<PAGE>
As filed with the Securities and Exchange Commission on February 16, 1999
Registration No. 333-
==============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------
TRANSMEDIA NETWORK INC.
(Exact name of registrant as specified in its charter)
Delaware 84-6028875
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
11900 Biscayne Boulevard
North Miami, Florida 33181
(305) 892-3300
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
--------------------
TRANSMEDIA NETWORK INC.
1996 LONG-TERM INCENTIVE PLAN
(Full title of the Plan)
--------------------
Gene M. Henderson
President and Chief Executive Officer
Transmedia Network Inc.
11900 Biscayne Boulevard
North Miami, Florida 33181
(305) 892-3300
(Name and address, including zip code, and telephone
number, including area code, of agent for service)
--------------------
Copies to
Stephen P. Farrell, Esq.
Morgan, Lewis & Bockius LLP
101 Park Avenue
New York, New York 10178
(212) 309-6000
--------------------
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Maximum Maximum
Title of Each Class of Securities to Amount to be Offering Aggregate Offering Amount of
be Registered Registered(1) Price Per Share Price Registration Fee(3)
- ---------------------------------------- ---------------- ------------------ -------------------- ---------------------
<S> <C> <C> <C> <C>
Common Stock, par value $0.02 per share 1,000,000 $4.16(2) $4,160,000 $1,157.00
Total
- ---------------------------------------- ---------------- ------------------ -------------------- ---------------------
</TABLE>
(1) Pursuant to Rule 416(a), the number of shares being registered shall
be adjusted to include any additional shares which may become
issuable as a result of stock splits, stock dividends or similar
transactions in accordance with the anti-dilution provisions of the
Transmedia Network Inc. 1996 Long-Term Incentive Plan.
(2) Calculated pursuant to Rules 457(c) and (h), based upon the average
of the reported high and low sales prices for the Common Stock as
reported on the New York Stock Exchange for February 12, 1999.
(3) Calculated pursuant to Section 6(b) of the Securities Act of 1933 as
follows: Proposed Maximum Offering Price per share multiplied by
.000278.
==============================================================================
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Item 1. Plan Information.*
Item 2. Registrant Information and Employee Plan Annual Information.*
* Information required by Part I to be contained in the Section 10(a)
prospectus is omitted from this Registration Statement in accordance with
Rule 428 under the Securities Act of 1933, as amended (the "1933 Act"),
and the Introductory Note to Part I of Form S-8.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents previously filed with the Securities and
Exchange Commission (the "Commission") by Transmedia Network Inc., a Delaware
corporation (the "Company"), are incorporated herein by reference:
(a) The Company's Annual Report on Form 10-K for the fiscal year
ended September 30, 1998, filed with the Commission on December 31, 1998.
(b) The Company's Current Reports on Form 8-K dated November 6, 1997
(filed with the Commission on November 17, 1998), dated December 29, 1997
(filed with the Commission on January 12, 1998), dated March 3, 1998 (filed
with the Commission on March 17, 1998), dated August 6, 1998 (filed with the
Commission on August 21, 1998) and dated October 20, 1998 (filed with the
Commision on November 2, 1998).
(c) The description of the Company's Common Stock, registered under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
contained in the Company's Registration Statement filed under Section 12 of
the Exchange Act, including any amendments or reports filed for the purpose of
updating any such description.
In addition, all reports and other documents subsequently filed by
the Company pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange
Act prior to the filing of a post-effective amendment which indicates that all
securities offered have been sold or which deregisters all securities then
remaining unsold, shall be deemed to be incorporated by reference herein and
to be a part hereof from the date of filing of such reports and documents.
<PAGE>
Any statement contained herein, or in a document, all or a portion of
which is incorporated or deemed to be incorporated by reference herein, shall
be deemed to be modified or superseded for purposes of this Registration
Statement to the extent that a statement contained herein or in any other
subsequently filed document which also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this Registration Statement.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Offers.
Section 145 of the Delaware General Corporation Law provides that
each corporation incorporated thereunder, such as the Company, may indemnify
any person who was or is a party or is threatened to be a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, by reason of the fact that he is or
was a director, officer, employee or agent of the corporation or serving
another corporation at the request of the corporation, against expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement,
actually and reasonably incurred by him if he acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best interests of
the corporation and, with respect to a criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. Lack of good faith is
not to be presumed from settlement. No indemnification is allowed in respect
to any proceeding charging improper personal benefit to the officer or
director in which such person was adjudged to be liable on the basis that
personal benefit was improperly received. To the extent any such person
succeeds on the merits or otherwise, he shall be indemnified against expenses
(including attorneys' fees). A determination that the person to be indemnified
meets the applicable standard of conduct, if not made by a court, is made by
the Board of Directors by majority vote of a quorum consisting of directors
not party to such action, suit or proceeding or, if a quorum is not obtainable
or a disinterested quorum so directs, by independent legal counsel or by the
stockholders. Expenses may be paid in advance upon receipt of undertakings to
repay. A corporation may purchase indemnification insurance.
Article 8 of the Company's Certificate of Incorporation provides that
the Company's officers, directors, employees and agents acting in their
official capacities are entitled, under certain conditions, to indemnification
against liabilities and expenses.
The Company also currently maintains a directors' and officers'
liability insurance policy providing aggregate coverage in the maximum annual
amount of $10 million, subject to certain
2
<PAGE>
deductibles and participation requirements, insuring the Company's officers
and directors against certain liabilities and expenses incurred by such
persons in such capacities. The maintenance of such insurance coverage is
considered vital by the Company in attracting and retaining the services of
qualified directors and officers. The Company, however, cannot be assured that
its existing policy will be renewed upon expiration or that, if the policy is
not renewed, the Company will be able to obtain similar insurance coverage
elsewhere or that the cost thereof will not be prohibitively expensive.
The Company has not entered into separate indemnification agreements
with any of its officers or directors.
Insofar as indemnification for liabilities arising under the 1933 Act
may be permitted to directors, officers or persons controlling the Company
pursuant to the foregoing provisions, the Company has been informed that in
the opinion of the Commission such indemnification is against public policy as
expressed in the 1933 Act and is therefore unenforceable.
Item 7. Exemption from Registration.
Not applicable.
Item 8. Exhibits.
Exhibit Description
4.1 - Certificate of Incorporation of the Company, as amended. (1)
4.2 - Certificate of Amendment to the Certificate of Incorporation of the
Company. (2)
4.3 - Certificate of Amendment to the Certificate of Incorporation of the
Company, as filed with the Delaware Secretary of State on March 22,
1994. (3)
4.4 - Certificate of Amendment to the Certificate of Incorporation of the
Company, as filed with the Delaware Secretary of State on March 3,
1998. (4)
4.5 - By-Laws of the Company, as amended and restated as of March 4,
1998. (4)
4.6 - Transmedia Network Inc. 1996 Long-Term Incentive Plan.
5.1 - Opinion of Morgan, Lewis & Bockius LLP.
23.1 - Consent of KPMG LLP.
23.2 - Consent of Morgan, Lewis & Bockius LLP (included in Exhibit 5.1).
24 - Powers of Attorney (included on signature pages hereof).
- ---------------
(1) Previously filed as an exhibit to the Company's Annual Report on Form
10-K for the fiscal year ended September 30, 1988 and incorporated by
reference thereto.
(2) Previously filed as an exhibit to the Company's Annual Report on Form
10-K for the fiscal year ended September 30, 1993 and incorporated by
reference thereto.
3
<PAGE>
(3) Previously filed as an exhibit to the Company's Annual Report on Form
10-K for the fiscal year ended September 30, 1994 and incorporated by
reference thereto.
(4) Previously filed as an exhibit to the Company's Current Report on
Form 8-K, dated March 3, 1998 (filed with the Commission on March 17,
1998), and incorporated by reference thereto.
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 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 the registration statement;"
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
the registration statement is on Form S-3, Form S-8 or Form F-3, and 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
Commission by the registrant pursuant to Section 13 or 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, 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.
4
<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 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(C) 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.
5
<PAGE>
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 Miami, State of Florida, on January
25, 1999.
TRANSMEDIA NETWORK INC.
By: /s/ Stephen E. Lerch
------------------------------
Stephen E. Lerch
Executive Vice President and
Chief Financial Officer
POWERS OF ATTORNEY
Each person whose name appears below constitutes and appoints F. Philip
Handy, Gene M. Henderson and Stephen E. Lerch, and each of them, his true and
lawful attorney-in-fact and agent with 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, as well as any related
registration statement (or amendment thereto) filed pursuant to Rule 462(b)
promulgated under the Securities Act of 1933, and to file the same, with all
exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents or any of them or his substitute or substitutes, may lawfully do or
cause to be done by virtue hereof.
This Power of Attorney may be executed in multiple counterparts, each of
which shall be deemed an original, but which taken together shall constitute
one instrument.
Pursuant to the requirement of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
/s/ F. Philip Handy Chairman of the Board January 25, 1999
- -------------------
F. Philip Handy
6
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/s/ Gene M. Henderson Director, President and Chief January 25, 1999
- --------------------- Executive Officer
Gene M. Henderson (Principal Executive Officer)
/s/ Stephen E. Lerch Executive Vice President and January 25, 1999
- ------------------------ Chief Financial Officer
Stephen E. Lerch (Principal Financial and
Accounting Officer)
/s/ Melvin Chasen Director January 25, 1999
- -----------------------
Melvin Chasen
/s/ Jack Africk Director January 25, 1999
- -----------------------
Jack Africk
/s/ Rod F. Dammeyer Director January 25, 1999
- ----------------------
Rod F. Dammeyer
/s/ Herbert M. Gardner Director January 25, 1999
- -----------------------
Herbert M. Gardner
Director January , 1999
- -----------------------
George S. Wiedemann
/s/ Lester Wunderman Director January 25, 1999
- -----------------------
Lester Wunderman
7
<PAGE>
Exhibit Index
Exhibit Description
4.1 Certificate of Incorporation of the Company, as amended. (1)
4.2 Certificate of Amendment to the Certificate of Incorporation of the
Company. (2)
4.3 Certificate of Amendment to the Certificate of Incorporation of the
Company as filed with the Delaware Secretary of State on March 22,
1994. (3)
4.4 Certificate of Amendment to the Certificate of Incorporation of the
Company as filed with the Delaware Secretary of State on March 3,
1998. (4)
4.5 By-Laws of the Company, as amended and restated as of March 4, 1998.
(4)
4.6 Transmedia Network Inc. 1996 Long-Term Incentive Plan.
5.1 Opinion of Morgan, Lewis & Bockius LLP.
23.1 Consent of KPMG LLP.
23.2 Consent of Morgan, Lewis & Bockius LLP (included on Exhibit 5.1).
24 Powers of Attorney (included on signature pages hereof).
- ---------------
(1) Previously filed as an exhibit to the Company's Annual Report on Form
10-K for the fiscal year ended September 30, 1988 and incorporated by
reference thereto.
(2) Previously filed as an exhibit to the Company's Annual Report on Form
10-K for the fiscal year ended September 30, 1993 and incorporated by
reference thereto.
(3) Previously filed as an exhibit to the Company's Annual Report on Form
10-K for the fiscal year ended September 30, 1994 and incorporated by
reference thereto.
(4) Previously filed as an exhibit to the Company's Current Report on
Form 8-K, dated March 3, 1998 (filed with the Commission on March 17,
1998), and incorporated by reference thereto.
8
<PAGE>
Exhibit 4.6
TRANSMEDIA NETWORK INC.
1996 LONG-TERM INCENTIVE PLAN
(including amendments through August 5, 1998)
l. Purpose. The purpose of this 1996 Long-Term Incentive Plan (the
"Plan") of Transmedia Network Inc., a Delaware corporation (the "Company"), is
to advance the interests of the Company and its stockholders by providing a
means to attract, retain, and reward directors, officers and other key
employees and consultants of the Company and its subsidiaries (including
consultants providing services of substantial value) and to enable such
persons to acquire or increase a proprietary interest in the Company, thereby
promoting a closer identity of interests between such persons and the
Company's stockholders.
2. Definitions. The definitions of awards under the Plan, including
Options, SARs (including Limited SARs), Restricted Stock, Deferred Stock,
Stock granted as a bonus or in lieu of other awards, Dividend Equivalents, and
Other Stock-Based Awards, are set forth in Section 6 of the Plan. Such awards,
together with any other right or interest granted to a Participant under the
Plan, are termed "Awards." For purposes of the Plan, the following additional
terms shall be defined as set forth below:
(a) "Award Agreement" means any written agreement, contract, or other
instrument or document evidencing an Award.
(b) "Beneficiary" shall mean the person, persons, trust, or trusts which
have been designated by a Participant in his or her most recent written
beneficiary designation filed with the Committee to receive the benefits
specified under this Plan upon such Participant's death or, if there is no
designated Beneficiary or surviving designated Beneficiary, then the person,
persons, trust, or trusts entitled by will or the laws of descent and
distribution to receive such benefits.
(c) "Board" means the Board of Directors of the Company.
(d) A "Change in Control" shall be deemed to have occurred if:
(i) any person (as defined in Sections 3(a)(9) and 13(d)(3) of
the Exchange Act), other than the Company or an employee benefit plan of
the Company, acquires directly or indirectly the beneficial ownership
(within the meaning of Rule 13d-3 promulgated pursuant to the Exchange
Act) of any voting security of the Company and immediately after such
acquisition such person is, directly or indirectly, the beneficial owner
of voting securities representing 50 percent or more of the total voting
power of all of the then-outstanding voting securities of the Company;
(ii) the individuals (A) who constitute the Board as of the date
this Plan is adopted by the Board (the "Original Directors") or (B) who
thereafter are elected to the Board and
9
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whose election, or nomination for election, to the Board was approved by
a vote of at least two-thirds (2/3) of the Original Directors then still
in office (such directors becoming "Additional Original Directors"
immediately following their election) or (C) who are elected to the
Board and whose election, or nomination for election, to the Board was
approved by a vote of at least two-thirds (2/3) of the Original
Directors and Additional Original Directors then still in office (such
directors also becoming "Additional Original Directors" immediately
following their election) (such individuals being the "Continuing
Directors"), cease for any reason to constitute a majority of the
members of the Board;
(iii) the stockholders of the Company shall approve a merger,
consolidation, recapitalization, or reorganization of the Company, a
reverse stock split of outstanding voting securities, or consummation of
any such transaction if stockholder approval is not sought or obtained,
other than any such transaction which would result in at least 75
percent of the total voting power represented by the voting securities
of the surviving entity outstanding immediately after such transaction
being beneficially owned (within the meaning of Rule 13d-3 promulgated
pursuant to the Exchange Act) by at least 75 percent of the holders of
outstanding voting securities of the Company immediately prior to the
transaction, with the voting power of each such continuing holder
relative to other such continuing holders not substantially altered in
the transaction; or
(iv) the stockholders of the Company shall approve a plan of
complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or a substantial portion of the
Company's assets (i.e., 50 percent or more of the total assets of the
Company).
(e) "Code" means the Internal Revenue Code of 1986, as amended from time
to time. References to any provision of the Code shall be deemed to include
regulations thereunder and successor provisions and regulations thereto.
(f) "Committee" means the Compensation Committee of the Board, or such
other Board committee as may be designated by the Board to administer the
Plan; provided, however, that to the extent necessary to comply with Rule
16b-3, the Committee shall consist of two or more directors, each of whom is a
"disinterested person" within the meaning of Rule 16b-3.
(g) "Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time. References to any provision of the Exchange Act shall be
deemed to include rules thereunder and successor provisions and rules thereto.
(h) "Fair Market Value" means, with respect to Stock, Awards, or other
property, the fair market value of such Stock, Awards, or other property
determined by such methods or procedures as shall be established from time to
time by the Committee, provided, however, that if the Stock is listed on a
national securities exchange or quoted in an interdealer quotation system, the
Fair Market Value of such Stock on a given date shall be based upon the last
sales price or, if unavailable, the average of the closing bid and asked
prices per share of the Stock on such date
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(or, if there was no trading or quotation in the Stock on such date, on the
next preceding date on which there was trading or quotation) as provided by
one of such organizations.
(j) "ISO" means any Option intended to be and designated as an incentive
stock option within the meaning of Section 422 of the Code.
(k) "Non-Employee Director" shall mean a member of the Board who is not
otherwise an employee of the Company or any subsidiary.
(l) "Participant" means a person who, at a time when eligible under
Section 5 hereof, has been granted an Award under the Plan.
(m) "Rule 16b-3" means Rule 16b-3, as from time to time in effect and
applicable to the Plan and Participants, promulgated by the Securities and
Exchange Commission under Section 16 of the Exchange Act.
(n) "Stock" means the Common Stock, $.02 par value, of the Company and
such other securities as may be substituted for Stock or such other securities
pursuant to Section 4.
3. Administration.
(a) Authority of the Committee. Except as otherwise provided below, the
Plan shall be administered by the Committee. The Committee shall have full and
final authority to take the following actions, in each case subject to and
consistent with the provisions of the Plan:
(i) to select persons to whom Awards may be granted;
(ii) to determine the type or types of Awards to be granted to
each such person;
(iii) to determine the number of Awards to be granted, the
number of shares of Stock to which an Award will relate, the terms and
conditions of any Award granted under the Plan (including, but not
limited to, any exercise price, grant price, or purchase price, any
restriction or condition, any schedule for lapse of restrictions or
conditions relating to transferability or forfeiture, exercisability, or
settlement of an Award, and waivers or accelerations thereof, and
waivers of or modifications to performance conditions relating to an
Award, based in each case on such considerations as the Committee shall
determine), and all other matters to be determined in connection with an
Award;
(iv) to determine whether, to what extent, and under what
circumstances an Award may be settled, or the exercise price of an Award
may be paid, in cash, Stock, other Awards, or other property, or an
Award may be cancelled, forfeited, or surrendered;
11
<PAGE>
(v) to determine whether, to what extent, and under what
circumstances cash, Stock, other Awards, or other property payable with
respect to an Award will be deferred either automatically, at the
election of the Committee, or at the election of the Participant;
(vi) to prescribe the form of each Award Agreement, which need
not be identical for each Participant;
(vii) to adopt, amend, suspend, waive, and rescind such rules
and regulations and appoint such agents as the Committee may deem
necessary or advisable to administer the Plan;
(viii) to correct any defect or supply any omission or reconcile
any inconsistency in the Plan and to construe and interpret the Plan and
any Award, rules and regulations, Award Agreement, or other instrument
hereunder; and
(ix) to make all other decisions and determinations as may be
required under the terms of the Plan or as the Committee may deem
necessary or advisable for the administration of the Plan.
Other provisions of the Plan notwithstanding, the Board shall perform the
functions of the Committee for purposes of granting awards to directors who
serve on the Committee (subject to Section 8), and may perform any function of
the Committee under the Plan for any other purpose, including without
limitation for the purpose of ensuring that transactions under the Plan by
Participants who are then subject to Section 16 of the Exchange Act in respect
of the Company are exempt under Rule 16b-3. In any case in which the Board is
performing a function of the Committee under the Plan, each reference to the
Committee herein shall be deemed to refer to the Board, except where the
context otherwise requires.
(b) Manner of Exercise of Committee Authority. Any action of the
Committee with respect to the Plan shall be final, conclusive, and binding on
all persons, including the Company, subsidiaries of the Company, Participants,
any person claiming any rights under the Plan from or through any Participant,
and stockholders. The express grant of any specific power to the Committee,
and the taking of any action by the Committee, shall not be construed as
limiting any power or authority of the Committee. The Committee may delegate
to officers or managers of the Company or any subsidiary of the Company the
authority, subject to such terms as the Committee shall determine, to perform
such functions as the Committee may determine, to the extent permitted under
applicable law.
(c) Limitation of Liability. Each member of the Committee shall be
entitled to, in good faith, rely or act upon any report or other information
furnished to him by any officer or other employee of the Company or any
subsidiary, the Company's independent certified public accountants, or any
executive compensation consultant, legal counsel, or other professional
retained by the Company to assist in the administration of the Plan. No member
of the Committee, nor any officer or employee of the Company acting on behalf
of the Committee, shall
12
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be personally liable for any action, determination, or interpretation taken or
made in good faith with respect to the Plan, and all members of the Committee
and any officer or employee of the Company acting on their behalf shall, to
the extent permitted by law, be fully indemnified and protected by the Company
with respect to any such action, determination, or interpretation.
4. Stock Subject to Plan.
(a) Amount of Stock Reserved. The total amount of Stock that may be
subject to outstanding Awards, determined immediately after the grant of any
Award, shall not exceed 1,505,966. Notwithstanding the foregoing, the number
of shares that may be delivered upon the exercise of ISOs shall not exceed
505,966; provided, however, that shares subject to ISOs shall not be deemed
delivered if such Awards are forfeited, expire or otherwise terminate without
delivery of shares to the Participant. If an Award valued by reference to
Stock may only be settled in cash, the number of shares to which such Award
relates shall be deemed to be Stock subject to such Award for purposes of this
Section 4(a). Any shares of Stock delivered pursuant to an Award may consist,
in whole or in part, of authorized and unissued shares or treasury shares.
(b) Annual Per-Participant Limitations. During any calendar year, no
Participant may be granted Options and other Awards under the Plan that may be
settled by delivery of more than 250,000 shares of Stock, subject to
adjustment as provided in Section 4(c). In addition, with respect to Awards
that may be settled in cash (in whole or in part), no Participant may be paid
during any calendar year cash amounts relating to such Awards that exceed the
greater of the Fair Market Value of the number of shares of Stock set forth in
the preceding sentence at the date of grant or the date of settlement of
Award. This provision sets forth two separate limitations, so that awards that
may be settled solely by delivery of Stock will not operate to reduce the
amount of cash-only Awards, and vice versa; nevertheless, Awards that may be
settled in Stock or cash must not exceed either limitation.
(c) Adjustments. In the event that the Committee shall determine that
any dividend or other distribution (whether in the form of cash, Stock, or
other property), recapitalization, forward or reverse split, reorganization,
merger, consolidation, spin-off, combination, repurchase, or share exchange,
or other similar corporate transaction or event, affects the Stock such that
an adjustment is appropriate in order to prevent dilution or enlargement of
the rights of Participants under the Plan, then the Committee shall, in such
manner as it may deem equitable, adjust any or all of (i) the number and kind
of shares of Stock reserved and available for Awards under Section 4(a), (ii)
the number and kind of shares of outstanding Restricted Stock or other
outstanding Award in connection with which shares have been issued, (iii) the
number and kind of shares that may be issued in respect of other outstanding
Awards, (iv) the exercise price, grant price, or purchase price relating to
any Award (or, if deemed appropriate, the Committee may make provision for a
cash payment with respect to any outstanding Award), (v) the number of shares
with respect to which Options and SARs may be granted to a Participant in any
calendar year, as set forth in Section 4(b), and (vi) the number and kind of
shares to be subject to Options granted pursuant to Section 6(i). In addition,
the Committee is authorized to make adjustments in the
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terms and conditions of, and the criteria included in, Awards in recognition
of unusual or nonrecurring events (including, without limitation, events
described in the preceding sentence) affecting the Company or any subsidiary
or the financial statements of the Company or any subsidiary, or in response
to changes in applicable laws, regulations, or accounting principles. The
foregoing notwithstanding, without the consent of the Participant, no
adjustments shall be authorized under this Section 4(c) with respect to ISOs
to the extent that such adjustment would cause such ISOs to fail to qualify as
ISOs.
5. Eligibility. Directors, executive officers and other key employees of
the Company and its subsidiaries, and persons who provide consulting or other
services to the Company deemed by the Committee to be of substantial value to
the Company, are eligible to be granted Awards under the Plan. In addition, a
person who has been offered employment by the Company or its subsidiaries, and
a person who is employed by an entity expected to become a subsidiary, is
eligible to be granted an Award under the Plan, provided that such Award shall
be cancelled if such person fails to commence such employment, or if such
entity fails to become a subsidiary, and no payment of value may be made in
connection with such Award until such person has commenced such employment or
until such entity has become a subsidiary.
6. Specific Terms of Awards.
(a) General. Awards may be granted on the terms and conditions set forth
in this Section 6. In addition, the Committee may impose on any Award or the
exercise thereof, at the date of grant or thereafter (subject to Section
8(e)), such additional terms and conditions, not inconsistent with the
provisions of the Plan, as the Committee shall determine, including terms
requiring forfeiture of Awards in the event of termination of employment or
service of the Participant.
(b) Options. The Committee is authorized to grant Options to
Participants (including "reload" options automatically granted to offset
specified exercises of options) on the following terms and conditions:
(i) Exercise Price. The exercise price per share of Stock
purchasable under an Option shall be determined by the Committee;
provided, however, that, the exercise price of an ISO shall be not less
than 100 percent (110 percent in the case of an ISO granted to a person
who owns (within the meaning of Section 422(b)(6) of the Code) 10
percent of the Stock) of the Fair Market Value of a share on the date of
grant of such Option.
(ii) Time and Method of Exercise. The Committee shall determine
the time or times at which an Option may be exercised in whole or in
part, the methods by which such exercise price may be paid or deemed to
be paid, the form of such payment, including, without limitation, cash,
Stock, other Awards or awards granted under other Company plans, or
other property (including notes or other contractual obligations of
Participants to make payment on a deferred basis, such as through
"cashless exercise" arrangements, to the extent permitted by applicable
law), and the methods by which Stock will be delivered or deemed to be
delivered to Participants.
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(iii) ISOs. The terms of any ISO granted under the Plan shall
comply in all respects with the provisions of Section 422 of the Code,
including but not limited to the requirement that no ISO shall be
granted more than ten years after the effective date of the Plan.
Anything in the Plan to the contrary notwithstanding, no term of the
Plan relating to ISOs shall be interpreted, amended, or altered, nor
shall any discretion or authority granted under the Plan be exercised,
so as to disqualify either the Plan or any ISO under Section 422 of the
Code.
(iv) Termination of Employment. Unless otherwise determined by
the Committee, upon termination of a Participant's employment with the
Company and its subsidiaries for any reason other than death, disability
(within the meaning of Section 22(e)(3) of the Code) or cause, such
Participant may exercise any Options during the 90-day period following
such termination of employment. In the event such termination is on
account of death or disability, the Participant may exercise any Options
during the one-year period following such termination. If the Committee
determines that termination of employment is for cause, all Options held
by the Participant shall immediately terminate. In any case where
Options remain exercisable following termination of employment, such
Options shall be exercisable only to the extent exercisable immediately
prior to such termination of employment.
(c) Stock Appreciation Rights. The Committee is authorized to grant SARs
to Participants on the following terms and conditions:
(i) Right to Payment. An SAR shall confer on the Participant to
whom it is granted a right to receive, upon exercise thereof, the excess
of (A) the Fair Market Value of one share of Stock on the date of
exercise (or, if the Committee shall so determine in the case of any
such right other than one related to an ISO, the Fair Market Value of
one share at any time during a specified period before or after the date
of exercise), over (B) the grant price of the SAR as determined by the
Committee as of the date of grant of the SAR, which, except as provided
in Section 7(a), shall be not less than the Fair Market Value of one
share of Stock on the date of grant.
(ii) Other Terms. The Committee shall determine the time or
times at which an SAR may be exercised in whole or in part, the method
of exercise, method of settlement, form of consideration payable in
settlement, method by which Stock will be delivered or deemed to be
delivered to Participants, whether or not an SAR shall be in tandem with
any other Award, and any other terms and conditions of any SAR. Limited
SARs that may only be exercised upon the occurrence of a Change in
Control may be granted on such terms, not inconsistent with this Section
6(c), as the Committee may determine. Limited SARs may be either
freestanding or in tandem with other Awards. Notwithstanding anything
contained herein to the contrary, no award shall be an SAR unless the
Award Agreement explicitly so provides.
(d) Restricted Stock. The Committee is authorized to grant Restricted
Stock to Participants on the following terms and conditions:
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(i) Grant and Restrictions. Restricted Stock shall be subject to
such restrictions on transferability and other restrictions, if any, as
the Committee may impose, which restrictions may lapse separately or in
combination at such times, under such circumstances, in such
installments, or otherwise, as the Committee may determine. Except to
the extent restricted under the terms of the Plan and any Award
Agreement relating to the Restricted Stock, a Participant granted
Restricted Stock shall have all of the rights of a stockholder
including, without limitation, the right to vote Restricted Stock or the
right to receive dividends thereon.
(ii) Forfeiture. Except as otherwise determined by the
Committee, upon termination of employment or service (as determined
under criteria established by the Committee) during the applicable
restriction period, Restricted Stock that is at that time subject to
restrictions shall be forfeited and reacquired by the Company; provided,
however, that the Committee may provide, by rule or regulation or in any
Award Agreement, or may determine in any individual case, that
restrictions or forfeiture conditions relating to Restricted Stock will
be waived in whole or in part in the event of termination resulting from
specified causes.
(iii) Certificates for Stock. Restricted Stock granted under the
Plan may be evidenced in such manner as the Committee shall determine.
If certificates representing Restricted Stock are registered in the name
of the Participant, such certificates shall bear an appropriate legend
referring to the terms, conditions, and restrictions applicable to such
Restricted Stock, the Company shall retain physical possession of the
certificate, and the Participant shall have delivered a stock power to
the Company, endorsed in blank, relating to the Restricted Stock.
(iv) Dividends. Dividends paid on Restricted Stock shall be
either paid at the dividend payment date in cash or in shares of
unrestricted Stock having a Fair Market Value equal to the amount of
such dividends, or the payment of such dividends shall be deferred
and/or the amount or value thereof automatically reinvested in
additional Restricted Stock, other Awards, or other investment vehicles,
as the Committee shall determine or permit the Participant to elect.
Stock distributed in connection with a Stock split or Stock dividend,
and other property distributed as a dividend, shall be subject to
restrictions and a risk of forfeiture to the same extent as the
Restricted Stock with respect to which such Stock or other property has
been distributed.
(e) Deferred Stock. The Committee is authorized to grant Deferred Stock
to Participants, subject to the following terms and conditions:
(i) Award and Restrictions. Delivery of Stock will occur upon
expiration of the deferral period specified for an Award of Deferred
Stock by the Committee (or, if permitted by the Committee, as elected by
the Participant). In addition, Deferred Stock shall be subject to such
restrictions as the Committee may impose, if any, which restrictions may
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lapse at the expiration of the deferral period or at earlier specified
times, separately or in combination, in installments, or otherwise, as
the Committee may determine.
(ii) Forfeiture. Except as otherwise determined by the
Committee, upon termination of employment or service (as determined
under criteria established by the Committee) during the applicable
deferral period or portion thereof to which forfeiture conditions apply
(as provided in the Award Agreement evidencing the Deferred Stock), all
Deferred Stock that is at that time subject to deferral (other than a
deferral at the election of the Participant) shall be forfeited;
provided, however, that the Committee may provide, by rule or regulation
or in any Award Agreement, or may determine in any individual case, that
restrictions or forfeiture conditions relating to Deferred Stock will be
waived in whole or in part in the event of termination resulting from
specified causes.
(f) Bonus Stock and Awards in Lieu of Cash Obligations. The Committee is
authorized to grant Stock as a bonus, or to grant Stock or other Awards in
lieu of Company obligations to pay cash under other plans or compensatory
arrangements.
(g) Dividend Equivalents. The Committee is authorized to grant Dividend
Equivalents to a Participant, entitling the Participant to receive cash,
Stock, other Awards, or other property equal in value to dividends paid with
respect to a specified number of shares of Stock. Dividend Equivalents may be
awarded on a free-standing basis or in connection with another Award. The
Committee may provide that Dividend Equivalents shall be paid or distributed
when accrued or shall be deemed to have been reinvested in additional Stock,
Awards, or other investment vehicles, and subject to such restrictions on
transferability and risks of forfeiture, as the Committee may specify.
(h) Other Stock-Based Awards. The Committee is authorized, subject to
limitations under applicable law, to grant to Participants such other Awards
that may be denominated or payable in, valued in whole or in part by reference
to, or otherwise based on, or related to, Stock and factors that may influence
the value of Stock, as deemed by the Committee to be consistent with the
purposes of the Plan, including, without limitation, convertible or
exchangeable debt securities, other rights convertible or exchangeable into
Stock, purchase rights for Stock, Awards with value and payment contingent
upon performance of the Company or any other factors designated by the
Committee, and Awards valued by reference to the book value of Stock or the
value of securities of or the performance of specified subsidiaries. The
Committee shall determine the terms and conditions of such Awards. Stock
issued pursuant to an Award in the nature of a purchase right granted under
this Section 6(h) shall be purchased for such consideration, paid for at such
times, by such methods, and in such forms, including, without limitation,
cash, Stock, other Awards, or other property, as the Committee shall
determine. Cash awards, as an element of or supplement to any other Award
under the Plan, may be granted pursuant to this Section 6(h).
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(i) Non-Employee Directors Options.
(i) On the day after the Company's annual meeting of
stockholders at which the Plan is approved, each person who is then a
Non-Employee Director shall receive, without the exercise of the
discretion of any person, a non-qualified stock option under the Plan
relating to the purchase of 5,000 shares of Stock. Thereafter, each
person who becomes a Non-Employee Director shall receive a
non-qualified stock option under the Plan relating to the purchase of
5,000 shares of Stock on the day after the date that he becomes a Non-
Employee Director. On the day after each of the Company's annual
meetings occurring in 1997 and thereafter, each person who is a
Non-Employee Director on any such day shall receive, without the
exercise of the discretion of any person, a non-qualified stock option
under the Plan relating to the purchase of 5,000 shares of Stock, plus
an additional 500 shares for each full year of service as a Non-Employee
Director performed from the date that the Plan was approved by the
Company's stockholders to the date of such annual meeting, provided,
however, that any Non-Employee Director who was granted an Option
pursuant to the preceding sentence within 30 days of the date of an
annual meeting shall be not be granted an Option pursuant to this
sentence on the day after such annual meeting. In the event that there
are not sufficient shares available under this Plan to allow for the
grant to each Non-Employee Director of an Option for the number of
shares provided herein, each Non-Employee Director shall receive an
Option for his pro rata share of the total number of shares of Stock
available under the Plan.
(ii) The exercise price of each share of Stock subject to an
Option granted to a Non-Employee Director shall equal the Fair Market
Value of a share of Stock on the date such Option is granted. Payment of
the exercise price for the shares being purchased shall be made in cash,
Stock, or a combination of both.
(iii) Each Option granted to a Non-Employee Director shall be
exercisable in full one year from the date the Option is granted, and
shall have a term of ten years from such date. Upon a Non-Employee
Director's cessation of service as a Non-Employee Director, the Option,
to the extent it was exercisable upon such cessation, shall remain
exercisable for a period of 90 days (one year in the event such
cessation is on account of death or disability). A Non-Employee
Director's removal for cause shall result in an immediate termination of
all Options. For purposes of this clause (iii), "cause" shall mean the
director's fraud, intentional misrepresentation, or embezzlement
committed against the Company, its agents or employees, or otherwise in
connection with his or her service as a director of the Company, the
director's misappropriation or conversion of assets or opportunities of
the Company or its subsidiaries, or the director's conviction of a
crime, whether or not in connection with his or her service as a
director, other than a traffic infraction or other violation not deemed
a felony or misdemeanor.
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7. Certain Provisions Applicable to Awards.
(a) Stand-Alone, Additional, Tandem, and Substitute Awards. Awards
granted under the Plan may, in the discretion of the Committee, be granted
either alone or in addition to, in tandem with, or in substitution for, any
other Award granted under the Plan or any award granted under any other plan
of the Company, any subsidiary, or any business entity to be acquired by the
Company or a subsidiary, or any other right of a Participant to receive
payment from the Company or any subsidiary. Awards granted in addition to or
in tandem with other Awards or awards may be granted either as of the same
time as or a different time from the grant of such other Awards or awards.
(b) Term of Awards. The term of each Award shall be for such period as
may be determined by the Committee; provided, however, that in no event shall
the term of any ISO or an SAR granted in tandem therewith exceed a period of
ten years from the date of its grant (or such shorter period as may be
applicable under Section 422 of the Code).
(c) Form of Payment Under Awards. Subject to the terms of the Plan and
any applicable Award Agreement, payments to be made by the Company or a
subsidiary upon the grant or exercise of an Award may be made in such forms as
the Committee shall determine, including, without limitation, cash, Stock,
other Awards, or other property, and may be made in a single payment or
transfer, in installments, or on a deferred basis. Such payments may include,
without limitation, provisions for the payment or crediting of reasonable
interest on installment or deferred payments or the grant or crediting of
Dividend Equivalents in respect of installment or deferred payments
denominated in Stock.
(d) Rule 16b-3 Compliance.
(i) Six-Month Holding Period. Unless a Participant could
otherwise dispose of equity securities, including derivative securities,
acquired under the Plan without incurring liability under Section 16(b)
of the Exchange Act, equity securities acquired under the Plan must be
held for a period of six months following the date of such acquisition,
provided that this condition shall be satisfied with respect to a
derivative security if at least six months elapse from the date of
acquisition of the derivative security to the date of disposition of the
derivative security (other than upon exercise or conversion) or its
underlying equity security.
(ii) Other Compliance Provisions. With respect to a Participant
who is then subject to Section 16 of the Exchange Act in respect of the
Company, the Committee shall implement transactions under the Plan and
administer the Plan in a manner that will ensure that each transaction
by such a Participant is exempt from liability under Rule 16b-3, except
that such a Participant may be permitted to engage in a non-exempt
transaction under the Plan if written notice has been given to the
Participant regarding the non-exempt nature of such transaction. The
Committee may authorize the Company to repurchase any Award or shares of
Stock resulting from any Award in order to prevent a Participant who is
subject to
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Section 16 of the Exchange Act from incurring liability under Section
16(b). Unless otherwise specified by the Participant, equity securities,
including derivative securities, acquired under the Plan which are
disposed of by a Participant shall be deemed to be disposed of in the
order acquired by the Participant.
(e) Loan Provisions. With the consent of the Committee, and subject at
all times to, and only to the extent, if any, permitted under and in
accordance with, laws and regulations and other binding obligations or
provisions applicable to the Company, the Company may make, guarantee, or
arrange for a loan or loans to a Participant with respect to the exercise of
any Option or other payment in connection with any Award, including the
payment by a Participant of any or all federal, state, or local income or
other taxes due in connection with any Award. Subject to such limitations, the
Committee shall have full authority to decide whether to make a loan or loans
hereunder and to determine the amount, terms, and provisions of any such loan
or loans, including the interest rate to be charged in respect of any such
loan or loans, whether the loan or loans are to be with or without recourse
against the borrower, the terms on which the loan is to be repaid and
conditions, if any, under which the loan or loans may be forgiven.
(f) Performance-Based Awards. The Committee may, in its discretion,
designate any Award the exercisability or settlement of which is subject to
the achievement of performance conditions as a performance-based Award subject
to this Section 7(f), in order to qualify such Award as "qualified
performance-based compensation" within the meaning of Section 162(m) of the
Code and regulations thereunder. The performance objectives for an Award
subject to this Section 7(f) shall consist of one or more business criteria
and a targeted level or levels of performance with respect to such criteria,
as specified by the Committee but subject to this Section 7(f). Performance
objectives shall be objective and shall otherwise meet the requirements of
Section 162(m)(4)(C) of the Code and regulations thereunder. Business criteria
used by the Committee in establishing performance objectives for Awards
subject to this Section 7(f) shall be selected exclusively from among the
following:
(1) Annual return on capital;
(2) Annual earnings per share;
(3) Annual cash flow provided by operations;
(4) Changes in annual revenues; and/or
(5) Strategic business criteria, consisting of one or more
objectives based on meeting specified revenue, market
penetration, geographic business expansion goals, cost targets,
and goals relating to acquisitions or divestitures.
The levels of performance required with respect to such business criteria may
be expressed in absolute or relative levels. Achievement of performance
objectives with respect to such Awards shall be measured over a period of not
less than one year nor more than five years, as the
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Committee may specify. Performance objectives may differ for such Awards to
different Participants. The Committee shall specify the weighting to be given
to each performance objective for purposes of determining the final amount
payable with respect to any such Award. The Committee may, in its discretion,
reduce the amount of a payout otherwise to be made in connection with an Award
subject to this Section 7(f), but may not exercise discretion to increase such
amount, and the Committee may consider other performance criteria in
exercising such discretion. All determinations by the Committee as to the
achievement of performance objectives shall be in writing. The Committee may
not delegate any responsibility with respect to an Award subject to this
Section 7(f).
(g) Acceleration upon a Change of Control. Notwithstanding anything
contained herein to the contrary, unless otherwise provided by the Committee
in an Award Agreement, all conditions and/or restrictions relating to the
continued performance of services and/or the achievement of performance
objectives with respect to the exercisability or full enjoyment of an Award
shall immediately lapse upon a Change in Control.
8. General Provisions.
(a) Compliance With Laws and Obligations. The Company shall not be
obligated to issue or deliver Stock in connection with any Award or take any
other action under the Plan in a transaction subject to the registration
requirements of the Securities Act of 1933, as amended, or any other federal
or state securities law, any requirement under any listing agreement between
the Company and any national securities exchange or automated quotation
system, or any other law, regulation, or contractual obligation of the
Company, until the Company is satisfied that such laws, regulations, and other
obligations of the Company have been complied with in full. Certificates
representing shares of Stock issued under the Plan will be subject to such
stop-transfer orders and other restrictions as may be applicable under such
laws, regulations, and other obligations of the Company, including any
requirement that a legend or legends be placed thereon.
(b) Limitations on Transferability. Awards and other rights under the
Plan, including any Award or right which constitutes a derivative security as
generally defined in Rule 16a-1(c) under the Exchange Act, will not be
transferable by a Participant except by will or the laws of descent and
distribution (or to a designated Beneficiary in the event of the Participant's
death), and, if exercisable, shall be exercisable during the lifetime of a
Participant only by such Participant or his guardian or legal representative;
provided, however, that such Awards and other rights (other than ISOs and SARs
in tandem therewith) may be transferred to one or more Beneficiaries during
the lifetime of the Participant in connection with the Participant's estate
planning, and may be exercised by such transferees in accordance with the
terms of such Award, consistent with the registration of the offer and sale of
Stock on Form S-8 or Form S-3 or a successor registration form of the
Securities and Exchange Commission, and permitted by the Committee. Awards and
other rights under the Plan may not be pledged, mortgaged, hypothecated, or
otherwise encumbered, and shall not be subject to the claims of creditors.
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(c) No Right to Continued Employment. Neither the Plan nor any action
taken hereunder shall be construed as giving any employee the right to be
retained in the employ of the Company or any of its subsidiaries, nor shall it
interfere in any way with the right of the Company or any of its subsidiaries
to terminate any employee's employment at any time.
(d) Taxes. The Company and any subsidiary is authorized to withhold from
any Award granted or to be settled, any delivery of Stock in connection with
an Award, any other payment relating to an Award, or any payroll or other
payment to a Participant amounts of withholding and other taxes due or
potentially payable in connection with any transaction involving an Award, and
to take such other action as the Committee may deem advisable to enable the
Company and Participants to satisfy obligations for the payment of withholding
taxes and other tax obligations relating to any Award. This authority shall
include authority to withhold or receive Stock or other property and to make
cash payments in respect thereof in satisfaction of a Participant's tax
obligations; in such case, the shares withheld shall be deemed to have been
delivered for purposes of Section 4(a).
(e) Changes to the Plan and Awards. The Board may amend, alter, suspend,
discontinue, or terminate the Plan or the Committee's authority to grant
Awards under the Plan without the consent of stockholders or Participants,
except that any such action shall be subject to the approval of the Company's
stockholders at or before the next annual meeting of stockholders for which
the record date is after such Board action if such stockholder approval is
required by any federal or state law or regulation or the rules of any stock
exchange or automated quotation system on which the Stock may then be listed
or quoted, and the Board may otherwise, in its discretion, determine to submit
other such changes to the Plan to stockholders for approval; provided,
however, that, without the consent of an affected Participant, no such action
may materially impair the rights of such Participant under any Award
theretofore granted to him. The Committee may waive any conditions or rights
under, or amend, alter, suspend, discontinue, or terminate, any Award
theretofore granted and any Award Agreement relating thereto; provided,
however, that, without the consent of an affected Participant, no such action
may materially impair the rights of such Participant under such Award.
(f) No Rights to Awards; No Stockholder Rights. No Participant or
employee shall have any claim to be granted any Award under the Plan, and
there is no obligation for uniformity of treatment of Participants and
employees. No Award shall confer on any Participant any of the rights of a
stockholder of the Company unless and until Stock is duly issued or
transferred and delivered to the Participant in accordance with the terms of
the Award or, in the case of an Option, the Option is duly exercised.
(g) Unfunded Status of Awards; Creation of Trusts. The Plan is intended
to constitute an "unfunded" plan for incentive and deferred compensation. With
respect to any payments not yet made to a Participant pursuant to an Award,
nothing contained in the Plan or any Award shall give any such Participant any
rights that are greater than those of a general creditor of the Company;
provided, however, that the Committee may authorize the creation of trusts or
make other arrangements to meet the Company's obligations under the Plan to
deliver cash, Stock,
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other Awards, or other property pursuant to any Award, which trusts or other
arrangements shall be consistent with the "unfunded" status of the Plan unless
the Committee otherwise determines with the consent of each affected
Participant.
(h) Nonexclusivity of the Plan. Neither the adoption of the Plan by the
Board nor its submission to the stockholders of the Company for approval shall
be construed as creating any limitations on the power of the Board to adopt
such other compensatory arrangements as it may deem desirable, including,
without limitation, the granting of stock options otherwise than under the
Plan, and such arrangements may be either applicable generally or only in
specific cases.
(i) No Fractional Shares. No fractional shares of Stock shall be issued
or delivered pursuant to the Plan or any Award. The Committee shall determine
whether cash, other Awards, or other property shall be issued or paid in lieu
of such fractional shares or whether such fractional shares or any rights
thereto shall be forfeited or otherwise eliminated.
(j) Compliance with Section 162(m) of the Code. It is the intent of the
Company that Options granted at or above Fair Market Value, SARs, and other
Awards designated as Awards subject to Section 7(f) shall constitute
"qualified performance-based compensation" within the meaning of Section
162(m) of the Code and regulations thereunder. Accordingly, if any provision
of the Plan or any Award Agreement relating to such an Award does not comply
or is inconsistent with the requirements of Section 162(m) of the Code or
regulations thereunder, such provision shall be construed or deemed amended to
the extent necessary to conform to such requirements, and no provision shall
be deemed to confer upon the Committee or any other person discretion to
increase the amount of compensation otherwise payable in connection with any
such Award upon attainment of the performance objectives.
(k) Governing Law. The validity, construction, and effect of the Plan,
any rules and regulations relating to the Plan, and any Award Agreement shall
be determined in accordance with the Delaware General Corporation Law, without
giving effect to principles of conflicts of laws, and applicable federal law.
(l) Effective Date; Plan Termination. The Plan shall become effective as
of the date of its adoption by the Board and shall continue in effect until
terminated by the Board.
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EXHIBIT 5.1
Opinion of Morgan, Lewis & Bockius LLP
February 16, 1999
Transmedia Network Inc.
11900 Biscayne Boulevard
North Miami, Florida 33181
Re: Issuance of Additional Shares Pursuant to
Registration Statement on Form S-8
Ladies and Gentlemen:
We have acted as counsel to Transmedia Network Inc., a
Delaware corporation, in connection with the preparation and filing with
the Securities and Exchange Commission under the Securities Act of 1933,
as amended (the "Act"), of a Registration Statement on Form S-8 (the
"Registration Statement") relating to the registration by the Company of
an additional 1,000,000 shares (the "Shares") of the Company's Common
Stock, $.02 par value per share, available for issuance under the
Company's 1996 Long-Term Incentive Plan (as amended to date, the
"Plan").
In so acting, we have examined originals, or copies
certified or otherwise identified to our satisfaction, of (a) the
Certificate of Incorporation of the Company, (b) the By-Laws of the
Company, (c) a good standing certificate dated as of a recent date from
the State of Delaware, (d) the Plan and (e) such other documents,
records, certificates and other instruments of the Company as in our
judgment are necessary or appropriate for purposes of this opinion.
In rendering this opinion, we have assumed that the Shares
when issued pursuant to the Plan will be issued for consideration not
less than the par value of the Common Stock.
Based on the foregoing, we are of the following opinion:
1. The Company has been duly incorporated and is validly
existing as a corporation under the laws of the State of Delaware.
2. The Shares, when issued in accordance with the terms of
the Plan, will be duly authorized, validly issued, fully paid and
non-assessable.
The opinion is based upon and limited to the General
Corporation Law of the State of Delaware.
We consent to the use of this opinion as an exhibit to the
Registration Statement. In giving such opinion, we do not thereby admit
that we are acting within the category of persons whose consent is
required under Section 7 of the Act or the rules and regulations of the
Commission thereunder.
Very truly yours,
/s/ Morgan, Lewis & Bockius LLP
-------------------------------
Morgan, Lewis & Bockius LLP
<PAGE>
Exhibit 23.1
[LETTERHEAD OF KPMG LLP]
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors
Transmedia Network Inc.:
We consent to incorporation by reference in the registration statement dated
February 16, 1998, on Form S-8 of Transmedia Network Inc. and subsidiaries of
our report dated December 10, 1998, relating to the consolidated balance
sheets and financial statement schedules of Transmedia Network Inc. and
subsidiaries as of September 30, 1998 and 1997, and the related consolidated
statements of income, stockholders' equity and cash flows and financial
statement schedules for each of the years in the three-year period ended
September 30, 1998, which report appears in the September 30, 1998 annual
report on form 10-K of Transmedia Network Inc.
KPMG LLP
Miami, Florida
February 8, 1999
