Registration No.333-
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
J. BAKER, INC.
(Exact name of Registrant as specified in Its Charter)
Massachusetts 04-2866591
(State or other Jurisdiction of (IRS Employer
Incorporation or Organization) Identification No.)
555 Turnpike Street, Canton, Massachusetts 02021
(Address of Principal Executive Offices) (Zip Code)
Amended and Restated 1994 Equity Incentive Plan
Amended and Restated Directors' 1992 Stock Option Plan
Non-Qualified Stock Option Grants
(Full title of the Plans)
ALAN I. WEINSTEIN
J. Baker, Inc.
555 Turnpike Street
Canton, Massachusetts 02021
(Name and address of agent for service)
(781) 828-9300
(Telephone Number, including Area Code, of Agent for Service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<S> <C> <C> <C>
Amount to Proposed maximum Proposed maximum Amount of
Title of Securities be regis- offering price aggregate offering registration
to be registered tered (1) per share price fee
- ---------------------- -------- ------------------- ---------- ---------
Common Stock, par 600,000 $10.875 (2) $6,525,000 (2) $1,925.00
value $.50 per share
Common Stock, par 100,000 $10.875 (2) $1,087,500 (2) $321.00
value $.50 per share
Common Stock, par 100,000 $1.00 (3) $100,000 (3) $30.00
value $.50 per share
Common Stock, par 50,000 $8.63 (3) $431,500 (3) $127.00
value $.50 per share
</TABLE>
<PAGE>
(1) The Registration Statement also covers such additional number of shares
which may be issued as a result of anti-dilution adjustments. This
Registration Statement also relates to the Rights to purchase shares of
Series A Junior Participating Cumulative Preferred Stock of the
Registrant which are attached to all shares of Common Stock outstanding
as of, and issued subsequent to, January 6, 1995, pursuant to the terms
of the Registrant's Shareholder Rights Agreement dated December 15,
1994. Until the occurrence of certain prescribed events, the Rights are
not exercisable, are evidenced by the certificates for the Common Stock
and will be transferred with and only with such stock.
(2) Estimated solely for the purpose of determining the amount of the
Registration fee pursuant to Rule 457(c) and (h) and is based upon the
average of the high and low prices of the registrant's Common Stock on
the National Market System of the National Association of Securities
Dealers, Inc. Automated Quotation System on July 22, 1998.
(3) Based upon the exercise price of the Non-Qualified Stock Option
Grants, pursuant to Rule 457(h)(1) under the Securities Act of 1933,
as amended.
PART II
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INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
J. Baker, Inc. (the "Company") hereby incorporates by reference the
documents listed in (a) through (c) below, which have previously been filed with
the Securities and Exchange Commission:
(a) The Company's Annual Report on Form 10-K for the Company's fiscal year ended
January 31, 1998.
(b) The Company's Quarterly Report on Form 10-Q for the Company's fiscal quarter
ended May 2, 1998.
(c) The description of the Company's Common Stock $.50 par value, contained
in the Company's Registration Statement on Form 8-A filed pursuant to
Section 12(g) of the Securities Exchange Act of 1934, as amended, dated
June 2, 1986, including any amendment or report filed for the purpose
of updating such description.
The description of the Company's Rights to purchase shares of the
Company's Series A Junior Participating Cumulative Preferred Stock
contained in the Company's Registration Statement on Form 8-A filed
pursuant to Section 12(g) of the Securities Exchange Act of 1934, as
amended, dated December 15, 1994, including any amendment or report
filed for the purpose of updating such description.
All documents subsequently filed by the Company with the Securities and Exchange
Commission pursuant to Sections 13(a), (c), 14 and 15(d) of the Securities
Exchange Act of 1934, as amended, prior to the filing of a post-effective
amendment which indicates that all securities offered hereunder have been sold
or which deregisters all securities then remaining unsold, shall be deemed to be
incorporated by reference in this registration statement and to be a part hereof
from the date of filing of such documents.
Any statement contained in a document incorporated or deemed to be incorporated
by reference herein shall be deemed to be modified or superseded for purposes
hereof to the extent that a statement contained herein or in any other
subsequently filed document which also is incorporated or 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 Officers.
As permitted by applicable Massachusetts law, Article 6A of the Company's
Restated Articles of Organization, as amended, provides, that the Company shall
indemnify, except as limited by law or as otherwise provided in the Company's
Articles of Organization, each person who serves or has served as a director or
in any other office filled by election or appointment by the stockholders or by
the Board of Directors of the Company against all liability fixed by a judgment,
order, decree, or award in any action, suit or proceeding, civil or criminal,
brought or threatened in or before any court, tribunal, administrative or
legislative body or agency incurred by such person in connection with each such
action, suit or proceeding in which such person is involved as a result of
serving or having served the Company in such capacity or, at the request of the
Company, as a director, officer, employer or other agent of any other
organization. No indemnification will be provided under Article 6A to such a
person with respect to a matter as to which it shall have been adjudicated in
any such action, suit or proceeding that such person did not act in good faith
in the reasonable belief that such person's action was in the best interests of
the Company. Also, in the event that any such action, suit or proceeding is
compromised or settled so as to impose any liability or obligation upon such
person or upon the Company, no indemnification shall be provided to such person
with respect to a matter if the Company has obtained an opinion of counsel that
with respect to such matter such person did not act in good faith in the
reasonable belief that such person's action was in the best interests of the
Company.
Article 6F of the Company's Restated Articles of Organization, provides that no
director of the Company shall be personally liable to the Company or its
stockholders for monetary damages for breach of the Director's duty as a
director notwithstanding any provision of law imposing such liability; provided,
however, that Article 6F also states that the Article shall not eliminate or
limit any liability of a Director (i) for any breach of the director's duty of
loyalty to the Company or its stockholders, (ii) for acts or omissions not in
good faith or which involve intentional misconduct or a knowing violation of
law, (iii) under Sections 61 or 62 of the Massachusetts Business Corporation
Law, or (iv) with respect to any transaction from which the director derived an
improper personal benefit.
Article 6F also provides that if the Massachusetts Business Corporation law is
subsequently amended to further eliminate or limit the personal liability of
directors or to authorize corporate action to further eliminate or limit such
liability, then the liability of the directors of the company shall be
eliminated or limited to the fullest extent permitted by the Massachusetts
Business Corporation Law as so amended.
Item 7. Exemption from Registration Claimed.
Not Applicable.
Item 8. Exhibits.
The following is a complete list of Exhibits filed or incorporated by
reference as part of this Registration Statement.
Exhibits
4.1 Amended and Restated Articles of Organization of the Company, as filed with
the Secretary of the Commonwealth of Massachusetts on September 26, 1990
(incorporated herein by reference to Exhibit 3.01 to the Company's Form
10-K Report for the year ended February 2, 1991).
4.2 By-laws of the Company, as amended by the Board of Directors on September
11, 1990 (incorporated herein by reference to Exhibit 19.01 to the
Company's Form 10-Q Report for the quarter ended November 3, 1990). 5 *
Opinion of Mark T. Beaudouin, counsel to the Company, as to the legality of
the securities being registered.
23.1* Consent of Mark T. Beaudouin (included in Exhibit 5).
23.2* Consent of KPMG Peat Marwick LLP.
24* Power of Attorney (included on signature page of this Registration
Statement).
99.1*J. Baker, Inc. Amended and Restated 1994 Equity Incentive Plan dated as of
March 29, 1994.
99.2*J. Baker, Inc. Amended and Restated 1992 Directors' Stock Option Plan
dated as of April 13, 1992.
99.3*Non-Qualified Stock Option Grant Agreement between J. Baker, Inc. and
James D. Lee, dated June 5, 1997.
99.4*Non-Qualified Stock Option Grant Agreement between J. Baker, Inc. and
Roger J. Osborne, dated June 5, 1997.
99.5*Non-Qualified Stock Option Grant Agreement between J. Baker, Inc. and
Stuart M. Glasser, dated September 15, 1997.
99.6*Non-Qualified Stock Option Grant Agreement between J. Baker, Inc. and
Stuart M. Glasser, dated September 15, 1997.
* Filed herewith
<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 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 and 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; and
(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) herein do
not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic
reports filed by the undersigned registrant pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement;
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof; and
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at
the termination of the offering.
(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.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Canton, Commonwealth of Massachusetts, on July 28,
1998.
J. BAKER, INC.
By: /s/ Alan I. Weinstein
Alan I. Weinstein
President and Chief Executive Officer
POWER OF ATTORNEY AND SIGNATURES
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Alan I. Weinstein and Philip G.
Rosenberg, and each of them singly, his or her true and lawful attorneys-in-fact
and agents, with full power of substitution and resubstitution, for him or her
and in his or her name, place and stead, and in any and all capacities, to sign
any and all amendments (including post-effective amendments) to this
Registration Statement on Form S-8 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 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 each such person might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or their substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
<TABLE>
<S> <C> <C>
Signature Capacity Date
/s/ Alan I. Weinstein President, Chief July 28, 1998
Alan I. Weinstein Executive Officer and
Director (Principal
Executive Officer)
/s/ Philip G. Rosenberg Executive Vice President, July 28, 1998
Philip G. Rosenberg Chief Financial Officer and
Treasurer (Principal Financial and
Accounting Officer)
/s/ Sherman N. Baker Chairman of the Board July 28, 1998
Sherman N. Baker of Directors
/s/ J. Christopher Clifford Director July 28, 1998
J. Christopher Clifford
/s/ Douglas J. Kahn Director July 28, 1998
Douglas J. Kahn
/s/ Harold Leppo Director July 28, 1998
Harold Leppo
/s/ David Pulver Director July 28, 1998
David Pulver
/s/ Melvin M. Rosenblatt Director July 28, 1998
Melvin M. Rosenblatt
/s/ Nancy Ryan Director July 28, 1998
Nancy Ryan
</TABLE>
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description of Document
4.1 Amended and Restated Articles of Organization of the Company, as filed with
the Secretary of the Commonwealth of Massachusetts on September 26, 1990
(incorporated herein by reference to Exhibit 3.01 to the Company's Form
10-K Report for the year ended February 2, 1991).
4.2 By-laws of the Company, as amended by the Board of Directors on September
11, 1990 (incorporated herein by reference to Exhibit 19.01 to the
Company's Form 10-Q Report for the quarter ended November 3, 1990).
5* Opinion of Mark T. Beaudouin, counsel to the Company, as to the legality of
the securities being registered, attached.
23.1* Consent of Mark T. Beaudouin (included in Exhibit 5), attached.
23.2* Consent of KPMG Peat Marwick LLP, attached.
24 * Power of Attorney (included on signature page of this Registration
Statement), attached.
99.1*J. Baker, Inc. Amended and Restated 1994 Equity Incentive Plan dated as of
March 29, 1994, attached.
99.2*J. Baker, Inc. Amended and Restated 1992 Directors' Stock Option Plan
dated as of April 13, 1992, attached.
99.3*Non-Qualified Stock Option Grant Agreement between J. Baker, Inc. and
James D. Lee, dated June 5, 1997, attached.
99.4*Non-Qualified Stock Option Grant Agreement between J. Baker, Inc. and
Roger J. Osborne, dated June 5, 1997, attached.
99.5*Non-Qualified Stock Option Grant Agreement between J. Baker, Inc. and
Stuart M. Glasser, dated September 15, 1997, attached.
99.6*Non-Qualified Stock Option Grant Agreement between J. Baker, Inc. and
Stuart M. Glasser, dated September 15, 1997, attached.
* Filed herewith
EXHIBIT 5
OPINION OF MARK T. BEAUDOUIN
July 28, 1998
J. Baker, Inc.
555 Turnpike Street
Canton, MA 02021
RE: J. Baker, Inc.
Amended and Restated 1994 Equity Incentive Plan
Amended and Restated 1992 Directors' Stock Option Plan
Non-Qualified Stock Option Grants
Gentlemen:
This opinion is furnished in connection with the registration, pursuant
to the Securities Act of 1933 (the "Act"), of 600,000 shares of the Common
Stock, par value $.50 per share of J. Baker, Inc. (the "Company") which may
be issued under the J. Baker, Inc. Amended and Restated 1994 Equity
Incentive Plan, 100,000 shares of the Company's Common Stock, par value $.50
per share, which may be issued under the Amended and Restated 1992
Directors' Stock Option Plan and 150,000 shares of the Company's Common
Stock, par value $.50 per share, which may be issued under J. Baker, Inc.
Non-Qualified Stock Option Grants (such shares hereinafter collectively
referred to as the "Shares").
I have acted as counsel to the Company in connection with the
registration of the Shares under the Act. I have examined the Restated
Articles of Organization and the By-Laws of the Company, each as amended to
date; such records of proceedings of the Company as I deemed material; a
Registration Statement on Form S-8 under the Act relating to the Shares (the
"Registration Statement"); and such other certificates, records and
documents as I have considered necessary for the purposes of this opinion.
Based upon the foregoing, I am of the opinion that upon the issuance
and delivery of the Shares in accordance with the terms of the Registration
Statement and the plan pursuant to which they were issued, the Shares will
be legally issued, fully paid and non-assessable shares of the Company's
Common Stock.
The foregoing assumes that all requisite steps will be taken to comply
with the requirements of the Act, applicable requirements of state laws
regulating the offer and sale of securities and applicable requirements of
the National Association of Securities Dealers, Inc.
I understand that this opinion is to be used in connection with the
Registration Statement. I consent to the filing of a copy of this opinion
with the Registration Statement.
Very truly yours,
/s/ Mark T. Beaudouin
Mark T. Beaudouin
General Counsel
MTB/tag
EXHIBIT 23.1
CONSENT OF MARK T. BEAUDOUIN
Consent of Mark T. Beaudouin:
(INCLUDED IN EXHIBIT 5)
EXHIBIT 23.2
CONSENT OF KPMG PEAT MARWICK LLP
CONSENT OF INDEPENDENT ACCOUNTANTS
The Board of Directors
J. Baker, Inc.
We consent to the incorporation by reference in this Registration
Statement on Form S-8 relating to the J. Baker, Inc. Non-Qualified
Stock Option Grants, the Amended and Restated 1992 Directors' Stock
Option Plan and the Amended and Restated 1994 Equity Incentive Plan of
our report dated March 23, 1998 relating to the consolidated balance
sheets of J. Baker, Inc. and subsidiaries as of January 31, 1998 and
February 1, 1997 and the related consolidated statements of earnings,
changes in stockholders' equity and cash flows for each of the years in
the three-year period ended January 31, 1998 which report is included
in the Company's Annual Report of Form 10-K pursuant to the Securities
Exchange Act of 1934 for the year ended January 31, 1998.
/s/ KPMG Peat Marwick LLP
KPMG PEAT MARWICK LLP
Boston, Massachusetts
July 24, 1998
EXHIBIT 24
POWER OF ATTORNEY
Power of Attorney:
(INCLUDED ON SIGNATURE PAGE OF THIS REGISTRATION STATEMENT)
EXHIBIT 99.1
J. BAKER, INC.
AMENDED AND RESTATED
1994 EQUITY INCENTIVE PLAN
SECTION 1. GENERAL PURPOSE OF THE PLAN; DEFINITIONS
The name of the plan is the J. Baker, Inc. 1994 Equity Incentive Plan
(the "Plan"). The purpose of the Plan is to encourage and enable the officers
and other key employees of J. Baker, Inc. (the "Company") and its Subsidiaries
upon whose judgment, initiative and efforts the Company largely depends for the
successful conduct of its business to acquire a proprietary interest in the
Company. It is anticipated that providing such persons with a direct stake in
the Company's welfare will assure a closer identification of their interests
with those of the Company, thereby stimulating their efforts on the Company's
behalf and strengthening their desire to remain with the Company.
The following terms shall be defined as set forth below:
"Act" means the Securities Exchange Act of 1934, as amended.
"Award" or "Awards," except where referring to a particular category of
grant under the Plan, shall include Incentive Stock Options, Non-Qualified Stock
Options, Restricted Stock Awards, Unrestricted Stock Awards and Performance
Share Awards.
"Board" means the Board of Directors of the Company.
"Cause" means the occurrence of one or more of the following: (i)
employee is convicted of, pleads guilty to, or confesses to any felony or any
act of fraud, misappropriation or embezzlement which has an immediate and
materially adverse effect on the Company or any Subsidiary, as determined by the
Board in good faith in its sole discretion, (ii) employee engages in a
fraudulent act to the material damage or prejudice of the Company or any
Subsidiary or in conduct or activities materially damaging to the property,
business or reputation of the Company or any Subsidiary, all as determined by
the Board in good faith in its sole discretion, (iii) any material act or
omission by employee involving malfeasance or negligence in the performance of
employee's duties to the Company or any Subsidiary to the material detriment of
the Company or any Subsidiary, as determined by the Board in good faith in its
sole discretion, which has not been corrected by employee within 30 days after
written notice from the Company of any such act or omission, (iv) failure by
employee to comply in any material respect with the terms of his employment
agreement, if any, or any written policies or directives of the Board as
determined by the Board in good faith in its sole discretion, which has not been
corrected by employee within 30 days after written notice from the Company of
such failure, or (v) material breach by employee of his non-competition
agreement with the Company, if any, as determined by the Board in good faith in
its sole discretion.
"Change of Control" is defined in Section 13.
"Code" means the Internal Revenue Code of 1986, as amended, and any
successor Code, and related rules, regulations and interpretations.
"Committee" means the Committee of the Board referred to in Section 2.
"Disability" means an employee's inability to perform his normal
required services for the Company and its Subsidiaries for a period of six
consecutive months by reason of the employee's mental or physical disability, as
determined by the Committee in good faith in its sole discretion.
"Effective Date" means the date on which the Plan is approved by
stockholders as set forth in Section 15.
"Fair Market Value" on any given date means the closing price per share
of Stock on the NASDAQ National Market System, or the principal exchange on
which the Stock is traded, on such date (or if no such price is reported on such
date, such price as reported on the nearest preceding date on which such price
is reported).
"Incentive Stock Option" means any Stock Option designated and
qualified as an "incentive stock option" as defined in Section 422 of the Code.
"Non-Qualified Stock Option" means any Stock Option that is not an
Incentive Stock Option.
"Option" or "Stock Option" means any option to purchase shares of Stock
granted pursuant to Section 5.
"Outside Director" means a member of the Board who qualifies as such
under Section 162(m) of the Code and the regulations promulgated thereunder.
"Performance Share Award" means Awards granted pursuant to Section 8.
"Restricted Stock Award" means Awards granted pursuant to Section 6.
"Retirement" means the employee's termination of employment with the
Company and its Subsidiaries after attainment of the age and/or service
requirements to qualify for early or normal retirement under the Company's
qualified retirement plan.
"Stock" means the Common Stock, par value $0.50 per share, of the
Company, subject to adjustments pursuant to Section 3.
"Subsidiary" means any corporation or other entity (other than the
Company) in any unbroken chain of corporations or other entities, beginning with
the Company if each of the corporations or entities (other than the last
corporation or entity in the unbroken chain) owns stock or other interests
possessing 50% or more of the economic interest or the total combined voting
power of all classes of stock or other interests in one of the other
corporations or entities in the chain.
"Unrestricted Stock Award" means Awards granted pursuant to Section 7.
SECTION 2. ADMINISTRATION OF PLAN; COMMITTEE AUTHORITY TO SELECT PARTICIPANTS
AND DETERMINE AWARDS
(a) Committee. The Plan shall be administered by two or more Outside
Directors appointed from time to time to serve as the Compensation Committee of
the Board. No member of the Board shall be liable for any action or
determination under the Plan made in good faith.
(b) Powers of Committee. The Committee shall have the power and
authority to grant Awards consistent with the terms of the Plan, including the
power and authority:
(i) to select the officers and other employees of the
Company and its Subsidiaries to whom Awards may from time to time be
granted;
(ii) to determine the time or times of grant, and the extent,
if any, of Incentive Stock Options, Non-Qualified Stock Options,
Restricted Stock Awards, Unrestricted Stock Awards and Performance
Share Awards, or any combination of the foregoing, granted to any one
or more participants;
(iii) to determine the number of shares of Stock to be covered
by any Award;
(iv) to determine and modify the terms and conditions,
including restrictions, not inconsistent with the terms of the Plan, of
any Award, which terms and conditions may differ among individual
Awards and participants, and to approve the form of written instruments
evidencing the Awards;
(v) to accelerate the exercisability or vesting of all
or any portion of any Award, with or without conditions;
(vi) subject to the provisions of Section 5(a)(ii),
to extend the period in which Stock Options may be exercised;
(vii) to determine whether, to what extent, and under what
circumstances Stock and other amounts payable with respect to an Award
shall be deferred either automatically or at the election of the
participant and whether and to what extent the Company shall pay or
credit amounts constituting interest (at rates determined by the
Committee) or dividends or deemed dividends on such deferrals; and
(viii) to adopt, alter and repeal such rules, guidelines and
practices for administration of the Plan and for its own acts and
proceedings as it shall deem advisable; to interpret the terms and
provisions of the Plan and any Award (including related written
instruments); to make all determinations it deems advisable for the
administration of the Plan; to decide all disputes arising in
connection with the Plan; and to otherwise supervise the administration
of the Plan.
All decisions and interpretations of the Committee shall be binding on
all persons, including the Company and Plan participants.
SECTION 3. STOCK ISSUABLE UNDER THE PLAN; RECAPITALIZATIONS; MERGERS;
SUBSTITUTE AWARDS
(a) Stock Issuable. The maximum number of shares of Stock reserved and
available for issuance under the Plan shall be 1,600,000 shares, of which no
more than 250,000 shares shall be available for issuance in the form of
Restricted Stock Awards, Unrestricted Stock Awards or Performance Share Awards,
counted cumulatively, during the term of the Plan. For purposes of the foregoing
limitations, the shares of Stock underlying any Awards which are forfeited,
cancelled, reacquired by the Company, satisfied without the issuance of Stock or
otherwise terminated (other than by exercise) shall be added back to the shares
of Stock available for issuance under the Plan so long as the participants to
whom such Awards had been previously granted received no benefits of ownership
of the underlying shares of Stock to which the Award related. No more than
100,000 Stock Options may be granted to any one individual participant during
any calendar year period. The shares available for issuance under the Plan may
be authorized but unissued shares of Stock or shares of Stock reacquired by the
Company.
(b) Recapitalizations. If, through or as a result of any merger,
consolidation, sale of all or substantially all of the assets of the Company,
reorganization, recapitalization, reclassification, stock dividend, stock split,
reverse stock split or other similar transaction, the outstanding shares of
Stock are increased or decreased or are exchanged for a different number or kind
of shares or other securities of the Company, or additional shares or new or
different shares or other securities of the Company or other non-cash assets are
distributed with respect to such shares of Stock or other securities, the
Committee shall make an appropriate or proportionate adjustment in (i) the
maximum number and kind of shares reserved for issuance under the Plan and in
the form of Restricted Stock Awards, Unrestricted Stock Awards or Performance
Share Awards, (ii) the maximum number of Stock Options that can be granted to
any one individual participant, (iii) the number and kind of shares or other
securities subject to any then outstanding Awards under the Plan, and (iv) the
price for each share subject to any then outstanding Stock Options under the
Plan, without changing the aggregate exercise price as to which such Stock
Options remain exercisable. The adjustment by the Committee shall be final,
binding and conclusive. No fractional shares of Stock shall be issued under the
Plan resulting from any such adjustment, but the Committee in its discretion may
make a cash payment in lieu of fractional shares.
(c) Mergers. In the event a consolidation or merger or sale
of all or substantially all of the assets of the Company in which outstanding
shares of Stock are exchanged for securities, cash or other property of any
other corporation or business entity or in the event of a liquidation of the
Company, the Board, or the board of directors of any corporation assuming the
obligations of the Company, may, in its discretion, take any one or more of the
following actions, as to outstanding Stock Options: (i) provide that such Stock
Options shall be assumed, or equivalent options shall be substituted, by the
acquiring or succeeding corporation (or an affiliate thereof), (ii) upon written
notice to the optionees, provide that all unexercised Stock Options will
terminate immediately prior to the consummation of such transaction unless
exercised by the optionee within a specified period following the date of such
notice, and/or (iii) in the event of a business combination under the terms of
which holders of the Stock of the Company will receive upon consummation thereof
a payment for each share surrendered in the business combination (the "Merger
Price"), make or provide for a cash payment to the optionees equal to the
difference between (A) the Merger Price times the number of shares of Stock
subject to such outstanding Stock Options (to the extent then exercisable at
prices not in excess of the Merger Price) and (B) the aggregate exercise price
of all such outstanding options in exchange for the termination of such options.
(d) Substitute Awards. The Committee may grant Awards under the Plan in
substitution for stock and stock based awards held by employees of another
corporation who concurrently become employees of the Company or a Subsidiary as
the result of a merger or consolidation of the employing corporation with the
Company or a Subsidiary or the acquisition by the Company or a Subsidiary of
property or stock of the employing corporation. The Committee may direct that
the substitute awards be granted on such terms and conditions as the Committee
considers appropriate in the circumstances.
SECTION 4. ELIGIBILITY
Participants in the Plan will be such full or part-time officers and
other employees of the Company and its Subsidiaries who are responsible for or
contribute to the management, growth or profitability of the Company and its
Subsidiaries and who are selected from time to time by the Committee, in its
sole discretion.
SECTION 5. STOCK OPTIONS
Any Stock Option granted under the Plan shall be in such form as the
Committee may from time to time approve.
Stock Options granted under the Plan may be either Incentive Stock
Options or Non-Qualified Stock Options. To the extent that any Option does not
qualify as an Incentive Stock Option, it shall constitute a Non-Qualified Stock
Option.
No Incentive Stock Option shall be granted under the Plan after March
24, 2008.
(a) Stock Options Granted to Employees. The Committee in its discretion
may grant Stock Options to eligible employees of the Company or any Subsidiary.
Stock Options granted to employees pursuant to this Section 5(a) shall be
subject to the following terms and conditions and shall contain such additional
terms and conditions, not inconsistent with the terms of the Plan, as the
Committee shall deem desirable:
(i) Exercise Price. The exercise price per share for the Stock
covered by a Stock Option granted pursuant to this Section 5(a) shall
be determined by the Committee at the time of grant but shall not be
less than 100% of the Fair Market Value on the date of grant. If an
employee owns or is deemed to own (by reason of the attribution rules
applicable under Section 424(d) of the Code) more than 10% of the
combined voting power of all classes of stock of the Company or any
Subsidiary or parent corporation and an Incentive Stock Option is
granted to such employee, the option price of such Incentive Stock
Option shall be not less than 110% of the Fair Market Value on the
grant date.
(ii) Option Term. The term of each Stock Option shall be
fixed by the Committee, but no Incentive Stock Option
shall be exercisable more than ten years after the date
the option is granted. If an employee owns or is deemed to
own (by reason of the attribution rules of Section 424(d)
of the Code) more than 10% of the combined voting power of
all classes of stock of the Company or any Subsidiary or
parent corporation and an Incentive Stock Option is
granted to such employee, the term of such option shall be
no more than five years from the date of grant.
(iii) Exercisability; Rights of a Stockholder. Stock Options
shall become vested and exercisable at such time or times, whether or
not in installments, as shall be determined by the Committee at or
after the grant date. The Committee may at any time accelerate the
exercisability of all or any portion of any Stock Option. An optionee
shall have the rights of a stockholder only as to shares acquired upon
the exercise of a Stock Option and not as to unexercised Stock Options.
(iv) Method of Exercise. Stock Options may be exercised in
whole or in part, by giving written notice of exercise to the Company,
specifying the number of shares to be purchased. Payment of the
purchase price may be made by one or more of the following methods:
(A) In cash, by certified or bank check or other
instrument acceptable to the Committee;
(B) In the form of shares of Stock that are not then
subject to restrictions under any Company plan and that have
been held by the optionee for at least six months, if
permitted by the Committee in its discretion. Such surrendered
shares shall be valued at Fair Market Value on the exercise
date; or
(C) By the optionee delivering to the Company a
properly executed exercise notice together with irrevocable
instructions to a broker to promptly deliver to the Company
cash or a check payable and acceptable to the Company to pay
the purchase price; provided that in the event the optionee
chooses to pay the purchase price as so provided, the optionee
and the broker shall comply with such procedures and enter
into such agreements of indemnity and other agreements as the
Committee shall prescribe as a condition of such payment
procedure.
Payment instruments will be received subject to collection. The
delivery of certificates representing the shares of Stock to be
purchased pursuant to the exercise of a Stock Option will be contingent
upon receipt from the optionee (or a purchaser acting in his stead in
accordance with the provisions of the Stock Option) by the Company of
the full purchase price for such shares and the fulfillment of any
other requirements contained in the Stock Option or applicable
provisions of laws.
(v) Non-transferability of Options. Except as otherwise
permitted by the Committee, no Stock Option shall be transferable by
the optionee otherwise than by will or by the laws of descent and
distribution and all Stock Options shall be exercisable, during the
optionee's lifetime, only by the optionee.
(vi) Termination by Reason of Death. Any Stock Option held by
an optionee whose employment by the Company and its Subsidiaries is
terminated by reason of death shall become fully exercisable and may
thereafter be exercised by the legal representative or legatee of the
optionee, for a period of twelve months (or such longer period as the
Committee shall specify at any time) from the date of death, or until
the expiration of the stated term of the Option, if earlier.
(vii) Termination by Reason of Disability.
(A) Any Stock Option held by an optionee whose
employment by the Company and its Subsidiaries is terminated
by reason of Disability shall become fully exercisable and may
thereafter be exercised, for a period of twelve months (or
such longer period as the Committee shall specify at any time)
from the date of such termination of employment, or until the
expiration of the stated term of the Option, if earlier.
(B) The Committee shall have sole authority and
discretion to determine whether a participant's employment has
been terminated by reason of Disability.
(C) Except as otherwise provided by the Committee at
any time, the death of an optionee during the period provided
in this Section 5(a)(vii) for the exercise of a Stock Option
shall extend such period for twelve months from the date of
death, subject to termination on the expiration of the stated
term of the Option, if earlier.
(viii) Termination by Reason of Retirement.
(A) Any Stock Option held by an optionee whose
employment by the Company and its Subsidiaries is terminated
by reason of Retirement may thereafter be exercised, to the
extent it was exercisable at the time of such termination, for
a period of twenty-four months (or such other period as the
Committee shall specify at any time) from the date of such
termination of employment, or until the expiration of the
stated term of the Option, if earlier.
(B) Except as otherwise provided by the Committee at
any time, the death of an optionee during a period provided in
this Section 5(a)(viii) for the exercise of a Stock Option
shall extend such period for twelve months from the date of
death, subject to termination on the expiration of the stated
term of the Option, if earlier.
(ix) Termination for Cause. If any optionee's employment by
the Company and its Subsidiaries is terminated for Cause, any Stock
Option held by such optionee, including any Stock Option that is
exercisable at the time of such termination, shall immediately
terminate and be of no further force and effect; provided, however,
that the Committee may, in its sole discretion, provide that such Stock
Option can be exercised for a period of up to 30 days from the date of
termination of employment or until the expiration of the stated term of
the Option, if earlier.
(x) Other Termination. Unless otherwise determined by the
Committee, if an optionee's employment by the Company and its
Subsidiaries terminates for any reason other than death, Disability,
Retirement, or for Cause, any Stock Option held by such optionee may
thereafter be exercised, to the extent it was exercisable on the date
of termination of employment, for three months (or such longer period
as the Committee shall specify at any time) from the date of
termination of employment or until the expiration of the stated term of
the Option, if earlier.
(xi) Annual Limit on Incentive Stock Options. To the extent
required for "incentive stock option" treatment under Section 422 of
the Code, the aggregate Fair Market Value (determined as of the time of
grant) of the shares of Stock with respect to which Incentive Stock
Options granted under this Plan and any other plan of the Company or
its Subsidiaries become exercisable for the first time by an optionee
during any calendar year shall not exceed $100,000. To the extent that
any Stock Option exceeds this limit, it shall constitute a
Non-Qualified Stock Option.
(xii) Form of Settlement. Shares of Stock issued upon exercise
of a Stock Option shall be free of all restrictions under the Plan,
except as otherwise provided in the Plan.
SECTION 6. RESTRICTED STOCK AWARDS
(a) Nature of Restricted Stock Awards. The Committee may grant
Restricted Stock Awards to any employee of the Company or any Subsidiary. A
Restricted Stock Award is an Award entitling the recipient to acquire, at no
cost or for a purchase price determined by the Committee, shares of Stock
subject to such restrictions and conditions as the Committee may determine at
the time of grant ("Restricted Stock"). Conditions may be based on continuing
employment and/or achievement of pre-established performance goals and
objectives.
(b) Acceptance of Award. A participant who is granted a Restricted
Stock Award shall have no rights with respect to such Award unless the
participant shall have accepted the Award within 30 days (or such shorter date
as the Committee may specify) following the award date by making payment to the
Company, if required, by certified or bank check or other instrument or form of
payment acceptable to the Committee in an amount equal to the specified purchase
price, if any, of the shares covered by the Award and by executing and
delivering to the Company a written instrument that sets forth the terms and
conditions of the Restricted Stock Award in such form as the Committee shall
determine.
(c) Rights as a Stockholder. Upon complying with Section 6(b) above, a
participant shall have the rights of a stockholder with respect to the voting of
the Restricted Stock, subject to such conditions contained in the written
instrument evidencing the Restricted Stock Award. Unless the Committee shall
otherwise determine, certificates evidencing the Restricted Stock shall remain
in the possession of the Company until such Restricted Stock is vested as
provided in Section 6(e) below.
(d) Restrictions. Restricted Stock may not be sold, assigned,
transferred, pledged or otherwise encumbered or disposed of except as
specifically provided herein or in the written instrument evidencing the
Restricted Stock Award. In the event of termination of employment by the Company
and its Subsidiaries for any reason other than death or Disability, the Company
shall have the right, at the discretion of the Committee, to repurchase
Restricted Stock with respect to which conditions have not lapsed at its
purchase price, or to require forfeiture of such shares to the Company if
acquired at no cost, from the participant or the participant's legal
representative. The Company must exercise such right of repurchase or forfeiture
not later than the 90th day following such termination of employment (unless
otherwise specified in the written instrument evidencing the Restricted Stock
Award).
(e) Vesting of Restricted Stock. The Committee at the time of grant
shall specify the date or dates and/or the attainment of pre-established
performance goals, objectives and other conditions on which the
non-transferability of the Restricted Stock and the Company's right of
repurchase or forfeiture shall lapse. Specifically, an Award of Restricted Stock
which is contingent on the attainment of pre-established performance goals shall
be subject to a minimum period of one (1) year prior to the lapse of such
restriction. An Award of Restricted Stock which is contingent upon continued
service with the Company shall be subject to a minimum period of three (3) years
prior to the lapse of such restriction. Subsequent to such date or dates and/or
the attainment of such pre-established performance goals, objectives and other
conditions, the shares on which all restrictions have lapsed shall no longer be
Restricted Stock and shall be deemed "vested." A participant whose employment is
terminated for reason of death or Disability shall become fully vested in his
Restricted Stock on his termination date to the extent such vesting is otherwise
contingent only on continued service with the Company. Where vesting is
contingent on attainment of pre-established performance goals, the vesting of
Restricted Stock in the case of death or Disability shall remain dependent on
the attainment of such goals and shall be determined as of such date or dates
specified by the Committee.
(f) Waiver, Deferral and Reinvestment of Dividends. The written
instrument evidencing the Restricted Stock Award may require or permit the
immediate payment, waiver, deferral or investment of dividends paid on the
Restricted Stock.
SECTION 7. UNRESTRICTED STOCK AWARDS
The Committee may, in its sole discretion, grant (or sell at a purchase
price determined by the Committee) an Unrestricted Stock Award to any employee
of the Company or any Subsidiary pursuant to which such employee may receive
shares of Stock free of any restrictions under the Plan in lieu of any cash
compensation to such employee. The aggregate number of shares of Stock to be
granted (or sold) in the form of Unrestricted Stock Awards hereunder shall not
exceed ten percent (10%) of the aggregate number of shares authorized under the
Plan, as the Plan may be amended from time to time.
SECTION 8. PERFORMANCE SHARE AWARDS
(a) Nature of Performance Share Awards. A Performance Share Award is an
award entitling the recipient to acquire shares of Stock upon the attainment of
specified performance goals. The Committee may make Performance Share Awards
independent of or in connection with the granting of any other Award under the
Plan. Performance Share Awards may be granted under the Plan to any employees of
the Company or any Subsidiary, including those who qualify for awards under
other performance plans of the Company. The Committee in its sole discretion
shall determine whether and to whom Performance Share Awards shall be made, the
performance goals applicable under each such Award, the periods during which
performance is to be measured, and all other limitations and conditions
applicable to the awarded Performance Shares; provided, however, that the
Committee may rely on the performance goals and other standards applicable to
other performance unit plans of the Company in setting the standards for
Performance Share Awards under the Plan.
(b) Restrictions on Transfer. Performance Share Awards and all rights
with respect to such Awards may not be sold, assigned, transferred, pledged or
otherwise encumbered.
(c) Rights as a Shareholder. A participant receiving a Performance
Share Award shall have the rights of a shareholder only as to shares actually
received by the participant under the Plan and not with respect to shares
subject to the Award but not actually received by the participant. A participant
shall be entitled to receive a stock certificate evidencing the acquisition of
shares of Stock under a Performance Share Award only upon satisfaction of all
conditions specified in the written instrument evidencing the Performance Share
Award (or in a performance plan adopted by the Committee).
(d) Termination. Except as may otherwise be provided by the Committee
at any time prior to termination of employment, a participant's rights in all
Performance Share Awards shall automatically terminate upon the participant's
termination of employment by the Company and its Subsidiaries for any reason.
(e) Acceleration, Waiver, Etc. At any time prior to the participant's
termination of employment by the Company and its Subsidiaries, the Committee may
in its sole discretion accelerate, waive or, subject to Section 11, amend any or
all of the goals, restrictions or conditions imposed under any Performance Share
Award.
SECTION 9. TAX WITHHOLDING
(a) Payment by Participant. Each participant shall, no later than the
date as of which the value of an Award or of any Stock or other amounts received
thereunder first becomes includable in the gross income of the participant for
Federal income tax purposes, pay to the Company, or make arrangements
satisfactory to the Committee regarding payment of, any Federal, state, or local
taxes of any kind required by law to be withheld with respect to such income.
The Company and its Subsidiaries shall, to the extent permitted by law, have the
right to deduct any such taxes from any payment of any kind otherwise due to the
participant.
(b) Payment in Stock. A participant may elect to have such tax
withholding obligation satisfied, in whole or in part, by (i) authorizing the
Company to withhold from shares of Stock to be issued pursuant to any Award a
number of shares with an aggregate Fair Market Value (as of the date the
withholding is effected) that would satisfy the withholding amount due, or (ii)
transferring to the Company shares of Stock owned by the participant with an
aggregate Fair Market Value (as of the date the withholding is effected) that
would satisfy the withholding amount due. With respect to any participant who is
subject to Section 16 of the Act, the following additional restrictions shall
apply:
(A) the election to satisfy tax withholding obligations
relating to an Award in the manner permitted by this Section 9(b) shall
be made either (1) during the period beginning on the third business
day following the date of release of quarterly or annual summary
statements of sales and earnings of the Company and ending on the
twelfth business day following such date, or (2) at least six months
prior to the date as of which the receipt of such an Award first
becomes a taxable event for Federal income tax purposes;
(B) such election shall be irrevocable;
(C) such election shall be subject to the consent or
disapproval of the Committee; and
(D) the Stock withheld to satisfy tax withholding must pertain
to an Award which has been held by the participant for at least six
months from the date of grant of the Award.
SECTION 10. TRANSFER, LEAVE OF ABSENCE, ETC
For purposes of the Plan, the following events shall not be deemed a
termination of employment:
(a) a transfer to the employment of the Company from a
Subsidiary or from the Company to a Subsidiary, or from one Subsidiary to
another; or
(b) an approved leave of absence for military service or sickness, or
for any other purpose approved by the Company, if the employee's right to
re-employment is guaranteed either by a statute or by contract or under the
policy pursuant to which the leave of absence was granted or if the Committee
otherwise so provides in writing.
SECTION 11. AMENDMENTS AND TERMINATION
The Board may, at any time, amend or discontinue the Plan and the
Committee may, at any time, amend or cancel any outstanding Award (or provide
substitute Awards at the same or reduced exercise or purchase price or with no
exercise or purchase price, but such price, if any, must satisfy the
requirements which would apply to the substitute or amended Award if it were
then initially granted under this Plan) for the purpose of satisfying changes in
law or for any other lawful purpose, but no such action shall adversely affect
rights under any outstanding Award without the holder's consent. Notwithstanding
anything to the contrary set forth above, the amendment, cancellation and/or
substitution of a Stock Option at a reduced exercise price shall be subject to
approval by the Company's stockholders. If and to the extent required by the Act
to ensure that Awards granted under the Plan are exempt under Rule 16b-3
promulgated under the Act, Plan amendments shall be subject to approval by the
Company's stockholders.
SECTION 12. STATUS OF PLAN
With respect to the portion of any Award which has not been exercised
and any payments in cash, Stock or other consideration not received by a
participant, a participant shall have no rights greater than those of a general
creditor of the Company unless the Committee shall otherwise expressly determine
in connection with any Award or Awards. In its sole discretion, the Committee
may authorize the creation of trusts or other arrangements to meet the Company's
obligations to deliver Stock or make payments with respect to Awards hereunder,
provided that the existence of such trusts or other arrangements is consistent
with the foregoing sentence.
SECTION 13. CHANGE OF CONTROL PROVISIONS
Upon the occurrence of a Change of Control as defined in this Section
13:
(a) Each outstanding Stock Option shall automatically become fully
exercisable notwithstanding any provision to the contrary herein.
(b) Each Restricted Stock Award and Performance Share Award shall be
subject to such terms, if any, with respect to a Change of Control as have been
provided by the Committee in connection with such Award.
(c) "Change of Control" shall mean the occurrence of any one of the
following events:
(i) any "person," as such term is used in Sections 13(d) and
14(d) of the Act (other than the Company, any of its Subsidiaries, or
any trustee, fiduciary or other person or entity holding securities
under any employee benefit plan or trust of the Company or any of its
Subsidiaries), together with all "affiliates" and "associates" (as such
terms are defined in Rule 12b-2 under the Act) of such person, shall
become the "beneficial owner" (as such term is defined in Rule 13d-3
under the Act), directly or indirectly, of securities of the Company
representing 30% or more of either (A) the combined voting power of the
Company's then outstanding securities having the right to vote in an
election of the Company's Board of Directors ("Voting Securities") or
(B) the then outstanding shares of Stock of the Company (in either such
case other than as a result of an acquisition of securities directly
from the Company); or
(ii) persons who, as of the Effective Date, constitute the
Company's Board of Directors (the "Incumbent Directors") cease for any
reason, including, without limitation, as a result of a tender offer,
proxy contest, merger or similar transaction, to constitute at least a
majority of the Board, provided that any person becoming a director of
the Company subsequent to the Effective Date whose election or
nomination for election was approved by a vote of at least a majority
of the Incumbent Directors shall, for purposes of this Plan, be
considered an Incumbent Director; or
(iii) the stockholders of the Company shall approve (A) any
consolidation or merger of the Company or any Subsidiary where the
shareholders of the Company, immediately prior to the consolidation or
merger, would not, immediately after the consolidation or merger,
beneficially own (as such term is defined in Rule 13d-3 under the Act),
directly or indirectly, shares representing in the aggregate 80% or
more of the voting shares of the corporation issuing cash or securities
in the consolidation or merger (or of its ultimate parent corporation,
if any), (B) any sale, lease, exchange or other transfer (in one
transaction or a series of transactions contemplated or arranged by any
party as a single plan) of all or substantially all of the assets of
the Company or (C) any plan or proposal for the liquidation or
dissolution of the Company.
Notwithstanding the foregoing, a "Change of Control" shall not be
deemed to have occurred for purposes of the foregoing clause (i) solely as the
result of an acquisition of securities by the Company which, by reducing the
number of shares of Stock or other Voting Securities outstanding, increases (x)
the proportionate number of shares of Stock beneficially owned by any person to
30% or more of the shares of Stock then outstanding or (y) the proportionate
voting power represented by the Voting Securities beneficially owned by any
person to 30% or more of the combined voting power of all then outstanding
Voting Securities; provided, however, that if any person referred to in clause
(x) or (y) of this sentence shall thereafter become the beneficial owner of any
additional shares of Stock or other Voting Securities (other than pursuant to a
stock split, stock dividend, or similar transaction), then a "Change of Control"
shall be deemed to have occurred for purposes of the foregoing clause (i).
SECTION 14. GENERAL PROVISIONS
(a) No Distribution; Compliance with Legal Requirements. The Committee
may require each person acquiring Stock pursuant to an Award to represent to and
agree with the Company in writing that such person is acquiring the shares
without a view to distribution thereof.
No shares of Stock shall be issued pursuant to an Award until all
applicable securities law and other legal and stock exchange or similar
requirements have been satisfied. The Committee may require the placing of such
stop-orders and restrictive legends on certificates for Stock and Awards as it
deems appropriate.
(b) Delivery of Stock Certificates. Delivery of stock certificates to
participants under this Plan shall be deemed effected for all purposes when the
Company or a stock transfer agent of the Company shall have mailed such
certificates in the United States mail, addressed to the participant, at the
participant's last known address on file with the Company.
(c) Other Compensation Arrangements; No Employment Rights. Nothing
contained in this Plan shall prevent the Board from adopting other or additional
compensation arrangements, including trusts, and such arrangements may be either
generally applicable or applicable only in specific cases. The adoption of this
Plan and the grant of Awards do not confer upon any employee any right to
continued employment with the Company or any Subsidiary.
SECTION 15. EFFECTIVE DATE OF PLAN
This Plan shall become effective upon approval by the holders of a
majority of the shares of Stock of the Company present or represented and
entitled to vote at a meeting of stockholders. Subject to such approval by the
stockholders and to the requirement that no Stock may be issued hereunder prior
to such approval, Stock Options and other Awards may be granted hereunder on and
after adoption of this Plan by the Board.
SECTION 16. GOVERNING LAW
This Plan shall be governed by the law of the Commonwealth of
Massachusetts except to the extent such law is preempted by Federal law.
EXHIBIT 99.2
J. BAKER, INC.
AMENDED AND RESTATED 1992 DIRECTORS' STOCK OPTION PLAN
As Amended through June 10, 1997
1. Purpose.
The purpose of this 1992 Directors' Stock Option Plan (the "Plan") of
J. Baker, Inc. (the "Company") is to promote the recruiting and retention of
highly qualified outside directors and to strengthen the commonality of interest
between directors and stockholders. Except where the context otherwise requires,
the term "Company" shall include all present and future subsidiaries of the
Company as defined in Sections 424(e) and 424(f) of the Internal Revenue Code of
1986, as amended or replaced from time to time (the "Code").
2. Administration.
The Plan will be administered by the Board of Directors of the Company,
whose construction and interpretation of the terms and provisions of the Plan
shall be final and conclusive. Grants of stock options under the Plan and the
amount and nature of the awards to be granted shall be automatic and
non-discretionary in accordance with Section 5. However, all questions of
interpretation of the Plan or of any options issued under it shall be determined
by the Board of Directors and such determination shall be final and binding upon
all persons having an interest in the Plan. No director shall be liable for any
action or determination under the Plan made in good faith.
3. Participation in the Plan.
Directors of the Company who are not employees of the Company shall be
eligible to be granted options under the Plan.
4. Stock Subject to the Plan.
(a) The maximum number of shares which may be issued under the Plan
shall be 200,000 shares of the Company's Common Stock, $.50 par value per share
("Common Stock"), subject to adjustment as provided in Section 9.
(b) If any outstanding option under the Plan for any reason expires or
is terminated without having been exercised in full, the shares allocable to the
unexercised portion of such option shall again become available for grant
pursuant to the Plan.
(c) All options granted under the Plan shall be non-qualified options
which are not intended to meet the requirements of Section 422 of the Code.
5. Terms, Conditions and Form of Options.
Each option granted under the Plan shall be evidenced by a written
agreement in such form as the Board of Directors shall from time to time
approve, which agreements shall comply with and be subject to the following
terms and conditions:
(a) Option Grant Dates. Options shall be granted automatically
to all eligible directors as follows: (i) each director who is eligible
for participation shall be granted an option to purchase 2,500 shares
of Common Stock on the close of business on the fifth business day
following approval of the Plan by the holders of a majority of the
shares of Common Stock present or represented at a meeting of the
Company's stockholders duly called and held in accordance with the
Company's by-laws and applicable law; (ii) each person who becomes an
eligible director after the date of stockholder approval of the Plan
shall be granted an option to purchase 2,500 shares of Common Stock on
the close of business on the date of his or her initial election to the
Board of Directors; and (iii) each eligible director shall be granted
an additional option to purchase 2,500 shares of Common Stock for each
fiscal year on the close of business on the fifth business day
following the Company's annual meeting of stockholders, provided he or
she is an eligible director on the date of grant.
(b) Option Exercise Price. The option exercise price per share
for each option granted under the Plan shall equal the closing price
per share of the Company's Common Stock on the NASDAQ System, or the
principal exchange on which the Common Stock is then listed, on the
date of grant (or if no such price is reported on such date, such price
as reported on the nearest preceding date on which such price is
reported).
(c) Options Non-Transferable. Each option granted under the
Plan by its terms shall not be transferable by the optionee otherwise
than by will or by the laws of descent and distribution and shall be
exercised during the lifetime of the optionee only by such optionee.
(d) Exercise Period. Each option may be exercised at any time
and from time to time, in whole or in part, prior to the tenth
anniversary of the date of grant.
(e) Exercise Procedure. Options may be exercised only by
written notice to the Company at its principal office accompanied by
payment of the full consideration for the shares as to which they are
exercised.
(f) Payment of Purchase Price. Payment of the exercise price
may be made, at the election of the optionee, (i) by delivery of cash
or a check to the order of the Company in an amount equal to the
exercise price, (ii) by delivery to the Company of shares of Common
Stock of the Company already owned and held by the optionee for at
least twelve months and having a fair market value equal in amount to
the exercise price of the options being exercised, or (iii) by any
combination of such methods of payment. The fair market value of any
shares of Common Stock which may be delivered upon exercise of an
option shall be determined by the Company as of the date that such
shares are delivered.
6. Assignments.
The rights and benefits under the Plan may not be assigned except as
provided in Section 5.
7. [THIS SECTION INTENTIONALLY LEFT BLANK]
8. Limitation of Rights.
(a) No Right to Continue as a Director. Neither the Plan, nor the
granting of an option nor any other action taken pursuant to the Plan, shall
constitute or be evidence of any agreement or understanding, express or implied,
that the Company will retain a director for any period of time.
(b) No Stockholder Rights with respect to Options. An optionee shall
have no rights as a stockholder with respect to the shares covered by his or her
option until the date of the issuance to him or her of a stock certificate
therefor, and no adjustment will be made for dividends or other rights for which
the record date is prior to the date such certificate is issued.
9. Adjustment Provisions.
(a) Recapitalizations. If, through or as a result of any merger,
consolidation, sale of all or substantially all of the assets of the Company,
reorganization, recapitalization, reclassification, stock dividend, stock split,
reverse stock split or other similar transaction, (i) the outstanding shares of
Common Stock are increased or decreased or are exchanged for a different number
or kind of shares or other securities of the Company, or (ii) additional shares
or new or different shares or other securities of the Company or other non-cash
assets are distributed with respect to such shares of Common Stock or other
securities, an appropriate and proportionate adjustment may be made in (x) the
maximum number and kind of shares reserved for issuance under the Plan, (y) the
number and kind of shares or other securities subject to any then outstanding
options under the Plan, and (z) the price for each share subject to any then
outstanding options under the Plan, without changing the aggregate purchase
price as to which such options remain exercisable.
(b) Mergers. In the event of a consolidation or merger or sale of all
or substantially all of the assets of the Company in which outstanding shares of
Common Stock are exchanged for securities, cash or other property of any other
corporation or business entity or in the event of a liquidation of the Company,
the Board of Directors of the Company, or the board of directors of any
corporation assuming the obligations of the Company, may, in its discretion,
take any one or more of the following actions, as to outstanding options: (i)
provide that such options shall be assumed or equivalent options shall be
substituted, by the acquiring or succeeding corporation (or an affiliate
thereof), (ii) upon written notice to the optionees, provide that all
unexercised options will terminate immediately prior to the consummation of such
transaction unless exercised by the optionee within a specified period following
the date of such notice, and/or (iii) in the event of a merger under the terms
of which holders of the Common Stock of the Company will receive upon
consummation thereof a cash payment for each share surrendered in the merger
(the "Merger Price"), make or provide for a cash payment to the optionees equal
to the difference between (A) the Merger Price times the number of shares of
Common Stock subject to such outstanding options (to the extent then exercisable
at prices not in excess of the Merger Price) and (B) the aggregate exercise
price of all such outstanding options in exchange for the termination of such
options.
10. Amendment of the Plan.
(a) The provisions of Sections 3, 5 (a) and 5 (b) of the Plan shall not
be amended more than once every six months, other than to comport with changes
in the Code, the Employee Retirement Income Security Act of 1974, or the rules
thereunder. Subject to the foregoing, the Board of Directors may at any time,
and from time to time, modify or amend the Plan in any respect.
(b) The termination or any modification or amendment of the Plan shall
not, without the consent of an optionee, affect his or her rights under an
option previously granted to him or her. With the consent of the optionees
affected, the Board of Directors may amend outstanding option agreements in a
manner not inconsistent with the Plan. The Board of Directors shall have the
right to amend or modify the terms and provisions of the Plan and of any
outstanding option to the extent necessary to ensure the qualification of the
Plan under Rule 16b-3 under the Securities Exchange Act of 1934, or any
successor rule ("Rule 16b-3").
11. Withholding.
The optionee shall pay any federal, state or local taxes of any kind
required by law to be paid with respect to any shares issued upon exercise of
options under the Plan. The Company shall have the right to deduct from payments
of any kind otherwise due to the optionee any such taxes required by law to be
withheld with respect to any shares issued upon exercise of options under the
Plan. Subject to the prior approval of the Company, which may be withheld by the
Company in its sole discretion, the optionee may elect to satisfy such
obligations, in whole or in part, (i) by causing the Company to withhold shares
of Common Stock otherwise issuable pursuant to the exercise of an option or (ii)
by delivering to the Company shares of Common Stock already owned by the
optionee. The shares so delivered or withheld shall have a fair market value
equal to such withholding obligation. The fair market value of the shares used
to satisfy such withholding obligation shall be determined by the Company as of
the date that the amount of tax to be withheld is to be determined. An optionee
who has made an election pursuant to this Section 11 may only satisfy his or her
withholding obligation with shares of Common Stock which are not subject to any
repurchase, forfeiture, unfulfilled vesting or other similar requirements.
Notwithstanding the foregoing, no election to use shares for the payment of
withholding taxes shall be effective unless made in compliance with any
applicable requirements of Rule 16b-3.
12. Notice.
Any written notice to the Company required by any of the provisions of
the Plan shall be addressed to the Chief Executive Officer of the Company and
shall become effective when it is received.
13. Effective Date and Duration of the Plan.
(a) Effective Date. The Plan shall become effective when adopted by the
Board of Directors, but no options granted under the Plan shall become
exercisable unless and until the Plan shall have been approved by the Company's
stockholders. If such stockholder approval is not obtained within twelve months
after the date of the Board's adoption of the Plan, all options granted under
the Plan shall terminate and no further options shall be granted under the Plan.
Amendments to the Plan not requiring stockholder approval shall become effective
when adopted by the Board of Directors; amendments requiring stockholder
approval shall become effective when adopted by the Board of Directors, but no
option issued after the date of such amendment shall become exercisable (to the
extent that such amendment to the Plan was required to enable the Company to
grant such option to a particular optionee) unless and until such amendment
shall have been approved by the Company's stockholders. If such stockholder
approval is not obtained within twelve months of the Board's adoption of such
amendment, any options granted on or after the date of such amendment shall
terminate to the extent that such amendment to the Plan was required to enable
the Company to grant such option to a particular optionee. Subject to this
limitation, options may be granted under the Plan at any time after the
effective date and before the date fixed for termination of the Plan.
(b) Termination. Unless earlier terminated pursuant to Section 9, the
Plan shall terminate on the date on which all shares available for issuance
under the Plan (as the Plan may be amended from time to time to increase the
number of available shares) shall have been issued pursuant to the exercise of
options granted under the Plan.
14. General Obligations.
(a) Investment Representations. The Company may require any person to
whom an option is granted, as a condition of exercising such option, to give
written assurances in substance and form satisfactory to the Company to the
effect that such person is acquiring the Common Stock subject to the option for
his or her own account for investment and not with any present intention of
selling or otherwise distributing the same, and to such other effects as the
Company deems necessary or appropriate in order to comply with federal and
applicable state securities laws.
(b) Compliance With Securities Laws. Each option shall be subject to
the requirements that if, at any time, counsel to the Company shall determine
that the listing, registration or qualification of the shares subject to such
option upon any securities exchange or under any state or federal law, or the
consent or approval of any governmental or regulatory body, or that the
disclosure of non-public information or the satisfaction of any other condition
is necessary as a condition of, or in connection with, the issuance or purchase
of shares thereunder, such option may not be exercised, in whole or in part,
unless such listing, registration, qualification, consent or approval, or
satisfaction of such conditions shall have been effected or obtained on
conditions acceptable to the Board of Directors. Nothing herein shall be deemed
to require the Company to apply for or to obtain such listing, registration,
qualification, consent or approval, or to satisfy such condition.
15. Governing Law.
The Plan and all determinations made and actions taken pursuant hereto
shall be governed by the laws of the Commonwealth of Massachusetts.
Adopted by the Board of Directors
on April 13, 1992
Amended by the Board of Directors
on June 10, 1997
EXHIBIT 99.3
NON-QUALIFIED OPTION TO PURCHASE
SHARES OF COMMON STOCK
OF J. BAKER, INC.
20,000 June 5, 1997
- --------------- ------------
No. of Shares Date
Pursuant to a vote ratified and confirmed at a meeting of its Board of
Directors held on June 10, 1997, J. Baker, Inc. (the "Company") hereby grants to
James D. Lee (the "Optionee") a Non-qualified Stock Option to purchase prior to
June 5, 2007 (the "Expiration Date") all or any part of 20,000 shares of common
stock of the Company (the "Option Shares") at a price of $1.00 per share subject
to the terms and conditions contained herein. This Option is intended to be, and
shall be treated as, a non-qualified stock option, and is not an incentive stock
option under the provisions of the Internal Revenue Code of 1986, as amended
(the "Code").
1. Vesting. Subject to the provisions of Section 3 hereof, this Option
shall become vested and exercisable with respect to the following whole number
of Option Shares according to the timetable set forth below and shall continue
to be exercisable by the Optionee at any time or times prior to the Expiration
Date:
<TABLE>
<S> <C> <C>
Number of
Shares Becoming Cumulative
Years After Available for Number of
Date of Grant Exercise Shares Available
________________________________________________________________________________________
Less than 1 year 0 0
At least 1 year 2,000 2,000
At least 2 years 3,000 5,000
At least 3 years 4,000 9,000
At least 4 years 5,000 14,000
At least 5 years 6,000 20,000
</TABLE>
2. Manner of Exercise. The Optionee may exercise this Option only in
the following manner: From time to time prior to the Expiration Date of this
Option, the Optionee may give written notice to the Company of his election to
purchase some or all of the Option Shares purchasable at the time of such
notice. Said notice shall specify the number of shares to be purchased and shall
be accompanied by payment therefor in cash or, subject to the discretion of the
Company, in shares of the Company's common stock, valued at their fair market
value on the date of exercise as determined by the closing price of the
Company's common stock on the
NASDAQ stock market for the immediately preceding trading day. No certificates
for the shares so purchased will be issued to the Optionee until the Company has
completed all steps required by law to be taken in connection with the issue and
sale of the shares, including without limitation, the registration of such
shares under the Securities Act of 1933 and, if the Company deems it necessary
or appropriate, receipt of a representation from the Optionee upon each exercise
of this Option that he is purchasing the shares for his own account and not with
a view to any resale or distribution thereof, the legending of any certificate
representing said shares, and the imposition of a stop transfer order with
respect thereto, to prevent a resale or distribution in violation of Federal or
State securities laws. If requested upon the exercise of the Option,
certificates for shares may issued in the name of the Optionee jointly with
another person with rights of survivorship or in the name of the executor or
administrator of his estate, and the foregoing representations shall be modified
accordingly.
3. Transferability and Termination. Except as provided in the following
sentence, this Option is personal to the Optionee, is not transferable by the
Optionee in any manner by operation of law or otherwise, and is exercisable,
during the Optionee's lifetime, only by him.
(a) In the event the Optionee dies before the Expiration Date,
this Option may be exercised by the Optionee's personal representatives
prior to the earlier of (i) the first anniversary of his death or (ii)
the Expiration Date, but only to the extent that this Option was
exercisable by the Optionee on the date of his death.
(b) In the event the Optionee's employment terminates by
reason of Disability, this option shall be exercisable, to the extent
exercisable on the date of termination for a period of 12 months from
the date of termination or until the expiration date, if earlier.
(c) If the Optionee's employment terminates for Cause, any
option held by the Optionee shall immediately terminate and be of no
further force and effect. If the Optionee's employment terminates for
any reason other than death, Disability or Cause, this option may be
exercised, to the extent exercisable on the date of termination, for a
period of three (3) months from the date of termination or until the
Expiration Date, if earlier.
For purposes of this Option, "Disability" shall mean the Optionee's
inability to perform his normal required services for the Company and its
Subsidiaries for a period of six consecutive months by reason of the Optionee's
mental or physical disability as determined by the Company, in good faith.
For purposes of this Option, "Cause" shall mean the occurrence of one
or more of the following: (i) Optionee is convicted of, pleads guilty to, or
confesses to any felony or any act of fraud, misappropriation or embezzlement
which has an immediate and materially adverse effect on the Company or any
Subsidiary, as determined by the Board in good faith in its sole discretion,
(ii) Optionee engages in a fraudulent act to the material damage or prejudice of
the Company or any subsidiary or in conduct or activities materially damaging to
the property, business or reputation of the Company or any Subsidiary, all as
determined by the Board in good faith in its sole discretion, (iii) any material
act or omission by Optionee involving malfeasance or negligence in the
performance of Optionee's duties to the Company or any Subsidiary to the
material detriment of the Company or any Subsidiary, as determined by the Board
in good faith in its sole discretion, which has not been corrected by Optionee
within 30 days after written notice from the Company of any such act or
omission, (iv) failure by Optionee to comply in any material respect with the
terms of his employment agreement, if any, or any written policies or directives
of the Board as determined by the Board in good faith in its sole discretion,
which has not been corrected by Optionee within 30 days after written notice
from the Company of such failure, or (v) material breach by Optionee of his
noncompetition agreement with the Company, if any, as determined by the Board in
good faith in its sole discretion.
4. Option Shares. The shares of stock which are the subject of this
Option are shares of the Common Stock of the Company as constituted on the date
of this Option, subject to adjustment as provided in this Section 4. The terms
of this Option and the number of shares subject to this Option shall be
equitably adjusted in such manner as to prevent dilution or enlargement of
option rights in the following instances:
(a) the declaration of a dividend payable to the holders of
Common Stock in stock of the same class;
(b) a split-up of the Common Stock or a reverse split
thereof; and
(c) a recapitalization of the Company under which shares of
one or more different classes of stock are changed into or distributed
in exchange for or upon the Common Stock without payment of any
valuable consideration by the holders thereof.
The terms of any such adjustment shall be conclusively determined by the Board
of Directors.
5. Effect of Change of Control. In the case of the occurrence of
certain Change of Control Events, outstanding Options will become immediately
exercisable in full. A Change of Control Event includes (i) any person or group,
with certain exceptions, acquiring the beneficial ownership of 30% or more of
either the voting securities of the Company or the then outstanding shares of
the Company; (ii) a change in the composition of a majority of the Company's
Board of Directors as it is composed on the date hereof unless the selection or
nomination of each of the new members was approved by a majority of the members
of the Company's Board of Directors who were members on the date hereof; or
(iii) approval by the Company's stockholders of a consolidation or merger where
the stockholders of the Company would not beneficially own at least 80% of the
voting stock of the corporation issuing cash or securities, any plan for the
liquidation or dissolution of the Company, or the sale of all or substantially
all of the Company's assets; or (iv) the sale of the Company's Licensed Discount
Division in its entirety as a going concern or the discontinuance of the
operation of the Licensed Discount Division and the commencement of liquidation
of the Divisions licenses, inventory and fixed assets.
6. No Special Employment Rights. This Option will not confer upon the
Optionee any right with respect to continued employment by the Company or a
Subsidiary, nor will it interfere in any way with any right of the Optionee's
employer to terminate the Optionee's employment at any time.
7. Rights as a Shareholder. The Optionee shall have no rights as a
shareholder with respect to any shares of Common Stock that may be purchased by
exercise of this Option unless and until a certificate or certificates
representing such shares of Common Stock are duly issued and delivered to the
Optionee. No adjustment shall be made for dividends or other rights for which
the record date is prior to the date such stock certificate is issued.
8. Tax Withholding. No later than the date as of which part or all of
the value of any shares of Common Stock received by the Optionee first becomes
includable in the Optionee's gross income for Federal tax purposes, the Optionee
shall make arrangements with the Company regarding the payment of any Federal,
state or local taxes required to be withheld with respect to such income.
9. Miscellaneous. Notices hereunder shall be mailed or delivered to the
Company at its principal place of business, 555 Turnpike Street, Canton,
Massachusetts 02021 and shall be mailed or delivered to the Optionee at his
address set forth below, or in either case at such other address as one party
may subsequently furnish to the other party in writing. This Option shall be
governed by the laws of the Commonwealth of Massachusetts without giving effect
to the choice of law principles thereof.
J. BAKER, INC.
/s/Alan I. Weinstein
Name: Alan I. Weinstein
Title: President and C.E.O.
Receipt is acknowledged of the foregoing Option and its terms and
conditions are hereby agreed to:
Dated: June 5, 1997 /s/James D. Lee
------------- ---------------
James D. Lee
1148 High Street
Westwood, MA 02090
EXHIBIT 99.4
NON-QUALIFIED OPTION TO PURCHASE
SHARES OF COMMON STOCK
OF J. BAKER, INC.
20,000 June 5, 1997
- --------------- ------------
No. of Shares Date
Pursuant to a vote ratified and confirmed at a meeting of its Board of
Directors held on June 10, 1997, J. Baker, Inc. (the "Company") hereby grants to
Roger J. Osborne (the "Optionee") a Non-qualified Stock Option to purchase prior
to June 5, 2007 (the "Expiration Date") all or any part of 20,000 shares of
common stock of the Company (the "Option Shares") at a price of $1.00 per share
subject to the terms and conditions contained herein. This Option is intended to
be, and shall be treated as, a non-qualified stock option, and is not an
incentive stock option under the provisions of the Internal Revenue Code of
1986, as amended (the "Code").
1. Vesting. This Option shall be fully vested and exercisable with
respect to all of the Option Shares from and after April 30, 2000 if, and only
if (i) the Company's Work 'N Gear Division achieves earnings before interest,
taxes, depreciation, amortization and overhead of $8.1 million for the fiscal
year ending on or about February 1, 2000, and (ii) the Optionee is still
employed by the Company as of April 30, 2000. Subject to the terms of this
Section 1 and Section 3 hereof, this option shall continue to be exercisable by
the Optionee at any time or times prior to the Expiration Date.
2. Manner of Exercise. The Optionee may exercise this Option only in
the following manner: From time to time prior to the Expiration Date of this
Option, the Optionee may give written notice to the Company of his election to
purchase some or all of the Option Shares purchasable at the time of such
notice. Said notice shall specify the number of shares to be purchased and shall
be accompanied by payment therefor in cash or, subject to the discretion of the
Company, in shares of the Company's common stock, valued at their fair market
value on the date of exercise as determined by the closing price of the
Company's common stock on the NASDAQ stock market for the immediately preceding
trading day. No certificates for the shares so purchased will be issued to the
Optionee until the Company has completed all steps required by law to be taken
in connection with the issue and sale of the shares, including without
limitation, the registration of such shares under the Securities Act of 1933
and, if the Company deems it necessary or appropriate, receipt of a
representation from the Optionee upon each exercise of this Option that he is
purchasing the shares for his own account and not with a view to any resale or
distribution thereof, the legending of any certificate representing said shares,
and the imposition of a stop transfer order with respect thereto, to prevent a
resale or distribution in violation of Federal or State securities laws. If
requested upon the exercise of the Option, certificates for shares may issued in
the name of the Optionee jointly with another person with rights of survivorship
or in the name of the executor or administrator of his estate, and the foregoing
representations shall be modified accordingly.
3. Transferability and Termination. Except as provided in the following
sentence, this Option is personal to the Optionee, is not transferable by the
Optionee in any manner by operation of law or otherwise, and is exercisable,
during the Optionee's lifetime, only by him.
(a) In the event the Optionee dies before the Expiration Date,
this Option may be exercised by the Optionee's personal representatives
prior to the earlier of (i) the first anniversary of his death or (ii)
the Expiration Date, but only to the extent that this Option was
exercisable by the Optionee on the date of his death.
(b) In the event the Optionee's employment terminates by
reason of Disability, this option shall be exercisable, to the extent
exercisable on the date of termination for a period of 12 months from
the date of termination or until the expiration date, if earlier.
(c) If the Optionee's employment terminates for Cause, any
option held by the Optionee shall immediately terminate and be of no
further force and effect. If the Optionee's employment terminates for
any reason other than death, Disability or Cause, this option may be
exercised, to the extent exercisable on the date of termination, for a
period of three (3) months from the date of termination or until the
Expiration Date, if earlier.
For purposes of this Option, "Disability" shall mean the Optionee's
inability to perform his normal required services for the Company and its
Subsidiaries for a period of six consecutive months by reason of the Optionee's
mental or physical disability as determined by the Company, in good faith.
For purposes of this Option, "Cause" shall mean the occurrence of one
or more of the following: (i) Optionee is convicted of, pleads guilty to, or
confesses to any felony or any act of fraud, misappropriation or embezzlement
which has an immediate and materially adverse effect on the Company or any
Subsidiary, as determined by the Board in good faith in its sole discretion,
(ii) Optionee engages in a fraudulent act to the material damage or prejudice of
the Company or any subsidiary or in conduct or activities materially damaging to
the property, business or reputation of the Company or any Subsidiary, all as
determined by the Board in good faith in its sole discretion, (iii) any material
act or omission by Optionee involving malfeasance or negligence in the
performance of Optionee's duties to the Company or any Subsidiary to the
material detriment of the Company or any Subsidiary, as determined by the Board
in good faith in its sole discretion, which has not been corrected by Optionee
within 30 days after written notice from the Company of any such act or
omission, (iv) failure by Optionee to comply in any material respect with the
terms of his employment agreement, if any, or any written policies or directives
of the Board as determined by the Board in good faith in its sole discretion,
which has not been corrected by Optionee within 30 days after written notice
from the Company of such failure, or (v) material breach by Optionee of his
noncompetition agreement with the Company, if any, as determined by the Board in
good faith in its sole discretion.
4. Option Shares. The shares of stock which are the subject of this
Option are shares of the Common Stock of the Company as constituted on the date
of this Option, subject to adjustment as provided in this Section 4. The terms
of this Option and the number of shares subject to this Option shall be
equitably adjusted in such manner as to prevent dilution or enlargement of
option rights in the following instances:
(a) the declaration of a dividend payable to the holders of
Common Stock in stock of the same class;
(b) a split-up of the Common Stock or a reverse split
thereof; and
(c) a recapitalization of the Company under which shares of
one or more different classes of stock are changed into or distributed
in exchange for or upon the Common Stock without payment of any
valuable consideration by the holders thereof.
The terms of any such adjustment shall be conclusively determined by the Board
of Directors.
5. Effect of Change of Control. In the case of the occurrence of
certain Change of Control Events, outstanding Options will become immediately
exercisable in full. A Change of Control Event includes (i) any person or group,
with certain exceptions, acquiring the beneficial ownership of 30% or more of
either the voting securities of the Company or the then outstanding shares of
the Company; (ii) a change in the composition of a majority of the Company's
Board of Directors as it is composed on the date hereof unless the selection or
nomination of each of the new members was approved by a majority of the members
of the Company's Board of Directors who were members on the date hereof; or
(iii) approval by the Company's stockholders of a consolidation or merger where
the stockholders of the Company would not beneficially own at least 80% of the
voting stock of the corporation issuing cash or securities, any plan for the
liquidation or dissolution of the Company, or the sale of all or substantially
all of the Company's assets.
6. No Special Employment Rights. This Option will not confer upon the
Optionee any right with respect to continued employment by the Company or a
Subsidiary, nor will it interfere in any way with any right of the Optionee's
employer to terminate the Optionee's employment at any time.
7. Rights as a Shareholder. The Optionee shall have no rights as a
shareholder with respect to any shares of Common Stock that may be purchased by
exercise of this Option unless and until a certificate or certificates
representing such shares of Common Stock are duly issued and delivered to the
Optionee. No adjustment shall be made for dividends or other rights for which
the record date is prior to the date such stock certificate is issued.
8. Tax Withholding. No later than the date as of which part or all of
the value of any shares of Common Stock received by the Optionee first becomes
includable in the Optionee's gross income for Federal tax purposes, the Optionee
shall make arrangements with the Company regarding the payment of any Federal,
state or local taxes required to be withheld with respect to such income.
9. Miscellaneous. Notices hereunder shall be mailed or delivered to the
Company at its principal place of business, 555 Turnpike Street, Canton,
Massachusetts 02021 and shall be mailed or delivered to the Optionee at his
address set forth below, or in either case at such other address as one party
may subsequently furnish to the other party in writing. This Option shall be
governed by the laws of the Commonwealth of Massachusetts without giving effect
to the choice of law principles thereof.
J. BAKER, INC.
/s/Alan I. Weinstein
Name: Alan I. Weinstein
Title: President and C.E.O.
Receipt is acknowledged of the foregoing Option and its terms and
conditions are hereby agreed to:
Dated: June 5, 1997 /s/Roger J. Osborne
------------- -------------------
Roger J. Osborne
25 Hidden Valley Road
Marshfield, Massachusetts 02052
EXHIBIT 99.5
NON-QUALIFIED OPTION TO PURCHASE
SHARES OF COMMON STOCK
OF J. BAKER, INC.
60,000 September 15, 1997
- --------------- ------------------
No. of Shares Date
Pursuant to a vote of the Compensation Committee (the "Committee") of
the Board of Directors of J. Baker, Inc. (the "Company") held on September 15,
1997, the Company hereby grants to Stuart M. Glasser (the "Optionee") effective
as of the date hereof a Non-qualified Stock Option (the "Option") to purchase
prior to September 15, 2007 (the "Expiration Date") all or any part of 60,000
shares of common stock of the Company (the "Option Shares") at a price of $1.00
per share subject to the terms and conditions contained herein. This Option is
intended to be, and shall be treated as, a non-qualified stock option, and is
not an incentive stock option under the provisions of the Internal Revenue Code
of 1986, as amended (the "Code").
1. Vesting. Subject to the provisions of Section 4 hereof, this Option
shall become vested and exercisable with respect to the following whole number
of Option Shares according to the timetable set forth below and shall continue
to be exercisable by the Optionee at any time or times prior to the Expiration
Date:
<TABLE>
<S> <C> <C>
Number of
Shares Becoming Cumulative
Available for Number of
Vesting Date Exercise Shares Available
---------------------------------------------------------------------------------------
September 14, 1998 30,000 30,000
September 14, 1999 30,000 60,000
</TABLE>
Notwithstanding the foregoing, this Option shall become vested and fully
exercisable upon a "Change of Control", as defined herein.
2. Manner of Exercise. The Optionee may exercise this Option only in
the following manner: From time to time prior to the Expiration Date of this
Option, the Optionee may give written notice to the Company of his election to
purchase some or all of the Option Shares purchasable at the time of such
notice. Said notice shall specify the number of shares to be purchased and shall
be accompanied by payment therefor in cash or, subject to the discretion of the
Company, in shares of the Company's common stock that have been held by the
Optionee for at least six months and that are not subject to any restrictions
under any Company plan. Such shares shall be valued at their fair market value
on the date of exercise as determined by the closing price of the Company's
common stock on the NASDAQ stock market for the immediately preceding trading
day. Alternatively, the Optionee may deliver to the Company a properly executed
exercise notice together with irrevocable instructions to a broker to promptly
deliver to the Company cash or a check payable and acceptable to the Company to
pay the option purchase price, provided that in the event the Optionee chooses
to pay the option purchase price as so provided, the Optionee and the broker
shall comply with such procedures and enter into such agreements of indemnity
and other agreements as the Committee shall prescribe as a condition of such
payment procedure. The delivery of certificates representing the Option Shares
will be contingent upon the Company's receipt from the Optionee of full payment
for the Option Shares, as set forth above and any agreement, statement or other
evidence that is reasonably required to cause the issuance of Common Stock to be
purchased pursuant to the exercise of Options hereunder and any subsequent
resale of the shares of Common Stock to be in compliance in all reasonable
respects with applicable laws and governmental or regulatory agency regulations.
With respect to the exercise of any Option hereunder, the Company shall proceed
diligently and in an expeditious manner to effect the issuance and delivery of
certificates representing the Option Shares.
3. Non-transferability of Option. Except as provided in the following
sentence, this Option is personal to the Optionee, is not transferable by the
Optionee in any manner by operation of law or otherwise, and is exercisable,
during the Optionee's lifetime, only by him.
4. Termination of Employment. If the Optionee's employment by the
Company or a subsidiary of the Company is terminated, the period within which to
exercise the Option may be subject to earlier termination as set forth below.
(a) Termination Due to Death - If the Optionee's employment
terminates by reason of death, any Option held by the Optionee
shall immediately become fully exercisable and may thereafter
be exercised by the Optionee's legal representative or legatee
for a period of 12 months from the date of death or until the
Expiration Date, if earlier.
(b) Termination Due to Disability - If the Optionee's employment
terminates by reason of Disability (as defined in Section
13(e) of Optionee's Employment Agreement dated as of September
15, 1997 (the "Employment Agreement")), any Option held by the
Optionee shall become immediately fully exercisable and may
thereafter be exercised by the Optionee for a period of 12
months from the date of termination or until the Expiration
Date, if earlier. The death of the Optionee during the
12-month period provided in this Section 4(b) shall extend
such period for another 12 months from the date of death or
until the Expiration Date, if earlier.
(c) Termination Due to Retirement - If the Optionee's
employment terminates by reason of Retirement, any Option
held by the Optionee may be exercised, to the extent
exercisable on the date of termination, for a period of 24
months from the date of termination or until the
Expiration Date, if earlier. The death of the Optionee
during the 24-month period provided in this Section 4(c)
shall extend such period for another 12 months from the
date of death or until the Expiration Date, if earlier.
"Retirement" as referred to herein shall mean the
Optionee's termination of employment with the Company and/or
its subsidiaries after attainment of the age and/or service
requirements to qualify for early or normal retirement
under the Company's qualified retirement plan.
(d) Termination for Cause - If the Optionee's employment
terminates for Cause (as defined in Section 13(c) of the
Employment Agreement), any unexercised Option held by the
Optionee shall immediately terminate and be of no further
force and effect.
(e) Termination Without Cause - If the Optionee's employment is
terminated by the Company without Cause, any Option held by
the Optionee shall immediately become fully vested and
exercisable with respect to all of the Option Shares for a
period of ninety (90) days from the date of termination or
until the Expiration date, if earlier. Thereafter, any Option
held by the Optionee shall terminate and be of no further
force or effect.
(f) Termination for Good Reason - If the Optionee terminates his
employment for "good reason" (as defined in Section 13(a) of
the Employment Agreement) upon giving the Company at least
ninety (90) days notice of his intention to do so, any
Option held by the Optionee shall immediately
become fully vested and exercisable with respect to all
of the Option Shares for a period of ninety (90) days from
the effective date of termination or until the Expiration
Date, if earlier. Thereafter, any Option held by the
Optionee shall terminate and be of no further force or
effect. In the event the Optionee terminates his employment
for "good reason" upon less than ninety (90) days notice to
the Company, the provisions of Section 4(i) shall apply.
(g) Termination after Change of Control - In the event the
Company re-assigns the Optionee such that the Optionee
ceases reporting to the current Chief Executive Officer of
the Company, the Optionee may terminate his employment
with the Company within six (6) months of such
re-assignment and any Option held by the Optionee shall
immediately become fully vested and exercisable with respect
to all of the Option Shares for a period of ninety (90) days
from the date of termination or until the Expiration Date,
if earlier; provided that (A) the Optionee's notice
of such termination occurs after a Change of Control (as
defined herein)and (B) the Optionee
gives at least ninety (90) days notice of such termination.
Upon expiration of ninety (90) days from the date of
termination, any Option held by the Optionee shall terminate
and be of no further force or effect.
(h) Termination for Non-extension of Employment Term - In the
event the Optionee's timely written request to extend the
term of his employment by one (1) year pursuant to
Section 14 of the Employment Agreement is not accepted by the
Company, the Optionee shall be entitled to resign
from employment effective as of the end of the Term (as
defined in Section 7 of the Employment Agreement). Upon such
resignation, any Option held by the Optionee shall immediately
become fully vested and exercisable with respect to all of
the Option Shares for a period of ninety (90) days from the
effective date of termination or until the Expiration date,
if earlier. Thereafter, any Option held by the Optionee
shall terminate and be of no further force or effect.
(i) Other Termination - If the Optionee's employment terminates
for any reason other than those set forth in subparagraphs
(a)-(h) above, and unless otherwise determined by the
Committee, any Option held by the Optionee may be exercised,
to the extent exercisable on the date of termination, for a
period of three months from the date of termination or until
the Expiration Date, if earlier. Any portion of the Option
that is not exercisable on the date of termination shall
terminate as of such date and be of no further force or
effect.
For purposes of this Option a "Change of Control" shall mean the
occurrence of any one of the following events:
(i) any "person," as such term is used in Section 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended (the "Act")
(other than the Company, any of its Subsidiaries, or any trustee,
fiduciary or other person or entity holding securities under any
employee benefit plan or trust of the Company or any of its
subsidiaries), together with all "affiliates" and "associates" (as such
terms are defined in Rule 12B-2 under the Act), directly or indirectly,
of securities of the Company representing 30% or more of either (A) the
combined voting power of the Company's then outstanding
securities having the right to vote in an election of the Company's
Board of Directors ("Voting Securities") or (B) the then outstanding
shares of the common stock, par value $.50 per share, of the Company
(the "Stock")(in either such case other than as a result of acquisition
of securities directly from the Company); or
(ii) persons who, as of June 7, 1994, constituted the
Company's Board of Directors (the "Incumbent Directors") cease for any
reason, including, without limitation, as a result of a tender offer,
proxy contest, merger or similar transaction, to constitute at least a
majority of the Board, provided that any person becoming a director of
the Company subsequent to such date whose election or nomination for
election was approved by a vote of at least a majority of the Incumbent
Directors shall, for purposes of this Plan, be considered an Incumbent
Director; or
(iii) the stockholders of the Company shall approve (A) any
consolidation or merger of the Company or any subsidiary where the
stockholders of the Company, immediately prior to the consolidation or
merger, would not, immediately after the consolidation or merger,
beneficially own (as such term is defined in Rule 13d-3 under the Act),
directly or indirectly, shares representing in the aggregate 80% or
more of the voting shares of the corporation issuing cash or securities
in the consolidation or merger (or of its ultimate parent corporation,
if any), (B) any sale, lease, exchange or other transfer (in one
transaction or a series of transactions contemplated or arranged by any
party as a single plan) of all or substantially all of the assets of
the Company or (C) any plan or proposal for the liquidation or
dissolution of the Company.
Notwithstanding the foregoing, a "Change of Control" shall not be
deemed to have occurred for purposes of the foregoing clause (i) solely as a
result of an acquisition of securities by the Company which, by reducing the
number of shares of Stock or other Voting Securities outstanding, increases (x)
the proportionate number of shares of Stock beneficially owned by any person to
30% or more of the shares of Stock then outstanding or (y) the proportionate
voting power represented by the Voting Securities beneficially owned by any
person to 30% or more of the combined voting power of all then outstanding
Voting Securities; provided, however, that if any person referred to in clause
(x) or (y) of this sentence shall thereafter become the beneficial owner of any
additional shares of Stock or other Voting Securities (other than pursuant to a
stock split, stock dividend, or similar transaction), then a "Change of Control"
shall be deemed to have occurred for purposes of the foregoing clause (i).
5. Option Shares. The shares of stock which are the subject of this
Option are shares of the Common Stock of the Company as constituted on the date
of this Option, subject to adjustment as provided in this Section 5. The terms
of this Option and the number of shares subject to this Option shall be
equitably adjusted in such manner as to prevent dilution or enlargement of
option rights in the following instances:
(a) the declaration of a dividend payable to the holders of
Common Stock in stock of the same class;
(b) a split-up of the Common Stock or a reverse split
thereof; and
(c) a recapitalization of the Company under which shares of
one or more different classes of stock are changed into or distributed
in exchange for or upon the Common Stock without payment of any
valuable consideration by the holders thereof.
The terms of any such adjustment shall be conclusively determined by the Board
of Directors.
6. Mergers. In the event of a consolidation or merger or sale of all or
substantially all of the assets of the Company in which the outstanding shares
of Stock are exchanged for securities, cash or other property of any other
corporation or business entity or in the vent of a liquidation of the Company,
the Board, or the board of directors of any corporation assuming the obligations
of the company, may, in its discretion, take any one or more of the following
actions, as to outstanding Stock Options: (i) provide that such Stock Options
shall be assumed, or equivalent options shall be substituted, by the acquiring
or succeeding corporation (or an affiliate thereof), (ii) upon written notice to
the optionee, provide that all unexercised Stock Options will terminate
immediately prior to the consummation of such transaction unless exercised by
the optionee within a specified period following the date of such notice, and/or
(iii) int eh event of a business combination under the terms of which holders of
the Stock of the Company will receive upon consummation thereof a cash payment
for each share surrendered in the business combination (the "Merger Price"),
make or provide for a cash payment to the optionees equal to the difference
between (A) the Merger Price times the number of shares of Stock subject to such
outstanding Stock Options (to the extent then exercisable at prices not in
excess of the Merger Price) and (B) the aggregate exercise price of all such
outstanding options in exchange for the termination of such options.
7. No Special Employment Rights. This Option will not confer upon the
Optionee any right with respect to continued employment by the Company or a
Subsidiary, nor will it interfere in any way with any right of the Optionee's
employer to terminate the Optionee's employment at any time.
8. Rights as a Shareholder. The Optionee shall have no rights as a
shareholder with respect to any shares of Common Stock that may be purchased by
exercise of this Option unless and until a certificate or certificates
representing such shares of Common Stock are duly issued and delivered to the
Optionee. No adjustment shall be made for dividends or other rights for which
the record date is prior to the date such stock certificate is issued.
9. Tax Withholding. With respect to the exercise of all or any part of
the Option Shares granted hereunder, the Optionee shall promptly contact the
Company regarding the payment of any Federal, state or local taxes required to
be withheld in connection with such exercise.
10. Miscellaneous. Notices hereunder shall be mailed or delivered to
the Company at its principal place of business, 555 Turnpike Street, Canton,
Massachusetts 02021 and shall be mailed or delivered to the Optionee at his
address set forth below, or in either case at such other address as one party
may subsequently furnish to the other party in writing. This Option shall be
governed by the laws of the Commonwealth of Massachusetts without giving effect
to the choice of law principles thereof.
J. BAKER, INC.
/s/Alan I. Weinstein
Name: Alan I. Weinstein
Title: President and Chief
Executive Officer
Receipt is acknowledged of the foregoing Option and its terms and
conditions are hereby agreed to:
Dated:September 15, 1997 /s/Stuart M. Glasser
Stuart M. Glasser
318 Beacon Street
Boston, Massachusetts 02116
EXHIBIT 99.6
NON-QUALIFIED OPTION TO PURCHASE
SHARES OF COMMON STOCK
OF J. BAKER, INC.
50,000 September 15, 1997
- --------------- ------------------
No. of Shares Date
Pursuant to a vote of the Compensation Committee (the "Committee") of
the Board of Directors of J. Baker, Inc. (the "Company") held on September 9,
1997, the Company hereby grants to Stuart M. Glasser (the "Optionee") effective
as of the date hereof a Non-qualified Stock Option (the "Option") to purchase
prior to September 15, 2007 (the "Expiration Date") all or any part of 50,000
shares of common stock of the Company (the "Option Shares") at a price of $8.625
per share subject to the terms and conditions contained herein. This Option is
intended to be, and shall be treated as, a non-qualified stock option, and is
not an incentive stock option under the provisions of the Internal Revenue Code
of 1986, as amended (the "Code").
1. Vesting. Subject to the provisions of Section 4 hereof, this Option
shall become vested and exercisable with respect to the following whole number
of Option Shares according to the timetable set forth below and shall continue
to be exercisable by the Optionee at any time or times prior to the Expiration
Date:
<TABLE>
<S> <C> <C>
Number of
Shares Becoming Cumulative
Available for Number of
Vesting Date Exercise Shares Available
---------------------------------------------------------------------------------------
September 14, 1998 12,500 12,500
September 14, 1999 12,500 25,000
September 14, 2000 12,500 37,500
September 14, 2001 12,500 50,000
</TABLE>
Notwithstanding the foregoing, this Option shall become vested and fully
exercisable upon a "Change of Control", as defined herein.
2. Manner of Exercise. The Optionee may exercise this Option only in
the following manner: From time to time prior to the Expiration Date of this
Option, the Optionee may give written notice to the Company of his election to
purchase some or all of the Option Shares purchasable at the time of such
notice. Said notice shall specify the number of shares to be purchased and shall
be accompanied by payment therefor in cash or, subject to the discretion of the
Company, in shares of the Company's common stock that have been held by Optionee
for at least six months and that are not subject to any restrictions under any
Company plan. Such shares shall be valued at their fair market value on the date
of exercise as determined by the closing price of the Company's common stock on
the NASDAQ stock market for the immediately preceding trading day.
Alternatively, the Optionee may deliver to the Company a properly executed
exercise notice together with irrevocable instructions to a broker to promptly
deliver to the Company cash or a check payable and acceptable to the Company to
pay the option purchase price, provided that in the event the Optionee chooses
to pay the option purchase price as so provided, the Optionee and the broker
shall comply with such procedures and enter into such agreements of indemnity
and other agreements as the Committee shall prescribe as a condition of such
payment procedure. The delivery of certificates representing the Option Shares
will be contingent upon the Company's receipt from the Optionee of full payment
for the Option Shares, as set forth above and any agreement, statement or other
evidence that is reasonably required to cause the issuance of Common Stock to be
purchased pursuant to the exercise of Options hereunder and any subsequent
resale of the shares of Common Stock to be in compliance in all reasonable
respects with applicable laws and governmental or regulatory agency regulations.
With respect to the exercise of any Option hereunder, the Company shall proceed
diligently and in an expeditious manner to effect the issuance and delivery of
certificates representing the Option Shares.
3. Non-transferability of Option. Except as provided in the following
sentence, this Option is personal to the Optionee, is not transferable by the
Optionee in any manner by operation of law or otherwise, and is exercisable,
during the Optionee's lifetime, only by him.
4. Termination of Employment. If the Optionee's employment by the
Company or a subsidiary of the Company is terminated, the period within which to
exercise the Option may be subject to earlier termination as set forth below.
(a) Termination Due to Death - If the Optionee's employment
terminates by reason of death, any Option held by the Optionee
shall immediately become fully exercisable and may thereafter
be exercised by the Optionee's legal representative or legatee
for a period of 12 months from the date of death or until the
Expiration Date, if earlier.
(b) Termination Due to Disability - If the Optionee's employment
terminates by reason of Disability (as defined in Section
13(e) of Optionee's Employment Agreement dated as of September
15, 1997 (the "Employment Agreement")), any Option held by the
Optionee shall become immediately fully exercisable and may
thereafter be exercised by the Optionee for a period of 12
months from the date of termination or until the Expiration
Date, if earlier. The death of the Optionee during the
12-month period provided in this Section 4(b) shall extend
such period for another 12 months from the date of death or
until the Expiration Date, if earlier.
(c) Termination Due to Retirement - If the Optionee's
employment terminates by reason of Retirement, any Option
held by the Optionee may be exercised, to the extent
exercisable on the date of termination, for a period of 24
months from the date of termination or until the
Expiration Date, if earlier. The death of the Optionee
during the 24-month period provided in this Section 4(c)
shall extend such period for another 12 months from the
date of death or until the Expiration Date, if earlier.
"Retirement" as referred to herein shall mean the
Optionee's termination of employment with the Company and/or
its subsidiaries after attainment of the age and/or service
requirements to qualify for early or normal retirement
under the Company's qualified retirement plan.
(d) Termination for Cause - If the Optionee's employment
terminates for Cause (as defined in Section 13(c) of the
Employment Agreement), any unexercised Option held by the
Optionee shall immediately terminate and be of no further
force and effect.
(e) Termination Without Cause - If the Optionee's employment is
terminated by the Company without Cause, any Option held by
the Optionee shall immediately become fully vested and
exercisable with respect to all of the Option Shares for a
period of ninety (90) days from the date of termination or
until the Expiration date, if earlier. Thereafter, any Option
held by the Optionee shall terminate and be of no further
force or effect.
(f) Termination for Good Reason - If the Optionee terminates his
employment for "good reason" (as defined in Section 13(a) of
the Employment Agreement) upon giving the Company at least
ninety (90) days notice of his intention to do so, any
Option held by the Optionee shall immediately
become fully vested and exercisable with respect to all
of the Option Shares for a period of ninety (90) days from
the effective date of termination or until the Expiration
Date, if earlier. Thereafter, any Option held by the
Optionee shall terminate and be of no further force or
effect. In the event the Optionee terminates his employment
for "good reason" upon less than ninety (90) days notice to
the Company, the provisions of Section 4(i) shall apply.
(g) Termination after Change of Control - In the event the
Company re-assigns the Optionee such that the Optionee
ceases reporting to the current Chief Executive Officer of
the Company, the Optionee may terminate his employment
with the Company within six (6) months of such
re-assignment and any Option held by the Optionee shall
immediately become fully vested and exercisable with respect
to all of the Option Shares for a period of ninety (90) days
from the date of termination or until the Expiration Date,
if earlier; provided that (A) the Optionee's notice
of such termination occurs after a Change of Control (as
defined herein)and (B) the Optionee
gives at least ninety (90) days notice of such termination.
Upon expiration of ninety (90) days from the date of
termination, any Option held by the Optionee shall terminate
and be of no further force or effect.
(h) Termination for Non-extension of Employment Term - In the
event the Optionee's timely written request to extend the
term of his employment by one (1) year pursuant to
Section 14 of the Employment Agreement is not accepted by the
Company, the Optionee shall be entitled to resign
from employment effective as of the end of the Term (as
defined in Section 7 of the Employment Agreement). Upon such
resignation, any Option held by the Optionee shall immediately
become fully vested and exercisable with respect to all of
the Option Shares for a period of ninety (90) days from the
effective date of termination or until the Expiration date,
if earlier. Thereafter, any Option held by the Optionee
shall terminate and be of no further force or effect.
(i) Other Termination - If the Optionee's employment terminates
for any reason other than those set forth in subparagraphs
(a)-(h) above, and unless otherwise determined by the
Committee, any Option held by the Optionee may be exercised,
to the extent exercisable on the date of termination, for a
period of three months from the date of termination or until
the Expiration Date, if earlier. Any portion of the Option
that is not exercisable on the date of termination shall
terminate as of such date and be of no further force or
effect.
For purposes of this Option a "Change of Control" shall mean the
occurrence of any one of the following events:
(i) any "person," as such term is used in Section 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended (the "Act")
(other than the Company, any of its Subsidiaries, or any trustee,
fiduciary or other person or entity holding securities under any
employee benefit plan or trust of the Company or any of its
subsidiaries), together with all "affiliates" and "associates" (as such
terms are defined in Rule 12B-2 under the Act), directly or indirectly,
of securities of the Company representing 30% or more of either (A) the
combined voting power of the Company's then outstanding securities
having the right to vote in an election of the Company's Board of
Directors ("Voting Securities") or (B) the then outstanding shares of
the common stock, par value $.50 per share, of the Company (the
"Stock")(in either such case other than as a result of acquisition of
securities directly from the Company); or
(ii) persons who, as of June 7, 1994, constituted the
Company's Board of Directors (the "Incumbent Directors") cease for any
reason, including, without limitation, as a result of a tender offer,
proxy contest, merger or similar transaction, to constitute at least a
majority of the Board, provided that any person becoming a director of
the Company subsequent to such date whose election or nomination for
election was approved by a vote of at least a majority of the Incumbent
Directors shall, for purposes of this Plan, be considered an Incumbent
Director; or
(iii) the stockholders of the Company shall approve (A) any
consolidation or merger of the Company or any subsidiary where the
stockholders of the Company, immediately prior to the consolidation or
merger, would not, immediately after the consolidation or merger,
beneficially own (as such term is defined in Rule 13d-3 under the Act),
directly or indirectly, shares representing in the aggregate 80% or
more of the voting shares of the corporation issuing cash or securities
in the consolidation or merger (or of its ultimate parent corporation,
if any), (B) any sale, lease, exchange or other transfer (in one
transaction or a series of transactions contemplated or arranged by any
party as a single plan) of all or substantially all of the assets of
the Company or (C) any plan or proposal for the liquidation or
dissolution of the Company.
Notwithstanding the foregoing, a "Change of Control" shall not be
deemed to have occurred for purposes of the foregoing clause (i) solely as a
result of an acquisition of securities by the Company which, by reducing the
number of shares of Stock or other Voting Securities outstanding, increases (x)
the proportionate number of shares of Stock beneficially owned by any person to
30% or more of the shares of Stock then outstanding or (y) the proportionate
voting power represented by the Voting Securities beneficially owned by any
person to 30% or more of the combined voting power of all then outstanding
Voting Securities; provided, however, that if any person referred to in clause
(x) or (y) of this sentence shall thereafter become the beneficial owner of any
additional shares of Stock or other Voting Securities (other than pursuant to a
stock split, stock dividend, or similar transaction), then a "Change of Control"
shall be deemed to have occurred for purposes of the foregoing clause (i).
5. Option Shares. The shares of stock which are the subject of this
Option are shares of the Common Stock of the Company as constituted on the date
of this Option, subject to adjustment as provided in this Section 5. The terms
of this Option and the number of shares subject to this Option shall be
equitably adjusted in such manner as to prevent dilution or enlargement of
option rights in the following instances:
(a) the declaration of a dividend payable to the holders of
Common Stock in stock of the sameclass;
(b) a split-up of the Common Stock or a reverse split thereof;
and
(c) a recapitalization of the Company under which shares of
one or more different classes of stock are changed into or distributed
in exchange for or upon the Common Stock without payment of any
valuable consideration by the holders thereof.
The terms of any such adjustment shall be conclusively determined by the Board
of Directors.
6. Mergers. In the event of a consolidation or merger or sale of all or
substantially all of the assets of the Company in which the outstanding shares
of Stock are exchanged for securities, cash or other property of any other
corporation or business entity or in the event of a liquidation of the Company,
the Board, or the board of directors of any corporation assuming the obligations
of the Company, may, in its discretion, take any one or more of the following
actions, as to outstanding Stock Options: (i) provide that such Stock Options
shall be assumed, or equivalent options shall be substituted, by the acquiring
or succeeding corporation (or an affiliate thereof), (ii) upon written notice to
the optionee, provide that all unexercised Stock Options will terminate
immediately prior to the consummation of such transaction unless exercised by
the optionee within a specified period following the date of such notice, and/or
(iii) in the event of a business combination under the terms of which holders of
the Stock of the Company will receive upon consummation thereof a cash payment
for each share surrendered in the business combination (the "Merger Price"),
make or provide for a cash payment to the optionee equal to the difference
between (A) the Merger Price times the number of shares of Stock subject to such
outstanding Stock Options (to the extent then exercisable at prices not in
excess of the Merger Price) and (B) the aggregate exercise price of all such
outstanding options in exchange for the termination of such options.
7. No Special Employment Rights. This Option will not confer upon the
Optionee any right with respect to continued employment by the Company or a
Subsidiary, nor will it interfere in any way with any right of the Optionee's
employer to terminate the Optionee's employment at any time.
8. Rights as a Shareholder. The Optionee shall have no rights as a
shareholder with respect to any shares of Common Stock that may be purchased by
exercise of this Option unless and until a certificate or certificates
representing such shares of Common Stock are duly issued and delivered to the
Optionee. No adjustment shall be made for dividends or other rights for which
the record date is prior to the date such stock certificate is issued.
9. Tax Withholding. With respect to the exercise of all or any part of
the Option Shares granted hereunder, the Optionee shall promptly contact the
Company regarding the payment of any Federal, state or local taxes required to
be withheld in connection with such exercise.
10. Miscellaneous. Notices hereunder shall be mailed or delivered to
the Company at its principal place of business, 555 Turnpike Street, Canton,
Massachusetts 02021 and shall be mailed or delivered to the Optionee at his
address set forth below, or in either case at such other address as one party
may subsequently furnish to the other party in writing. This Option shall be
governed by the laws of the Commonwealth of Massachusetts without giving effect
to the choice of law principles thereof.
J. BAKER, INC.
/s/Alan I. Weinstein
Name: Alan I. Weinstein
Title: President and Chief
Executive Officer
Receipt is acknowledged of the foregoing Option and its terms and
conditions are hereby agreed to:
Dated: September 15, 1997 /s/Stuart M. Glasser
------------------ --------------------
Stuart M. Glasser
318 Beacon Street
Boston, Massachusetts 02116
