the
discharge of their duties solely in their capacity as directors and officers of
the company, individually or collectively. The insurance includes the cost of
defenses, appeals, bonds, settlements and judgments. The insurers limit of
liability under the policy is $1 million in the aggregate for all losses per
year. The policy contains various reporting requirements, deductibles, and
exclusions.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8. EXHIBITS
The following exhibits are filed pursuant to Item 601 of Regulation
S-K:
3.1.2 Restated Articles of Incorporation(1)
4.2 Employment Agreement dated as of March 16, 1995, between
Registrant and Ernest P. Esztergar(2)
4.3 Employment Agreement and First Amendment to Employment
Agreement dated as of March 31, 1994, between Registrant and
Richard J. Gibbens(2)
4.4 Employment Agreement and Second Amendment to Employment
Agreement dated as of March 1, 1993, between Registrant and
Joan Juhasz(2)
4.6.1 Third Amendment to Employment Agreement dated October 31, 1995
between Registrant and R. Brent Lassetter(3)
4.8 Employment Agreement and Fourth Amendment to Employment
Agreement dated as of July 15, 1995, between Registrant and
Jeffrey N. Montag(2)
4.9 Employment Agreement and Third Amendment to Employment
Agreement dated March 31, 1995, between Registrant and Elon A.
Place(2)
4.10 Employment Agreement dated as of March 1, 1994, between
Registrant and Nancy C. Propp(2)
4.11 Employment Agreement and First Amendment to the Employment
Agreement dated as of March 31, 1994, between Registrant and
Claudine R. Savatt(2)
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4.12 Employment Agreement dated as of June 12, 1995, between
Registrant and Joseph A. Savoca(2)
4.13 Employment Agreement dated as of December 1, 1994, between
Registrant and John Taylor(2)
4.15 Employment Agreement dated as of August 15, 1994, between
Registrant and Ming Wang(2)
4.18 Employment Agreement dated as of March 1, 1996, between
Registrant and Kimberly Krmpotich(4)
4.19 Consulting Agreement dated as of June 1, 1995, between
Registrant and Franklin Rinker(4)
5. Opinion of Fisher Thurber, Ltd. regarding the legality of the
Common Stock registered hereby(4)
23. Consent of Ernst & Young LLP, Independent Auditors(4)
23.1 Consent of Fisher Thurber, Ltd. (included in Exhibit 5)(4)
(1) Incorporated by reference to Annual Report on Form 10-K (File No.
2-93124) for the year ended December 31, 1987.
(2) Incorporated by reference to Registration Statement on Form S-8
(File No. 2-93124) filed on August 23, 1995.
(3) Incorporated by reference to Registration Statement on Form S-8
(File No. 2-93124) filed on February 16, 1996.
(4) Filed herewith.
ITEM 9. UNDERTAKINGS
The Company hereby undertakes:
(1) to file, during any period in which offers or sales of the Common
Stock are being made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of
the Securities Act of 1933, as amended (the "Securities Act");
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the
most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the registration
statement;
(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 that if
the information in paragraphs (i) and (ii) above and to be
included in a post-effective amendment hereto is contained in
periodic reports filed by the registrant pursuant to section
13 or section 15(d) of the Exchange Act and is incorporated by
reference in the S-8 Registration Statement, no post-effective
amendment hereto shall be filed;
(2) that, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof; and
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
Additionally, the undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act, each filing of
the Company'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 Exchange Act), that is
incorporated by reference in the registration statement shall be deemed to be a
new registration
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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.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Company pursuant to the foregoing provisions, or otherwise, the registrant has
been advised that in the opinion of the SEC 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 expense incurred or
paid by a director, officer or controlling person 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.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, 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 to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of San Diego, State of California, on June 6, 1996.
SGI INTERNATIONAL
By: /s/ JOSEPH A. SAVOCA
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Joseph A. Savoca, Chief Executive Officer
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.
<TABLE>
<CAPTION>
Signature Title Date
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<S> <C> <C>
Chairman of the Board and
/s/ JOSEPH A. SAVOCA Chief Executive Officer June 6, 1996
- ---------------------------------------
Joseph A. Savoca
/s/ ERNEST P. ESZTERGAR Director June 6, 1996
- ----------------------------------------
Ernest P. Esztergar
/s/ NORMAN A. GRANT Director June 6, 1996
- ----------------------------------------
Norman A. Grant
/s/ WILLIAM A. KERR Director June 6, 1996
- ----------------------------------------
William A. Kerr
</TABLE>
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Exhibit Index
<TABLE>
<CAPTION>
No. Description Page
- --- ----------- ----
<S> <C> <C>
4.18 Employment Agreement dated as of March 1, 1996,
between Registrant and Kimberly Krmpotich 10
4.19 Consulting Agreement dated as of June 1, 1995,
between Registrant and Franklin Rinker 12
5. Opinion of Fisher Thurber, Ltd. regarding the
legality of the Common Stock registered hereby 14
23. Consent of Ernst & Young LLP, Independent Auditors 16
23.1 Consent of Fisher Thurber, Ltd. (included in Exhibit 5) 14
</TABLE>
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EXHIBIT 4.18
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EMPLOYMENT AGREEMENT
This agreement ("Agreement") is effective as of the 1st day of March,
1994, by and between SGI International, a Utah Corporation ("Employer"), and
Kimberly A. Krmpotich, an individual ("Employee").
In consideration of the mutual agreements and the promises herein
contained, the parties hereto agree as follows:
1. Employer hereby agrees to employ Employee, and Employee agrees to be
employed, upon the terms and conditions set forth herein, as Administrative
Assistant/Receptionist, commencing on the date hereof and ending March 1, 1997.
2. Employee shall receive a salary of One thousand four hundred eighty
dollars ($1,520.00) per month, payable no less frequently than the fifteenth and
the last day of each month.
(a) As additional incentive compensation, Employer shall grant to
Employee a Warrant to purchase one thousand (1,000) shares of SGI restricted
common stock at an exercise price of $1.72 per share, which Warrant shall expire
on 12/31/01.
(b) As further Incentive Compensation, such bonuses and benefits as
Employer's Board of Directors, in its sole discretion shall determine.
(c) Compensation shall be reviewed by Employer and Employee at
least annually.
(d) Additional terms in Employer's Employee Handbook are hereby
incorporated by reference as if fully set forth herein.
3. This Agreement cannot be modified except by a writing signed by the
parties.
4. This Agreement shall constitute a contract under the laws of the
State of California and shall be governed and construed in accordance with the
laws of said state as to both interpretation and performance.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed at La Jolla, California as of the day first above written.
SGI INTERNATIONAL EMPLOYEE
By /s/ JOSEPH A. SAVOCA /s/ KIMBERLY A. KRMPOTICH
-------------------------- -----------------------------
Joseph A. Savoca Kimberly A. Krmpotich
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EXHIBIT 4.19
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CONSULTING AGREEMENT
THIS AGREEMENT is made and entered into as of June 1, 1995, by and
between FRANKLIN G. RINKER, an individual, 27457 Holiday Lane, Suite G,
Perrysburg, Ohio 43551 ("CONSULTANT") and SGI INTERNATIONAL, a Utah corporation,
1200 Prospect Street, Suite 325, La Jolla, California 92037 ("COMPANY").
WITNESSETH that: COMPANY agrees to engage CONSULTANT and CONSULTANT
agrees to serve as a consultant to COMPANY upon the following terms and
conditions:
1. Independent Contractor: CONSULTANT shall have sole discretion as
to the manner in which the consulting services performed hereunder are carried
out and shall be an independent contractor and not an agent or employee of
COMPANY.
2. Technical Consulting Services: CONSULTANT shall provide
technical consulting services at such time as COMPANY may from time to time
reasonably designate, with due regard for other obligations of the CONSULTANT,
on a project-by-project basis, for a consulting fee as is mutually agreed prior
to commencement thereof. In addition to consulting fees, CONSULTANT shall be
entitled to warrants to purchase SGI common stock. Specific warrant terms,
including but not limited to number of shares and exercise price, shall be set
by SGI's Board of Directors.
3. Advance Estimates: Upon the request of the COMPANY, CONSULTANT
shall without cost to COMPANY, provide an advance estimate which shall state:
(a) The estimated total cost of consulting
services and expenses for such project.
(b) The estimated completion date for the
performance of such services and a not-to-
exceed final completion date, assuming no
scope changes in the meantime.
4. Project Definition: Upon receipt of such advance estimates by
COMPANY, COMPANY and CONSULTANT shall cooperate in defining the project,
payments, times and all other provisions related to the performance of services
by CONSULTANT with respect to such project, and shall enter into a supplemental
letter agreement specifying the same.
5. Advance Authorization: COMPANY shall have no obligation to pay
any fees, costs or expenses not authorized in writing by COMPANY before such
fees, costs or expenses are incurred.
6. Records: CONSULTANT shall provide statements for services, fees
and costs according to generally accepted accounting standards in sufficient
detail to satisfy all state and federal taxing authorities.
7. Term: This Agreement shall commence as of June 1, 1995 and shall
continue until December 31, 1996, unless extended by mutual written agreement.
Either party may terminate this Agreement upon thirty (30) days prior written
notice.
8. Enforcement: In the event of any litigation to enforce or
interpret any provision of this Agreement, a court of competent jurisdiction may
award either party reasonable attorneys fees and costs, in addition to any other
appropriate relief.
IN WITNESS WHEREOF, this Agreement is executed as of the day and
year first written above.
SGI INTERNATIONAL FRANKLIN G. RINKER
By /s/ JOSEPH A. SAVOCO /s/ FRANKLIN G. RINKER
------------------------- -----------------------------
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EXHIBIT 5.
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[FISHER THURBER LLP LETTERHEAD]
June 6, 1996
SGI International
1200 Prospect Street
La Jolla, CA 92037
Re: Form S-8 Registration Statement
Gentlemen:
We have acted as special counsel to SGI International, a Utah
corporation (the "Company") in connection with the review of a Registration
Statement on Form S-8 (the "Registration Statement") to be filed with the
Securities and Exchange Commission in order to register 512,509 shares of the
Company's common stock, no par value per share (the "Common Stock"), issued and
issuable upon exercise of the Warrants accompanying the Employment Agreements
and Consulting Agreements referenced in the Registration Statement.
For purposes of rendering this opinion, we have made such legal and
factual examinations as we have deemed necessary under the circumstances and, as
part of such examination, we have examined among other things, originals and
copies, certified or otherwise, identified to our satisfaction, of such
documents, corporate records and other instruments as we have deemed necessary
or appropriate. For the purposes of such examination, we have assumed the
genuineness of all signatures on original documents and the conformity to
original documents of all copies submitted to us.
On the basis of and relying upon the foregoing examination and
assumptions, we are of the opinion that, assuming the Registration Statement
shall have become effective pursuant to the provisions of the Securities Act of
1933, as amended, the shares of Common Stock being offered in the Registration
Statement, when issued in accordance with the Registration Statement and the
provisions of the Employment Agreement, Consulting Agreements and Warrants
referenced in the Registration Statement, will be validly issued, fully paid and
nonassessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
Fisher Thurber, Ltd.
By: /s/ David A. Fisher
--------------------------
David A. Fisher
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EXHIBIT 23
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CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement (Form
S-8) pertaining to the Employment Agreements dated as of March 1, 1994, March
31, 1994, August 15, 1994, December 1, 1994, March 16, 1995, June 12, 1995,
March 1, 1996, Amendments to Employment Agreements dated as of March 31, 1993,
March 31, 1994, March 31, 1995, July 15, 1995, October 31, 1995 and Consulting
Agreement dated as of June 1, 1995 of our report dated March 11, 1996 with
respect to the consolidated financial statements of SGI International included
in its Annual Report (Form 10-K) for the year ended December 31, 1995, filed
with the Securities and Exchange Commission.
ERNST & YOUNG LLP
San Diego, California
June 6, 1996
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EXHIBIT 23.1
(included in Exhibit 5)
