SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
Toll Brothers, Inc.
(Exact name of issuer as specified in its charter)
Delaware 23-2416878
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3103 Philmont Avenue, Huntingdon Valley, Pennsylvania 19006-4298
(Address of Principal Executive Offices) (Zip Code)
Toll Brothers, Inc. Stock Incentive Plan (1998)
(Full Title of the Plan)
Robert I. Toll
Chairman of the Board
and Chief Executive Officer
Toll Brothers, Inc.
3103 Philmont Avenue
Huntingdon Valley, Pennsylvania 19006-4298
(Name and address of agent for service)
(215) 938-8000
(Telephone number, including area code, of agent for service)
Copies to:
Mark K. Kessler, Esquire
Wolf, Block, Schorr and Solis-Cohen LLP
Twelfth Floor Packard Building
111 South 15th Street
Philadelphia, PA 19102-2678
(215) 977-2576
PAGE
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CALCULATION OF REGISTRATION FEE
Title of Amount to be Proposed Maximum Proposed Maximum Amount of
Securities Registered Offering Price Aggregate Offering Registration
to be Per Share (1) Price (1) Fee (1)
Registered
Common Stock, 4,500,000(2) $26.41 $118,845,000 $35,059.28
par value
$0.01
(1) Calculated pursuant to Rule 457(h) under the Securities Act of 1933, as
amended, based upon the average of the high and low prices of the Registrant's
Common Stock on June 16, 1998 as quoted on the New York Stock Exchange.
(2) Pursuant to Rule 416 under the Securities Act of 1933, as amended,
this Registration Statement also covers such additional shares as may
hereinafter be offered or issued to prevent dilution resulting from
stock splits, stock dividends, recapitalizations or certain other capital
adjustments.
PAGE
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PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents filed by Toll Brothers, Inc. (the "Registrant")
with the Securities and Exchange Commission (the "Commission")
pursuant to the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), are incorporated by reference in this Registration
Statement:
1. The Registrant's Annual Report on Form 10-K for the year ended
October 31, 1997.
2. The Registrant's Quarterly Report on Form 10-Q for the quarter
ended January 31, 1998.
3. The Registrant's Quarterly Report on Form 10-Q for the quarter
ended April 30, 1998.
4. The Registrant's Current Report on Form 8-K dated February 25,
1998.
5. The description of the Registrant's Common Stock contained in its
Registration Statement on Form 8-A dated June 19, 1986.
6. The description of preferred stock purchase rights contained in the
Registrant's Registration Statement on Form 8-A dated June 20, 1997.
All documents subsequently filed with the Commission by the Registrant
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, and
prior to the filing of a post-effective amendment that indicates that all
securities offered hereby have been sold or that 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 by reference or
deemed to be incorporated by reference herein shall be deemed to be
modified or superseded to the extent that a statement contained herein
or in any other subsequently filed document that also is incorporated
by reference herein modifies or supersedes such earlier statement.
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Any statement so modified or superseded shall not be deemed to
constitute a part of hereof except as so modified or superseded.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Officers.
For information regarding provisions under which a director or officer of
the Registrant may be insured or indemnified in any manner against any
liability which he may incur in his capacity as such, reference is made to
Section 145 of the Delaware General Corporation Law, which provides
in its entirety as follows:
"(a) A corporation shall have power to indemnify any person who was or
is a party or is threatened to be made a party to any threatened, pending
or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of
the corporation) by reason of the fact that the person is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees), judgments, fines
and amounts paid in settlement actually and reasonably incurred by the
person in connection with such action, suit or proceeding if the person
acted in good faith and in a manner the person reasonably believed
to be in or not opposed to the best interests of the corporation, and,
with respect to any criminal action or proceeding, had no reasonable
cause to believe the person's conduct was unlawful. The
termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its
equivalent, shall not, of itself, create a presumption that the
person did not act in good faith and in a manner which the person
reasonably believed to be in or not opposed to the best interests of
the corporation, and, with respect to any criminal action or
proceeding, had reasonable cause to believe that the person's conduct
was unlawful.
(b) A corporation shall have power to indemnify any person who was or
is a party or is threatened to be made a party to any threatened, pending
or completed action or suit by or in the right of the corporation to procure
a judgment in its favor by reason of the fact that the person is
or was a director, officer, employee or agent of the corporation, or is or
was serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership,
joint venture, trust or other enterprise against expenses (including
attorneys' fees) actually and reasonably incurred by the person in
connection with the defense or settlement of such action or
suit if the person acted in good faith and in a manner the person
reasonably believed to be in or not opposed to the best interests of the
corporation and except that no indemnification shall be
made in respect of any claim, issue or matter as to which such person
shall have been adjudged to be liable to the corporation unless and only
to the extent that the Court of Chancery or the court in which such
<PAGE>
action or suit was brought shall determine upon
application that, despite the adjudication of liability but in view
of all the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses which the
Court of Chancery or such other court shall deem proper.
(c) To the extent that a present or former director or officer of a
corporation has been successful on the merits or otherwise in
defense of any action, suit or proceeding referred to in
subsections (a) and (b) of this section, or in defense of any claim,
issue or matter therein, such person shall be indemnified against
expenses (including attorneys' fees) actually and reasonably
incurred by such person in connection therewith.
(d) Any indemnification under subsections (a) and (b) of this section
(unless ordered by a court) shall be made by the corporation only as
authorized in the specific case upon a determination that
indemnification of the present or former director, officer, employee
or agent is proper in the circumstances because the person has met
the applicable standard of conduct set forth in subsections (a) and (b)
of this section. Such determination shall be made, with respect to
a person who is a director or officer at the time of such determination,
(1) by a majority vote of the directors who are not parties to such action,
suit or proceeding, even though less than a quorum, or (2) by a
committee of such directors designated by majority vote of such
directors, even though less than a quorum, or (3) if there are no
such directors, or if such directors so direct, by independent legal
counsel in a written opinion, or (4) by the stockholders.
(e) Expenses (including attorneys' fees) incurred by an officer or director
in defending any civil, criminal, administrative or investigative action,
suit or proceeding may be paid by the corporation in advance of the
final disposition of such action, suit or proceeding upon receipt of
an undertaking by or on behalf of such director or officer to repay such
amount if it shall ultimately be determined that such person is not
entitled to be indemnified by the corporation as authorized in this
section. Such expenses (including attorneys' fees) incurred by
former directors and officers or other employees and
agents may be so paid upon such terms and conditions, if
any, as the corporation deems appropriate.
(f) The indemnification and advancement of expenses provided by, or
granted pursuant to, the other subsections of this section shall not be
deemed exclusive of any other rights to which those seeking
indemnification or advancement of expenses may be entitled under
any bylaw, agreement, vote of stockholders or disinterested directors
or otherwise, both as to action in such person's official capacity and
as to action in another capacity while holding such office.
(g) A corporation shall have power to purchase and maintain insurance
on behalf of any person who is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against
any liability asserted against such person and incurred by such person
in any such capacity, or arising out of such person's status as such,
whether or not the corporation would have the power to indemnify
such person against such liability under this section.
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(h) For purposes of this section, references to "the corporation" shall
include, in addition to the resulting corporation, any constituent
corporation (including any constituent of a constituent) absorbed in a
consolidation or merger which, if its separate existence had continued,
would have had power and authority to indemnify its directors, officers,
and employees or agents, so that any person who is or was a director,
officer, employee or agent of such constituent corporation, or is or
was serving at the request of such constituent corporation as a
director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, shall stand in
the same position under this section with respect to the resulting
or surviving corporation as such person would have with respect to such
constituent corporation if its separate existence had continued.
(i) For purposes of this section, references to "other enterprises" shall
include employee benefit plans; references to "fines" shall include
any excise taxes assessed on a person with respect to any employee
benefit plan; and references to "serving at the request of the
corporation" shall include any service as a director, officer, employee or
agent of the corporation which imposes duties on, or involves services
by, such director, officer, employee, or agent with
respect to an employee benefit plan, its participants or beneficiaries; and a
person who acted in good faith and in a manner such person reasonably
believed to be in the interest of the participants and beneficiaries of an
employee benefit plan shall be deemed to have acted in a
manner "not opposed to the best interests of the corporation" as referred to
in this section.
(j) The indemnification and advancement of expenses provided by, or
granted pursuant to, this section shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a
director, officer, employee or agent and shall inure to the benefit of
the heirs, executors and administrators of such a person.
(k) The Court of Chancery is hereby vested with exclusive jurisdiction to
hear and determine all actions for advancement of expenses or indemnification
brought under this section or under any bylaw, agreement, vote of
stockholders or disinterested directors, or otherwise. The
Court of Chancery may summarily determine a corporation's obligation
to advance expenses (including attorneys' fees)."
See also Article Six of the Registrant's Certificate of Incorporation, as
amended, and Article VII of the Registrant's By-laws, as amended,
pursuant to which the Registrant is granted the power to indemnify
any director, officer, employee or agent of the Registrant.
See also Section 2 of the Toll Brothers, Inc. Stock Incentive Plan (1998)
(the "Plan"), filed as Exhibit 4 hereto, which provides that in addition
to such other rights of indemnification as he may have as a member
of the Board of Directors or the Committee (as hereinafter defined),
and with respect to administration of the Plan and the granting of Options
and Awards under it, each member of the Board of Directors and
<PAGE>
of the Committee shall be entitled without further act
on his part to indemnity from the Registrant for all expenses reasonably
incurred by him in connection with or arising out of any action, suit
or proceeding with respect to the administration of the Plan or the
granting of options or awards under it in which he may be involved
by reason of his being or having been a member of the Board of
Directors or the Committee. "Committee" is defined in the Plan
to mean a committee, composed of two or more members of the
Board of Directors, or the Board of Directors in its administrative
capacity with respect to the Plan.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
The following Exhibits are filed as part of this Registration Statement:
4 Toll Brothers, Inc. Stock Incentive Plan (1998).
5 Opinion and Consent of Wolf, Block, Schorr and Solis-Cohen
LLP.
23(a) Consent of independent public accountants, Ernst & Young
LLP.
23(b) Consent of Wolf, Block, Schorr and Solis-Cohen LLP
(contained in Exhibit 5).
24 Power of Attorney (included on signature page of this
Registration Statement).
Item 9. Undertakings.
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, as amended (the "Securities Act");
(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
<PAGE>
the registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering
range may be reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate, the changes
in volume and price represent no more than 20 percent change in
the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement.
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration statement
or any material change to such information in the registration statement;
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the
information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed with or
furnished to the Commission by the Registrant pursuant to
Section 13 or 15(d) of the Exchange Act that are incorporated by
reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section
13(a) or 15(d) of the Exchange Act 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.
Insofar as indemnification for liabilities arising under the Securities Act
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 Commission
such indemnification is against public policy as expressed in the Securities
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 Securities Act and will be governed by the
final adjudication of such issue.
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<PAGE>
SIGNATURES AND POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act, 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 Township of
Lower Moreland, Commonwealth of Pennsylvania, on this
22nd day of June, 1998.
TOLL BROTHERS, INC.
By:/s/ Robert I. Toll
Robert I. Toll
Chairman of the Board of Directors and
Chief Executive Officer
PAGE
<PAGE>
KNOW ALL MEN BY THESE PRESENTS, that each person whose
signature appears below constitutes and appoints Robert I. Toll, Bruce
E. Toll, Richard J.Braemer, Joel H. Rassman and Joseph R. Sicree,
and each of them, the undersigned's true and lawful attorney-in-fact
and agent, with full power of substitution and resubstitution, for
the undersigned and in the undersigned's name, place and stead, in
any and all capacities, to sign any and all amendments to this
Registration Statement (including, without limitation, post-effective
amendments to this Registration Statement), and to file the same,
with all exhibits thereto, and other documents in connection
therewith, with the Commission, granting unto said attorney-in-fact
and agent 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 the
undersigned might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent, or his
substitute or substitutes, may lawfully do or cause to be done
by virtue hereof.
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed by the following persons in the capacities
indicated, on this 22nd day of June, 1998.
Signature Title
/s/ Robert I. Toll Chairman of the Board, Chief
Robert I. Toll Executive Officer and Director
(Principal Executive Officer)
/s/ Bruce E. Toll President, Secretary and Director
Bruce E. Toll
/s/ Zvi Barzilay Executive Vice President,
Zvi Barzilay Chief Operating Officer and Director
/s/ Robert S. Blank Director
Robert S. Blank
/s/ Richard J. Braemer Director
Richard J. Braemer
/s/ Roger S. Hillas Director
Roger S. Hillas
<PAGE>
Director
Carl B. Marbach
/s/ Joel H. Rassman Senior Vice President, Treasurer,Chief
Joel H. Rassman Financial Officer, Director
(Principal Financial Officer)
/s/ Paul Shapiro Director
Paul Shapiro
/s/ Joseph R. Sicree Chief Accounting Officer
Joseph R. Sicree (Principal Accounting Officer)
PAGE
<PAGE>
TOLL BROTHERS, INC.
STOCK INCENTIVE PLAN (1998)
REGISTRATION STATEMENT ON FORM S-8
EXHIBIT INDEX
Exhibit Document Method of Filing
No.
4 Toll Brothers, Inc. Stock Incentive
Plan (1998). Filed electronically herewith.
5 Opinion and Consent of Wolf, Block,
Schorr and Solis-Cohen LLP.
23(a) Consent of independent public accountants,
Ernst & Young LLP. Filed electronically herewith.
23(b) Consent of Wolf, Block, Schorr and
Solis-Cohen LLP Contained in Exhibit 5
24 Power of Attorney (included on signature
page of this Registration Statement). Filed electronically herewith.
<PAGE>
EXHIBIT 4
TOLL BROTHERS, INC.
STOCK INCENTIVE PLAN
(1998)
1. Purpose. The Toll Brothers, Inc. Stock Incentive Plan (1998) (the
"Plan")
is intended as an additional incentive to employees and non-employee
members of the Board of
Directors (together the "Optionees") to enter into or remain in the employ of
Toll Brothers, Inc.,
a Delaware corporation (the "Company") or any Affiliate (as defined below),
or serve on the
Board of Directors of the Company (the "Board of Directors") or of any
Affiliate, and to devote
themselves to the Company's success by providing such employees and
non-employee members
of the Board of Directors ("Non-employee Directors") with an opportunity to
acquire or increase
their proprietary interest in the Company (a) through receipt of rights (the
"Options") to acquire
the Company's Common Stock, par value $0.01 per share (the "Common
Stock") and (b)
through incentive stock awards involving the transfer or issuance of Common
Stock, which may
be subject to conditions of forfeiture (the "Awards"). Each Option granted
under the Plan to an
employee of the Company or an Affiliate is intended to be an incentive stock
option ("ISO")
within the meaning of section 422(b) of the Internal Revenue Code of 1986,
as amended (the
"Code"), for federal income tax purposes, except to the extent (i) any such
ISO grant would
exceed the limitation of subsection 6(a), (ii) any Option is specifically
designated at the time of
grant (the "Grant Date") as not being an ISO ("Non-Qualified Stock Option"),
and (iii) any
Option is granted under Section 8. No Option granted to a person who is not
an employee of the
Company or any Affiliate on the Grant Date shall be an ISO.
For purposes of the Plan, the term "Affiliate" shall mean a corporation
which is a parent corporation or a subsidiary corporation with respect to the
Company within the
meaning of section 424(e) or (f) of the Code.
2. Administration. The Plan shall be administered by the Board of
Directors,
without participation by any member of the Board of Directors on any matter
pertaining to him.
However, the Board of Directors may designate a committee or committees
composed of two or
more of its members to operate and administer the Plan in its stead. Any such
committee and the
Board of Directors in its administrative capacity with respect to the Plan is
referred to herein as
the "Committee." The members of the Board of Directors shall, however, act
as the Committee
with respect to all grants made to Non-employee Directors pursuant to the
provisions for grants
set forth in Section 8.
The Committee shall hold meetings at such times and places as it may
determine. Acts approved at a meeting by a majority of the members of the
Committee or acts
approved in writing by the unanimous consent of the members of the
Committee shall be the
valid acts of the Committee.
The Committee shall, from time to time at its discretion, direct the
Company to grant Options and Awards pursuant to the provisions of the Plan.
The Committee
shall have plenary authority to determine the Optionees to whom and the
times at which Options
and Awards shall be granted, the number of Option Shares (as defined in
Section 4) or Awards to
be granted and the price and other terms and conditions thereof, including a
specification with
respect to whether an Option is intended to be an ISO subject, however, to the
express provisions
of the Plan. In making such determinations, the Committee may take into
account the nature of
the Optionee's services and responsibilities, the Optionee's present and
potential contribution to
the Company's success and such other factors as it may deem relevant. The
interpretation and
construction by the Committee of any provision of the Plan or of any Option
or Award granted
under it shall be final, binding and conclusive.
No member of the Board of Directors or the Committee shall be
personally liable for any action or determination made in good faith with
respect to the Plan or
any Option or Award granted under it. No member of the Committee shall be
liable for any act
or omission of any other member of the Committee or for any act or omission
on his own part,
including but not limited to the exercise of any power and discretion given to
him under the Plan,
except those resulting from (i) any breach of such member's duty of loyalty to
the Company or
its stockholders, (ii) acts or omissions not in good faith or involving
intentional misconduct or a
knowing violation of law, (iii) acts or omissions that would result in liability
under Section 174
of the General Corporation Law of the State of Delaware, as amended, and
(iv) any transaction
from which the member derived an improper personal benefit.
In addition to such other rights of indemnification as he may have as a
member of the Board of Directors or the Committee, and with respect to
administration of the
Plan and the granting of Options and Awards under it, each member of the
Board of Directors
and of the Committee shall be entitled without further act on his part to
indemnity from the
Company for all expenses (including the amount of any judgment and the
amount of approved
settlements made with a view to the curtailment of costs of litigation, other
than amounts paid to
the Company itself) reasonably incurred by him in connection with or arising
out of any action,
suit or proceeding with respect to the administration of the Plan or the
granting of Options or
Awards under it in which he may be involved by reason of his being or
having been a member of
the Board of Directors or the Committee, whether or not he continues to be
such member of the
Board of Directors or the Committee at the time of the incurring of such
expenses; provided,
however, that such indemnity shall not include any expenses incurred by such
member of the
Board of Directors or the Committee: (i) in respect of matters as to which he
shall be finally
adjudged in such action, suit or proceeding to have been guilty of gross
negligence or willful
misconduct in the performance of his duties as a member of the Board of
Directors or the
Committee; or (ii) in respect of any matter in which any settlement is effected
to an amount in
excess of the amount approved by the Company on the advice of its legal
counsel; and provided
further, that no right of indemnification under the provisions set forth herein
shall be available to
or accessible by any such member of the Board of Directors or the Committee
unless within five
days after institution of any such action, suit or proceeding he shall have
offered the Company in
writing the opportunity to handle and defend such action, suit or proceeding
at its own expense.
The foregoing right of indemnification shall inure to the benefit of the heirs,
executors or
administrators of each such member of the Board of Directors or the
Committee and shall be in
addition to all other rights to which such member of the Board of Directors or
the Committee
would be entitled as a matter of law, contract or otherwise.
3. Eligibility. All employees of the Company or its Affiliates (who may
also
be members of the Board of Directors or of a board of directors of an
Affiliate) shall be eligible
to receive ISOs hereunder. All employees of the Company or its Affiliates
and all members of
the Board of Directors shall be eligible to receive Options that are
Non-Qualified Stock Options
and to receive Awards hereunder. The Committee, in its sole discretion, shall
determine whether
an individual qualifies as an employee or an Optionee. An Optionee may
receive more than one
Option or Award, but only on the terms and subject to the restrictions of the
Plan.
4. Shares Under the Plan. The number of shares of Common Stock
available
for granting Options and Awards under the Plan during the fiscal year of the
Company in which
the Plan is adopted shall be two million five hundred thousand (2,500,000),
subject to adjustment
as provided in Section 9. The number of shares of Common Stock available
for granting Options
and Awards under the Plan for each subsequent fiscal year (commencing as
of November 1,
1998) shall be equal to the sum of (i) the number of shares of Common Stock
available for
granting Options and Awards in the immediately preceding fiscal year
reduced by the number of
shares of Common Stock with respect to which Options and Awards were
granted in such fiscal
year and (ii) two and one-half percent (2.5%) of the outstanding shares of
Common Stock
(including treasury shares) as of the first day of the fiscal year in which such
additional shares of
Common Stock are first to become available; provided, however that no more
than two million
five hundred thousand (2,500,000) shares of Common Stock shall be
available for granting
Options and Awards under the Plan in any single fiscal year. If any shares
subject to any Option
("Option Shares") or shares subject to an Award granted hereunder ("Award
Shares") are
forfeited or such Option otherwise terminates without the issuance of such
shares, the shares
subject to such Option or Award, to the extent of any such forfeiture or
termination, shall again
be available for the grant of Options and Awards under the Plan. Option
Shares and Awards
shall be issued from authorized and unissued Common Stock or Common
Stock held in or
hereafter acquired for the treasury of the Company. If any outstanding
Option granted under the
Plan expires, lapses or is terminated for any reason, or if the shares of
Common Stock that has
been transferred pursuant to an Award under the Plan are forfeited for any
reason, the Option
Shares allocable to the unexercised portion of such Option and the forfeited
shares of Common
Stock may again be the subject of an Option or Award granted pursuant to the
Plan.
5. Term of Plan. The Plan is adopted December 17, 1997, effective as of
January 1, 1998; provided, however that the Plan is approved by vote of a
majority of the
outstanding voting stock of the Company on or before December 17, 1998.
No Option or Award
may be granted under the Plan after December 16, 2007.
6. Terms and Conditions of Options. Options granted pursuant to the
Plan
shall be evidenced by written documents (the "Option Documents") in such
form as the
Committee shall from time to time approve, which Option Documents shall
comply with and be
subject to the following terms and conditions and such other terms and
conditions which the
Committee shall from time to time require which are not inconsistent with the
terms of the Plan.
(a) Number of Option Shares. Each Option Document shall state the
number of Option Shares to which it pertains. In no event shall the aggregate
fair market value
of the Option Shares (determined at the time the ISO is granted) with respect
to which an ISO is
exercisable for the first time by the Optionee during any calendar year (under
all incentive stock
option plans of the Company or its Affiliates) exceed $100,000. In addition,
and anything to the
contrary otherwise contained in the Plan notwithstanding, no employee shall
be granted more
than 1,000,000 Option Shares during any calendar year.
(b) Option Price. Each Option Document shall state the price at which
Option Shares may be purchased (the "Option Price"), which shall be at least
100% of the fair
market value of the Common Stock on the date the Option is granted as
determined by the
Committee; provided, however, that if an ISO is granted to an Optionee who
then owns, directly
or by attribution under section 424(d) of the Code, shares possessing more
than ten percent of the
total combined voting power of all classes of stock of the Company or an
Affiliate, then the
Option Price shall be at least 110% of the fair market value of the Option
Shares on the date the
Option is granted. If the Common Stock is traded in a public market, then the
fair market value
per share shall be, if the Common Stock is listed on a national securities
exchange or included in
the NASDAQ National Market System, the last reported sale price thereof on
the relevant date,
or, if the Common Stock is not so listed or included, the mean between the
last reported "bid"
and "asked" prices thereof on the relevant date, as reported on NASDAQ or,
if not so reported, as
reported by the National Daily Quotation Bureau, Inc. or as reported in a
customary financial
reporting service, as applicable and as the Committee determines.
(c) Medium of Payment. An Optionee shall pay for Option Shares: (i)
in cash, (ii) by certified check payable to the order of the Company, or (iii)
by such other mode of payment as the Committee may approve, including payment
through a broker in accordance
with procedures permitted by Regulation T of the Federal Reserve Board.
Furthermore, the
Committee may provide in an Option Document that payment may be made
in whole or in part
in shares of the Common Stock held by the Optionee for more than one year.
If payment is made
in whole or in part in shares of the Common Stock, then the Optionee shall
deliver to the
Company certificates registered in the name of such Optionee representing
shares of Common
Stock legally and beneficially owned by such Optionee, free of all liens,
claims and
encumbrances of every kind and having a fair market value on the date of
delivery of such notice
that is not greater than the Option Price of the Option Shares with respect to
which such Option
is to be exercised, accompanied by stock powers duly endorsed in blank by
the record holder of
the shares represented by such certificates. In the event that certificates for
shares of the
Company's Common Stock delivered to the Company represent a number of
shares in excess of
the number of shares required to make payment for the Option Price of the
Option Shares (or
relevant portion thereof) with respect to which such Option is to be exercised
by payment in
shares of Common Stock, the stock certificate issued to the Optionee shall
represent the Option
Shares in respect of which payment is made, and such excess number of
shares. Notwithstanding
the foregoing, the Committee, in its sole discretion, may refuse to accept
shares of Common
Stock in payment of the Option Price. In that event, any certificates
representing shares of
Common Stock which were delivered to the Company shall be returned to the
Optionee with
notice of the refusal of the Committee to accept such shares in payment of the
Option Price. The
Committee may impose such limitations and prohibitions on the use of shares
of the Common
Stock to exercise an Option as it deems appropriate, subject to the provisions
of the Plan.
(d) Termination of Options. No Option shall be exercisable after the
first to occur of the following:
(i) Expiration of the Option term specified in the Option
Document, which for an ISO shall not exceed (A) ten years from the Grant
Date or (B) five years
from the Grant Date if the Optionee on the date of grant owns, directly or by
attribution under
section 424(d) of the Code, shares possessing more than ten percent of the
total combined voting
power of all classes of stock of the Company or of an Affiliate and for any
other Option shall not
exceed ten years and one day from the date of grant;
(ii) Expiration of three months (or such shorter period as the
Committee may select) from the date the Optionee's employment or service
with the Company or its Affiliates terminates for any reason other than:
(a) disability (within the meaning of section 22(e)(3) of the Code) or death
or (b) circumstances described by paragraph (d)(vi), below;
(iii) Expiration of one year from the date the Optionee's
employment or service with the Company or its Affiliates terminates by
reason of the Optionee's
disability (within the meaning of section 22(e)(3) of the Code) or death;
(iv) The date, if any, set by the Committee as an accelerated
expiration date in the event of a "Change in Control" (as defined in
subsection 6(e) below)
provided an Optionee who holds an Option is given written notice at least 30
days before the date
so fixed.
(v) The date set by the Committee to be an accelerated
expiration date after a finding by the Committee that a change in the financial
accounting
treatment for Options from that in effect on the date the Plan was adopted
adversely affects or, in
the determination of the Committee, may adversely affect in the foreseeable
future, the
Company, provided the Committee may take whatever other action, including
acceleration of any
exercise provisions, it deems necessary should it make the determination
referred to hereinabove.
(vi) A finding by the Committee, after full consideration of the
facts presented on behalf of both the Company and the Optionee, that the
Optionee has breached
his employment or service contract with the Company or an Affiliate, or has
been engaged in any
sort of disloyalty to the Company or an Affiliate, including, without
limitation, fraud,
embezzlement, theft, commission of a felony or proven dishonesty in the
course of his
employment or service or has disclosed trade secrets of the Company or an
Affiliate. In such
event, in addition to immediate termination of the Option, the Optionee, upon
a determination by
the Committee, shall automatically forfeit all Option Shares for which the
Company has not yet
delivered the share certificates upon refund by the Company of the Option
Price.
Notwithstanding the foregoing, except as may be specifically provided in
an
Option Document at the discretion of the Committee, no Option shall be
exercisable after the
termination of an Optionee's service or employment with the Company or any
of its Affiliates
except to the extent such Option was exercisable on the date of such
termination of service or
employment. The Committee may extend the period during which an Option
may be exercised
to a date no later than the date of the expiration of the Option term specified
in the Option
Documents.
(e) Change of Control. In the event of a Change of Control (as
defined below), the Committee may take whatever action with respect to the
Options outstanding
that it deems necessary or desirable, including, without limitation,
accelerating the expiration or
termination date in the respective Option Documents to a date no earlier than
thirty (30) days
after notice of such acceleration is given to the Optionees. In addition to the
foregoing, in the
event of a Change of Control, Options granted pursuant to the Plan shall
become immediately
exercisable in full. A "Change of Control" shall be deemed to have occurred
upon the earliest to
occur of the following events: (i) the date the stockholders of the Company
(or the Board of
Directors, if stockholder action is not required) approve a plan or other
arrangement pursuant to
which the Company will be dissolved or liquidated, or (ii) the date the
stockholders of the
Company (or the Board of Directors, if stockholder action is not required)
approve a definitive
agreement to sell or otherwise dispose of substantially all of the assets of the
Company, or (iii)
the date the stockholders of the Company (or the Board of Directors, if
stockholder action is not
required) and the stockholders of the other constituent corporation (or its
board of directors if
stockholder action is not required) have approved a definitive agreement to
merge or consolidate
the Company with or into such other corporation, other than, in either case, a
merger or
consolidation of the Company in which holders of shares of the Common
Stock immediately
prior to the merger or consolidation will hold at least a majority of the
ownership of common
stock of the surviving corporation (and, if one class of common stock is not
the only class of
voting securities entitled to vote on the election of directors of the surviving
corporation, a
majority of the voting power of the surviving corporation's voting securities)
immediately after
the merger or consolidation, which common stock (and, if applicable, voting
securities) is to be
held in the same proportion as such holders' ownership of Common Stock
immediately before
the merger or consolidation, or (iv) the date any entity, person or group,
(within the meaning of
Section 13(d)(3) or Section 14(d)(2) of the Securities Exchange Act of 1934,
as amended), (other
than (A) the Company or any of its subsidiaries or any employee benefit plan
(or related trust)
sponsored or maintained by the Company or any of its subsidiaries or (B) any
person who, on the
date the Plan is effective, shall have been the beneficial owner of at least
fifteen percent (15%) of
the outstanding Common Stock), shall have become the beneficial owner of,
or shall have
obtained voting control over, more than fifty percent (50%) of the
outstanding shares of the
Common Stock, or (v) the first day after the date this Plan is effective when
directors are elected
such that a majority of the Board of Directors shall have been members of the
Board of Directors
for less than twenty-four (24) months, unless the nomination for election of
each new director
who was not a director at the beginning of such twenty-four (24) month
period was approved by
a vote of at least two-thirds of the directors then still in office who were
directors at the
beginning of such period.
(f) Transfers. No Option granted under the Plan may be transferred,
except by will or by the laws of descent and distribution. During the lifetime
of the person to
whom an Option is granted, such Option may be exercised only by him.
Notwithstanding the
foregoing a Non-qualified Stock Option may be transferred pursuant to the
terms of a "qualified
domestic relations order," within the meaning of Sections 401(a)(13) and
414(p) of the Code or
within the meaning of Title I of the Employee Retirement Income Security
Act of 1974, as
amended.
(g) Other Provisions. The Option Documents shall contain such other
provisions, subject to the provisions of Section 8 including, without
limitation, additional
restrictions upon the exercise of the Option or additional limitations upon the
term of the Option,
as the Committee shall deem advisable.
(h) Amendment. Subject to the provisions of the Plan, the Committee
shall have the right to amend Option Documents issued to an Optionee,
subject to the Optionee's
consent if such amendment is not favorable to the Optionee except that the
consent of the
Optionee shall not be required for any amendment made under subsection
6(e).
7. Exercise. No Option shall be deemed to have been exercised prior to
the
receipt by the Company of written notice of such exercise and of payment in
full of the Option
Price for the Option Shares to be purchased. Each such notice shall specify
the number of
Option Shares to be purchased and shall (unless the Option Shares are
covered by a then current
registration statement or a Notification under Regulation A under the
Securities Act of 1933 (the
"Act")), contain the Optionee's acknowledgment in form and substance
satisfactory to the
Company that (a) such Option Shares are being purchased for investment and
not for distribution
or resale (other than a distribution or resale which, in the opinion of counsel
satisfactory to the
Company, may be made without violating the registration provisions of the
Act), (b) the
Optionee has been advised and understands that (i) the Option Shares may
not have been
registered under the Act and are "restricted securities" within the meaning of
Rule 144 under the
Act and are subject to restrictions on transfer and (ii) the Company is under
no obligation to
register the Option Shares under the Act or to take any action which would
make available to the
Optionee any exemption from such registration, (c) such Option Shares may
not be transferred
without compliance with all applicable federal and state securities laws, and
(d) an appropriate
legend referring to the foregoing restrictions on transfer and any other
restrictions imposed under
the Option Documents may be endorsed on the certificates. Notwithstanding
the above, should
the Company be advised by counsel that issuance of shares should be delayed
pending (A)
registration under federal or state securities laws (B) the receipt of an
opinion that an appropriate
exemption therefrom is available, (C) the listing or inclusion of the shares on
any securities
exchange or in an automated quotation system or (D) the consent or approval
of any
governmental regulatory body whose consent or approval is necessary in
connection with the
issuance of such Option Shares, the Company may defer exercise of any
Option granted
hereunder until event A, B, C, or D has occurred. No Option granted
pursuant to Section 8 may
be exercised until one year has elapsed from the Grant Date.
8. Grants to Non-employee Directors. Options granted to Non-employee
Directors pursuant to this Section 8 of the Plan shall be granted without
further action by the
Committee, shall be in accordance with the terms set forth in this Section 8,
and shall be
evidenced by Option Documents in such form as the Committee shall from
time to time approve,
which Option Documents shall comply with and be subject to the following
terms and conditions
and such other terms and conditions as the Committee shall from time to time
require which are
not inconsistent with terms of the Plan. Each Option granted under this
Section 8 shall be a Non-qualified Stock Option and shall have an Option
Price equal to 100% of the fair market value (as defined in subsection 6(b)) of
the Common Stock on the Grant Date.
(a) Timing of Grants; Number of Option Shares Subject of Options;
Exercisability of Options; Option Price.
(i) Each Non-employee Director who was a member of the
Board of Directors on December 17, 1997 shall be granted on December 20,
1998, and on each
anniversary thereafter during the term of the Plan, an Option to purchase
Fifteen Thousand
(15,000) Option Shares during the term of the Plan. Each other
Non-employee Director who first
becomes a member of the Board of Directors during the term of the Plan shall
be granted Options
as follows: Any Non-employee Director who first becomes a member of the
Board of Directors
on December 20 of any year shall be granted on the date he or she first
becomes a member of the
Board of Directors, and on each anniversary thereafter during the term of the
Plan, an Option to
purchase Fifteen Thousand (15,000) Option Shares. Any Non-employee
Director who first
becomes a member of the Board of Directors at any time after December 20
of any year and
before September 1 of the following year shall be granted an Option to
purchase Ten Thousand
(10,000) Option Shares at the time he or she first becomes a member of the
Board of Directors,
and shall be granted on each December 20 thereafter during the term of the
Plan, an Option to
purchase Fifteen Thousand (15,000) Option Shares. Any Non-employee
Director who first
becomes a member of the Board of Directors at any time after August 31 of
any year and before
November 30 of the same year shall be granted an Option to purchase Five
Thousand (5,000)
Option Shares at the time he or she first becomes a member of the Board of
Directors, and shall
be granted on each December 20 thereafter during the term of the Plan, an
Option to purchase
Fifteen Thousand (15,000) Option Shares. Any Non-employee Director who
first becomes a
member of the Board of Directors at any time after November 30 of any year
and before
December 20 of the same year shall be granted on each December 20
thereafter during the term
of the Plan, an Option to purchase Fifteen Thousand (15,000) Option Shares.
Each such Option
shall be a Non-qualified Stock Option becoming exercisable over a period of
two (2) years, so
that the Optionee shall have the right to exercise the Option with respect to
fifty percent (50%) of
the Option Shares covered thereby on the first anniversary of the date of
grant, and the right to
exercise the Option with respect to the remainder of such Option Shares on
the second
anniversary of the date of grant. The Option Price shall be equal to the fair
market value of the
Option Shares on the date the Option is granted as determined by the
Committee.
Notwithstanding anything to the contrary set forth in this Section 8(a), in the
event any Non-employee Director receives an option grant under the terms of
the Toll Brothers, Inc. Key
Executives and Non-employee Directors Stock Option Plan (the "1993 Plan")
as of the same date
an Option would otherwise be granted to him or her pursuant to this Section 8
of the Plan, the
number of Option Shares subject to the Option granted to such non-employee
member of the
Board of Directors pursuant to this Section 8 of the Plan shall be reduced by
the number of
shares subject to the option granted under the terms of the 1993 Plan.
(ii) Each Option granted to a Non-employee Director under the
terms of this Section 8 shall be for the number of shares determined in
accordance with
subsection 8(a)(i) above, plus an additional number of shares determined in
accordance with the
following schedule:
Membership on the Audit Committee an additional 1,000 shares
Membership on any other Committee an additional 500 shares
The additional shares for which Options are granted as determined pursuant
to this subsection
8(a)(ii) shall be subject to the following limitations and conditions:
(A) A Non-employee Director shall be treated as
serving on a committee of the Board of Directors only if he or she was, at any
time during the
calendar year in which the Option is granted, a member of the committee and
sat on one or more
meetings of such committee during such calendar year.
(B) The Option granted under this Section 8 to a
Non-employee Director shall be determined by taking into account the
non-employee member's
membership on no more than four committees if one of the committees is the
Audit Committee,
and in all other cases, no more than three committees.
(C) The committees of the Board of Directors that are
taken into account for purposes of this Section 8(a)(ii) shall be those
committees of the Board of
Directors as are listed on Schedule A attached hereto, as that may be amended
by the Board of
Directors from time to time.
(b) Termination of Options Granted Pursuant to Section 8. All
Options granted pursuant to this Section 8 shall be exercisable until the first
to occur of the
following:
(i) Expiration of ten (10) years from the date of grant;
(ii) Expiration of three months from the date the Optionee's
service with the Company or its Affiliates terminates for any reason other
than disability (within
the meaning of section 22(e)(3) of the Code) or death; or
(iii) Expiration of one year from the date the Optionee's
service with the Company or its Affiliates terminates by reason of the
Optionee's disability (within the meaning of section 22(e)(3) of the Code) or
death.
(c) Applicability of Provisions of Section 6 to Options Granted
Pursuant to Section 8. The following provisions of Section 6 shall be
applicable to Options
granted pursuant to this Section 8: Subsection 6(a) (provided that all Options
granted pursuant to
this Section 8 shall be Non-qualified Stock Option's); Subsection 6(b)
(provided, however, that
the Option Price shall in all events be the fair market value of the Option
Shares on the date of
grant; Subsection 6(c) (provided, however, that the Option Document shall in
all events permit
payment to be made in whole or in part in shares of the Common Stock held
by the Optionee for
more than one year; and Subsection 6(g).
9. Adjustments on Changes in Common Stock. The aggregate number of
shares of Common Stock as to which Options or Awards may be granted
hereunder, the number
of Option Shares covered by each outstanding Option and the Option Price
per Option Share
shall be appropriately adjusted in the event of a stock dividend, stock split or
other increase or
decrease in the number of issued and outstanding shares of Common Stock
resulting from a
subdivision or consolidation of the Common Stock or other capital
adjustment (not including the
issuance of Common Stock on the conversion of other securities of the
Company which are
convertible into Common Stock) effected without receipt of consideration by
the Company. The
Committee shall have authority to determine the adjustments to be made
under this Section and
any such determination by the Committee shall be final, binding and
conclusive; provided,
however, that no adjustment shall be made which will cause an ISO to lose its
status as such.
10. Amendment of the Plan. The Board of Directors may amend the
Plan
from time to time in such manner as it may deem advisable. Nevertheless,
the Board of
Directors may not, without obtaining approval by vote of a majority of the
outstanding voting
stock of the Company, within twelve months before or after such action,
change the class of
individuals eligible to receive an ISO, extend the expiration date of the Plan,
decrease the
minimum Option Price of an ISO granted under the Plan or increase the
maximum number of
shares as to which Options may be granted.
11. Continued Employment. The grant of an Option or an Award pursuant
to
the Plan shall not be construed to imply or to constitute evidence of any
agreements express or
implied, on the part of the Company or any Affiliate to retain the Optionee in
the employ of the
Company or an Affiliate, as a member of the Board of Directors or in any
other capacity,
whichever the case may be.
12. Withholding of Taxes. Whenever the Company proposes or is
required to
issue or transfer Option Shares pursuant to the terms of an Option or Award
Shares pursuant to
an Award, the Company shall have the right to (i) require the recipient or
transferor to remit to
the Company an amount sufficient to satisfy any federal, state and/or local
withholding tax
requirements prior to the delivery or transfer of any certificate or
certificates for such Option
Shares or Award Shares or (ii) take whatever action it deems necessary to
protect its interests.
The Company's obligation to make any delivery or transfer of Option Shares
or Award Shares
shall be conditioned on the recipient's compliance, to the Company's
satisfaction, with any
withholding requirement. The Committee may establish requirements and
procedures with
respect to the Company's withholding of Option Shares or Award Shares to
satisfy any federal,
state and/or local withholding tax requirements which arise in connection
with the transfer of
Option Shares or Award Shares, as the Committee deems appropriate.
13. Terms and Conditions of Awards. Awards granted pursuant to the
Plan
shall be evidenced by written Award agreements (the "Award Agreements")
in such form as the
Committee shall from time to time approve, which Award Agreements shall
comply with and be
subject to the provisions contained in the Plan and subject to such conditions
and restrictions
(including conditions which may result in a forfeiture) as the Committee may,
from time to time,
require; provided such conditions and restrictions are not inconsistent with
the terms of the Plan.
The Award may provide for the lapse of restrictions on transfer and forfeiture
conditions in
installments. The Committee may, in its sole discretion, shorten or waive any
condition or
restriction with respect to all or any portion of any Award. Notwithstanding
the foregoing, all
restrictions and conditions shall lapse or terminate with respect to shares of
Common Stock
subject to an Award upon the death or disability (within the meaning of
section 22(e)(3) of the
Code) of the recipient of the Award (the "Awardee").
(a) Number of Shares. Each Award Agreement shall state the number
of shares of Common Stock to which it pertains.
(b) Purchase Price. Each Award Agreement shall specify the purchase
price, if any, which applies to the Award. If the Committee specifies a
purchase price, the
Awardee shall be required to make payment on or before the date specified in
the Award
Agreement. An Awardee shall pay for such shares of Common Stock (i) in
cash, (ii) by certified
check payable to the order of the Company, or (iii) by such other mode of
payment as the
Committee may approve.
(c) Transfer of Shares. In the case of an Award which provides for a
transfer of shares of Common Stock without any payment by the Awardee,
the transfer shall take
place on the date specified in the Award Agreement. In the case of an Award
which provides for
a payment, the transfer shall take place on the date the initial payment is
delivered to the
Company, unless the Committee or the Award Agreement otherwise
specifies. Stock certificates
evidencing shares of Common Stock transferred pursuant to an Award shall
be issued in the sole
name of the Awardee. Notwithstanding the foregoing, as a precondition to a
transfer, the
Company may require an acknowledgment by the Awardee as required with
respect to Options
under Section 7 and may further require that the Awardee satisfy any of the
Company's
withholding obligations attributable to any federal, state or local law as a
result of such transfer.
(d) Forfeiture Conditions. The Committee may specify in an Award
Agreement any conditions under which the Awardee shall be required to
convey to the Company
the shares of Common Stock covered by the Award. Upon the occurrence of
any such specified
condition, the Awardee shall forthwith surrender and deliver to the Company
the certificates
evidencing such shares as well as completely executed instruments of
conveyance. The
Committee, in its discretion, may provide that certificates for shares of
Common Stock
transferred pursuant to an Award be held in escrow by the Company's
Treasurer or an
appropriate officer of the Company, together with an undated stock power
executed by the
Awardee, until such time as each and every condition that may result in a
forfeiture has lapsed,
and that the Awardee be required, as a condition of the transfer, to deliver to
such escrow agent
stock powers covering the transferred shares of Common Stock duly
endorsed by the Awardee.
Stock certificates evidencing shares of Common Stock subject to forfeiture
shall bear a legend to
the effect that the Common Stock evidenced thereby is subject to repurchase
or conveyance to
the Company in accordance with an Award made under the Plan and that the
shares of Common
Stock may not be sold or otherwise transferred.
(e) Lapse of Conditions. Upon termination or lapse of each and every
forfeiture condition, the Company shall cause certificates without the legend
referring to the
Company's repurchase right (but with any other legends that may be
appropriate, including
legends indicating the restrictions that have been established by the terms of
the Award)
evidencing the shares of Common Stock covered by the Award to be issued
to the Awardee upon
the Awardee's surrender of the legended certificates held by him to the
Company.
(f) Rights as Stockholder. Upon payment of the purchase price, if
any, for shares of Common Stock covered by an Award and compliance with
the
acknowledgment requirement of subsection 13(c), the Awardee shall have all
of the rights of a
stockholder with respect to the shares of Common Stock covered thereby,
including the right to
vote such shares and receive all dividends and other distributions paid or
made with respect
thereto, except to the extent otherwise provided by the Committee or in the
Award Agreement.
(g) Lapse of Restrictions. Upon the expiration or termination of the
restrictions applicable under the terms of an Award, and the satisfaction of
any other conditions
set forth in an Award Agreement by the Committee as permitted under the
Plan, the restrictions
applicable to the shares of Common Stock granted pursuant to an Award shall
lapse and a stock
certificate for the number of shares of Common Stock with respect to which
the restrictions have
lapsed shall be delivered, free of all such restrictions, except any that may be
imposed by law or
pursuant to any shareholders agreement then in effect, to the Awardee or the
beneficiary or estate
of the Awardee, as the case may be. The Company shall not, however, be
required to deliver any
fractional share of Common Stock but will pay, in lieu thereof, the fair
market value (determined
as of the date the restrictions lapse) of such fractional share to the Awardee
or the Awardee's beneficiary or estate, as the case may be.
(h) Section 83(b) Elections. An Awardee who files an election with
the Internal Revenue Service to include the fair market value of any shares of
Common Stock
granted pursuant to an Award in gross income while they are still subject to
restrictions shall
promptly furnish the Company with a copy of such election together with the
amount of any
federal, state, local or other taxes required to be withheld to enable the
Company to claim an
income tax deduction with respect to such election.
(i) Forfeiture for Breach of Duty to Company. Upon a finding by the
Committee, after full consideration of the facts presented on behalf of both
the Company and the
Awardee, that the Awardee has breached his or her employment or service
contract with the
Company or an Affiliate, or has been engaged in disloyalty to the Company
or an Affiliate,
including, without limitation, fraud, embezzlement, theft, commission of a
felony or proven
dishonesty in the course of his or her employment or service, or has disclosed
trade secrets or
confidential information of the Company or an Affiliate, Awardee shall
automatically forfeit all
shares of Common Stock granted pursuant to an Award for which (1) the
Company has not yet
delivered the share certificates to the Awardee or (ii) any restrictions
applicable to such shares
have not lapsed. Notwithstanding anything herein to the contrary, the
Company may withhold
delivery of certificates for shares of Common Stock granted pursuant to an
Award pending the
resolution of any inquiry that could lead to a finding resulting in a
forfeiture.
(j) Amendment. Subject to the provisions of the Plan, the Committee
shall have the right to amend Awards issued to an Awardee, subject to the
Awardee's consent if
such amendment is not favorable to the Awardee, except that the consent of
the Awardee shall
not be required for any amendment made pursuant to Section 10 of the Plan.
(k) Change of Control. In the event of a Change of Control (as
defined in Section 6(f) above), the Committee may take whatever action with
respect to Awards
that have been granted under the Plan that it deems necessary or desirable. In
addition to the
foregoing, in the event of a Change of Control, the restrictions applicable to
shares of Common
Stock issued pursuant to Awards under the Plan shall lapse.
14. Interpretation. The Plan is intended to enable transactions under the
Plan
with respect to directors and officers (within the meaning of Section 16(a)
under the Securities
Exchange Act of 1934, as amended) to satisfy the conditions of Rule 16b-3
promulgated under
the Securities Exchange Act of 1934, as amended; any provision of the Plan
which would cause a
conflict with such conditions shall be deemed null and void to the extent
permitted by applicable
law and in the discretion of the Board of Directors.
15. Effective Date. The Plan shall be effective as of January 1, 1998.<PAGE>
SCHEDULE A
Committees of the Board of Directors
Audit Committee
Compensation Committee
Subordinated Debt-Repurchase Authorization Committee
Shelf Term Committee
Employee Stock Purchase Plan Committee
Exhibit 5
June 22, 1998
Toll Brothers, Inc.
3103 Philmont Avenue
Huntingdon Valley, PA 19006
RE: Registration Statement on Form S-8 Relating to the
Toll Brothers, Inc. Stock Incentive Plan (1998)
Ladies and Gentlemen:
As counsel to Toll Brothers, Inc., a Delaware corporation (the
"Company"), we have assisted in the preparation of the
Registration Statement on Form S-8 (the "Registration
Statement") to be filed with the Securities and Exchange
Commission under the Securities Act of 1933, as amended,
relating to 4,500,000 shares of the Company's Common
Stock, $.01 par value per share (the "Common Stock"),
which may be issued under the Toll Brothers, Inc. Stock
Incentive Plan (1998) (the "Plan").
In this connection, we have examined and considered the original or
copies, certified or otherwise identified to our satisfaction,
of the Company's Restated Certificate of Incorporation, as amended,
its By-laws, as amended, the Plan, resolutions of the Company's
Board of Directors and such other documents and corporate records
relating to the Company and the issuance and sale of the Common
Stock as we have deemed appropriate for purposes of
rendering this opinion.
In all examinations of documents, instruments and other papers,
we have assumed the genuineness of all signatures on original and
certified documents and the conformity to original and certified
documents of all copies submitted to us as conformed,
photostat or other copies. As to matters of fact which have not
been independently established, we have relied upon representations
of officers of the Company.
Based upon the foregoing examination and the information thus supplied,
it is our opinion that the shares of Common Stock to be offered under
the Plan are duly authorized and, when issued and sold pursuant to
the terms of the Plan, will be validly issued, fully paid and non-assessable.
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We hereby expressly consent to the inclusion of this opinion as an
exhibit to the Registration Statement.
Sincerely,
WOLF, BLOCK, SCHORR AND SOLIS-COHEN LLP
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Exhibit 23(a)
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts"
in the Registration Statement (Form S-8 No.333-0000) pertaining
to the Toll Brothers, Inc. Stock Incentive Plan (1998) and to the
incorporation by reference therein of our report dated December 9,
1997, with respect to the consolidated financial statements and
schedule of Toll Brothers, Inc. included in its Annual Report
(Form 10-K) for the year ended October 31, 1997, filed with the
Securities and Exchange Commission.
Philadelphia, Pennsylvania
June 19, 1998
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