As filed with the Securities and Exchange Commission on
June 4, 1996. Registration No. 333-_____
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
ENCORE COMPUTER CORPORATION
(Exact name of registrant as specified in its charter)
Delaware No. 04-2789167
(State or other (IRS Employer
jurisdiction of Identification No.)
incorporation or
organization)
6901 West Sunrise Blvd.
Fort Lauderdale, Florida 33313
(954) 587-2900
(Address, including zip code, and telephone number,
including area code, of registrant's principal
executive offices)
1985 Nonqualified Stock Option Plan
1995 Long Term Performance Plan
(Full title of plans)
KENNETH G. FISHER,
Chairman and Chief Executive Officer
Encore Computer Corporation
6901 West Sunrise Blvd.
Ft. Lauderdale, Florida 33313
(954) 587-2900
(Name, address, including zip code, and telephone
number, including area code, of agent for service)
Copy to:
CAMERON READ, ESQ.
Choate, Hall & Stewart
Exchange Place
53 State Street
Boston, Massachusetts 02109
(617) 248-5000
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
Title of Proposed Proposed
securities to Amount to be maximum offering aggregate Amount of Amount of
be registered registered(1) price per share(2) offering price(2) registration fee registration fee
_____________ ______________ __________________ __________________ _________________
<S> <C> <C> <C> <C>
Common Stock 12,000,000 $3.328125 $39,937,500 $13,771.56
$0.01 par value Shares
</TABLE>
(1) Plus such additional number of shares as may be
required pursuant to the Plan in the event of a
stock dividend, split-up of shares,
recapitalization or other similar change in the
Common Stock.
(2) Estimated solely for the purpose of calculating
the registration fee, in accordance with Rule 457,
on the basis of the average of the high and low
sales prices of the Common Stock as reported on
The Nasdaq Stock Market on May 29, 1996.
EXPLANATORY STATEMENT
This Registration Statement has been prepared in
accordance with the requirements of Form S-8 and
relates to shares of Common Stock, $.01 par value per
share (the "Common Stock"), of Encore Computer
Corporation not exceeding in the aggregate 12,000,000
shares which have been reserved for issuance upon the
exercise of options or pursuant to stock awards which
have been or may be granted under the Company's 1985
Nonqualified Stock Option Plan or its 1995 Long-Term
Performance Plan. An aggregate of 12,000,000 shares
have previously been registered for issuances upon the
exercise of options granted under the Company's 1983
Incentive Stock Option Plan (all options under such
plan having been either exercised or expired
unexercised) or its 1985 Nonqualified Stock Option Plan
pursuant to Registration Statements on Form S-8.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents are hereby incorporated by
reference in this Registration Statement:
(a) The Company's annual report on Form 10-K for
the fiscal year ended December 31, 1995 filed with the
Securities and Exchange Commission (the "Commission")
under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), containing the Company's audited
financial statements for the fiscal year ending
December 31, 1995;
(b) The Company's quarterly report on Form 10-Q
for the quarter ended March 31, 1996 filed with the
Commission under the Exchange Act;
(c) The description of the Company's Common Stock
incorporated by reference into the Company's
registration statement on Form 8-A dated May 1, 1985
and filed with the Commission, including any amendment
or report filed for the purpose of updating such
description.
In addition, all documents filed by the Company
after the initial filing date of this registration
statement pursuant to Sections 13(a), 13(c), 14 and
15(d) of the Exchange Act, and prior to the filing of a
post-effective amendment which indicates that all
shares registered hereunder have been sold or which de-
registers all shares then remaining unsold, shall be
deemed to be incorporated by reference in this
registration statement and to be a part hereof from the
date of filing of such documents.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
The legality of the shares of common stock offered
hereby has been passed upon for the Company by Choate,
Hall & Stewart, Exchange Place, 53 State Street,
Boston, Massachusetts 02109. Cameron Read, a partner
of Choate, Hall & Stewart, is Assistant Secretary of
the Company.
II-1
Item 6. Indemnification of Officers and Directors and
Officers.
Section 145 of the Delaware General Corporation
Law permits indemnification of directors, officers,
employees and agents of a corporation under certain
conditions and subject to certain limitations. Article
EIGHTH of the Certificate of Incorporation of the
Registrant provides for indemnification to the fullest
extent permitted by Section 145.
Section 102(b)(7) of the Delaware General
Corporation Law permits a corporation to provide in its
Certificate of Incorporation that a director of the
corporation shall not be personally liable to the
corporation or its stockholders for monetary damages
for breach of fiduciary duty as a director, except for
liability (i) for any breach of the director's duty of
loyalty to the corporation or its stockholders, (ii)
for acts or omissions not in good faith or which
involve intentional misconduct or a knowing violation
of law, (iii) under Section 174 of the Delaware General
Corporation Law (relating to illegal dividends or stock
repurchases), or (iv) for any transaction from which
the director derived an improper personal benefit.
Article ELEVENTH of the Registrant's Certificate of
Incorporation, as amended, provides that no director of
the Company shall be liable for monetary damages for
any breach of fiduciary duty, except to the extent that
the Delaware General Corporation Law prohibits the
elimination or limitation of liability of directors for
breach of fiduciary duty.
Item 7. Exemption From Registration Claimed.
Not applicable.
Item 8. Exhibits.
5.1 Opinion of Choate, Hall & Stewart.
10.1 The Company's 1985 Nonqualified Stock
Option Plan.
10.2 The Company's 1995 Long Term Performance
Plan.
23.1 Consent of Coopers & Lybrand L.L.P.
23.2 Consent of Choate, Hall & Stewart
(included in Exhibit 5.1).
25.1 Power of Attorney (part of page II-5).
II-2
Item 9. Undertakings.
The Company hereby undertakes:
(1) To file, during any period in which offers or
sales are being made, a post-effective amendment to
this registration statement;
(a) to include any prospectus required by
section 10(a)(3) of the Securities Act of 1933;
(b) 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; and
(c) 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 (1)(a) and
(1)(b) shall not apply if the information required
to be included in a post-effective amendment by
those paragraphs is contained in periodic reports
filed by the registrant pursuant to section 13 of
section 15(d) of the Securities Exchange Act of
1934 that are incorporated by reference in the
registration statement;
(2) That, for the purpose of determining any
liability under the Securities Act of 1933, as amended,
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; and
(4) That, insofar as provisions for
indemnification of directors and officers of the
Company contained in the Company's Certificate of
Incorporation require the Company to indemnify its
directors and officers against any expenses,
liabilities or other matters to the fullest extent
permitted under Delaware laws, and insofar as the
II-3
Company has entered into, and may in the future enter
into, indemnification agreements with its directors and
officers which cover and may, in certain respects,
extend the indemnification provisions contained in the
Certificate of Incorporation, and 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 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.
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 Fort Lauderdale, Florida on May 30, 1996.
ENCORE COMPUTER CORPORATION
(Issuer and Employer)
By: Kenneth G. Fisher
Chairman and
Chief Executive
Officer
II-4
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person
whose signature appears below constitutes and appoints
Kenneth G. Fisher, Kenneth S. Silverstein, and Cameron
Read, jointly and severally, his attorneys-in-fact,
each with the power of substitution, for him 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 each of said
attorneys-in-fact, or his 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
below by the following persons in the capacities and on
the dates indicated.
Name Capacity Date
Kenneth G. Fisher Chairman May 30, 1996
and Executive
Officer;
Director
Rowland H. Thomas, Jr. President May 30, 1996
and Chief
Operating
Officer;
Director
Kenneth S. Silverstein Secretary May 29, 1996
and Chief
Accounting
Officer
Daniel O. Anderson Director June 3, 1996
C. David Ferguson Director May 31, 1996
II-5
INDEX TO EXHIBITS
Exhibit Number Page
5.1 Opinion of Choate, Hall &
Stewart.
10.1 The Company's 1985
Nonqualified Stock Option Plan.
10.2 The Company's 1995 Long Term
Performance Plan.
23.1 Consent of Coopers & Lybrand
L.L.P.
23.2 Consent of Choate, Hall &
Stewart (included in
Exhibit 5.1).
25.1 Power of Attorney (part of
page II-5).
II-6
Exhibit 5.1
CHOATE, HALL & STEWART
A Partnership Including Professional Corporations
EXCHANGE PLACE
53 STATE STTEET
BOSTON, MASSACHUSETTS 02109-2891
Telephone: (617) 248-5000
Fax: (617) 248-4000
June 4, 1996
Encore Computer Corporation
6901 West Sunrise Blvd.
Ft. Lauderdale, Florida 33313
Gentlemen:
This opinion is delivered to you in connection
with the Registration Statement on Form S-8 (the
"Registration Statement") to be filed on or about June
4, 1996 by Encore Computer Corporation (the "Company")
under the Securities Act of 1933, as amended, for
registration under said Act of 12,000,000 shares of
common stock, $0.01 par value (the "Common Stock"), of
the Company.
We are familiar with the Company's Certificate of
Incorporation and its By-Laws, as amended, as well as
the Registration Statement. We have also examined such
other documents, records and certificates and made such
further investigation as we have deemed necessary for
the purposes of this opinion.
Based upon and subject to the foregoing, we are of
the opinion that the shares of Common Stock to be sold
by the Company under its 1985 Nonqualified Stock Option
Plan or its 1995 Long-Term Performance Plan, as in
effect on the date hereof, when issued against receipt
of the agreed purchase price therefor, will be legally
issued, fully paid and nonassessable.
We understand that this opinion is to be used in
connection with the Registration Statement and consent
to the filing of this opinion as an exhibit to the
Registration Statement. We further consent to the
reference to this firm in the section entitled
"Interests of Named Experts and Counsel" included in
the Registration Statement.
Very truly yours,
CHOATE, HALL & STEWART
Exhibit 10.1
ENCORE COMPUTER CORPORATION
1985 NONQUALIFIED STOCK OPTION PLAN
1. Purpose. The purpose of this Plan is to advance the
interests of Encore Computer Corporation, a Delaware corporation,
and its present and future subsidiaries (hereinafter collectively
referred to as the "Company") by strengthening the ability of the
Company to attract, retain and motivate key employees and
consultants to the Company by providing them with an opportunity
to purchase stock of Encore Computer Corporation. It is intended
that this purpose will be effected by the granting of
nonqualified stock options ("options").
2. Effective Date. This Plan originally became effective
on September 24, 1985, and has been amended from time to time
thereafter. Although options with respect to such additional
shares may be granted before such approval, no option may be
exercised until such approval is obtained and such options will
be null and void if such approval is not obtained.
3. Stock Subject to the Plan. The shares with respect to
which options may be granted under this Plan shall not exceed in
the aggregate 24,000,000 shares of the $.01 par value, common
stock of the Company (the "Shares"); provided, however, that such
maximum number of Shares shall be reduced by the number of any
Shares that are made subject to options (which have not
subsequently expired or been terminated prior to exercise)
pursuant to the Encore Computer Corporation 1983 Incentive Stock
Option Plan. Any Shares subject to an option under this Plan
which for any reason expires or is terminated unexercised as to
such Shares may again be the subject of an option under the Plan.
In addition, any Shares purchased by an optionee upon exercise of
an option under this Plan which are subsequently repurchased by
the Company pursuant to the terms of such option may again be the
subject of an option under the Plan. The Shares delivered upon
exercise of options under this Plan may, in whole or in part, be
either authorized but unissued Shares or issued Shares reacquired
by the Company.
4. Administration. This Plan shall be administered by the
Board of Directors or, to the extent delegated by the Board of
Directors, a compensation or stock option committee (the
"Committee"). Subject to the provisions of this Plan, the Board
of Directors or such a committee shall have full power to
construe and interpret the Plan and to establish, amend and
rescind rules and regulations for its administration. Any
decisions made with respect thereto shall be final and binding on
the Company, the optionees and all other persons.
5. Eligible Optionees. Stock options may be granted to
such key employees (including members of the Board of Directors
of the Company who are also employees) and consultants to the
Company, as are selected by the Board of Directors or Committee.
Notwithstanding anything to the contrary herein, discretion
as to the selection of any director or officer of Encore Computer
Corporation to whom options may be granted hereunder, and the
determination of the number of shares covered by options granted
2
hereunder to any director or officer of the Encore Computer
Corporation, shall be exercised only as follows:
(i) with respect to participation of directors:
(a) by the Board of Directors, if a majority of
such Board of Directors and a majority of such
Board of Directors acting in the matter, are
"disinterested persons," as such term is defined
in Rule 16b-3(d)(3) of the Securities Exchange Act
of 1934; or (b) by, or in accordance with the
recommendation of, a committee to which the Board
of Directors has delegated its authority, if such
committee consists of three or more persons having
full authority to act in the matter and all of
such persons are "disinterested persons," as
defined above;
(ii) with respect to the participation of officers who
are not directors:
(a) by the Board of Directors or a committee of
three or more directors; or (b) by, or in
accordance with the recommendation of, a committee
of three or more persons having full authority to
act in the matter, all of the members of which
committee are "disinterested persons," as defined
above.
6. Duration of the Plan. This Plan shall terminate ten
(10) years from the original effective date hereof, unless
terminated earlier pursuant to Paragraph 11 hereafter, and no
options may be granted thereafter.
7. Terms and Conditions of Options. Options granted under
this Plan shall be evidenced by stock option agreements in such
form and containing such terms and conditions as the Board of
Directors or Committee shall determine; provided, however, that
such agreements shall evidence among their terms and conditions
the following:
3
(a) Price. The purchase price per Share payable upon
the exercise of each option granted hereunder shall be determined
by the Board of Directors or Committee at the time the option is
granted, but such price per Share shall in no event be less than
50% of the fair market value of a Share on the date of grant.
(b) Number of Shares. Each option agreement shall
specify the number of Shares to which it pertains.
(c) Exercise of Options. Each option shall be
exercisable for the full amount or for any part thereof and at
such intervals or in such installments as the Board of Directors
or Committee may determine at the time it grants such option;
provided, however, that no option shall be exercisable with
respect to any Shares later than ten (10) years after the date of
the grant of such option.
(d) Notice of Exercise and Payment. An option shall
be exercisable only by delivery of a written notice to the
Treasurer of Encore Computer Corporation, or any other officer of
the Company designated by the Board of Directors or Committee to
accept such notices on its behalf, specifying the number of
Shares for which it is exercised. If the offering of said Shares
is not at that time effectively registered under the Securities
Act of 1933, as amended, the optionee shall include with such
notice a letter, in form and substance satisfactory to the
Company, confirming that the Shares are being purchased for the
optionee's own account for investment and not with a view to
distribution, and acknowledging that the optionee is familiar
4
with any restrictions on the resale of the Shares under
applicable securities laws. Payment shall be made in full at the
time the option is exercised. Payment shall be made either (i)
in cash, (ii) by check, (iii) if permitted by the Board of
Directors or Committee, by delivery and assignment to the Company
of shares of Company stock having a fair market value (as
determined by the Board of Directors or Committee) equal to the
exercise price, (iv) if permitted by the Board of Directors or
Committee, by promissory note, or (v) by a combination of (i),
(ii), (iii), or (iv).
(e) Non-Transferability. No option shall be
transferable by the optionee otherwise than by will or the laws
of descent or distribution, and each option shall be exercisable
during his lifetime only by him.
(f) Termination of Options. Each option shall
terminate and may no longer be exercised if the optionee ceases
for any reason to perform services for the Company in accordance
with the following provisions:
(i) if the optionee's ceases to perform services for
the Company by reason of resignation or other
voluntary action of the optionee, or if the
Company determines that it no longer wishes to
engage the optionee's services and makes such
determination based on cause, the option shall
terminate at the time of such resignation or
termination and may not be exercised thereafter;
(ii) if the optionee ceases to perform services for the
Company for any reason other than cause
resignation or other voluntary action before he is
eligible to retire, death or disability (as
defined below); he may, at any time within a
period of three (3) months after he ceased to
perform services, exercise the option to the
5
extent that the option was exercisable by him on
the date on which he ceased to perform services
for the Company;
(iii) if the optionee ceases to perform services for the
Company because of disability within the meaning
of Section 22(e)(3) of the Code, he may, at any
time within a period of one (1) year after he
ceases to perform services, exercise the option to
the extent that the option was exercisable by him
on the date he ceased to perform services; and
(iv) if the optionee dies at a time when he might have
exercised the option, then his estate, personal
representative or beneficiary to whom it has been
transferred pursuant to Paragraph 7(e) hereof may,
at any time within a period of one (1) year after
the optionee's death, exercise the option to the
extent the optionee might have exercised it at the
time of his death;
provided, however, that the Board of Directors or Committee may
provide specifically in an option agreement for such other period
of time during which an optionee may exercise an option after
termination of the optionee's services as the Board of Directors
or Committee may approve, subject to the overriding limitation
that no option may be exercised to any extent by anyone after the
date of expiration of the option.
(g) Rights as Shareholder. The optionee shall have no
rights as a shareholder with respect to any Shares covered by his
option until the date of issuance of a stock certificate to him
for such Shares.
(h) Repurchase of Shares by the Company. Any Shares
purchased by an optionee upon exercise of an option may in the
discretion of the Board of Directors or Committee be subject to
repurchase by the Company if and to the extent specifically set
6
forth in the option agreement pursuant to which the Shares were
purchased.
8. Stock Dividends; Stock Splits; Stock Combinations;
Recapitalizations. Appropriate adjustment shall be made by the
Board of Directors or Committee in the maximum number of Shares
subject to the Plan and in the number, kind, and option price of
Shares covered by outstanding options granted hereunder to give
effect to any stock dividends, stock splits, stock combinations,
recapitalizations and other similar changes in the capital
structure of the Company after the effective date of the Plan.
9. Merger; Sale of Assets; Dissolution. In the event of a
change of the Shares resulting from a merger or similar
reorganization as to which Encore Computer Corporation is the
surviving corporation, the number and kind of shares which
thereafter may be optioned and sold under the Plan, and the
number and kind of shares then subject to options granted
hereunder and the option price per share thereof shall be
appropriately adjusted in such manner as the Board of Directors
or Committee may deem equitable to prevent dilution or
enlargement of the rights available or granted hereunder. Except
as otherwise determined by the Board of Directors, a merger or a
similar reorganization which Encore Computer Corporation does not
survive, or a sale of all or substantially all of the assets of
Encore Computer Corporation, shall cause every option outstanding
hereunder to terminate, to the extent not then exercised, unless
any surviving entity agrees to assume the obligations hereunder.
7
10. Definitions.
(a) The term "employee" shall have, for purposes of
this Plan, the meaning ascribed to it under Section 3401(c) of
the Code and the regulations promulgated thereunder.
(b) The term "key employees" refers to those
executive, technical, administrative, managerial or other
employees who are determined by the Board of Directors or
Committee to be eligible for options under this Plan.
(c) The term "optionee" means a key employee of or
consultant to the Company to whom an option is granted under this
Plan.
(d) The term "subsidiary" shall have, for purposes of
this Plan, the meaning ascribed to it under Section 425(f) of the
Code and the regulations promulgated thereunder.
11. Termination or Amendment of Plan. The Board of
Directors may at any time terminate the Plan or make such changes
in or additions to the Plan as it deems advisable without further
action on the part of the shareholders of the Company, provided:
(a) that no such termination or amendment shall
adversely affect or impair any then outstanding option without
the consent of the optionee holding such option; and
(b) that no such amendment which increases the maximum
number of Shares subject to this Plan, changes the class of
persons eligible to participate in the Plan, or materially
increases the benefits accruing to participants under the Plan
shall be effective unless it is approved by the shareholders of
8
Encore Computer Corporation not later than the next annual
meeting of shareholders following the date such amendment is
adopted by the Board of Directors.
9
Exhibit 10.2
ENCORE COMPUTER CORPORATION
1995 LONG TERM PERFORMANCE PLAN
______________
1. PURPOSE
The purpose of this Encore Computer Corporation 1995 Long
Term Performance Plan (the "Plan") is to advance the interests of
Encore Computer Corporation (the "Company") by enabling the
Company to attract and retain directors, officers, executives,
key employees and other key individuals performing services for
the Company, and reward them for making major contributions to
the success of the Company. This purpose is accomplished by
making stock awards under the Plan, thereby providing
Participants with a proprietary interest in the growth and
performance of the Company.
2. DEFINITIONS
(a) "Award" shall mean the grant of any form of stock
option, stock appreciation right, stock, whether granted singly,
or in combination to a Participant pursuant to such terms,
conditions, performance requirements, restrictions and
limitations as the Committee may establish in order to fulfill
the purpose of the Plan.
(b) "Award Agreement" shall mean a written plan document
adopted by the Company or a written agreement between the Company
and a Participant that sets forth the terms, conditions,
performance requirements, restrictions and limitations applicable
to an Award.
(c) "Board" shall mean the Board of Directors of the
Company.
(d) "Code" shall mean the Internal Revenue Code of 1986,
as amended from time to time.
(e) "Committee" shall mean the committee designated by
the Board to administer the Plan or, when more than one committee
is designated by the Board, the applicable committee designated
to administer the Plan with respect to a particular class of
Participants and Awards granted thereto, it being the purpose of
providing herein for multiple committees that certain Awards
granted under the Plan will comply with the requirements of
Section 162(m) of the Code, and regulations promulgated
thereunder, and/or Rule 16b-3 promulgated under the Securities
Exchange Act of 1934 or any successors to such rules and
regulations, concerning, without limitation, the requirements
that the Plan be administered by two or more "outside directors"
within the meaning of Section 162(m) of the Code and
"disinterested persons" within the meaning of Rule 16b-3.
(f) "Common Stock" or "Stock" shall mean authorized and
issued or unissued $0.01 par value Common Stock of the Company.
(g) "Company" shall mean Encore Computer Corporation and
its subsidiaries including subsidiaries of subsidiaries and
partnerships and other business ventures in which Encore Computer
Corporation has a significant equity interest, as determined in
the sole discretion of the Committee.
(h) "Fair Market Value" shall mean the value of Common
Stock as determined in accordance with procedures established in
good faith by the Committee and, with regard to incentive stock
options, in conformity with the Code and regulations with regard
to incentive stock options.
(i) "Participant" shall mean a director or an employee
of the Company or other key individual performing services for
the Company to whom an Award has been made under the Plan.
3. ELIGIBILITY
Awards may be granted to such directors, officers,
executives, key employees or other individuals performing
services for the Company who in the judgment of the Committee or
the management of the Company can have a significant effect on
the success of the Company.
4. STOCK AVAILABLE FOR AWARDS
The number of shares of Common Stock that may be issued
under the Plan for Awards granted wholly or partly in Stock is 24
million shares less the number of shares issued or reserved for
issuance under options granted pursuant to the Company's 1983
Incentive Stock Option Plan or 1985 Nonqualified Stock Option
Plan (the "Prior Plans") plus any shares subject to outstanding
options under the Prior Plans which are terminated or expire
unexercised (the "Share Limit"). Included in the Share Limit are
Awards denominated in shares of Stock that may be redeemed or
exercised, at the Participant's option, for cash and/or for
Stock. Also included in the Share Limit are shares of Stock
withheld by the Company in connection with the exercise of any
stock option or other Award to satisfy tax withholding
requirements or to pay the exercise price of such stock options
or Awards. Stock related to Awards that are forfeited,
terminated, expire unexercised, or settled in such manner that
all or some of the shares covered by an Award are not issued to a
Participant, or are exchanged for Awards that do not involve
Stock, shall immediately become available for Awards and will not
-2-
be included within the Share Limit; provided, in the case of
shares reacquired by the Company pursuant to a repurchase right,
the holder thereof did not receive any benefits with respect to
the ownership thereof other than voting rights.
5. ADMINISTRATION
The Plan shall be administered by the Committee, which shall
have full and exclusive power to interpret the Plan and to adopt
such rules, regulations and guidelines for carrying out the Plan
as it may deem necessary or proper, all of which powers shall be
executed in the best interests of the Company and in keeping with
the purposes of the Plan. These powers include, but are not
limited to, designating the Participants, designating the Awards
made to each Participant, establishing performance goals and
subplans, establishing vesting and exercisability restrictions,
and waiving any or all restrictions previously attached to any
Award. These powers include the adoption of modifications,
amendments, procedures, subplans and the like as are necessary to
comply with provisions of the laws and regulations of the
countries in which the Company operates in order to assure the
viability of Awards granted under the Plan and to enable
Participants regardless of where employed to receive advantages
and benefits under the Plan and such laws and regulations.
6. DELEGATION OF AUTHORITY
The Committee may delegate to the chief executive officer
and to other senior officers of the Company its duties under the
Plan pursuant to such conditions or limitations as the Committee
may establish, except that only a Committee consisting of
"disinterested directors" and/or "outside directors", as
applicable, may select, and grant Awards to, Participants who are
subject to Section 16 of the Securities Exchange Act of 1934
("Section 16 Persons") and/or who are "covered employees" within
the meaning of Section 162(m) of the Code.
7. AWARDS
The Committee shall determine the type or types of Award(s)
to be made to each Participant and shall set forth in the related
Award Agreement the terms, conditions, performance requirements,
and limitations applicable to each Award. Awards may include but
are not limited to those listed in this Section 7. Awards may be
granted singly or in combination. Awards may also be made in
combination with, in replacement of, or as alternatives to,
grants or rights under any other employee plan of the Company,
including the plan of any acquired entity. Any other provision
hereof notwithstanding, no Participant shall be granted within
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any fiscal year of the Company Awards of stock options or SAR's
the aggregate of which shall exceed 1.2 million shares.
(a) Stock Options. A stock option is the grant by the
Company to a Participant of a right to purchase a specified
number of shares of Stock. A stock option may be in the form of
(i) a nonqualified option which shall be subject to terms,
conditions and limitations established by the Committee or
(ii) an incentive stock option ("ISO") which, in addition to
being subject to applicable terms, conditions and limitations
established by the Committee, complies with Section 422 of the
Code which, among other limitations, provides that the aggregate
Fair Market Value (as determined at the time the option is
granted) of Stock for which ISO's are exercisable for the first
time by a Participant during any calendar year shall not exceed
$100,000; that ISO's shall be priced at not less than 100% of the
Fair Market Value on the date of the grant; and that ISO's shall
be exercisable for a period of not more than ten years.
(b) Stock Appreciation Rights. A stock appreciation
right ("SAR") is a right of a Participant to receive from the
Company a payment, in cash and/or Stock, equal to the excess of
the Fair Market Value of a specified number of shares of Stock on
the date the SAR is exercised over the Fair Market Value on the
date of grant of the SAR, as set forth in the Award Agreement.
(c) Stock Award. An Award may be made in shares of
Stock or denominated in shares of Stock. All or part of any
Stock Award may be subject to terms, conditions and limitations
established by the Committee, and set forth in the Award
Agreement, which may include, but are not limited to, continuous
service with the Company, achievement of specific individual,
divisional or Company-wide business objectives, increases in
specified indices, attaining financial growth rates, and other
comparable measurements of performance. When transfer of Stock
is so restricted or subject to other restriction or forfeiture
provisions, it is referred to as "Restricted Stock."
(d) Formula Options to Non-Employee Directors On the
day following the annual shareholders meeting each year
commencing with the 1995 annual meeting of shareholders (or if
such day is not a business day, the next business day), each
member of the Board who is not an employee of the Company or any
of its affiliates shall be granted an option to purchase 5,000
shares of Common Stock at a price equal to 100% of the Fair
Market Value on the date of grant and subject to such other terms
and conditions, not inconsistent with the terms of this Plan, as
the Committee shall include in the Award Agreement.
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8. PAYMENT OF AWARDS
Payment of Awards may be made in the form of cash, Stock, or
combinations thereof, and may include such restrictions as the
Committee shall determine, including in the case of Stock,
restrictions on transfer and forfeiture provisions. If the
Committee specifies in the Award Agreement, payment of Awards
shall be deferred, either in the form of installments or as a
future lump sum payment. The Committee may permit Participants
to elect to defer payments of some or all types of Awards in
accordance with procedures established by the Committee which are
intended to permit such deferrals to comply with applicable
requirements of the Code including, at the choice of the
Participant, the capability to make further deferrals for payment
after retirement. Any deferred payment, whether elected by the
Participant or specified by the Award Agreement, may require the
payment to be forfeited in accordance with the provisions of
Section 13 of the Plan. Dividends or dividend equivalent rights
may be extended to and made a part of any Award denominated in
Stock or shares of Stock, subject to such terms, conditions and
restrictions as the Committee may establish. The Committee may
also establish rules and procedures for the crediting of interest
on deferred cash payments and dividend equivalents for deferred
payments denominated in Stock or shares of Stock. At the
discretion of the Committee, a Participant may be offered an
election to substitute an Award for another Award or Awards of
the same or different type.
9. STOCK OPTION EXERCISE
The price at which shares of Stock may be purchased under a
Stock Option shall be paid in full at the time of the exercise in
cash or, if permitted by the Committee, by means of tendering
Stock or surrendering another Award, including Restricted Stock,
valued at Fair Market Value on the date of exercise, or any
combination thereof. The Committee shall determine acceptable
methods for tendering Common Stock or other Awards and may impose
such conditions on the use of Common Stock or other Awards to
exercise a stock option as it deems appropriate. In the event
shares of Restricted Stock are tendered as consideration for the
exercise of a stock option, a number of the shares issued upon
the exercise of the stock option, equal to the number of shares
of Restricted Stock used as consideration therefor, shall be
subject to the same restrictions as the Restricted Stock so
submitted plus any additional restrictions that may be imposed by
the Committee.
10. TAX WITHHOLDING
The Company shall have the right in its sole discretion to
deduct applicable taxes from any Award payment and withhold, at
the time of delivery or (other than with respect to stock
options) vesting of shares under the Plan, an appropriate number
of shares for payment of taxes required by law or to take such
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other action as may be necessary in the opinion of the Company to
satisfy all obligations for withholding of such taxes; provided
that with respect to Section 16 Persons the Company shall in all
cases where tax withholding is required with respect to such
Participants, withhold shares of Stock having a value equal to
such withholding obligation, unless the applicable Award
Agreement provides that the Participant shall have the option of
satisfying such mandatory withholding obligation by delivering to
the Company cash in lieu of stock being withheld in an amount
equal to such witholding obligation. If Stock or Restricted
Stock is used to satisfy tax withholding, such Stock shall be
valued based on the Fair Market Value when the tax withholding is
required to be made.
11. AMENDMENT, MODIFICATION, SUSPENSION OR
DISCONTINUANCE OF THE PLAN
The Board may amend, modify, suspend or terminate the Plan
for the purpose of meeting or addressing any changes in legal
requirements or for any other purpose permitted by law. Subject
to changes in law or other legal requirements that would permit
otherwise, the Plan may not be amended without the approval of
the shareholders, to (i) increase the aggregate number of shares
of Common Stock that may be issued under the Plan (except for
adjustments pursuant to Section 15 of the Plan), or
(ii) materially modify the requirements as to eligibility for
participation in the Plan, or (iii) materially modify the
provisions of Section 7(d) of the Plan, which provisions shall
not, in any event, be amended more than once every six months
other than to comport with changes in the Code, the Employee
Retirement Income Security Act, or the rules thereunder.
12. TERMINATION OF EMPLOYMENT
Subject to the discretion of the Committee to provide
specifically in an Award Agreement for such other period of time
during which a Participant may exercise an Award after
termination of the Participant's services as the Committee may
approve, and subject to the overriding limitation that no Award
may be exercised to any extent by anyone after the date of
expiration of the Award, each unexercised, deferred or unpaid
Award shall terminate and may no longer be exercised if the
Participant ceases for any reason to perform services for the
Company, in accordance with the following provisions:
(i) if the Participant ceases to perform services
for the Company by reason of resignation or other voluntary
action of the Participant, or if the Company determines that it
no longer wishes to engage the Participant's services and makes
such determination based on cause, the Award shall terminate at
the time of such resignation or termination and may not be
exercised thereafter;
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(ii) if the Participant ceases to perform services
for the Company for any reason other than cause, resignation,
other voluntary action, death or disability (as defined below);
he may, at any time within a period of three (3) months after he
ceased to perform services, exercise the Award to the extent that
the Award was exercisable by him on the date on which he ceased
to perform services for the Company;
(iii) if the Participant ceases to perform services
for the Company because of disability within the meaning of
Section 22(e)(3) of the Code, he may at any time within a period
of one (1) year after he ceases to perform services, exercise the
Award to the extent that the Award was exercisable by him on the
date he ceased to perform services; and
(iv) if the Participant dies at a time when he might
have exercised the Award, then his estate, personal
representative or beneficiary to whom it has been transferred by
will or by the laws of descent or distribution may at any time
within a period of one (1) year after the Participant's death
exercise the Award to the extent the Participant might have
exercised it at the time of his death;
(v) after the death or disability of a Participant,
the Committee may in its sole discretion at any time
(1) terminate restrictions in Award Agreements; (2) accelerate
any or all installments and rights: and (3) instruct the Company
to pay the total of any accelerated payments in a lump sum to the
Participant, the Participant's estate, beneficiaries or
representative, notwithstanding that, in the absence of such
termination of restrictions or acceleration of payments, any or
all of the payments due under the Awards might ultimately have
become payable to other beneficiaries; and
(vi) in the event of uncertainty as to interpretation
of or controversies concerning this Section 12, the Committee's
determination shall be binding and conclusive.
13. CANCELLATION AND RESCISSION OF AWARDS
Unless the Award Agreement specifies otherwise, the Committee
may cancel any unexpired, unpaid, or deferred Awards at any time
if the Participant is not in compliance with all other applicable
provisions of the Award Agreement, the Plan and with the
following conditions:
(a) A Participant shall not render services for any
organization or engage directly or indirectly in any business
which, in the judgment of the chief executive officer of the
Company or other senior officer designated by the Committee, is
or becomes competitive with the Company, or which organization or
business, or the rendering of services to such organization or
-7-
business, is or becomes otherwise prejudicial to or in conflict
with the interests of the Company. For a Participant whose
employment has terminated, the judgment of the chief executive
officer shall be based on the Participant's position and
responsibilities while employed by the Company, the Participant's
post-employment responsibilities and position with the other
organization or business, the extent of past, current and
potential competition or conflict between the Company and the
other organization or business, the effect on the Company's
customers, suppliers and competitors of the Participant's
assuming the post-employment position, and such other
considerations as are deemed relevant given the applicable facts
and circumstances.
(b) A Participant shall not, without prior written
authorization from the Company, disclose to anyone outside the
Company, or use in other than the Company's business, any
confidential information or material relating to the business of
the Company, acquired by the Participant either during or after
employment with the Company.
(c) A Participant shall disclose promptly and assign to
the Company all right, title, and interest in any invention or
idea, patentable or not, made or conceived by the Participant
during employment by the Company, relating in any manner to the
actual or anticipated business, research or development work of
the Company and shall do anything reasonably necessary to enable
the Company to secure a patent where appropriate in the United
States and in other countries.
(d) Upon exercise, payment or delivery pursuant to an
Award, the Participant, if requested to do so by the Committee,
shall certify on a form acceptable to the Committee that he or
she is in compliance with the terms and conditions of the Plan.
Failure to comply with the provisions of paragraph (a), (b) or
(c) of this Section 13 prior to, or during the six months after,
any exercise, payment or delivery pursuant to an Award shall
cause such exercise, payment or delivery to be rescinded. The
Company shall notify the Participant in writing of any such
rescission within two years after such exercise, payment or
delivery. Within thirty days after receiving such a notice from
the Company, the Participant shall pay to the Company an amount
equal to the value (as of the time of realization or payment
without consideration of any taxes or transactional fees or
commissions paid or payable by the Participant) of any gain
realized or payment received as a result of the exercise, payment
or delivery made pursuant to such later rescinded Award. Such
payment shall be made either in cash or by returning to the
Company a number of shares of Stock with a value on the date of
delivery to the Company equal to such value realized or payment
received.
-8-
(e) Nothing in the Plan shall interfere with or limit in
any way the right of the Company to terminate any Participant's
employment at any time, for any reason or no reason in the
Company's sole discretion, nor confer upon any Participant any
right to continue in the employ of the Company. For purposes of
the Plan, transfer of employment of a Participant between the
Company and any one of its subsidiaries (or between subsidiaries)
shall not be deemed a termination of employment.
(f) No employee shall have the right to be selected to
receive an Award under this Plan, or, having been so selected, to
be selected to receive a future Award.
14. NON-TRANSFERABILITY
Unless the Award Agreement specifies otherwise, no Award
shall be transferable by a Participant otherwise than by will or
by the laws of descent and distribution and each Award shall be
exercisable during a Participant's lifetime only by him.
15. ADJUSTMENTS
(a) In the event of any change in the outstanding Stock of
the Company by reason of a stock split, stock dividend,
combination or reclassification of shares, recapitalization,
merger, or similar event, the Committee may adjust proportionally
(i) the number of shares of Stock (A) reserved under the Plan,
(B) available for ISO's, (C) for which Awards may be granted to
an individual Participant, and (D) covered by outstanding Awards
denominated in Stock or shares of Stock; (ii) the Stock prices
related to outstanding Awards; and (iii) the appropriate Fair
Market Value and other price determinations for such Awards. In
the event of any other change affecting the Stock or any
distribution (other than normal cash) to holders of Stock, such
adjustments as may be deemed equitable by the Committee,
including adjustments to avoid fractional shares, shall be made
to give proper effect to such event. In the event of a corporate
merger, consolidation, acquisition of property or stock,
reorganization or liquidation, the Committee is authorized to
issue or assume stock options, whether or not in a transaction to
which Section 424(a) of the Code applies, by means of
substitution of new stock options for previously issued stock
options or an assumption of previously issued stock options.
(b) If the Company is merged into or consolidated with
another corporation under circumstances where the Company is not
the surviving corporation, or if the Company is liquidated or
sells or otherwise disposes of substantially all of its assets to
another corporation while Awards remain outstanding under the
Plan, (i) subject to the provisions of clauses (ii), (iii) and
(iv) below, after the effective date of such merger,
consolidation or sale, as the case may be, each holder of an
-9-
outstanding Award shall be entitled, upon exercise of such Award,
to receive in lieu of Stock of the Company, shares of such stock
or other securities as the holders of Stock received pursuant to
the terms of the merger, consolidation or sale; or (ii) the
Committee may waive any discretionary limitations imposed with
respect to the exercise of the Award so that all Awards from and
after a date prior to the effective date of such merger,
consolidation, liquidation or sale, as the case may be, specified
by the Committee, shall be exercisable or payable in full; or
(iii) all outstanding Awards may be cancelled by the Committee as
of the effective date of any such merger, consolidation,
liquidation or sale provided that notice of such cancellation
shall be given to each holder of an Award, and each such holder
thereof shall have the right to exercise such Award in full
(without regard to any discretionary limitations imposed with
respect to the Award) during a 30-day period preceding the
effective date of such merger, consolidation, liquidation or
sale; or (iv) all outstanding Awards may be cancelled by the
Committee as of the date of any such merger, consolidation,
liquidation or sale provided that notice of such cancellation
shall be given to each holder of an Award, and each such holder
thereof shall have the right to exercise such Award but only to
the extent exercisable in accordance with any discretionary
limitations imposed with respect to the Award prior to the
effective date of such merger, consolidation, liquidation or
sale.
16. NOTICE
Any notice to the Company required by any of the provisions
of the Plan shall be addressed to the chief financial officer of
the Company in writing, and shall become effective when it is
received by the chief financial officer.
17. UNFUNDED PLAN
Insofar as it provides for Awards of cash and Stock, the Plan
shall be unfunded. Although bookkeeping accounts may be
established with respect to Participants who are entitled to
cash, Stock or rights thereto under the Plan, any such accounts
shall be used merely as a bookkeeping convenience. The Company
shall not be required to segregate any assets that may at any
time be represented by cash, Stock or rights thereto, nor shall
the Plan be construed as providing for such segregation, nor
shall the Company or the Board or the Committee be deemed to be a
trustee of any cash, Stock or rights thereto to be granted under
the Plan. Any liability of the Company to any Participant with
respect to a grant of cash, Stock or rights thereto under the
Plan shall be based solely upon any contractual obligations that
may be created by the Plan and any Award Agreement; no such
obligation of the Company shall be deemed to be secured by any
pledge or other encumbrance on any property of the Company.
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Neither the Company nor the Board nor the Committee shall be
required to give any security or bond for the performance of any
obligation that may be created by the Plan.
18. GOVERNING LAW
The Plan and all determinations made and actions taken
pursuant hereto, to the extent not otherwise governed by the laws
of the United States, shall be governed by the laws of the State
of Florida and construed accordingly.
19. EFFECTIVE AND TERMINATION DATES
The Plan shall become effective upon its adoption by the
Board, but it is conditioned upon approval of the Plan by the
shareholders within one year thereafter. Stock options and other
Awards may be granted under the Plan prior to shareholder
approval, but such stock options or other Awards shall be void if
shareholder approval is not obtained within such one year period.
The Plan shall terminate ten years after the date it is initially
adopted by the Board, subject to earlier termination by the Board
pursuant to Section 11, after which no Awards may be made under
the Plan, but any such termination shall not affect Awards then
outstanding or the authority of the Committee to continue to
administer the Plan.
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Exhibit 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in
this registration statement of Encore Computer
Corporation on Form S-8 of our report dated February
15, 1996, except for Note M as to which the date is
April 16, 1996 on our audits of the consolidated
financial statements and financial statement schedule
of Encore Computer Corporation as of December 31, 1995
and 1994, and for the years ended December 31, 1995,
1994 and 1993, which reports are included in the
Company's Annual Report on Form 10-K for the fiscal
year ended December 31, 1995, filed with the Securities
and Exchange Commission pursuant to the Securities
Exchange Act of 1934, which is incorporated by
reference in this registration statement.
COOPERS & LYBRAND L.L.P
Miami, Florida
June 3, 1996
