Registration No.333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
BEN & JERRY'S HOMEMADE, INC.
(Exact name of registrant as specified in its charter)
Vermont 2024 03-02675-43
(State or other Jurisdiction of Primary Standard Industrial (I.R.S. Employer
Incorporation or Organization) Classification Code Number) Identification No.)
30 Community Drive
South Burlington, Vermont 05403
(Address of Principal Executive Offices, including Zip Code)
1999 EQUITY INCENTIVE PLAN
Perry Odak
President and Chief Executive Officer
Ben & Jerry's Homemade, Inc.
30 Community Drive
South Burlington, VT 05403
802/846-1500
(Name, Address and Telephone Number of Agent for Service)
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Please send copies of all communications to:
Howard K. Fuguet, Esquire
Ropes & Gray
One International Place
Boston, MA 02110
617-951-7000
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CALCULATION OF REGISTRATION FEE
<S> <C> <C> <C> <C>
Proposed maximum Proposed maximum Amount of
Title of securities to be Amount to be offering price per aggregate offering registration
registered registered share (1) price fee
- -------------------------- ------------ ------------------- ------------------- --------------
- -------------------------- ------------ ------------------- ------------------- --------------
Class A Common Stock,
par value
$0.033 per share 200,000 $26.156 $5,231,250 1,454.29
- -------------------------- ------------- -------------------- ------------------- ---------------
</TABLE>
1. Estimated solely for the purpose of calculating the registration fee pursuant
to Rule 457(h) on the basis of the high and low prices of Ben & Jerry's
Homemade, Inc. Class A Common Stock, par value $0.033, reported on the NASDQ
National Market System on December 8, 1999
===============================================================================
The date of this Registration Statement is December 10, 1999
Exhibit Index on Page 7
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PART I
INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
Note: The document(s) containing the 1999 Equity Incentive Plan information
required by Item 1 of this Form S-8 and the statement of availability of
Registrant information, and other information required by Item 2 of this Form
will be sent or given to eligible employees as specified by Rule 428(b)(1) under
the Securities Act of 1933 (the "Securities Act"). In accordance with Rule 428
and the requirements of Part I of Form S-8, such documents are not being filed
with the Securities and Exchange Commission (the "Commission") either as part of
this Registration Statement or as prospectuses or prospectus supplements
pursuant to Rule 424. The Registrant shall maintain a file of such documents in
accordance with the provisions of Rule 428. Upon request, the Registrant will
furnish to the Commission or its staff a copy or copies of all of the documents
included in such file.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
Ben & Jerry's Homemade, Inc. (the "Corporation", or the "Registrant")
hereby incorporates the following document herein by reference:
(a) The Registrant's latest annual report on Form 10-K for the fiscal year
ended December 26, 1998, filed pursuant to Section 13 of the Securities
Exchange Act of 1934 as amended (the "Exchange Act"), filed with the
Commission on March 26, 1999.
(b) Quarterly Reports on Form 10-Q for the quarters ended March 27, 1999,
June 26, 1999 and September 25, 1999 , as filed with the Commission
pursuant to Section 13 under the Exchange Act, on May 11, 1999, August
10, 1999 and November 9, 1999, respectively.
(c) The description of the Registrant's Class A Common Stock contained in
the Company's Registration Statement on Form S-1, filed pursuant to
Section 12 of the Exchange Act (No. 33-17516).
All documents subsequently filed by the Registrant pursuant to Section 13(a),
Section 13(c), Section 14 and Section 15(d) of the Exchange Act prior to the
filing of a post-effective amendment to this Registration Statement that
indicates that all securities offered have been sold or which deregisters all
securities then remaining unsold shall be deemed incorporated herein by
reference from the date of filing of such documents.
Item 4. Description of Securities
Not applicable.
Item 5. Interests of Named Experts and Counsel
Not applicable.
Item 6. Indemnification of Directors and Officers
The Vermont Statutes Annotated, Title 8, Section 1837, as amended, regulates
indemnification by a Corporation in the following manner: a corporation may
indemnify or reimburse any person for reasonable expenses, including but not
limited to attorney fees, actually incurred by him in connection with any
action, suit or proceeding, instituted or threatened, judicial or
<PAGE>
administrative, civil or criminal, to which he is made a party by reason of his
being or having been a director, officer or employee of an association,
provided, however, that no person can be indemnified or reimbursed, nor retain
any advancement or allowance for indemnification which may have been made by the
corporation in advance of final disposition, in relation to that action, suit or
proceeding in which and to the extent that he is found to have been guilty of a
breach of good faith, to have been negligent in the performance of his duties or
to have committed an action or failed to perform a duty for which there is
common law or statutory liability. A person, may, with the approval of the
commissioner, be indemnified or reimbursed for:
(1) Amounts paid in compromise or settlement of any action, suit or
proceeding, including reasonable expenses incurred in connection
therewith, or
(2) Reasonable expenses incurred in connection with a criminal action, suit
or proceeding in which that person has been adjudicated guilty,
negligent or liable if it shall be determined by the board of director
and by the commissioner that the person was acting in good faith and in
what he believed to be the best interests of the association and
without knowledge that the action was illegal, if the indemnification
or reimbursement is approved at an annual or special meeting of the
members by a majority of the votes eligible to be cast.
Sections 2 and 3 of the Registrant's By-laws state that the Corporation shall
indemnify an individual made a party to a proceeding because the individual is
or was a director against liability incurred in the proceeding if: (1) the
director conducted himself or herself in good faith, and (2) the director
reasonably believed: (a) in the case of conduct in the director's official
capacity with the Corporation, that the director's conduct was in its best
interests; and (b) in all other cases, that the director's conduct was at least
not opposed to its best interests, and (3) in the case of any proceeding brought
by a governmental entity, the director had no reasonable cause to believe his or
her conduct was unlawful, and the director is not finally found to have engaged
in a reckless or intentional unlawful act.
A director's conduct with respect to an employee benefit plan for a purpose the
director reasonably believed to be in the interests of the participants in and
beneficiaries of the plan is conduct that satisfies the preceding requirements.
The termination of a proceeding by judgment, order, settlement, conviction, or
upon a plea of nolo contendere or its equivalent is not, of itself,
determinative that the director did not meet the standard of conduct described
above. The Corporation may not indemnify a director: (i) in connection with a
proceeding by or in the right of the Corporation in which the director was
adjudged liable to the Corporation, or (ii) in connection with any other
proceeding charging improper personal benefit to the director, whether or not
involving action in the director's official capacity in which the director was
adjudged liable on the basis that personal benefit was improperly received by
the director. Indemnification permitted under the Registrant's by-laws in
connection with a proceeding by or in the right of the Corporation is limited to
reasonable expenses incurred in connection with the proceeding. Notwithstanding
the above, the Corporation will indemnify a director who was wholly successful,
on the merits or otherwise, in the defense of any proceeding to which the
director was a party because the director is or was a director of the
Corporation against reasonable expenses incurred by the director in connection
with the proceeding.
<PAGE>
Item 7. Exemption from Registration Claimed
Not applicable.
Item 8. Exhibits
5.1 Opinion of Ropes & Gray.
10 1999 Equity Incentive Plan
23.1 Consent of Ernst & Young LLP, Independent Auditors
23.2 Consent of Ropes & Gray (see Exhibit 5.1).
24 Power of Attorney (Included on Signature Page).
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. Notwithstanding the foregoing, any
increase or decrease in the volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more than
20 percent change in the maximum aggregate offering price set forth in
the "Calculation of Registration Fee" table in the effective
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 this
Registration Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) above shall not
apply if the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed with
or furnished to the Securities and Exchange Commission by the Registrant
pursuant to Section 13 or Section 15(d) of the Exchange Act that are
incorporated by reference in this Registration Statement.
(2) That, for the purposes of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the
termination of the offering.
<PAGE>
(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 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) 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.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, 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 on Form S-8 to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of South Burlington,
State of Vermont, on this 10th day of December 1999.
BEN & JERRY'S HOMEMADE, INC.
/s/Perry D. Odak
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By:Perry D. Odak
Chief Executive Officer, President
POWER OF ATTORNEY
Dated: December 10,1999
Each person whose signature appears below constitutes and appoints Perry D. Odak
and Frances Rathke, and each of them singly, his true and lawful
attorney-in-fact and agent with full power of substitution and resubstitution,
for him and in his name, place and stead, in any and all capacities, to sign any
and all amendments (including post-effective amendments) to this Registration
Statement on Form S-8 to be filed by Ben & Jerry's Homemade, Inc., and to file
the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission making such changes in
this Registration Statement as the person(s) so acting deems appropriate, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or their
substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to
the requirements of the Securities Act of 1933, as amended, this Registration
Statement on Form S-8 has been signed below by the following persons in the
capacities indicated.
Signature Capacity Date
--------- -------- ----
/s/Perry D. Odak Chief Executive Officer, Director December 10, 1999
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Perry D. Odak
/s/Frances G. Rathke Chief Financial Officer, Secretary December 10, 1999
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Frances G. Rathke
/s/ Jerry Greenfield Chairman, Board of Directors December 10, 1999
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Jerry Greenfield
Director December 10, 1999
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Pierre Ferrari
/s/ Jeffrey Furman Director December 10, 1999
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Jeffrey Furman
Director December 10, 1999
- ---------------------
Bennett Cohen
/s/ Jennifer Henderson Director December 10, 1999
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Jennifer Henderson
/s/ Frederick A. Miller Director December 10, 1999
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Frederick A. Miller
Director December 10, 1999
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Henry Morgan
<PAGE>
EXHIBIT INDEX
Number Title of Exhibit
5.1 Opinion of Ropes & Gray.
10 1999 Equity Incentive Plan
23.1 Consent of Ernst & Young LLP, Independent Auditors
23.2 Consent of Ropes & Gray (see Exhibit 5.1).
24 Power of Attorney (Included on Signature Page).
EXHIBIT 5.1
(Ropes & Gray Letterhead)
December 10, 1999
Ben & Jerry's Homemade, Inc.
30 Community Drive
South Burlington, Vermont 05403-6828
Ladies and Gentlemen:
This opinion is furnished to you in connection with a registration
statement on Form S-8 (the "Registration Statement"), to be filed with the
Securities and Exchange Commission (the "Commission") under the Securities Act
of 1933, as amended, for the registration of 200,000 shares of Class A Common
Stock, $0.33 par value per share (the "Shares"), of Ben & Jerry's Homemade,
Inc., a Vermont Corporation (the "Company").
We have acted as counsel to the Company and are familiar with the
actions taken by the Company in connection with the Company's 1999 Equity
Incentive Plan (the "Plan"). For purposes of this opinion, we have examined the
Plan and such other documents as we deemed appropriate.
For purposes of our opinion, we have assumed that (i) any consideration
received by the Company upon the issuance or exercise of any award granted under
the Plan will at least be equal to the par value of the Shares issuable upon the
exercise of any stock options or subject to any other award, and (ii) the number
of shares to be issued upon any such exercise or issuance, together with the
total number of shares of the Company's Common Stock previously outstanding,
will not exceed the authorized number of shares of Common Stock specified in the
Company's Articles of Association as then in effect.
<PAGE>
Based upon the foregoing, we are of the opinion that the Shares have
been duly authorized and, when the Shares have been issued and sold and
consideration received therefor by the Company in accordance with the terms of
the Plan, will be validly issued, fully paid and non-assessable.
We hereby consent to your filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
Ropes & Gray
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 1999 Equity Incentive Plan of Ben & Jerry's Homemade,
Inc., of our report dated January 22, 1999, except for Note 17, as to which the
date is February 26, 1999, with respect to the consolidated financial statements
and schedule of Ben & Jerry's Homemade, Inc. included in its Annual Report (Form
10-K) for the year ended December 26, 1998, filed with the Securities and
Exchange Commission.
Boston, Massachusetts
December 3, 1999
EXHIBIT 10
BEN & JERRY'S HOMEMADE, INC.
1999 EQUITY INCENTIVE PLAN (Excluding Officers and Directors)
1. PURPOSE
The purpose of this 1999 Equity Incentive Plan (the "Plan") is to
advance the interests of Ben & Jerry's Homemade, Inc. (the "Company") by
enhancing its ability to attract and retain key
Employees (other than officers or directors of the Company) who are in a
position to make significant contributions to the success of the Company and its
subsidiaries through ownership of shares of the Company's Class A Common Stock
("Stock").
The Plan is intended to accomplish these goals by enabling the Company
to grant Awards in the form of Options, Stock Appreciation Rights, Restricted
Stock or Unrestricted Stock Awards, Deferred Stock Awards, Cash or Stock
Performance Awards, Loans or Supplemental Grants, or combinations thereof, all
as more fully described below.
2. ADMINISTRATION
The Board may, in its discretion, delegate some or all of its powers
with respect to the Plan to a committee, which shall consist of at least two
directors. A majority of the members of the committee shall constitute a quorum,
and all determinations of the committee shall be made by a majority of its
members. Any determination of the committee under the Plan may be made without
notice or meeting of the committee by a writing signed by a majority of the
committee members.
The Board of Directors has determined that the Plan will be
administered by the Compensation Committee of the Board of Directors of the
Company (the "Committee"). The Committee will have authority, not inconsistent
with the express provisions of the Plan and in addition to other authority
granted under the Plan, to (a) grant Awards at such time or times as it may
choose; (b) determine the size of each Award, including the number of shares of
Stock subject to the Award; (c) determine the type or types of each Award; (d)
determine the terms and conditions of each Award, including without limitation,
any required holding period (without regard to requirements under the Securities
Act of 1933) on stock acquired upon exercise of options granted under the plan;
(e) waive compliance by a Participant (as defined below) with any obligations to
be performed by the Participant under an Award and waive any term or condition
of an Award; (f) amend or cancel an existing Award in whole or in part (and if
an Award is cancelled, grant another Award in its place on such terms as the
Committee shall specify), or settle any award by paying the cash value of the
Stock otherwise issuable, except that the Committee may not, without the consent
of the holder of an Award, take any action under this clause with respect to
such Award if such action would adversely affect the rights of such holder; (g)
prescribe the form or forms of instruments that are required or deemed
appropriate under the Plan, including any written notices and elections required
of Participants, and change such forms from time to time; (h) adopt, amend and
rescind rules and regulations for the administration of the Plan; and (i)
interpret the Plan and decide any questions and settle all controversies and
disputes that may arise in connection with the Plan. Such determinations and
actions of the Committee, and all other determinations and actions of the
<PAGE>
Committee made or taken under authority granted by any provision of the Plan,
will be conclusive and will bind all parties. Nothing in this paragraph shall be
construed as limiting the power of the Board or the Committee to make
adjustments under Section 7.3 or Section 8.6.
3. EFFECTIVE DATE AND TERM OF PLAN
The Plan, having been adopted by the Board of Directors on January 21,
1999 is effective on said date.
No Award may be granted under the Plan after January 20, 2009, but
Awards previously granted may extend beyond that date.
4. SHARES SUBJECT TO THE PLAN
Subject to the adjustment as provided in Section 8.6 below, the
aggregate number of shares of Stock that may be delivered under the Plan will be
200,000. If any Award requiring exercise by the Participant for delivery of
Stock terminates without having been exercised in full, or if any Award payable
in Stock or cash is satisfied in cash rather than Stock, the number of shares of
Stock as to which such Award was not exercised or for which cash was substituted
will be available for future grants.
Shares of Restricted Stock that have been forfeited in accordance with
the terms of the applicable Award and shares held back, in satisfaction of the
exercise price or tax withholding requirements, from shares that would otherwise
have been delivered pursuant to an Award shall also be available for future
grants. The number of shares of Stock delivered under an Award shall be
determined net of any previously acquired Shares tendered by the Participant in
payment of the exercise price or of withholding taxes.
Stock delivered under the Plan may be either authorized but unissued
Stock or previously issued Stock acquired by the Company and held in treasury.
No fractional shares of Stock will be delivered under the Plan.
5. ELIGIBILITY AND PARTICIPATION
Those eligible to be selected to receive Awards under the Plan
("Participants") will be key persons in the employ of the Company or any of its
subsidiaries ("Employees") excluding all employees who are officers or directors
of the Company. A "subsidiary" for purposes of the Plan will be a corporation in
which the Company owns, directly or indirectly, stock possessing 50% or more of
the total combined voting power of all classes of stock. Eligibility for ISO's
is further limited to those individuals whose employment status would qualify
them for the tax treatment described in Section 421 and 422 of the Internal
Revenue Code.
Options for no more than 10,000 shares can be granted to any individual
in any one year under the Plan.
<PAGE>
6. TYPES OF AWARDS
6.1. OPTIONS
(a) Nature of Options. An Option is an Award entitling the
recipient on exercise thereof to purchase Stock at a specified exercise price.
Options that are not incentive stock options, may be granted under the Plan.
Incentive stock options may not be granted under the Plan.
(b) Exercise Price. The exercise price of an Option will be
determined by the Committee, subject to the following:
(1) In no case may the exercise price paid for Stock be less
than the par value per share of the Stock.
(2) The Committee may reduce the exercise price of an Option
at any time after the time of grant.
(c) Duration of Options. The latest date on which an Option may be
exercised will be the tenth anniversary of the day immediately preceding the
date the Option was granted, or such earlier date as may have been specified by
the Board at the time the Option was granted.
(d) Exercise of Options. An Option will become exercisable at such
time or times, and on such conditions, as the Committee may specify. The
Committee may at any time and from time to time accelerate the time at which all
or any part of the Option may be exercised. If desired, the Committee may
provide for vesting prior to the date the option becomes exercisable.
Any exercise of an Option must be in writing, signed by the
proper person and delivered or mailed to the Company, accompanied by (1) any
documents required by the Committee and (2) payment in full in accordance with
paragraph (e) below for the number of shares for which the Option is exercised.
(e) Payment for Stock. Stock purchased on exercise of an Option
must be paid for as follows: (1) in cash or by check (acceptable to the Company
in accordance with guidelines established for this purpose), bank draft or money
order payable to the order of the Company, or (2) through the delivery of shares
of Stock (which in the case of Shares acquired from the Company, have been
outstanding for at least six months) having a fair market value on the last
business day preceding the date of exercise equal to the purchase price, or (3)
by delivery of an unconditional and irrevocable undertaking by a broker to
deliver promptly to the Company sufficient funds to pay the exercise price, or
(4) if so permitted by the instrument evidencing the Option (or by the Committee
on or after grant of the Option), by delivery of a promissory note of the Option
holder to the Company, payable on such terms as are specified by the Committee,
provided that if the stock delivered in exercise of the Option is an original
issue of authorized stock, then so much of the purchase price as represents par
value of the stock shall be paid in cash, or (5) by any combination of the
permissible forms of payment; provided, that if the Stock delivered upon
exercise of the Option is an original issue of authorized Stock, at least so
much of the exercise price as represents the par value of such Stock must be
paid in cash. In the event that payment of the Option price is made under (2)
above, the Committee may provide that the Option holder be granted an additional
Option covering the numbers of shares surrendered, at an exercise price equal to
the fair market value of a share of Stock on the date of surrender.
<PAGE>
(f) Discretionary Payments. If the market price of shares of Stock
subject to an Option (other than an Option which is in tandem with a Stock
Appreciation Right as described in Section 6.2 below) exceeds the exercise price
of the Option at the time of its exercise, the Committee may cancel the Option
and cause the Company to pay in cash or in shares of Common Stock (at a price
per share equal to the fair market value per share) to the person exercising the
Option an amount equal to the difference between the fair market value of the
Stock which would have been purchased pursuant to the exercise (determined on
the date the Option is cancelled) and the aggregate exercise price which would
have been paid. The Committee may exercise its discretion to take such action
only if it has received a written request from the person exercising the Option,
but such a request will not be binding on the Committee.
6.2.Stock Appreciation Rights.
(a) Nature of Stock Appreciation Rights. A Stock Appreciation
Right is an Award entitling the recipient on exercise of the Right to receive an
amount, in cash or Stock or a combination thereof (such form to be determined by
the Committee), determined in whole or in part by reference to appreciation in
Stock value.
Except as provided below, a Stock Appreciation Right entitles
the Participant to receive, with respect to each share of Stock as to which the
Right is exercised, the excess of the share's fair market value on the date of
exercise over its fair market value on the date the Right was granted. The
Committee may provide at the time of grant that the amount the recipient is
entitled to receive will be adjusted upward or downward under rules established
by the Committee to take into account the performance of the Stock in comparison
with the performance of other stocks or an index or indices of other stocks. The
Committee may also grant Stock Appreciation Rights providing that following a
Change in Control of the Company, as defined in Exhibit A, the holder of such
Right will be entitled to receive, with respect to each share of Stock subject
to the Right, an amount equal to the excess of a specified value (which may
include an average of values) for a share of Stock during a period preceding
such Change in Control over the fair market value of a share of Stock on the
date the Right was granted.
(b) Grant of Stock Appreciation Rights. Stock Appreciation Rights
may be granted in tandem with, or independently of, Options granted under the
Plan. A Stock Appreciation Right granted in tandem with an Option which is not
an ISO may be granted either at or after the time the Option is granted. A Stock
Appreciation Right granted in tandem with an ISO may be granted only at the time
the Option is granted.
(c) Rules Applicable to Tandem Awards. When Stock Appreciation
Rights are granted in tandem with Options, the following will apply:
(1) The Stock Appreciation Right will be exercisable only at
such time or times, and to the extent, that the related Option is
exercisable and will be exercisable in accordance with the
procedure required for exercise of the related Option.
(2) The Stock Appreciation Right will terminate and no
longer be exercisable upon the termination or exercise of the
related Option, except that a Stock Appreciation Right granted
with respect to less than the full number of shares covered by an
Option will not be reduced until the number of shares as to which
the related Option has been exercised or has terminated exceeds
the number of shares not covered by the Stock Appreciation Right.
<PAGE>
(3) The Option will terminate and no longer be exercisable
upon the exercise of the related Stock Appreciation Right.
(4) The Stock Appreciation Right will be transferable only
with the related Option.
(5) A Stock Appreciation Right granted in tandem with an ISO
may be exercised only when the market price of the Stock subject
to the Option exceeds the exercise price of such option.
(d) Exercise of Independent Stock Appreciation Rights. A Stock
Appreciation Right not granted in tandem with an Option will become exercisable
at such time or times, and on such conditions, as the Committee may specify. The
Committee may at any time accelerate the time at which all or any part of the
Right may be exercised.
Any exercise of an independent Stock Appreciation Right must
be in writing, signed by the proper person and delivered or mailed to the
Company, accompanied by any other documents required by the Committee.
6.3. Restricted and Unrestricted Stock.
(a) Nature of Restricted Stock Award. A Restricted Stock Award
entitles the recipient to acquire, for a purchase price to be specified by the
Committee, but in no event less than par value, shares of Stock subject to the
restrictions described in paragraph (d) below ("Restricted Stock").
(b) Acceptance of Award. A Participant who is granted a Restricted
Stock Award will have no rights with respect to such Award unless the
Participant accepts within 60 days or such other period specified by the
Committee, the Award by written instrument delivered or mailed to the Company
accompanied by payment in full of the specified purchase price, if any, of the
shares covered by the Award. Payment may be by certified or bank check or other
instrument acceptable to the Committee.
(c) Rights as a Stockholder. A Participant who receives Restricted
Stock will have all the rights of a stockholder with respect to the Stock,
including voting and dividend rights, subject to the restrictions described in
paragraph (d) below and any other conditions imposed by the Committee at the
time of grant. Unless the Committee otherwise determines, certificates
evidencing shares of Restricted Stock will remain in the possession of the
Company until such shares are free of all restrictions under the Plan.
(d) Restrictions. Except as otherwise specifically provided by the
Plan, Restricted Stock may not be sold, assigned, transferred, pledged or
otherwise encumbered or disposed of, and if the Participant ceases to be an
Employee or otherwise suffers a Status Change (as defined at Section 7.2 below)
for any reason, must be offered to the Company for purchase for the amount of
cash paid for the Stock, or forfeited to the Company if no cash was paid. These
restrictions will lapse at such time or times, and on such conditions, as the
Committee may specify. Upon lapse of all restrictions, Stock will cease to be
Restricted Stock for purposes of the Plan. The Committee may at any time
accelerate the time at which the restrictions on all or any part of the shares
will lapse.
<PAGE>
(e) Notice of Election. Any Participant making an election under
Section 83(b) of the Code with respect to Restricted Stock must provide a copy
thereof to the Company within 10 days of the filing of such election with the
Internal Revenue Service.
(f) Other Awards Settled with Restricted Stock. The Committee may,
at the time any Award described in this Section 6 is granted, provide that any
or all the Stock delivered pursuant to the Award will be Restricted Stock.
(g) Unrestricted Stock. The Committee may, in its sole discretion,
approve the sale to any Participant of shares of Stock free of restrictions
under the Plan for a price which is not less than the par value of the Stock.
6.4. Deferred Stock Awards.
A Deferred Stock Award entitles the recipient to receive shares of
Stock to be delivered in the future. Delivery of the Stock will take place at
such time or times, and on such conditions, as the Committee may specify. The
Committee may specify that a Deferred Stock Award may be forfeited if certain
conditions are or are not satisfied. The Committee may at any time accelerate
the time at which delivery of all or any part of the Stock will take place. At
the time any Award described in this Section 6 is granted, the Committee may
provide that, at the time Stock would otherwise be delivered pursuant to the
Award, the Participant will instead receive an instrument evidencing the
Participant's right to future delivery of Stock.
6.5. Performance Awards; Performance Goals.
(a) Nature of Performance Awards. A Performance Award entitles the
recipient to receive, without payment, an amount in cash or Stock or a
combination thereof (such form to be determined by the Committee) following the
attainment of Performance Goals. "Performance Goals" are goals which may be
related to personal performance, corporate performance, departmental performance
or any other category of performance deemed by the Committee to be important to
the success of the Company. The Committee will determine the Performance Goals,
the period or periods during which performance is to be measured and all other
terms and conditions applicable to the Award.
(b) Other Awards Subject to Performance Condition. The Committee
may, at the time any Award described in this Section 6 is granted, impose the
condition (in addition to any conditions specified or authorized in this Section
6 or any other provision of the Plan) that Performance Goals be met prior to the
Participant's realization of any payment or benefit under the Award.
6.6 Loans and Supplemental Grants
(a) Loans. The Company may make a loan to a Participant ("Loan"),
either on the date of or after the grant of any Award to the Participant. A Loan
may be made either in connection with the purchase of Stock under the Award or
with the payment of any Federal, state and local income tax with respect to
income recognized as a result of the Award. The Committee will have full
authority to decide whether to make a Loan and to determine the amount, terms
and conditions of the Loan, including the interest rate (which may be zero),
whether the Loan is to be secured or unsecured or with or without recourse
against the borrower, the terms on which the Loan is to be repaid and the
conditions, if any, under which it may be forgiven. However, no Loan may have a
term (including extensions) exceeding ten years in duration.
<PAGE>
(b) Supplemental Grants. In connection with any Award, the
Committee may at the time such Award is made or at a later date, provide for and
grant a cash award to the Participant ("Supplemental Grant") not to exceed an
amount equal to (1) the amount of any federal, state and local income tax on
ordinary income for which the Participant may be liable with respect to the
Award, determined by assuming taxation at the highest marginal rate, plus (2) an
additional amount on a grossed-up basis intended to make the Participant whole
on an after-tax basis after discharging all the Participant's income tax
liabilities arising from all payments under this Section 6. Any payments under
this subsection (b) will be made at the time the Participant incurs Federal
income tax liability with respect to the Award.
7. EVENTS AFFECTING OUTSTANDING AWARDS
7.1. Death and Total or Permanent Disability.
Except as otherwise provided by the Committee, if a Participant dies or
is totally or permanently disabled as determined by the Committee, the following
will apply:
(a) All Options and Stock Appreciation Rights held by the
Participant immediately prior to death or total or permanent disability, as the
case may be, shall, if not then exercisable, be accelerated and become
exercisable at such time and then all options so held by the Participant may be
exercised by the Participant's executor or administrator or the person or
persons to whom the Option or Right is transferred by will or the applicable
laws of descent and distribution or the Participant's guardian, at any time
within the one year period ending with the first anniversary of the
Participant's death, or total or permanent disability, as the case may be (or
such longer period as the Committee may determine), and shall thereupon
terminate. In no event, however, shall an Option or Stock Appreciation Right
remain exercisable beyond the latest date on which it could have been exercised
without regard to this Section 7.
(b) Except as otherwise determined by the Committee, all
Restricted Stock, as to which the forfeiture restrictions have not lapsed, held
by the Participant must be transferred to the Company (and, in the event the
certificates representing such Restricted Stock are held by the Company, such
Restricted Stock will be so transferred without any further action by the
Participant) in accordance with Section 6.3 above.
(c) Any payment or benefit under a Deferred Stock Award,
Performance Award, or Supplemental Grant to which the Participant was not
irrevocably entitled prior to death or total or permanent disability, as the
case may be, will be forfeited and the Award canceled as of the time of death,
or total or permanent disability, as the case may be, unless otherwise
determined by the Committee.
7.2. Termination of Service (Other Than By Death or Disability).
If a Participant who is an Employee ceases to be an Employee for any
reason other than death or total or permanent disability, as the case may be, or
if there is a termination (other than by reason of death or total or permanent
disability, as the case maybe) of the consulting, service or similar
relationship in respect of which a non-Employee Participant was granted an Award
hereunder (such termination of the employment or other relationship being herein
referred to as a "Status Change"), the following will apply:
(a) Except as otherwise determined by the Committee, all Options
and Stock Appreciation Rights held by the Participant that were not exercisable
immediately prior to the Status Change shall terminate at the time of the Status
Change provided that options that are not then exercisable on such date which
<PAGE>
are held by a Participant who retires and who is at least 60 years of age and
has completed at least ten or more years of service (as determined by the
Committee) shall continue to vest. Any Options or Rights that were exercisable
immediately prior to the Status Change will continue to be exercisable for a
period of one year (or such longer period as the Committee may determine), and
shall thereupon terminate, unless the Award provides by its terms for immediate
termination in the event of a Status Change. Any Options or Rights that were not
exercisable immediately prior to the Status Change but which continued to vest
thereafter pursuant to the proviso above in this Section 7.2(a) will be
exercisable for a period of one year (or such longer period as the Committee may
determine) after the date such Option or Right vests, and shall thereafter
terminate unless the Award provides by its terms for immediate termination in
the event of a Status Change. If the Status Change results from a discharge for
cause (gross negligence or acts done with a malicious intent, as determined by
the Committee), all Awards will terminate if the Committee so determines in its
discretion either before or after such termination of employment. In no event,
however, shall an Option or Stock Appreciation Right remain exercisable beyond
the latest date on which it could have been exercised without regard to this
Section 7. For purposes of this paragraph, in the case of a Participant who is
an Employee, a Status Change shall not be deemed to have resulted by reason of
(i) a sick leave or other bona fide leave of absence approved for purposes of
the Plan by the Committee, so long as the Employee's right to reemployment is
guaranteed either by statute or by contract, or (ii) a transfer of employment
between the Company and a subsidiary or between subsidiaries, or to the
employment of a corporation (or a parent or subsidiary corporation of such
corporation) issuing or assuming an option in a transaction to which section
424(a) of the Code applies.
(b) Except as otherwise determined by the Committee, all
Restricted Stock, as to which the forfeiture restrictions have not lapsed, held
by the Participant at the time of the Status Change must be transferred to the
Company (and, in the event the certificates representing such Restricted Stock
are held by the Company, such Restricted Stock will be so transferred without
any further action by the Participant) in accordance with Section 6.3 above.
(c) Any payment or benefit under a Deferred Stock Award,
Performance Award, or Supplemental Grant to which the Participant was not
irrevocably entitled prior to the Status Change will be forfeited and the Award
cancelled as of the date of such Status Change unless otherwise determined by
the Committee.
Unless the Committee expressly provides otherwise, a
Participant's "employment or other service relationship with the Company and its
Subsidiaries" will be deemed to have ceased, in the case of an employee
Participant, upon termination of the Participant's employment with the Company
and its Subsidiaries (whether or not the Participant continues in the service of
the Company or its Subsidiaries in some capacity other than that of an employee
of the Company or its Subsidiaries), and in the case of any other Participant,
when the service relationship in respect of which the Award was granted
terminates (whether or not the Participant continues in the service of the
Company or its Subsidiaries in some other capacity).
7.3A Change in Control Provision
As used herein, a Change in Control and related definitions shall have
the meanings as set forth in Section 7.3 C below.
Immediately prior to the occurrence of a Change in Control:
<PAGE>
(a) Each Option and Stock Appreciation Right shall automatically
become fully exercisable unless the Committee shall otherwise expressly provide
at the time of grant.
(b) Restrictions and conditions on Restricted Stock, Deferred
Stock, Performance Units and Other Stock-based Awards shall automatically be
deemed waived to the extent, if any, specified (whether at or after time of
grant) by the Committee.
In addition to the foregoing and Sections 6.1(d), 6.2(d), 6.3(d) and
6.4, the Committee may at any time prior to or after a Change in Control
accelerate the exercisability of any Options and Stock Appreciation Rights and
may waive restrictions, limitations and conditions on Restricted Stock, Deferred
Stock, Performance Units and Other Stock-based Awards to the extent it shall in
its sole discretion determine.
7.3 B Certain Corporate Transactions
(a) In the event of a consolidation or merger in which the Company
is not the surviving corporation or which results in the acquisition of
substantially all the Company's outstanding Stock by a single person or entity
or by a group of persons and/or entities acting in concert, or in the event of
the complete liquidation of the Company or the sale or transfer of substantially
all of the company's assets (a "Covered Transaction"), all outstanding options
will terminate as of the effective date of the Covered Transaction, provided
that at least twenty (20) days prior to the effective date of any such merger,
consolidation, liquidation or sale of assets, but subject to Paragraphs (c) and
(d) below, the Committee shall make all outstanding Options exercisable
immediately prior to consummation of such Covered Transaction (to the extent
that such Options are not exercisable immediately prior to the consummation of
the Covered Transaction pursuant to Section 7.3A)
(b) Subject to Paragraphs (c) and (d) below, the Committee may, in
its sole discretion, prior to the effective date of the Covered Transaction, (1)
remove the restrictions from each outstanding share of Restricted Stock, (2)
cause the Company to make any payment and provide any benefit under each
outstanding Deferred Stock Award, Performance Award, and Supplemental Grant
which would have been made or provided with the passage of time had the
transaction not occurred and the Participant remained an employee, and (3)
forgive all or any portion of the principal of or interest on a loan.
(c) If an outstanding option or Other Award is subject to
performance or other conditions (other than conditions relating the mere passage
of time and continued employment) which will not have been satisfied at the time
of the Covered Transaction the Committee may, in its sole discretion, remove
such conditions. If it does not do so however, such Option or Other Award will
terminate, because the conditions have not been satisfied, as of the date of the
Covered Transaction notwithstanding Paragraph (a) and (b) above.
(d) With respect to an outstanding Option or Other Award held by
the participant who, following the Covered Transaction, will be employed by a
corporation which is a surviving or acquiring corporation in such transaction or
an affiliate of such a corporation, the committee may, in lieu of the action of
the Committee described in Paragraphs (a) or (b) above or in addition to any
Option being exercisable immediately prior to consummation of the Covered
Transaction pursuant to Section 7.3A above, arrange to have such surviving or
acquiring corporation or affiliate assume the Option or Other Award or grant to
the Participant a replacement or substitute Option or other Award on such terms
<PAGE>
as the Committee approves. In the case of an assumed or substitute Option
intended to be an Incentive Stock Option, the requirements of Section 424 (a) of
the code shall be satisfied except as otherwise provided by the Committee.
7.3 C Change in Control and Related Definitions
A "Change in Control" shall be deemed to have occurred if the
conditions set forth in any one of the following paragraphs shall have been
satisfied:
(a) any Person is or becomes the Beneficial Owner, directly or
indirectly, of securities of the Company representing 35% or more of the
combined voting power of the Company's then outstanding securities; or
(b) during any period of not more than two consecutive years (not
including any period prior to December 31, 1996), individuals who at the
beginning of such period constitute the Board and any new director (other than a
director designated by a Person who has entered into an agreement with the
Company to effect a transaction described in Clause (a), (b), or (c) of Section
7.3 C) whose election by the Board or nomination for election by the Company's
stockholders was approved by a vote of at least two-thirds (2/3) of the
directors then still in office who either were directors at the beginning of the
period or whose election or nomination for election was previously so approved,
cease for any reason to constitute a majority thereof; or
(c) the shareholders of the Company approve a merger or
consolidation of the Company with any other corporation, other than:
(1) a merger or consolidation which would result in the voting
securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or being
converted into voting securities of the surviving entity) 60% or
more of the combined voting power of the voting securities of the
Company or such surviving entity outstanding immediately after
such merger or consolidation; or
(2) a merger or consolidation effected to implement a
recapitalization of the Company (or similar transaction) in which
no person acquires 35% or more of the combined voting power of the
Company's then outstanding securities;
(d) the shareholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or disposition by the
Company of all or substantially all the Company's assets.
Notwithstanding the foregoing provisions of this Section 7.3C, a "Change in
Control" will not be deemed to have occurred solely because of (i) the ownership
or acquisition of securities of the Company (or any reporting requirement under
the Securities Exchange Act of 1934) relating thereto) by an employee benefit
plan maintained by the Company for the benefit of employees or by ownership or
acquisition (whether accomplished by merger, consolidation, purchase or
otherwise) by any of Ben Cohen, Jerry Greenfield, Jeffrey Furman and Perry Odak
or their "affiliates" or "associates" (as such terms are defined in Rule 12b-2
under the Act) or members of their families (or trusts for their benefit) or
charitable trusts established by any of them and/or other related Company
management group.
In the foregoing provisions of this Section 7.3, the following terms shall
have the meanings set forth below:
<PAGE>
"Person" shall have the meaning given in Section 3 (a) (9) of the
Securities Exchange Act of 1934, as modified and used in Sections 13 9D and 14
(d) thereof; however, a Person shall not include
(1) the Company or any controlled subsidiary of the Company,
(2) a trustee or other fiduciary holding securities under an
employee benefit plan of the Company or
(3) a corporation or other entity owned, directly or indirectly,
by the shareholders of the Company in substantially the same
proportions as their ownership of stock of the Company.
"Beneficial Owner" shall have the meaning defined in Rule 13d-3 under the
Securities Exchange Act of 1934 as amended from time to time.
8. GENERAL PROVISIONS
8.1. Documentation of Awards.
Awards will be evidenced by such written instruments, if any, as may be
prescribed by the Board from time to time. Such instruments may be in the form
of agreements to be executed by both the Participant and the Company, or
certificates, letters or similar instruments, which need not be executed by the
Participant but acceptance of which will evidence agreement to the terms
thereof.
8.2. Rights as a Stockholder, Dividend Equivalents.
Except as specifically provided by the Plan, the receipt of an Award
will not give a Participant rights as a stockholder; the participant will obtain
such rights, subject to any limitations imposed by the Plan or the instrument
evidencing the Award, upon actual receipt of Stock. However, the Committee may,
on such conditions as it deems appropriate, provide that a Participant will
receive a benefit in lieu of cash dividends that would have been payable on any
or all Stock subject to the Participant's Award had such Stock been outstanding.
Without limitation, the Committee may provide for payment to the Participant of
amounts representing such dividends, either currently or in the future, or for
the investment of such amounts on behalf of the Participant.
8.3. Conditions on Delivery of Stock.
The Company will not be obligated to deliver any shares of Stock
pursuant to the Plan or to remove restriction from shares previously delivered
under the Plan (a) until all conditions of the Award have been satisfied or
removed, (b) until, in the opinion of the Company's counsel, all applicable
federal and state laws and regulation have been complied with, (c) if the
outstanding Stock is at the time listed on any stock exchange, until the shares
to be delivered have been listed or authorized to be listed on such exchange
upon official notice of notice of issuance, and (d) until all other legal
matters in connection with the issuance and delivery of such shares have been
approved by the Company's counsel. If the sale of Stock has not been registered
under the Securities Act of 1933, as amended, the Company may require, as a
condition to exercise of the Award, such representations or agreements as
counsel for the Company may consider appropriate to avoid violation of such Act
and may require that the certificates evidencing such Stock bear an appropriate
legend restricting transfer.
<PAGE>
If an Award is exercised by the Participant's legal representative, the
Company will be under no obligation to deliver Stock pursuant to such exercise
until the Company is satisfied as to the authority of such representative.
8.4. Tax Withholding.
The Company will withhold from any cash payment made pursuant to an
Award an amount sufficient to satisfy all federal, state and local withholding
tax requirements (the "withholding requirements").
In the case of an Award pursuant to which Stock may be delivered, the
Committee will have the right to require that the Participant or other
appropriate person remit to the Company an amount sufficient to satisfy the
withholding requirements, or make other arrangements satisfactory to the
Committee with regard to such requirements, prior to the delivery of any Stock.
If and to the extent that such withholding is required, the Committee may permit
the Participant or such other person to elect at such time and in such manner as
the Committee provides to have the Company hold back from the shares to be
delivered, or to deliver to the Company, Stock having a value calculated to
satisfy the withholding requirement.
8.5. Nontransferability of Awards.
No Award (other than an Award in the form of an outright transfer of
cash or Unrestricted Stock) may be transferred other than by will or by the laws
of descent and distribution, and during a Participant's lifetime an Award
requiring exercise may be exercised only by him or her (or in the event of the
Participant's incapacity, the person or persons legally appointed to act on the
Participant's behalf).
8.6. Adjustments in the Event of Certain Transactions.
(a) In the event of a stock dividend, stock split or combination
of shares, recapitalization or other change in the Company's capitalization, or
other distribution to common stockholders other than normal cash dividends,
after the effective date of the Plan, the Committee will make any appropriate
adjustments to the maximum number of shares that may be delivered under the Plan
under Section 4 above.
(b) In any event referred to in paragraph (a), the Committee will
also make any appropriate adjustments to the number and kind of shares of stock
or securities subject to Awards then outstanding or subsequently granted, any
exercise prices relating to Awards and any other provision of Awards affected by
such change. The Committee may also make such adjustments to take into account
material changes in law or in accounting practices or principles, mergers,
consolidations, acquisitions, dispositions or similar corporate transactions, or
any other event, if it is determined by the Committee that adjustments are
appropriate to avoid distortion in the operation of the Plan.
8.7. Employment Rights, Etc.
Neither the adoption of the Plan nor the grant of Awards will confer
upon any person any right to continued retention by the Company or any
subsidiary as an Employee or otherwise, or affect in any way the right of the
Company or subsidiary to terminate an employment, service or similar
relationship at any time. Except as specifically provided by the Committee in
any particular case, the loss of existing or potential profit in Awards granted
under the Plan will not constitute an element of damages in the event of
termination of an employment, service or similar relationship even if the
termination is in violation of an obligation of the Company to the Participant.
<PAGE>
8.8. Deferral of Payments.
The Committee may agree at any time, upon request of the Participant,
to defer the date on which any payment under an Award will be made.
8.9. Past Services as Consideration.
Where a Participant purchases Stock under an Award for a price equal to
the par value of the Stock the Committee may determine that such price has been
satisfied by past services rendered by the Participant.
8.10. Fair Market Value
For purposes of the Plan, fair market value of a share of Stock on any
date will be the closing price in the over-the-counter market with respect to
such Stock, as reported by the National Association of Securities Dealers, Inc.
Automated Quotation System or such other similar system then in use; or, if on
any such date such Stock is not quoted by any such organization, the average of
the closing bid and asked prices with respect to such Stock, as furnished by a
professional market maker making a market in such Stock selected by the
Committee; or if such prices are not available, the fair market value of such
Stock as of such date as determined in good faith by the Committee; or, where
necessary, in order to achieve the intended Federal income tax result, the value
of a share of Stock as determined by the Committee in accordance with the
applicable provisions of the Code.
9. EFFECT, DISCONTINUANCE, CANCELLATION, AMENDMENT AND TERMINATION
Neither adoption of the Plan nor the grant of Awards to a Participant
will affect the Company's right to grant to such Participant cash or Stock
awards that are not subject to the Plan, to issue to such Participant Stock as a
bonus or otherwise, or to adopt other plans or arrangements under which Stock be
issued to Employees. The Committee may at any time discontinue granting Awards
under the Plan.
The Board may at any time or times amend the Plan (and the Committee
may amend any outstanding Award) for any purpose which may at the time be
permitted by law, or may at any time terminate the Plan as to any further grants
of Awards, provided that no amendment or termination of the Plan may adversely
affect the rights of any Participant (without the Participant's consent) under
any Award previously granted.
