<PAGE> 1
As filed with the Securities and Exchange Commission on April 25, 1995
Registration No. 33 -
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
PENWEST, LTD.
(exact name of issuer as specified in its charter)
<TABLE>
<S> <C>
Washington 91-1221360
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
Security Pacific Plaza, Suite 2390
777 - 108th Avenue N.E., Bellevue, Washington 98004-5193
(address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (206) 462-6000
</TABLE>
PENWEST, LTD. 1994 Stock Option Plan
(Full title of the Plan)
Jefferey T. Cook
Vice President, Finance and
Chief Financial Officer
PENWEST, LTD.
Security Pacific Plaza, Suite 2390
777 - 108th Avenue N.E.
Bellevue, Washington 98004-5139
(Name and address of agent for service)
(206) 462-6000
(Telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
===========================================================================================================================
Proposed
Proposed maximum Amount of
Title of securities Amount to be maximum offering aggregate offering registration
to be registered registered price per share price fee(1)
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, 500,000 shares $21.375 $10,687,500 $3,685.34
par value $1.00(1)
===========================================================================================================================
</TABLE>
(1) The proposed maximum offering price per share and the registration fee were
calculated in accordance with Rule 457(c) and (h) based on the average of the
high and low prices for PENWEST, LTD.'s common shares on April 19, 1995, as
quoted by the Nasdaq National Market system, which was $21.375 per share.
Page 1 of ____ pages.
Exhibit Index begins at page _____.
<PAGE> 2
PART II. INFORMATION REQUIRED IN THE REGISTRATION
STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The documents listed in (a) through (c) below are incorporated by reference in
this registration statement.
(a) The Company's latest Annual Report on Form 10-K filed pursuant
to Section 13 of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), for the Company's fiscal year
ended August 31, 1994.
(b) All other reports filed pursuant to Section 13(a) or 15(d) of
the Exchange Act since the filing of the Form 10-K, as
amended, by reference herein to (a) above.
(c) The description of the Company's securities contained in a
Registration Statement filed pursuant to Section 12 of the
Exchange Act.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date hereof and 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 herein and to be a 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 Company's Articles of Incorporation provide that the Company may
indemnify and hold harmless to the fullest extent permitted by the Washington
Business Corporation Act or other applicable law each person who was or is made
a party to or is threatened to be made a party to or is involved (including,
without limitation, as a witness) in any actual or threatened action, suit or
other proceeding, whether civil, criminal, derivative, administrative or
investigative, by reason of the fact that he or she is or was a director,
officer, employee or agent of the Company or, being or having been such a
director, officer, employee or agent, he or she is or was serving at the
request of the Company as a director, officer, employee, agent, trustee, or in
any other capacity of another company or of a partnership, joint venture, trust
or other enterprise, including service with respect to employee benefit plans,
whether the basis of such proceeding is alleged action or omission in an
official capacity or in any other capacity while serving as a director,
officer, employee, agent, trustee or in any other capacity, against all
expense, liability and loss (including, without limitation, attorneys' fees,
judgments, fines, Employee Retirement Income Security Act of 1974 excise taxes
or penalties and amounts to be paid in settlement) actually or reasonably
incurred or suffered by such person in connection therewith. The Washington
Business Corporation Act includes a provision (Section 23B.08.320 of the
Revised Code of Washington) that permits a corporation to limit a director's
liability to the corporation or its shareholders for monetary damages for his
or her acts or omissions as a director, except in certain circumstances
involving intentional misconduct, self dealing or illegal corporate loans or
distributions, or any transaction from which the director personally benefits.
Such indemnification may continue as to a person who has ceased to be a
director, officer, employee or agent of the Company and shall inure to the
benefit of his or her heirs and personal representatives.
The Company may pay the expenses of a director, officer, employee or
agent of the Company incurred in defending any such proceeding in advance of
the final disposition of any such proceeding; provided, however, that the
payment of such expenses in advance of the final disposition of a proceeding
shall be made to or on behalf of a director, officer, employee or agent only
upon delivery to the Company of an undertaking, by or on behalf of such
director, officer, employee or agent, to repay all amounts so advanced if it
shall ultimately be determined that such director, officer, employee or agent
is not entitled to be indemnified under the Company's Articles of Incorporation
or otherwise, which undertaking may be unsecured and may be accepted without
reference to financial ability to make repayment.
II-1
<PAGE> 3
No indemnification shall be provided under the Company's Articles of
Incorporation to any such person if the Company is prohibited by the provisions
of the Washington Business Corporation Act or other applicable law as then in
effect from paying such indemnification. The Washington Business Corporation
Act (Sections 23B.08.500 through 23B.08.600 of the Revised Code of Washington)
authorizes a court to award, or a corporation's Board of Directors to grant,
indemnity to directors and officers in terms sufficiently broad to permit such
indemnification under certain circumstances for liabilities arising under the
Securities Act of 1933, as amended.
In addition, it is anticipated that the Company will maintain
directors' and officers' liability insurance coverage.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not Applicable
ITEM 8. EXHIBITS.
<TABLE>
<CAPTION>
Exhibit Number Exhibit
<S> <C>
4 .1 PENWEST, LTD. 1994 Stock Option Plan
5 .1 Opinion of Bogle & Gates
23.1 Consent of Ernst & Young LLP
23.2 Consent of Bogle & Gates (See Exhibit 5.1)
24.1 Power of Attorney (See page II-5 of this Registration Statement)
</TABLE>
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
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, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
registration statement is on Form S-3 or Form S-8 and the information required
to be included in a post-effective amendment by those paragraphs is contained
in periodic reports filed by the registrant pursuant to Section 13 or Section
15(d) of the Securities Exchange Act of 1934 that are incorporated by reference
in 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.
II-2
<PAGE> 4
(b) The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of 1933, each
filing of the registrant's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934, (and, where applicable, each
filing of an employee benefit plan's annual report pursuant to Section 15(d) of
the Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) The undersigned registrant hereby undertakes to deliver or
cause to be delivered with the prospectus, to each person to whom the
prospectus is sent or given, the latest annual report to security holders that
is incorporated by reference in the prospectus and furnished pursuant to and
meeting the requirements of Rule 14a-3 or Rule 14c-3 under the Securities
Exchange Act of 1934; and, where interim financial information required to be
presented by Article 3 of Regulation S-X is not set forth in the prospectus, to
deliver, or cause to be delivered to each person to whom the prospectus is sent
or given, the latest quarterly report that is specifically incorporated by
reference in the prospectus to provide such interim financial information.
(d) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question of
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
The Registrant. Pursuant to the requirements of the Securities Act of
1933, the registrant certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-8 and has duly caused
this registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Bellevue, Washington, on this 24th
day of April, 1995.
PENWEST, LTD.
/s/ Jeffrey T. Cook
By ----------------------------
Jeffrey T. Cook
Vice President, Fianance and
Chief Financial Officer
(Principal Financial Officer)
II-4
<PAGE> 6
POWER OF ATTORNEY
Each person whose signature appears below constitutes and appoints Tod
R. Hamachek and Jeffrey T. Cook, or either of them, his or her
attorney-in-fact, with the power of substitution, for them in any and all
capacities, to sign any 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, hereby ratifying and confirming
all that said attorneys-in-fact, or their substitute or substitutes, may 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/ Tod R. Hamachek
- -----------------------------
Tod R. Hamachek President, Chief Executive Officer
and Director (Principal Executive Officer) April 24, 1995
/s/ Jeffrey T. Cook
- -----------------------------
Jeffrey T. Cook Chief Financial Officer
(Principal Financial Officer) April 24, 1995
/s/ Jennifer L. Good
- -----------------------------
Jennifer L. Good Corporate Controller
(Principal Accounting Officer) April 24, 1995
/s/ Richard E. Engebrecht
- -----------------------------
Richard E. Engebrecht Director April 24, 1995
/s/ Paul H. Hatfield
- -----------------------------
Paul H. Hatfield Director April 24, 1995
/s/ c. Calvert Knudsen
- -----------------------------
C. Calvert Knudsen Director April 24, 1995
/s/ Harry L. Mullikin
- -----------------------------
Harry L. Mullikin Director April 24, 1995
/s/ Sally G. Narodick
- -----------------------------
Sally G. Narodick Director April 24, 1995
/s/ William G. Parzybok, Jr.
- -----------------------------
William G. Parzybok, Jr. Director April 24, 1995
/s/ N. Stewart Rogers
- -----------------------------
N. Stewart Rogers Director April 24, 1995
/s/ William K. Street
- -----------------------------
William K. Street Director April 24, 1995
/s/ James H. Wiborg
- -----------------------------
James H. Wiborg Director April 24, 1995
</TABLE>
II-5
<PAGE> 7
Exhibit Index
<TABLE>
<CAPTION>
Exhibit Number Exhibit Page
- -------------- ------- ----
<S> <C>
4.1 PENWEST, LTD. 1994 Stock Option Plan
5.1 Opinion of Bogle & Gates
23.1 Consent of Ernst & Young LLP
23.2 Consent of Bogle & Gates (See Exhibit 5.1)
24.1 Power of Attorney (See page II-5 of this Registration Statement)
</TABLE>
II-6
<PAGE> 1
EXHIBIT 4.1
PENWEST, LTD.
1994 STOCK OPTION PLAN
1. INTRODUCTION:
This Plan establishes the right of and procedures for PENWEST, LTD.
(the "Company") to grant stock options to its key employees. The Plan provides
for the granting of two types of options, namely, (1) Non-Statutory Stock
Options and (2) Incentive Stock Options. This Plan sets forth provisions
applicable to both types of options, to Non-Statutory Options only and to
Incentive Stock Options only.
2. PROVISIONS OF GENERAL APPLICATION:
The provisions of this Section 2 apply to both Non-Statutory Options
and Incentive Stock Options granted by the Company.
2.1 Objectives of the Plan:
The purpose of this Plan is to encourage ownership of Common Stock of
the Company by key employees of the Company and any subsidiary. This Plan is
intended to provide an incentive for maximum effort in the successful operation
of the Company and is expected to benefit the shareholders by enabling the
Company to attract and retain personnel of the best available talent through
the opportunity to share, by the proprietary interests created by this Plan, in
the increased value of the Company's shares to which such personnel have
contributed.
2.2 Stock Reserved for this Plan:
The stock reserved for issue upon the exercise of options granted
under this Plan will not exceed 500,000 shares of the Common Stock of the
Company (the "Shares"). Except to the extent provided by the last sentence of
this Section 2.2, if any outstanding option under this Plan expires or is
terminated for any reason, Shares allocable to the unexercised portion of such
option shall remain available for other options under this Plan provided that
the aggregate number of Shares subject to options under this Plan shall not
exceed 500,000 Shares. The maximum number of Shares for which grants of
options may be made to any employee over the life of this Plan is 100,000. If
an option granted to an employee is canceled, the canceled option shall be
counted against the maximum number of shares for which options may be granted
to the employee hereunder.
2.3 Administration of this Plan:
This Plan will be administered by the Compensation Committee of the
Board of Directors of the Company (the "Committee") composed of two or more
members all of whom shall be "disinterested persons" as defined in the rules
and regulations promulgated by the Securities and Exchange Commission pursuant
to Section 16 of the Securities Exchange Act of 1934, as amended (the "Exchange
Act") and all of whom shall be "outside directors" as defined in the
regulations promulgated by the
1
<PAGE> 2
Internal Revenue Service pursuant to Section 162(m) of the Internal Revenue
Code of 1986, as amended (the "Code").
A majority of the Committee shall constitute a quorum, and acts of a
majority of the members present at any meeting at which a quorum is present, or
acts approved in writing by all members of the Committee, shall be deemed the
acts of the Committee.
The Committee, after considering the recommendations of the President
and other officers of the Company, if the Committee shall deem the same
appropriate, shall:
(a) determine the number of shares subject to each
option, the terms thereof and the type of options to be granted, and
direct the President, or other officer in his absence, to enter into
an appropriate agreement evidencing such option;
(b) prescribe rules and regulations from time to time for
administration of this Plan;
(c) decide any questions arising as to the interpretation
or application of any provision of this Plan.
Any action, decision, interpretation or determination by the Committee
with respect to this Plan shall be final and binding upon all employees.
This Plan shall otherwise be administered in accordance with Section
16 of the Exchange Act, including where required or advisable any amendments
thereto or successor statutes.
2.4 Eligibility Facts to be Considered in Granting Options:
An option may be granted to any officer or key employee who, at the
time the option is granted, is a regular full time employee of the Company or
of any subsidiary. In its determination of an employee to whom an option shall
be granted and the number of Shares to be covered by such option, the Committee
shall take into account the duties of the employee, the present and potential
contributions of the employee to the success of the Company, the anticipated
number of years of service remaining before the attainment by the employee of
the age of retirement, and other factors deemed relevant by the Committee in
connection with accomplishing the purpose of this Plan. An employee who has
been granted an option to purchase Shares, whether under this Plan or
otherwise, may, if the Committee shall so determine, be granted additional
options. As used in this Plan, the term "Optionee" shall refer to the holder
of an option granted hereunder.
2.5 Vesting of Options:
The Committee shall have the authority to establish the conditions for
determining when the optioned Shares may be purchased, and whether all of the
options may be exercised at one time or in increments. The conditions for
vesting may include continued employment, attainment of individual,
departmental, divisional or Company goals, or such other conditions as the
Committee may designate.
2
<PAGE> 3
2.6 Accelerated Vesting:
The Committee shall have the authority to establish criteria for
accelerating the vesting of options if certain events occur. The Committee may
provide for accelerated vesting in the case of such events as merger,
consolidation, reorganization, tender offer, takeover bid, sale of assets, or
dissolution. All options shall automatically vest upon the option holder's:
(i) death, (ii) "disability" as defined in, and determined in accordance with,
the Company's Supplemental Plan of Disability, or (iii) retirement (1) in
accordance with the Company's normal retirement policy or (2) prior to
attaining sixty-five (65) years of age provided specific approval of such
vesting is given by the Company. No such acceleration shall allow the holder
of an option to purchase any optioned Shares for which the options have
expired.
2.7 Terms and Expiration of Options:
Each option granted under this Plan shall be in writing, shall be
subject to such amendment or modification from time to time as the Committee
shall deem necessary or appropriate to comply with, or take advantage of
applicable laws or regulations and shall contain provisions to the following
effect, together with such other provisions as the Committee shall from time to
time approve:
(a) that, subject to the provisions of Section 2.7(b)
below, the option, as to the whole or any part thereof, may be
exercised only by the Optionee or his or her personal representative;
(b) that neither the whole nor any part of the option
shall be transferable by the Optionee or by operation of law otherwise
than by the will of, or by the laws of descent and distribution
applicable to, a deceased Optionee and that the option and any and all
rights granted to the Optionee thereunder and not theretofore
effectively and completely exercised shall automatically terminate and
expire upon any sale, transfer or hypothecation or any attempted sale,
transfer or hypothecation of such rights or upon the bankruptcy or
insolvency of the Optionee or his or her estate;
(c) that subject to the foregoing provisions, an option
may be exercised at different times for portions of the total number
of option Shares for which the right to purchase or exercise shall
have vested provided that such portions are in multiples of five (5)
Shares;
(d) that the Optionee shall have no right to receive any
dividend on or to vote or exercise any right in respect of any Shares
the certificate for which has not been issued to him or her;
(e) that the option shall each expire at the earliest of
the following:
(1) the date specified in the option;
(2) a date specified in the option but not later
than three (3) months after voluntary or involuntary
termination of the Optionee's employment other than
termination as described in Paragraph (3) below;
(3) upon the discharge of the Optionee for
misconduct, willfully or wantonly harmful to the Company;
3
<PAGE> 4
(4) twelve (12) months after the Optionee's death
or disability;
(5) such earlier date as the Committee may
specify in the event of a merger, consolidation,
reorganization, tender offer, takeover bid, sale of assets, or
dissolution;
(f) that the terms of the option shall not be affected by
any change of the Optionee's duties or position so long as the
Optionee shall continue to be employed by the Company or a subsidiary.
2.8 Notice of Intent to Exercise Option:
The Optionee (or other person or persons, if any, entitled thereto
hereunder) desiring to exercise an option granted hereunder as to all or part
of the Shares covered thereby shall in writing notify the Company at its
principal office at Bellevue, Washington, to that effect specifying the number
of option Shares to be purchased. With respect to any Shares acquired pursuant
to Section 2.6, the Optionee shall be deemed to have given to the Company the
notice of exercise required by this Section 2.8 ten (10) days prior to the
closing or effective date of any accelerating event.
2.9 Recapitalization:
The aggregate number of Shares for which options may be granted
hereunder, the number of Shares covered by each outstanding option and the
price per share thereof in each such option shall be proportionately adjusted
for any increase or decrease in the number of outstanding shares of Common
Stock of the Company resulting from a division or consolidation of shares or
any other increase or decrease in such shares effected without receipt of
consideration by the Company excluding any decrease resulting from the purchase
of shares for the treasury. If the adjustment would result in a fractional
share, the Optionee shall be entitled to one (1) additional share, provided
that the total number of Shares to be granted under this Plan shall not be
increased above the equivalent number of shares initially allocated to this
Plan or subsequently approved by the shareholders of the Company for issuance
hereunder.
2.10 Termination and Amendment of this Plan:
The directors of the Company may at any time modify, amend or
terminate this Plan except with respect to options granted prior to such
action, provided, however, that no such amendment or modification shall
increase the number of Shares as to which options may be granted under this
Plan or change the class of employee to whom options may be granted under this
Plan.
2.11 Granting of Options:
The granting of any option pursuant to this Plan shall be entirely in
the discretion of the Committee and nothing herein contained shall be construed
to give any officer or employee any right to participate under this Plan or to
receive any option under it.
The granting of an option pursuant to this Plan shall not constitute
an agreement or understanding, express or implied, on the part of the Company
or a subsidiary to employ the Optionee for any specified period.
4
<PAGE> 5
2.12 Withdrawal:
An Optionee may at any time elect in writing to abandon an option with
respect to the number of Shares as to which the option shall not have been
exercised.
2.13 Government Regulations:
This Plan and the granting and exercise of any option hereunder and
the obligations of the Company to sell and deliver Shares under any such option
shall be subject to all applicable laws, rules and regulations, and to such
approvals by any governmental agencies as may be required. This Plan shall be
governed by the laws of the State of Washington.
2.14 Shareholder Approval:
This Plan shall be submitted to the shareholders for their approval
within twelve (12) months from the date hereof.
2.15 Compliance with Securities Laws:
The Committee shall have the right to:
(a) require an Optionee to execute, as a condition of the
exercise of an option, a letter evidencing the Optionee's intent to
acquire the Shares for investment and not with a view to the
distribution thereof;
(b) place appropriate legends upon the certificate or
certificates for the Shares; and
(c) take such other acts as it deems necessary in order
to cause the issuance of optioned Shares to comply with applicable
provisions of state and federal securities laws.
3. PROVISIONS APPLICABLE TO NON-STATUTORY AND INCENTIVE STOCK OPTIONS:
The provisions of this Section 3 shall apply to Non-Statutory Options
and Incentive Stock Options.
3.1 Method of Exercise of Option:
Within ten (10) days after receipt by the Company of the notice
provided for in Section 2.8, but not later than the expiration date specified
in Section 2.7(e), the option shall be exercised as to the number of Shares
specified in the notice of payment to the Company of the amount specified in
either Section 4.2 or Section 5.5, as may be applicable. Payment of the
purchase price provided in the option shall be made in cash, in shares of the
Company's Common Stock, or in any combination of cash and shares of the
Company's Common Stock. Full or partial payment in shares of the Company's
Common Stock shall be deemed to be the equivalent of payment in cash of the
fair market value of those shares. For purposes of the preceding sentence and
this Plan, "fair market value" is defined as the average, if any, of the
closing prices for the Common Stock as of 4:00 p.m. Eastern Time on the date
of exercise on the principal trading exchange or national automated stock
quotation system on which the Common
5
<PAGE> 6
Stock is traded or quoted. Payment of the purchase price in shares of the
Company's Common Stock shall be subject to rules and procedures established by
the Committee including but not limited to any minimum holding period of the
shares used in payment of the purchase price.
3.2 Holding Period:
Any Optionee who is an officer, director or ten percent ( 10%)
shareholder of the Company shall be precluded from selling or transferring any
Common Stock or other security of the Company underlying an option during the
six (6) months immediately following the grant of the option.
3.3 Substitutions and Assumptions:
The Committee shall have the right to substitute or assume options in
connection with mergers, reorganizations, separations or other "corporate
transactions" as that term is defined in and said substitutions and assumptions
are permitted by Section 425 of the Code, and the regulations promulgated
thereunder. The number of Shares reserved pursuant to Section 2.2 may be
increased by the corresponding number of options assumed and, in the case of a
substitution, by the net increase in the number of Shares subject to options
before and after the substitution.
3.4 Proceeds from Sale of Stock:
Proceeds of the purchase of optioned Shares by an Optionee shall be
for the general business purposes of the Company.
4. PROVISIONS APPLICABLE SOLELY TO NON-STATUTORY STOCK OPTIONS:
In addition to the provisions of Sections 2 and 3, the following
paragraphs shall apply to any options granted under this Plan which are not
Incentive Stock Options.
4.1 Option Price:
The option or purchase price of each Share optioned under this Plan
shall be determined by the Committee at the time the option is granted,
provided that the option price shall not be less than the fair market value of
such Shares on the date of grant.
4.2 Method of Exercise of Option:
The amount to be paid by the optionee upon exercise of a Non-Statutory
Option shall be the full purchase price thereof provided in the option,
together with the amount of federal, state or local taxes of any kind required
to be withheld by the Company. An Optionee may elect to pay his or her
withholding taxes by having the Company withhold shares of Company stock having
a value equal to the amount required to be withheld. The value of the shares
to be withheld is deemed to be equal to the fair market value of the shares on
the day the option is exercised. An election by an Optionee to have shares
withheld for this purpose will be subject to the following restrictions:
(a) if an Optionee has received multiple option grants, a
separate election must be made for each grant;
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<PAGE> 7
(b) the election must be made prior to the day the option
is exercised;
(c) the election will be irrevocable; and
(d) the election will be subject to the disapproval of
the Committee.
5. PROVISIONS APPLICABLE SOLELY TO INCENTIVE STOCK OPTIONS:
In addition to the provisions of Sections 2 and 3, the following
paragraphs shall apply to any options granted under this Plan which are
Incentive Stock Options.
5.1 Conformance with Internal Revenue Code:
Options granted under this Plan which are "Incentive Stock Options"
shall conform to, be governed by and interpreted in accordance with, Section
422 of the Code and any regulations promulgated thereunder as well as any
amendments to the Code and such regulations.
5.2 Option Price:
The option or purchase price of each Share optioned under the
Incentive Stock Option provisions of this Plan shall be determined by the
Committee at the time of the action for the granting of the option but shall
not, in any event, be less than the fair market value of such Shares on the
date of grant.
5.3 Limitation on Vesting of Incentive Stock Option:
The aggregate fair market value of the option Shares (determined on
the date of grant) with respect to which Incentive Stock Options are
exercisable for the first time by an Optionee during any calendar year (under
this Plan and any other plan of the Company or its subsidiaries which
authorizes Incentive Stock Options) shall not exceed $100,000.
5.4 Limitation on Grants to Substantial Shareholders:
An employee may not, immediately prior to the grant of an Incentive
Stock Option hereunder, own stock in the Company representing more than ten
percent (10%) of the voting power of all classes of stock of the Company unless
the per share option price specified by the Committee for the Incentive Stock
Options granted such an employee is at least one hundred ten percent (110%) of
the fair market value of the Company's stock on the date of grant and such
option, by its terms, is not exercisable after the expiration of five (5) years
from the date such option is granted.
5.5 Method of Exercise of Option:
The amount to be paid by the Optionee upon exercise of an Incentive
Stock Option shall be the full purchase price thereof provided in the option.
7
<PAGE> 8
5.6 Time Limits on Grants and Exercises:
No Incentive Stock Option may be granted after October 26, 2004, and
no Incentive Stock Option may have a term of more than ten (10) years.
DATED as of this 26th day of October, 1994.
PENWEST, LTD.
By /s/ Tod R. Hamachek
--------------------------------
Its President
--------------------------------
ATTEST:
/s/ Jeffrey T. Cook
- -------------------------
Its Secretary
8
<PAGE> 1
[BOGLE & GATES LETTERHEAD]
April 24, 1995
PENWEST, LTD.
777 108th Avenue N.E.
Suite 2390
Bellevue, Washington 98004-1688
Re: PENWEST LTD. 1994 Stock Option Plan
Registration Statement on Form S-8
Ladies and Gentlemen:
We are acting as counsel for PENWEST, LTD. (the "Company") in
connection with the filing of a Registration Statement on Form S-8 with the
Securities and Exchange Commission under the Securities Act of 1933, as
amended, relating to the proposed sale by the Company of an aggregate of
500,000 shares of its common stock, par value $1.00 per share (the "Shares"),
issuable upon the exercise of options granted pursuant to the Company's 1994
Stock Option Plan.
In connection with the foregoing, we are of the opinion that
the Shares will, when sold, be legally issued, fully paid and nonassessable.
We hereby authorize and consent to the use of this opinion as
Exhibit 5.1 to the Registration Statement.
Very truly yours,
/s/ BOGLE & GATES
Exhibit 5.1
<PAGE> 1
Exhibit 23.1
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement
(Form S-8) pertaining to the PENWEST LTD., 1994 Stock Option Plan of PENWEST,
LTD. of our report dated November 11, 1994, with respect to the consolidated
financial statements and schedules of PENWEST, LTD. included in its Annual
Report (Form 10-K) for the year ended August 31, 1994, filed with the
Securities and Exchange Commission.
/s/ERNST & YOUNG LLP
Seattle, Washington
April 24, 1995
