SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
PIONEER RAILCORP
(Exact name of registrant as specified in its charter)
Iowa 37-1191206
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
1318 S. Johanson Road
Peoria, Illinois 61607
(Address of principal executive offices) (zip code)
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under
the Securities Act of 1933, other than securities offered only in
connection with dividend or interest reinvestment plans, check the
following box: [X]
The Registrant hereby amends this registration statement on such
date or dates as may be necessary to delay its effective date until
the registrant shall file a further amendment which specifically
states that this registration statement shall thereafter become
effective in accordance with Section 8(a) of the Securities Act of
1933, or until the registration statement shall become effective on
such date as the Commission acting pursuant to said Section 8(a)
may determine.
1994 STOCK OPTION PLAN FOR PIONEER RAILCORP
(Full title of the plan)
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
Title of Amount to Proposed Proposed Amount of
Class of Be Registered Maximum Maximum Registration
Securities (1) Offering Aggregate Fee (2)
to Be Price per Offering
Registered share (2) Price (2)
<S> <C> <C> <C> <C>
Common Stock, 836,000 $3.92 $1,633,060. $563.12
Class "A"
$.001 par value
per Share
</TABLE>
(1) The securities to be registered consist of 836,000 shares
reserved for issuance under the 1994 Stock Option Plan for Pioneer
Railcorp, of which 770,000 shares are reserved for issuance to
employees of Pioneer Railcorp; and 66,000 shares are reserved for
issuance to non-employee directors (the "Plan").
(2) The Amount of the Registration Fee is calculated pursuant
to Rule 457(h). accordingly, the maximum price per share of the
common stock offered hereunder and the maximum aggregate offering
price pursuant to the Plan is based on the following shares of
common stock reserved for issuance under the Plan and subject to
options already granted thereunder at the following exercise
prices:
Number of Shares Exercise Price
of Common Stock Per Share
Reserved for Issuance
473,000 $1.50
165,000 1.65
44,000 2.38
11,000 2.69
121,000 3.56
22,000 3.92
----------------------------------------------------
PART II
INFORMATION REQUIRED IN REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The Registrant hereby incorporates by reference in this
Registration Statement the following documents previously filed by
the Registrant with the Securities & Exchange Commission (the
"Commission"):
The Company's Current Report on Form 8-K dated December 27, 1994, as amended
February 24, 1995 and August 23, 1995.
The Company's Annual Report on Form 10-KSB for the year ended December 31,
1994, as amended August 31, 1995 and September 20, 1995.
The Company's Quarterly Report on Form 10-QSB for the quarter ended March 31,
1995, as amended May 19, 1995, August 31, 1995, September 20, 1995 and
September 22, 1995.
The Company's Current Report on Form 8-K dated June 30, 1995, as amended August
19, 1995.
The Company's Quarterly Report on Form 10-QSB for the quarter ended June 30,
1995, as amended August 31, 1995, September 20, 1995, September 22, 1995, and
December 5, 1995.
The Company's Quarterly Report on Form 10-QSB for the quarter ended September
30, 1995.
The Company's Current Report on Form 8-K dated November 22, 1995.
All reports and other documents filed by the Company pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act after the date of this Prospectus and
prior to the termination of this offering shall be deemed to be incorporated
by reference in this Prospectus and to be made a part hereof from the date of
filing of such reports and documents.
The Company hereby undertakes to provide, without charge, to each person to
whom a copy of this Prospectus shall have been delivered, upon the written
or oral request of such person, a copy of any or all of the documents referred
to above which have been or may be incorporated in this Prospectus by
reference, other than exhibits to such documents, unless such exhibits shall
have been specifically incorporated by reference into such documents.
Requests for such copies should be directed to Investor Relations Dept.,
Pioneer Railcorp, 1318 S. Johanson Road,Peoria, Illinois 61607,
telephone (309) 697-1400.
Item 4. Description of Securities.
The shares available for purchase with the options described
herein (the "Option Shares") are authorized but unissued shares of
the Registrant's Class A Common Stock (which is the only class of
common equity currently outstanding). The Company's Class A
Common Stock is registered under the Securities Exchange Act of
1934, and is listed on the Chicago Stock Exchange.
Item 5. Interests of Named Experts and Counsel.
Certain matters with respect to the validity of Common Stock
to be offered hereby will be passed on for the Company by Daniel A.
LaKemper, Esq. Mr. LaKemper, the Secretary and General Counsel of
the Company, is also a shareholder of the Company, and, as of
January 26, 1996, held options to purchase 176,000 shares of Common
Stock.
Item 6. Indemnification of Directors and Officers.
Article XII of the Company's By-Laws contains provisions,
pursuant to Section 490.851 of the Iowa Business Corporation Act,
authorizing indemnification of reasonable expenses incurred by any
officer, director, employee or agent of the corporation, or any
individual serving at the request of the corporation as an officer,
director, employee or agent of any other entity, who is, was, or is
threatened to be made a party to any legal proceeding (other than
an action by or in the right of the corporation) brought by reason
of the fact that the individual is or was an officer, director,
employee or agent, if (a) the individual acted in good faith; (b)
the individual reasonably believed their conduct was in the best
interest of the corporation, or at least not opposed to the best
interests of the corporation; and (c) in the case of a criminal
proceeding, the individual had no reasonable cause to believe the
conduct was unlawful.
The By-Law also provides that the corporation may indemnify
any person who was, is, or is threatened to be made a party to an
action by or in the right of the corporation, under the same
conditions, provided the individual is not adjudged liable to the
corporation.
The Company is also subject to Section 490.852 of the Iowa
Business Corporation Act, which mandates indemnification to "a
director who was wholly successful, on the merits or otherwise, in
the defense of any proceeding to which the director was a party
because the director is or was a director of the corporation,
against reasonable expenses incurred by the director in connection
with the proceeding."
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers, or
persons controlling the Registrant pursuant to the foregoing
provisions, the Registrant has been informed 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.
Item 7. Exemption from Registration Claimed.
This Registration Statement does not seek to register a
reoffering or resale of restricted securities.
Item 8. Exhibits.
(a) Exhibits.
The following documents are filed as a part of this
registration statement.
Exhibit Description of Exhibit
1 Articles of Incorporation of Pioneer Railcorp
(incorporated by reference to Exhibit 1 to the
Registrant's Registration Statement on Form S-3
(Reg. No. 33-64909).
2 Bylaws of the Registrant, as amended.
3 1994 Stock Option Plan for Pioneer Railcorp.
4 Form of Incentive Stock Option Agreement under the
1994 Stock Option Plan for Pioneer Railcorp.
5 Form of Option Agreement for non-employee Directors
under the 1994 Stock Option Plan for Pioneer Railcorp.
6 Opinion as to Legality.
7 Consent of Daniel A. LaKemper, Esq.
8 Consent of McGladrey & Pullen, LLP.
9 Consent of Pasquale & Bowers.
(b) Not Applicable. This is not a qualified pension or
retirement plan under Section 401 of the Internal Revenue Code.
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 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.
(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; 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,
each filing of the Registrant's Annual Report pursuant to Section
13(a) or Section 15(d) of the Exchange Act (and, where applicable,
each filing of an employee benefit plan's annual report pursuant to
Section 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.
C. 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 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 of 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.
SIGNATURES
Pursuant to the requirements of the Securities Act of 19933, the
registrant certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-3 and has
duly caused this registration statement to be signed on its behalf
by the undersigned, thereunto duly authorized in the County of
Peoria, State of Illinois, on January 29, 1996.
PIONEER RAILCORP
(Registrant)
By:/s/ Guy L. Brenkman
Guy L. Brenkman, Chairman and
Chief Executive Officer
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 dates indicated.
/s/ J. Michael Carr /s/ Orvel L. Cox
J. Michael Carr, Director and Orvel L. Cox, Director
Chief Financial Officer
Dated: January 29, 1996 Dated: January 29, 1996
BY-LAWS OF
PIONEER RAILCORP
As Amended and in Force January 1, 1996
ARTICLE I
The Corporation shall continuously maintain in the State of Iowa a registered
office and a registered agent whose office is identical with such registered
office and may have other offices within or without the State of Iowa.
ARTICLE II
Shareholders
SECTION 1. ANNUAL MEETING. An annual meeting of the shareholders shall be
held during the month of June of each year for the purpose of electing directors
and for the transaction of such other business as may come before the
meeting. The Board of Directors shall designate the date and the time of such
meeting. If no designation is made, such meeting shall be held at 9:00 A.M.
on the second Saturday in June, or, if that day is a legal holiday, such meeting
shall be held on the succeeding business day.
SECTION 2. SPECIAL MEETING. Special meetings of the shareholders may be
called either by the President, the Board of Directors, or by the shareholders
owning not less than one-tenth of all the outstanding shares of the Corporation,
for the purpose or purposes stated in the call of the meeting, and upon giving
notice as required by statute.
SECTION 3. PLACE OF MEETING. The Board of Directors may designate the
place of meeting for any annual meeting or for any special meeting called by the
Board of Directors. If no designation is made, or if a special meeting be
otherwise called, the place of meeting shall be at the general offices of the
Corporation.
SECTION 4. NOTICE OF MEETINGS. Written or printed notice stating the
place, day and hour of the meeting and, in the case of a special meeting, the
purpose or purposes for which the meeting is called, shall be delivered not less
than ten nor more than sixty days before the date of the meeting, whether
personally or by mail, by or at the direction of the President, the Secretary,
the Board of Directors, or the persons calling the meeting. If mailed, such
notice shall be deemed to be delivered when deposited in the United States Mail,
addressed to the shareholder at his address as it appears on the stock transfer
books of the Corporation, with postage thereon prepaid.
SECTION 5. RECORD DATE. For the purpose of determining the shareholders
entitled to notice of or to vote at any meeting of shareholders or any
adjournment thereof, or to express consent to corporate action in writing
without a meeting, or to receive payment of any dividend, or other distribution
or allotment of any rights, or to exercise any rights in respect of any change,
conversion or exchange of shares or for the purpose of any other lawful action,
the Board of Directors of the Corporation may fix in advance a record date which
shall not be more than sixty days before such meeting, payment, or other action,
and, for a meeting of shareholders not less than ten days, or in the case of a
merger or consolidation, not less than twenty days, before the date of such
meeting. If no record date is fixed, the record date for the determination of
shareholders entitled to notice of or to vote at a meeting of shareholders shall
be thirty days before the date on which notice of the meeting is mailed, and the
record date for the determination of shareholders for any other purpose shall be
the date on which the Board of Directors adopts the resolution relating thereto.
A determination of shareholders of record entitled to notice of or to note at a
meeting of shareholders shall apply to any adjournment of the meeting.
SECTION 6. VOTING LISTS. The officer or agent having charge of the
transfer books for the shares of the Corporation shall make, at lease ten days
before each meeting of shareholders, a complete list of the shareholders
entitled to vote at such meeting, arranged in alphabetical order, showing the
address of and number of shares registered in the name of each, which list, for
a period of ten days prior to such meeting, shall be kept on file at the
registered office of the Corporation and shall be open to inspection by any
shareholder for any proper purpose, at any time during usual business hours.
Such list shall also be produced and kept open at the time and place of the
meeting and shall be open to inspection by any shareholder during the whole time
of the meeting. The original stock transfer books, or a duplicate thereof,
shall be prima facie evidence as to who are the shareholders entitled to examine
such list or transfer books, or to vote at any meeting of shareholders.
SECTION 7. QUORUM. The holders of a majority of the outstanding shares of
the Corporation, present in person or represented by proxy, shall constitute q
quorum at any meeting of shareholders. If a quorum is present, the affirmative
vote of the majority of the shares represented at the meeting shall be the act
of the shareholders, unless the vote of a greater number is required by the
Articles under which this Corporation was formed, these By-Laws, or by Statute.
SECTION 8. PROXIES. Each shareholder entitled to vote at a meeting of
shareholders or to express consent or dissent to corporate action in writing
without a meeting may authorize another person or persons to act for him by
written proxy, but no such proxy shall be valid after eleven months from the
date of its execution.
SECTION 9. VOTING OF SHARES. Each outstanding share, regardless of class,
shall be entitled to one vote upon each matter submitted to vote at a meeting of
shareholders.
SECTION 10. VOTING OF SHARES BY CERTAIN HOLDER. Shares standing in the
name of another corporation, domestic or foreign, may be voted by such officer,
agent,or proxy as the by-laws of such corporation may prescribe, or, in the
absence ofsuch provision, as the board of directors of such corporation may
determine.
Shares standing in the name of a deceased person, a minor, ward, or an
incompetent person, may be voted by such person's administrator, executor,
court-appointed guardian, or conservator, either in person or by proxy, without
a transfer of such shares into the name of such administrator, executor,
court-appointed guardian or conservator. Shares standing in the name of
trustee may be voted by such trustee either in person or by proxy, but no
trustee shall be entitled to vote shares held by him without a transfer of such
shares into his name.
Shares standing in the name of receiver may be voted by such receiver, and
shares held by or under the control of a receiver may be voted by such receiver
without the transfer thereof into his name if authority to do so be contained in
an appropriate order of the Court by which such receiver was appointed.
A shareholder whose shares are pledged shall be entitled to vote such
shares until the shares have been transferred into the name of the pledgee,
and thereafter the pledgee shall be entitled to vote the shares so transferred.
Any number of shareholders may create a voting trust for the purpose of
conferring upon a trustee or trustees the right to vote or otherwise represent
their shares for a period not to exceed ten years, by entering into a written
voting trust agreement specifying the terms and conditions of the voting
trust, and by transferring their shares to such trustee or trustees for the
purpose of the agreement. Any such voting trust agreement shall not become
effective until a counterpart of the agreement is deposited with the Corporation
at its registered office, and the shares are transferred. Such trustee or
trustees shall keep a record of the holders of voting trust certificates
evidencing a beneficial interest in the voting trust, giving the names and
addresses of all such holders and thenumber and class of the shares in resect of
which the voting trust certificates held by each are issued, and shall deposit a
copy of such record with the Corporation at its registered office. The
counterpart of the voting trust agreement and the copy of such record so
deposited with the Corporation shall be subject to the same right of examination
by a shareholder of the Corporation, in person or by agent or attorney, as are
the books and records of the Corporation, and such counterpart and such copy of
such record shall be subject to examination by any holder of record of voting
trust certificates, either in person or by agent or attorney, at any reasonable
time for any proper purpose. This sub-section shall not apply to agreements
among shareholders regarding the voting of their shares.
Neither treasury shares nor shares held by another corporation, if a
majority of the shares entitled to vote for the election of directors of such
other corporation is held by the Corporation, shall be voted at any meeting or
counted in determining the total number of outstanding shares at any given time.
SECTION 11. NON-CUMULATIVE VOTING. In all elections for directors every
shareholder shall have the right to vote in person or by proxy one vote for each
share owned, for each director to be elected. The Company has no provisions
whatsoever for cumulative voting in the election of its directors.
SECTION 12. INSPECTORS. At any meeting of shareholders, the presiding
officer may, or upon the request of any shareholders shall, appoint on or more
persons as inspectors for such meeting.
Such inspectors shall ascertain and report the number of shares represented
at the meeting, based upon their determination of the validity and effect of
proxies, count all votes and report the results; and do such other acts as are
proper to conduct the election and voting with impartiality and fairness to all
the shareholders.
Each report of an inspector shall be in writing and signed by him or by a
majority of them if there be more than one inspector acting at such meeting. If
there is more than one inspector, the report of a majority shall be the report
of the inspectors. The report of the inspector or inspectors on the number of
shares represented at the meeting and the results of the voting shall be prima
facie evidence thereof.
SECTION 13. VOTING BY BALLOT. Voting on any question or in any election
may be by voice unless the presiding officer shall order or any stockholder
shall demand that voting be by ballot or roll call.
ARTICLE III
Directors
SECTION 1. GENERAL POWERS. The business of the Corporation shall be
managed by its Board of Directors.
SECTION 2. NUMBER, TENURE AND QUALIFICATIONS. The Number of directors of
the Corporation shall be five. Each director shall hold office until the next
annual meeting of shareholders or until his successor shall have been elected
and qualified. Directors need not be residents of Iowa, but must be
shareholders of the Corporation. The number of directors may be increased or
decreased from time to time by the amendment of this Section; but no decrease
shall have the effect of shortening the term of any incumbent director.
SECTION 3. REGULAR MEETINGS. A regular meeting of the Board of Directors
shall be held without other notice than this By-Law, immediately after the
annual meeting of shareholders. The Board of Directors may provide, by
resolution, the time and place for the holding of additional regular meetings
without other notice than such resolution.
SECTION 4. SPECIAL MEETINGS. Special meetings of the Board of Directors
may be called by or at the request of the President or any three directors.
The place of such special meetings shall be at the general offices of the
Corporation, or at such other corporate facilities as may be designated by the
person or persons calling such meeting.
SECTION 5. NOTICE. Notice of any special meeting shall be given at least
ten days previous thereto by written notice to each director at his business
address, or at such other address as he shall designate in writing to the
Secretary. If mailed, such notice shall be deemed to be delivered when
deposited in the United States Mail so addressed, with postage thereon prepaid.
If notice be given by telegram, such notice shall be deemed to be delivered
when the telegram is delivered to the telegram company. The attendance of a
director at any meeting shall constitute a waiver of notice of such meeting,
except where a director attends a meeting for the express purpose of objecting
to the transaction of any business because the meeting is not lawfully called or
convened. Neither business to be transacted at, not the purpose of, any regular
or special meeting of the Board of Directors need be specified in the notice or
waiver of notice of such meeting.
SECTION 6. QUORUM. A majority of the number of directors fixed by
these By-Laws shall constitute a quorum for transaction of business at any
meeting of the Board of Directors.
SECTION 7. MANNER OF ACTING. The act of the majority of the directors
present at a meeting at which a quorum is present shall be the act of the Board,
unless the act of a greater number is required by statute, these By-Laws, or the
Articles of Incorporation.
Section 8. VACANCIES. Any vacancy occurring on the Board of Directors may
be filled by the affirmative vote of a majority of the remaining directors, even
though less than a quorum. A Director elected to fill a vacancy shall be
elected for the unexpired term of his or her predecessor in office. Any
irectorship to be filled by reason of an increase in the number of directors
shall be filled by election at the next annual meeting or at a special meeting
of shareholders called for that purpose.
SECTION 9. ACTION WITHOUT A MEETING. Unless specifically prohibited by
Statute, the Articles of Incorporation, or these By-Laws, any action required to
be taken at a meeting of the Board of Directors, or any other action which may
be taken at a meeting of the Board, or of any committee thereof, may be taken
without a meeting if a consent in writing, setting forth the action so taken,
shall be signed by all the directors entitled to vote with respect to the
subject matter thereof, or by all the members of such committee, as the case may
be. Any such consent signed by all the directors or all the members of the
committee shall have the same effect as a unanimous vote, and may be stated as
such in any document filed with the Secretary of State or with anyone else.
SECTION 10. COMPENSATION. The Board of Directors, by the affirmative vote
of a majority of directors then in office, and irrespective of any personal
interest of any of its members, shall have the authority to establish reasonable
compensation of all directors for services to the Corporation as directors,
officers, or otherwise. By resolution of the Board, the directors may be paid
their expenses, if any, of attendance at each meeting of the Board. No such
payment previously mentioned in this Section shall preclude any director from
serving the Corporation in any other capacity and receiving compensation
therefor.
SECTION 11. PRESUMPTION OF ASSENT. A director of the Corporation who is
present at a meeting of the Board of Directors at which action on any corporate
matter is taken shall be conclusively presumed to have assented to the action
taken unless his dissent shall be entered in the minutes of the meeting or
unless he shall file his written dissent to such action with the person acting
as the secretary of the meeting before the adjournment thereof, or shall forward
such dissent by certified mail to the Secretary of the Corporation within
seventy-two hours after the adjournment of the meeting. Such right to dissent
shall not apply to a director who voted in favor of such action.
SECTION 12. REMOVAL. At any special meeting, by a majority vote of all
the shares outstanding, such shareholders may remove any director of the
Corporation and elect others instead of those removed.
ARTICLE IV
Officers
SECTION 1. NUMBER. The officers of the Corporation shall be
a President, who shall be chosen from among the members of the Board of
Directors, one or more Vice Presidents (the number thereof to be determined by
the Board of Directors), a Treasurer, a Secretary, and such Vice Presidents,
Assistant Treasurers and Assistant Secretaries or other officers as may be
elected by a majority of the Board, provided, however, that the Board may,
in any year, choose not to elect a Vice President. Any two or more offices may
be held by the sameperson, except the offices of President and Secretary.
SECTION 2. ELECTION AND TERM OF OFFICE. The officers of the Corporation
shall be elected annually by the Board of Directors at the first meeting of the
Board of Directors held after each annual meeting of shareholders. If the
election of officers shall not be held at such meeting, such election shall be
held as soon thereafter as conveniently may be. Vacancies may be filled or new
offices created and filled at any meeting of the Board. Each officer shall hold
office until his successor shall have been duly elected and shall have qualified
or until his death or until he shall resign or shall have been removed in the
manner hereinafter provided. Election of an officer shall not of itself create
contract rights.
SECTION 3. REMOVAL. Any officer elected or appointed by the Board of
Directors may be removed by the Board whenever in its judgment the best
interests of the Corporation would be served thereby, but such removal shall be
without prejudice to the contract rights, if any, of the person so removed.
At any special meeting, by a majority vote of all shares, the shareholders may
remove any officer of the Corporation, and elect others instead of those so
removed.
SECTION 4. PRESIDENT. The President shall be the Chief Executive Officer
of the Corporation with full and complete authority in the day-to-day operations
of all businesses owned or controlled by the Corporation as well as any
subsidiaries of the Corporation, as well as being in charge of the business of
the Corporation. He shall see that the resolutions of the Board of Directors are
carried into effect except in those instances in which that responsibility is
specifically assigned to some other person by the Board; and, in general, he
shall discharge all duties incidental to the office of President and such
other duties as may be prescribed by the Board from time to time. He shall
preside at all meetings of the shareholders and of the Board. Except in those
instances in which the authority to execute is expressly delegated to another
officer or agent of the Corporation or a different mode is expressly prescribed
by the Board or these By-Laws, he may execute for the Corporation
certificates for its shares, and any contracts, deeds, mortgages, bonds, or
other instruments which the Board has authorized to be executed, and he may
accomplish such execution either under or without the seal ofthe Corporation
and either individually or with the Secretary, any Assistant Secretary, or
any other officer thereunto authorized by the Board, according to the
requirements of the form of the instrument. He may vote all securities which
the Corporation is entitled to vote except as and to the extent such authority
shall be vested in a different officer or agent of the Corporation by the Board.
SECTION 5. THE VICE PRESIDENTS. The Vice President (or in the event there
be more than one Vice President, each of the Vice Presidents) shall assist the
President in the discharge of his duties as the President may direct and shall
perform such other duties as from time to time may be assigned to him by the
President or by the Board of Directors. In the absence of the President, or in
the event of his inability or refusal to act, the Vice President (or in the
event there be more than one Vice President, the Vice Presidents in the order
designated by the Board, or by the President if the Board has not made such a
designation, or in the absence of any designation, then in the order of
seniority of tenure as Vice President) shall perform the duties of the
President and, when so acting, shall have all the powers of and be subject to
all the restrictions upon the President. Except in those instances in which
the authority to execute is expressly delegated to another officer or agent of
the Corporation or a different mode of execution is expressly prescribed by
the Board or these By-Laws, the Vice President (or each of them if there are
more than one) may execute for the Corporation certificates for its shares
and any contracts, deeds, mortgages, bonds, or other instruments which the
Board of Directors has authorized to be executed, and he may accomplish such
execution either under or without the seal of the Corporation and either
individually or with the Secretary, any Assistant Secretary, or any other
officer thereunto authorized by the Board of Directors, according to the
requirements of the form of the instrument.
SECTION 6. THE TREASURER. The Treasurer shall be the principal
accounting and financial officer of the Corporation. He shall: (a) have charge
of and be responsible for the maintenance of adequate books of account for the
Corporation; (b) have charge and custody of all funds and securities of the
Corporation, and be responsible therefor and for the receipt and disbursement
thereof; and (c) perform all the duties incident to the office of Treasurer and
such other duties as from time to time may be assigned to him by the President
or by the Board of Directors. If required by the Board of Directors, the
Treasurer shall give a bond for the faithful discharge of his duties in such sum
and with such surety or sureties as the Board of Directors may determine.
SECTION 7. THE SECRETARY. The Secretary shall: (a) record the minutes of
the shareholders and of the Board of Directors meetings in one or more books
provided for the purpose; (b) see that all notices are duly given in accordance
with the provisions of these By-Laws or as required by law; (c) be custodian of
the corporate records and of the seal of the Corporation; (d) keep a register of
the post-office address of each stockholder which shall be furnished to the
Secretary by such shareholder; (e) sign with the President, or a Vice-President,
or any other officer thereunto authorized by the Board of Directors,
certificates for shares of the Corporation, the issue of which shall have
been authorized by the Board of Directors, and any contracts, deeds,
mortgages, bonds or other instruments which the Board of Directors has
authorized to be executed, according to the requirements of the form of the
instrument, except when a different mode of execution is expressly prescribed by
the Board of Directors or these By-Laws; (f) have general charge of the stock
transfer books of the Corporation; (g) perform all duties incident to the office
of Secretary and such other duties as from time to time may be assigned to him
by the President or the Board of Directors.
SECTION 8. ASSISTANT TREASURERS AND ASSISTANT SECRETARIES. The Assistant
Treasurers and Assistant Secretaries shall perform such duties as shall be
assigned to them by the Treasurer or the Secretary, respectively, or by the
President or the Board of Directors. The Assistant Secretaries may sign with
the President, or a Vice-President, or any other officer thereunto authorized
by the Board of Directors, certificates for shares of the Corporation, the issue
of which shall have been authorized by the Board of Directors, and any contracts
deeds, mortgages, bonds, or other instruments which the Board of Directors has
authorized to be executed, according to the requirements of the form of the
instrument, except when a difference mode of execution is expressly
prescribed by the Board of Directors or these By-Laws. The Assistant
Treasurers shall respectively, if required by the Board of Directors, give
bonds for the faithful discharge of their duties in such sums and with such
sureties as the Board of Directors shall determine.
SECTION 9. SALARIES. The salaries of the officers shall be fixed from time
to time by the Board of Directors and no officer shall be prevented from
receiving such salary by reason of the fact that he is also a director of the
Corporation.
ARTICLE V
Contracts, Loans, Checks and Deposits
SECTION 1. CONTRACTS. The Board of Directors may authorize any officer or
officers, agent or agents, to enter into any contract or execute and deliver any
instrument in the name of and on behalf of the Corporation, and such authority
may be general or confined to specific instances.
SECTION 2. LOANS. No loans shall be contracted on behalf of the Corpora-
tion and no evidences of indebtedness shall be issued in its name unless
authorized by a resolution of the Board of Directors. Such authority may be
general or confined to specific instances. Except, however, at all general
meetings of the shareholders a majority in value of the shareholders may fix the
rate of interest which shall be paid by the Corporation for loans for the
construction of the railway and its appendages, and the amount of such loans.
SECTION 3. CHECKS, DRAFTS, ETC. All checks, drafts, or other orders for the
payment of money, notes, or other evidence of indebtedness issued in the name of
the Corporation, shall be signed by such officer or officers, agent or agents of
the Corporation and in such manner as shall from time to time be determined by
resolution of the Board of Directors.
SECTION 4. DEPOSITS. All funds of the Corporation not otherwise employed
shall be deposited from time to time to the credit of the Corporation in such
banks, trust companies or other depositories as the Board of Directors may
select.
ARTICLE VI
Certificates for Shares and their Transfer
SECTION 1. CERTIFICATES FOR SHARES. Certificates representing shares of
the Corporation shall be signed by the President or a Vice-President or by such
officer as shall be designated by resolution of the Board of Directors, and by
the Secretary or an Assistant Secretary, and shall be sealed with the seal or a
facsimile of the seal of the Corporation. If both of the signatures of the
officers be by facsimile, the certificate shall be manually signed by or on
behalf of a duly authorized transfer agent or clerk. Each certificate
representing shares shall be consecutively numbered or otherwise identified, and
shall also state the name of the person to whom issued, the number and class of
shares (with designation of series, if any), the date of issue, that the
Corporation is organized under Iowa law, and the par value or a statement that
the shares are without par value. If the Corporation is authorized and does
issue shares of more than one class or of series within a class, the
certificate shall also contain such information or statement as may be required
by law.
The name and address of each shareholder, the number and class of shares
held and the date on which the certificates for the shares were issued shall be
entered on the books of the Corporation. The person in whose name shares stand
on the books of the Corporation shall be deemed the owner thereof for all
purposes as regards the Corporation.
SECTION 2. LOST CERTIFICATES. If a certificate representing shares has
allegedly been lost or destroyed, the Board of Directors may in its discretion,
except as may be required by law, direct that a new certificate be issued upon
such indemnification and other reasonable requirements as it may impose.
SECTION 3. TRANSFERS OF SHARES. Transfers of shares of the Corporation
shall be recorded on the books of the Corporation and, except in the case of a
lost or destroyed certificate, on surrender for cancellation of the certificate
for such shares. A certificate presented for transfer must be duly endorsed and
accompanied by proper guaranty of signature and other appropriate assurances
that the endorsement is effective.
ARTICLE VII
Fiscal Year
The fiscal year of the Corporation shall be the calendar year, running January
1 - December 31.
ARTICLE VIII
Dividends
The Board of Directors may from time to time declare, and the Corporation may
pay, dividends on its outstanding shares in the manner and upon the terms and
conditions provided by law and its Articles of Incorporation.
ARTICLE IX
Seal
The Corporate seal shall have inscribed thereon the name of the Corporation
and the words "Corporate Seal, Iowa." The seal may be used by causing it or a
facsimile thereof to be impressed or affixed or in any manner reproduced.
ARTICLE X
Waiver of Notice
Whenever any notice is required to be given under the provisions of these
By-Laws or under the provisions of the Articles of Incorporation, a waiver
thereof in writing, signed by the person or persons entitled to such notice,
whether before or after the time stated therein, shall be deemed equivalent to
the giving of such notice.
ARTICLE XI
Amendments
The power to make, alter, amend, or repeal the By-Laws of the Corporation
shall be vested in the Board of Directors, unless reserved to the shareholders
by the Articles of Incorporation. The By-Laws may contain any provisions for
the regulation and management of the affairs of the Corporation not inconsistent
with law or the Articles of Incorporation.
ARTICLE XII
Indemnification of Officers, Directors,
Employees and Agents to the Extent Permitted
by the Applicable Law
SECTION 1. The Corporation shall have power to indemnify any person who was
or is a party or is threatened to be made a party to any such criminal,
administrative or investigative (other than an action by or in the right of the
Corporation) by reason of the fact that he 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 attorney's fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such action, suit or
proceeding if he acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the Corporation, and, with respect
to any criminal action or proceeding, had no reasonable cause to believe his
conduct was unlawful. The termination of any action, suit or proceeding by
udgment or 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 he reasonably believed to be in or not
opposed to the best interest of the Corporation, and with respect to any
criminal action or proceeding, had reasonable cause to believe that his conduct
was unlawful.
SECTION 2. The 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 he is or was a director,
officer, employee or agent 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 him in connection with the defense or settlement of such action or
suit if he acted in good faith and in a manner he reasonably believed to be in
or not opposed to the best interests of tile 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 for negligence or
misconduct in the performance of his' duty to the Corporation unless and only to
the extent that the court in which such action or suit was brought shall
determine upon application that despite the adjudication of liability but in
view of all the circumstances of tile case, such person is fairly and reasonably
entitled to indemnity for such expenses which the court shall deem proper.
SECTION 3. To the extent that a director, officer, employee or agent of a
Corporation has been successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in Sections 1 and 2, or in defense of any
claim, issue or matter therein, he shall be indemnified against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection therewith.
SECTION 4. Any indemnification under Sections 1 and 2 (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 director, officer, employee or
agent is proper in the circumstances because he has met the applicable standard
of conduct set forth in Sections 1 and 2. Such determination shall be made (a)
by the Board of Directors by a majority vote of a quorum consisting of directors
who were not parties to such action, suit or proceeding, or (b) if such a quorum
is not obtainable, or, even if obtainable, a quorum of disinterested directors
so directs, by independent legal counsel in a written opinion, or (c) by the
shareholders.
SECTION 5. The 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 him and incurred by him in any such capacity, or arising out
of his status as such, whether or not the Corporation would have the power to
indemnify him against such liability under the provisions of this Article.
1994 STOCK OPTION PLAN FOR PIONEER RAILCORP
This Stock Option Plan is made as of April 12, 1994 by Pioneer Railcorp.
Recitals
A. The Company desires to attract, retain and motivate employees of the
Company whose efforts contribute to the success of the Company. This Plan is
intended to reward such employees by providing the opportunity to acquire or
increase the proprietary interest of such employees in the Company.
B. This Plan has been approved by the shareholders of the Company and by
the Board.
C. The options granted under this Plan to employees are intended to be
"incentive stock options" within the meaning of Code Section 422 (the Plan also
includes non-employee directors, whose options may not qualify as "incentive
stockoptions").
Agreements
Now therefore it is agreed as follows:
Article I
Definitions
As used herein, the following terms have the meanings hereinafter set forth
unless the context clearly indicates to the contrary:
(a) "Board" shall mean the Board of Directors of the Company.
(b) "Company" shall mean Pioneer Railcorp.
(c) "Fair Market Value" shall mean the closing price per share at which
the Stock is sold in the regular way on the Chicago Stock Exchange
(or such other exchange on which the Stock is traded on the day an Option is
granted hereunder or, in the absence of any reported sales on such day, the
first preceding day on which there were such sales. The Fair Market Value of
the Stock on April 12, 1994 is $3.00 per share.
(d) "Option" shall mean an option to purchase Stock granted pursuant to
the provisions of Article V hereof.
(e) "Optionee" shall mean an employee to whom an Option has been granted
hereunder (or, where applicable, to a non-employee "outside" director to whom
an Option has been granted hereunder).
(f) "Plan" shall mean the 1994 Stock Option Plan for Pioneer Railcorp, the
terms of which are set forth herein.
(g) "Stock" shall mean the Class A Common Stock of the Company, or in the
event that the outstanding shares of Stock are hereafter changed into or
exchanged for shares of a different stock or securities of the Company or
some other corporation, such other stock or securities.
(h) "Stock Option Agreement" shall mean the agreement between the Company and
the Optionee under which the Optionee may purchase Stock hereunder.
(i) "Ten Percent Shareholder" shall mean an individual who owns stock of the
Company possessing more than 10 percent of the total combined voting power of
all classes of stock of the Company within the meaning of Code
Section 422 (b)(6).
Article II
Participants
Any employee (or outside director) of the Company or of a subsidiary of the
Company shall be eligible to participate in the Plan. The Board may grant
Options to any eligible person in accordance with such determinations as the
Board from time to time in its sole discretion shall make. Options may be
granted to eligible persons in the following groups:
Group Maximum Option Shares
Executive Officers 265,000
Outside Directors 30,000
Regular Employees 115,000
Other Individual Employees 10,000
The number of Option Shares for each group shall be increased as
provided in Section 4.1.
Article III
Administration
3.1 Duties and powers of the Board. The Plan shall be administered by the
Board. Subject to the express provisions of the Plan, the Board shall have sole
discretion and authority to determine from among eligible persons those to whom
and the time or times at which Options may be granted and the number of shares
of Stock to be subject to each Option. Subject to the express provisions of
the Plan, the Board shall also have complete authority to interpret the Plan,
to prescribe, amend, and rescind rules and regulations relating to it, to
determine the details and provisions of each Stock Option Agreement and to make
all other determinations necessary or advisable in the administration of the
Plan.
3.2 Company assistance. The Company shall supply full and timely information
to the Board on all matters relating to eligible employees, their employment,
death, retirement, disability or other termination of employment, and such other
pertinent facts as the
Board may require. The Company shall furnish the Board with such clerical and
other assistance as is necessary in the performance of its duties.
Article IV
Shares of Stock Subject to Plan
4.1 Limitations. Subject to adjustment pursuant to the provisions of
Section 4.3 hereof, the number of shares of Stock which may be issued and sold
hereunder shall not exceed 420,000 shares, except that such number shall be
increased by 10% if the price condition in Section 5.4(a) is satisfied on or
before December 31, 1995 and shall be increased by 5% if the price condition in
Section 5.4(a) is satisfied after December 31, 1995 but on or before
December 31, 1996. Such shares may be either authorized and unissued shares or
shares issued and thereafter acquired by the company.
4.2 Options and awards granted under Plan. Shares of stock with
respect to which an Option granted hereunder shall have been
exercised, shall not again be available for Option hereunder. If
Options granted hereunder shall terminate for any reason without
being wholly exercised, new Options may be granted hereunder
covering the number of shares to which such Option termination
relates.
4.3 Reorganization. In the event that the outstanding shares
of Stock hereafter are changed into or exchanged for a different
number or kind of shares or other securities of the Company or of
another corporation by reason of merger, consolidation, other
reorganization, recapitalization, reclassification, combination of
shares, stock split-up, or stock dividend:
(a) The aggregate number and kind of shares subject to
Options which may be granted hereunder shall be adjusted
appropriately; and
(b) Rights under outstanding Options granted hereunder,
both as to the number of subject shares and the Option price,
shall be adjusted appropriately.
The foregoing adjustments and the manner of application of the
foregoing provisions shall be determined solely by the Board, and
any such adjustment may provide for the elimination of fractional
share interests.
Article V
Options
5.1 Option grant and agreement. Each Option granted hereunder shall be
evidenced by minutes of a meeting or the written
consent of the Board and by a written Stock Option Agreement dated
as of the date of grant and executed by the Company and the Optionee, which
Agreement shall set forth such terms and conditions
as may be determined by the Board consistent with the Plan.
5.2 Option price. The per share Option price of the Stock
subject to each Option shall be determined by the Board, but the
per share price shall not be less than the Fair Market Value of the
Stock on the date the Option is granted. The foregoing notwithstanding, if the
Optionee is a Ten Percent Shareholder, the Option price per share shall not be
less that 110% of the Fair Market Value of the Stock on the date the Option is
granted.
5.3 Option Period. Each option granted hereunder must be granted, if
at all, on or before June 30, 1996. After satisfying the condition in
Section 5.4(a), each Option may be exercised at any time during the five-year
period thereafter, provided, however, that the aggregate Fair Market Value of
Stock (determined as of the date the Option is granted) which first becomes
exercisable with respect to any Optionee in any calendar year may not exceed
$100,000 (regardless of the date the Option is granted) and further provided
with respect to a Ten Percent Shareholder that such Optionee may not
exercise any Option after the expiration of five
(5) years from the date the Option is granted.
5.4 Option exercise. (a) Options granted hereunder may not
be exercised unless and until the closing price of Stock is at
least $8.00 per share (as reported in the Wall Street Journal) for
any ten consecutive days on or before December 31, 1997. If this
condition is not satisfied on or before December 31, 1997, all
Options hereunder shall be void.
(b) Options may be exercised in whole at any time, or in part
from time to time with respect to whole shares only, within the
period permitted for the exercise thereof, and shall be exercised
by written notice of intent to exercise the Option with respect to
a specified number of shares delivered to the Company at its principal office in
the State of Illinois, and payment in cash to
the Company at said office of the amount of the Option price for the number of
shares of Stock with respect to which the Option is
the being exercised.
5.5 Nontransferability of Option. No Option shall be transferred by an
Optionee other than by will or by the laws of descent and distribution.
During the lifetime of an Optionee, the Option shall be exercisable only by the
Optionee.
5.6 Effect of death of other termination of employment. (a) Upon
termination of an Optionee's employment with the Company or
subsidiary for any reason other than death, the Optionee may, for
a period of three months thereafter, exercise any Options which were exercisable
by the Optionee on the date of termination. Any Options not so exercised shall
terminate.
(b) If an Optionee dies while in the employ of the Company or
subsidiary, the executor or administrator of the estate of the decedent or the
person or persons to whom an Option granted hereunder shall have been validly
transferred by the executor or the administrator pursuant to will or the laws of
descent and distribution shall have the right to exercise the Optionee's Options
to the extent that it was exercisable by the Optionee at the date of termination
of employment by death, provided such Option is exercised before the first to
occur of (i) one year after Optionee's death and (ii) the end of the period
during which such Options is otherwise exercisable hereunder. Any Options not
so exercised shall terminate.
(c) No transfer of an Option by the Optionee by will or by the laws of
descent and distribution shall be effective to bind the Company unless the
Company shall have been furnished with written notice thereof and an
authenticated copy of the will and/or such other evidence as the Board may deem
necessary to establish the validity of the transfer and the acceptance by the
transferee or transferees of the terms and conditions of such Option.
5.7 Rights as shareholder. Any Optionee or a transferee of an Option
shall have no rights as a shareholder with respect to any shares subject to such
Option prior to the purchase of such shares by exercise of such Option as
provided herein.
Article VI
Stock Certificates
The Company shall not be required to issue or deliver any certificate of
shares of Stock purchased upon the exercise of any Option granted hereunder or
any portion thereof, prior to fulfillment of all the following conditions:
(a) The admission of such shares to listing on all
stock exchanges on which the Stock is then listed;
(b) The completion of any registration or other
qualifications of such shares under any federal or state
law or under the rulings or regulations of the Securities
and Exchange Commission or any other governmental
regulatory body, which the Board shall in its sole
discretion deem necessary of advisable;
(c) The obtaining of any approval or other clearance
from any federal or state governmental agency which the Board
shall in its sole discretion determine to be necessary or
advisable; and
(d) The lapse of such reasonable period of time
following the exercise of the Option as the Board from time to
time may establish for reasons of administrative convenience.
Article VII
Directors
This Plan shall also apply to outside directors of the
Company, even though the grant of an Option to an outside director
will not be an "incentive stock option" under Code Section 422.
For Options granted to outside directors hereunder, the provisions
of this Plan shall apply to directors and shall be interpreted in
a manner as though the directors were employees.
Article VIII
Termination, Amendment, and Modifications of Plan
The Board may at any time terminate and may at any time and
from time to time and in respect amend or modify, the Plan;
provided, however, that no such action of the Board without
approval of the majority of the shareholders of the Company may:
(a) Increase the total number of shares of Stock subject
to the Plan except as contemplated in Section 4.3 hereof;
(b) Change the manner of determining the Option price;
(c) Withdraw the administration of the Plan from the
Board; and
provided further, that no termination, amendment, or modification
of the Plan shall in any manner adversely affect any Option
theretofore granted under the Plan without the consent of the
Optionee or permitted transferee of the Option.
Article IX
Miscellaneous
9.1 Employment. Nothing in the Plan or in any Option granted
hereunder or in any Stock Option Agreement relating thereto shall confer upon
any employee the right to continue in the employ of the Company.
9.2 Other compensation plans. The adoption of the Plan shall not affect
any other stock option or incentive or other compensation plans in effect for
the Company, nor shall the Plan preclude the Company from establishing any other
forms of incentive or other compensation for employees of the Company.
9.3 Plan binding on successors. The Plan shall be binding
upon the successors and assigns of the Company.
9.4 Partial invalidity. If any term or provision of this
Plan shall be declared invalid or unenforceable, all other terms
and provisions hereof shall remain in full force and effect to the
fullest extent permitted by law.
9.5 Singular, plural; gender. Whenever used herein, nouns in
the singular shall include the plural, and the masculine pronoun
shall include the feminine gender.
9.6 Headings, etc., no part of plan. Headings of Articles
and Section hereof are inserted for convenience and reference; they
constitute no part of the Plan.
PIONEER RAILCORP
By:/s/ Guy L. Brenkman
Its CEO
Dated: April 12, 1994
STOCK OPTION AGREEMENT
Date of Grant _________:
THIS GRANT, dated as of the date of grant first stated above
(the "Date of Grant"), is delivered by Pioneer Railcorp ("Company") to
(the "Optionee"), who is a director of the Company.
WHEREAS, the Board of Directors of the Company (the "Board") on April 12,
1994, adopted, with stockholder approval, the Pioneer Railcorp Incentive Stock
Option Plan (the "Plan");
WHEREAS, the Plan provides for the granting of incentive stock options by
the Board to employees and directors of the Company to purchase, or to exercise
certain rights with respect to, shares of the Class A Common Stock of the
Company (the "Stock"), in accordance with the terms and provisions thereof; and
WHEREAS, the Board considers the optionee to be a person who is eligible
for a grant of incentive stock options under the Plan, and has determined that
it would be in the best interest of the Company to grant the incentive stock
options documented herein.
NOW, THEREFORE, the parties agree as follows:
1. Grant of option.
Subject to the terms and conditions hereinafter set forth, the Company
hereby grants to the Optionee, as of the Date of Grant, an option to purchase up
to _____shares of Stock at a price of $___ per share, the fair market value of
the Stock on the Date of Grant. (If the optionee is a ten percent shareholder,
the option price is $___ per share, 110% of the fair market value of the stock
on the date of grant). Such option is hereinafter referred to as the "Option"
and the shares of stock purchasable upon exercise of the option are hereinafter
sometimes referred to as the "Option Shares." The Option is intended by the
parties hereto to be, and shall be treated as, an incentive stock option as such
term is defined under Section 422 of the Internal Revenue Code of 1986.
The number of Option Shares shall be automatically increased by 10% if the
price condition in Section 2 is satisfied on or before December 31, 1995 and
shall be automatically increased by 5% if the price condition in Section 2 is
satisfied after December 31, 1995 but on or before December 31, 1996.
2. Exercise of Option.
No Option may be exercised unless and until the closing price of Stock is
at least $8.00 per share (as reported in the Wall Street Journal) for ten
consecutive days on or before December 31, 1997. Thereafter, Options may be
exercised at any time for five years, provided, however, that the aggregate fair
market value of Stock (as determined as of the Date of Grant) which first
becomes exercisable with respect to any optionee in any calendar year may not
exceed $100,000, regardless of the date the option is granted.
If the Optionee is a ten percent shareholder, any option must be exercised,
if at all, within five (5) yeasrs from the Date of Grant.
3. Termination of option.
(a) The Option and all rights hereunder with respect thereto, to
the extent such rights shall not have been exercised, shall terminate if the
price condition in Section 2 is not satisfied by December 31, 1997 or if and to
the extent the option is not otherwise exercised within five years thereafter.
(b) Upon the Optionee's termination of employment with the Company for any
reason other than death, the Optionee may, for a period of three months
thereafter, exercise any options which were exercisable on the date of
termination. Any option not so exercised shall terminate.
(C) In the event of the death of the optionee while a employee of the Company,
the Option may be exercised by the optionee's legal representative or transferee
within one year following the optionee's death, but only to the extent that the
Option would otherwise have been exercisable during such period by the Optionee.
4. Exercise of Options.
(a) The optionee may exercise the Option with respect to all or
any part of the number of Option Shares then exercisable hereunder by giving the
Company written notice of intent to exercise. The notice of exercise shall
specify the number of Option Shares as to which the Option is to be exercised
and the date of exercise thereof.
(b) Full payment by the Optionee of the option price for the Option Shares
purchased shall be made in cash on or before the exercise date specified in the
notice of exercise.
On the exercise date specified in the optionee's notice or as soon
thereafter as is practicable, the Company shall cause to be delivered to the
ptionee, a certificate or certificates for the Option Shares then being
purchased upon full payment of such option Shares. The obligation of the
Company to deliver Stock shall, however, be subject to the condition that if at
any time the Board shall determine in its discretion that the listing,
registration or qualification of the Option or the Option Shares upon any
securities exchange or under any state or federal law, or the consent or
approval of any governmental regulatory body, is necessary or desirable as a
condition of, or in connection with, the Option or the issuance or purchase
f Stock thereunder, the Option may not be exercised in whole or in part
unless such listing, registration, qualification, consent or approval shall
have been affected or obtained free of any conditions not acceptable to the
Board.
(C) If the Optionee fails to pay for any of the Option Shares specified in such
notice or fails to accept delivery thereof, the Optionee's right to purchase
such Option Shares may be terminated by the Company. The date specified in the
Optionee's notice as the date of exercise shall be deemed the date of exercise
of the option, provided that payment in full for the Option Shares to be
purchased upon such exercise shall
have been received by such date.
(d) Optionee shall comply with such additional procedures for
exercise of the Option as are from time to time established by the
Board.
5. Adjustment of and Changes in Stock of the Company.
In the event of a reorganization, recapitalization, change of shares,stock
split, spin-off,stock dividend, reclassification, subdivision or combination of
shares, merger, consolidation, rights offering, or any other change in the
corporate structure or shares of capital stock of the Company, the Board shall
make such adjustment as it deems appropriate in the number and kind of shares of
Stock subject to the Option or in the option price; provided, however that such
adjustment shall give the Optionee any additional benefits under the Option.
6. Fair Market Value.
As used herein, the "fair market value" of a share of Stock shall be the closing
price per share of Stock on the Chicago Stock Exchange or other recognized
market source, as determined by the Board, on the applicable date of reference
hereunder, or if there is no sale on such date, then the closing price on the
last previous day on which a sale is reported. The fair market value of the
Stock on April 12, 1994 is $3.00 per share.
7. No Rights of Stockholders.
Neither the Optionee nor any personal representative shall be, or shall
have any of the rights or privileges of, a stockholder of the Company with
respect to any shares of Stock purchasable or issuable upon the exercise of the
Option, in whole or in part, prior to the date of exercise of the option.
8. Non-Transferability of Option.
During the Optionee's lifetime, the option hereunder shall be exercisable
only by the Optionee or any guardian or legal representative of the Optionee,
and the Option shall not be transferable except, in case of the death of the
Optionee, by will or the laws of descent and distribution.
9. Employment Not Affected.
Neither the grant of the option nor its exercise shall be construed as
granting to the optionee any right with respect to continued employment with the
Company.
10. Amendment of option.
The option may be amended by the Board at any time (i) if the Board
determines, in its sole discretion, that amendment is necessary or
advisable in light of the Internal Revenue Code of 1986 or in the
regulations issued thereunder, or any federal or state securities law or
other law or regulation or (ii) other than in the circumstances described
in clause (i), with the consent of the Optionee, unless the amendment would
not adversely affect the Optionee.
11. Notice.
Any notice to the Company provided for in this instrument shall be
addressed to it at its offices at Peoria, Illinois, and any notice to the
Optionee shall be addressed to the Optionee at the current address shown on
the records of the Company. Any notice shall be deemed to by duly given if
and when properly addressed and posted by registered or certified mail,
postage prepaid.
12. Incorporation of Plan by Reference.
The option is granted pursuant to the terms of the Plan, the terms of
which are incorporated herein by reference, and the Option shall in all
respects be interpreted in accordance with the Plan. The Board shall
interpret and construe the Plan and this instrument, and its
interpretations and determinations shall be conclusive and binding on the
parties hereto and any other person claiming an interest hereunder, with
respect to any issue arising hereunder or thereunder.
13. Governing Law.
The validity, construction, interpretation and effect of this
instrument shall exclusively be governed by and determined in accordance
with the law of the State of Illinois.
OPTIONEE PIONEER RAILCORP
____________ By:______________
Its
STOCK OPTION AGREEMENT
Date of Grant _________:
THIS GRANT, dated as of the date of grant first stated above (the "Date of
Grant"), is delivered by Pioneer Railcorp ("Company") to (the "Optionee"), who
is a director of the Company.
WHEREAS, the Board of Directors of the Company (the "Board") on April 12,
1994, adopted, with stockholder approval, the Pioneer Railcorp Incentive Stock
Option Plan (the "Plan");
WHEREAS, the Plan provides for the granting of incentive stock options by
the Board to employees and directors of the Company to purchase, or to exercise
certain rights with respect to, shares of the Class A Common Stock of the
Company (the "Stock"), in accordance with the terms and provisions thereof; and
WHEREAS, the Board considers the optionee to be a person who is eligible
for a grant of incentive stock options under the Plan, and has determined that
it would be in the best interest of the Company to grant the incentive stock
options documented herein.
NOW, THEREFORE, the parties agree as follows:
1. Grant of option.
Subject to the terms and conditions hereinafter set forth, the Company
hereby grants to the Optionee, as of the Date of Grant, an option to purchase up
to _____shares of Stock at a price of $___ per share, the fair market value of
the Stock on the Date of Grant. Such option is hereinafter referred to as the
"Option" and the shares of stock purchasable upon exercise of the option are
hereinafter sometimes referred to as the "Option Shares."
The number of Option Shares shall be automatically increased by 10% if
the price condition in Section 2 is satisfied on or before December 31, 1995 and
shall be automatically increased by 5% if the price condition in Section 2 is
satisfied after December 31, 1995 but on or before December 31, 1996.
2. Exercise of Option.
No Option may be exercised unless and until the closing price of Stock is
at least $8.00 per share (as reported in the Wall Street Journal) for ten
consecutive days on or before December 31, 1997. Thereafter, Options may be
exercised at any time for five years, provided, however, that the aggregate fair
market value of Stock (as determined as of the Date of Grant) which first
becomes exercisable with respect to any optionee in any calendar year may not
exceed $100,000, regardless of the date the option is granted.
3. Termination of option.
(a) The Option and all rights hereunder with respect thereto, to
the extent such rights shall not have been exercised, shall terminate if the
price condition in Section 2 is not satisfied by December 31, 1997 or if and to
the extent the option is not otherwise exercised within five years thereafter.
(b) Upon the Optionee's termination as a director of the Company for any
reason other than death, the Optionee may, for a period of three months
thereafter, exercise any options which were exercisable on the date of
termination. Any option not so exercised shall terminate.
(C) In the event of the death of the optionee while a director of the Company,
the Option may be exercised by the optionee's legal representative or transferee
within one year following the optionee's death, but only to the extent that the
Option would otherwise have been exercisable during such period by the Optionee.
4. Exercise of Options.
(a) The optionee may exercise the Option with respect to all or
any part of the number of Option Shares then exercisable hereunder by giving the
Company written notice of intent to exercise. The notice of exercise shall
specify the number of Option Shares as to which the Option is to be exercised
and the date of exercise thereof.
(b) Full payment by the Optionee of the option price for the Option Shares
purchased shall be made in cash on or before the exercise date specified in the
notice of exercise.
On the exercise date specified in the optionee's notice or as soon
thereafter as is practicable, the Company shall cause to be delivered to the
Optionee, a certificate or certificates for the Option Shares then being
purchased upon full payment of such option Shares. The obligation of the
Company to deliver Stock shall, however, be subject to the condition that if
at any time the Board shall determine in its discretion that the listing,
registration or qualification of the Option or the Option Shares upon any
securities exchange or under any state or federal law, or the consent or
approval of any governmental regulatory body, is necessary or desirable as a
condition of, or in connection with, the Option or the issuance or purchase of
Stock thereunder, the Option may not be exercised in whole or in part unless
such listing, registration, qualification, consent or approval shall have been
affected or obtained free of any conditions not acceptable to the Board.
(C) If the Optionee fails to pay for any of the Option Shares specified in such
notice or fails to accept delivery thereof, the Optionee's right to purchase
such Option Shares may be terminated by the Company. The date specified in the
Optionee's notice as the date of exercise shall be deemed the date of exercise
of the option, provided that payment in full for the Option Shares to be
purchased upon such exercise shall have been received by such date.
(d) Optionee shall comply with such additional procedures for
exercise of the Option as are from time to time established by the
Board.
5. Adjustment of and Changes in Stock of the Company.
In the event of a reorganization, recapitalization, change of shares,stock
split, spin-off,stock dividend, reclassification, subdivision or combination of
shares, merger, consolidation, rights offering, or any other change in the
corporate structure or shares of capital stock of the Company, the Board shall
make such adjustment as it deems appropriate in the number and kind of shares of
Stock subject to the Option or in the option price; provided, however that such
adjustment shall give the Optionee any additional benefits under the Option.
6. Fair Market Value.
As used herein, the "fair market value" of a share of Stock shall be the closing
price per share of Stock on the Chicago Stock Exchange or other recognized
market source, as determined by the Board, on the applicable date of reference
hereunder, or if there is no sale on such date, then the closing price on the
last previous day on which a sale is reported. The fair market value of the
Stock on April 12, 1994 is $3.00 per share.
7. No Rights of Stockholders.
Neither the Optionee nor any personal representative shall be, or shall
have any of the rights or privileges of, a stockholder of the Company with
respect to any shares of Stock purchasable or issuable upon the exercise of the
Option, in whole or in part, prior to the date of exercise of the option.
8. Non-Transferability of Option.
During the Optionee's lifetime, the option hereunder shall be exercisable
only by the Optionee or any guardian or legal representative of the Optionee,
and the Option shall not be transferable except, in case of the death of the
Optionee, by will or the laws of descent and distribution.
9. Employment Not Affected.
Neither the grant of the option nor its exercise shall be construed as
granting to the optionee any right with respect to continued status as a
director with the Company.
10. Amendment of option.
The option may be amended by the Board at any time (i) if the Board
determines, in its sole discretion, that amendment is necessary or
advisable in light of the Internal Revenue Code of 1986 or in the
regulations issued thereunder, or any federal or state securities law or
other law or regulation or (ii) other than in the circumstances described
in clause (i), with the consent of the Optionee, unless the amendment would
not adversely affect the Optionee.
11. Notice.
Any notice to the Company provided for in this instrument shall be
addressed to it at its offices at Peoria, Illinois, and any notice to the
Optionee shall be addressed to the Optionee at the current address shown on
the records of the Company. Any notice shall be deemed to by duly given if
and when properly addressed and posted by registered or certified mail,
postage prepaid.
12. Incorporation of Plan by Reference.
The option is granted pursuant to the terms of the Plan, the terms of
which are incorporated herein by reference, and the Option shall in all
respects be interpreted in accordance with the Plan. The Board shall
interpret and construe the Plan and this instrument, and its
interpretations and determinations shall be conclusive and binding on the
parties hereto and any other person claiming an interest hereunder, with
respect to any issue arising hereunder or thereunder.
13. Governing Law.
The validity, construction, interpretation and effect of this
instrument shall exclusively be governed by and determined in accordance
with the law of the State of Illinois.
OPTIONEE PIONEER RAILCORP
____________ By:______________
Its
January 25, 1996
To the Board of Directors
Pioneer Railcorp
Peoria, Illinois
Gentlemen:
It is my opinion that the Shares proposed to be sold to option-holders are
authorized and that, when said options are exercised in a timely and proper
manner, said shares will be validly existing, fully paid and non-assessable
shares of the Class A Common Stock of the Company.
Sincerely yours,
/s/Daniel A. LaKemper,
General Counsel.
January 25, 1996
To the Board of Directors
Pioneer Railcorp
Peoria, Illinois
Gentlemen:
I hereby consent to the use in the Company's Registration Statement, Form S-8,
of my opinion as to the legality of the shares being offered, and to the
reference to me under the caption "Experts" in the Prospectus.
Sincerely yours,
/s/Daniel A. LaKemper,
General Counsel.
MCGLADREY&PULLEN, LLP
Certified Public Accountants and Consultants
INDEPENDENT AUDITOR'S CONSENT
We hereby consent to the incorporation by reference in this Form S-8
Registration Statement of our report dated February 22, 1995, except for
Note 12, as to which the date is September 18, 1995, on the financial statements
of Pioneer Railcorp (the "Registrant") as of and for the year ended
December 31, 1994, which report and statements appear in the Registrant's
Annual Report on Form 10-KSB (as amended) for the year ended December 31, 1994.
/S/ MCGLADREY & PULLEN, , LLP
Peoria, Illinois
January 26, 1996
PASQUALE & BOWERS
Certified Public Accountants
90 Presidential Plaza, Suite 210
Syracuse, New York 13202
To the Board of Directors
Pioneer Railcorp
Peoria, Illinois
We hereby consent to the use, in this Registration Statement, of our report,
dated March 5, 1994, relating to the consolidated financial statements of
Pioneer Railcorp and Subsidiaries, and to the reference to our Firm under
the caption "Experts" in the Prospectus.
/s/ PASQUALE & BOWERS
Syracuse, New York
January 24, 1996
