Registration No. 333-
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
Registration Statement
under
The Securities Act of 1933
RIGHT MANAGEMENT CONSULTANTS, INC.
(Exact name of registrant as specified in its charter)
Pennsylvania 23-2153729
(State of incorporation) (I.R.S. Employer Identification No.)
1818 Market Street, Philadelphia, Pennsylvania 19103
(Address of principal executive offices)(Zip Code)
1993 STOCK INCENTIVE PLAN, AS AMENDED
(Full title of the plan)
G. Lee Bohs, Chief Financial Officer, Treasurer and Secretary
Right Management Consultants, Inc.
1818 Market Street, 33rd Floor
Philadelphia, Pennsylvania 19103
(Name and address of agent for service)
(215) 988-1588
(Telephone number, including area code, of agent for service)
With a copy to:
Theodore A. Young, Esquire
Fox, Rothschild, O'Brien & Frankel, LLP
2000 Market Street
10th Floor
Philadelphia, PA 19103-3291
(215) 299-2802
<PAGE>
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
===============================================================================================================
Proposed Maximum Proposed Maximum
Title of Securities to No. of Shares Offering Price Per Aggregate Offering Amount of
be Registered to be Registered Share(1) Price Registration Fee
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, 750,000 (2) $ 14.094 $ 10,570,500 $ 2,938.60
$.01 par value
===============================================================================================================
<FN>
(1) Estimated solely for purposes of calculating the registration fee. The
proposed maximum aggregate offering price has been computed pursuant to
Rule 457(h) under the Securities Act of 1933, as amended (the
"Securities Act"), based upon the average of the high and low prices of
Registrant's Common Stock, as reported by the National Association of
Securities Dealers, Inc. Automated Quotation System on July 28, 1999.
(2) In addition, this registration statement also covers an indeterminate
number of additional shares that are issuable pursuant to the
anti-dilution provisions of 1993 Stock Incentive Plan, as amended.
</FN>
</TABLE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
This registration statement is being filed with the Securities and Exchange
Commission to register the additional 750,000 shares (plus an indeterminate
number of additional shares that are issuable pursuant to anti-dilution
provisions) of Registrant's Common Stock that are issuable as a result of an
amendment to Registrant's 1993 Stock Incentive Plan (such Plan, as amended, the
"Plan") approved by Registrant's shareholders on May 6, 1999. A registration
statement on Form S-8 (File no. 33-58698) was filed on February 23, 1993 in
respect of the 350,000 shares of Common Stock that were issuable under the 1993
Stock Option Plan, as originally adopted. A registration statement on Form S-8
(File no. 33-62997) (the "Incorporated Registration Statement") was filed on
September 28, 1995 to increase the number of shares eligible for issuance under
the plan to 700,000 and to rename the plan as the 1993 Stock Incentive Plan. An
additional registration statement on Form S-8 (File no. 333-06211) was filed on
June 18, 1996 to register an additional 600,000 shares. The Incorporated
Registration Statement is currently effective. Except as noted with reference to
Item 6 and Item 9 below, the contents of the Incorporated Registration Statement
are incorporated into this registration statement by reference pursuant to Rule
E of the General Instructions to Form S-8.
<PAGE>
Item 6. Indemnification of Directors and Officers.
Subchapter D (Sections 1741 through 1750) of Chapter 17 of the
Pennsylvania Business Corporation Law of 1988, as amended (the "BCL"), contains
provisions for mandatory and discretionary indemnification of a corporation's
directors, officers, employees and agents (collectively "Representatives"), and
related matters.
Under Section 1741, subject to certain limitations, a corporation has
the power to indemnify directors, officers and other Representatives under
certain prescribed circumstances against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement, actually and reasonably
incurred in connection with a threatened, pending or completed action or
proceeding, whether civil, criminal, administrative or investigative, to which
any of them is a party or threatened to be made a party by reason of his being a
Representative of the corporation or serving at the request of the corporation
as a Representative of another corporation, partnership, joint venture, trust or
other enterprise, 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 proceeding, had no reasonable cause to believe his
conduct was unlawful.
Section 1742 provides for indemnification with respect to derivative
actions similar to that provided by Section 1741. However, indemnification is
not provided under Section 1742 in respect of any claim, issue or matter as to
which a Representative has been adjudged to be liable to the corporation unless
and only to the extent that the proper court determines upon application that,
despite the adjudication of liability but in view of all the circumstances of
the case, a Representative is fairly and reasonably entitled to indemnity for
the expenses that the court deems proper.
Section 1743 provides that indemnification against expenses is
mandatory to the extent that a Representative has been successful on the merits
or otherwise in defense of any such action or proceeding referred to in Section
1741 or 1742.
Section 1744 provides that unless ordered by a court, any
indemnification under Section 1741 or 1742 shall be made by the corporation as
authorized in the specific case upon a determination that indemnification of a
Representative is proper because the Representative met the applicable standard
of conduct, and such determination will be made: (i) by the board of directors
by a majority vote of a quorum of directors not parties to the action or
proceeding; (ii) if a quorum is not obtainable or if obtainable and a majority
of disinterested directors so directs, by independent legal counsel; or (iii) by
the shareholders.
Section 1745 provides that expenses incurred by a Representative in
defending any action or proceeding referred to in Subchapter D of Chapter 17 of
the BCL may be paid by the corporation in advance of the final disposition of
such action or proceeding upon receipt of an undertaking by or on behalf of the
Representative to repay such amount if it shall ultimately be determined that he
is not entitled to be indemnified by the corporation.
<PAGE>
Section 1746 provides generally that except in any case where the act
or failure to act giving rise to the claim for indemnification is determined by
a court to have constituted willful misconduct or recklessness, the
indemnification and advancement of expenses provided by Subchapter D of Chapter
17 of the BCL shall not be deemed exclusive of any other rights to which a
Representative seeking indemnification or advancement of expenses may be
entitled under any bylaw, agreement, vote of shareholders or disinterested
directors or otherwise, both as to action in his official capacity and as to
action in another capacity while holding that office. Section 1746 also
authorizes a corporation to create a fund or otherwise secure or insure in any
manner its indemnification obligations.
Section 1747 grants a corporation the power to purchase and maintain
insurance on behalf of any Representative against any liability asserted against
him and incurred by him in his capacity as a Representative, or arising out of
his status as such, whether or not the corporation would have the power to
indemnify him against that liability under Subchapter D of Chapter 17 of the
BCL.
Sections 1748 and 1749 apply the indemnification and advancement of
expenses provisions contained in Subchapter D of Chapter 17 of the BCL to
successor corporations resulting from consolidation, merger or division and to
service as a Representative of a corporation or an employee benefit plan.
Section 1750 provides that the indemnification and advancement of
expenses pursuant to Subchapter D of Chapter 17 of the BCL shall continue as to
a person who has ceased to be a Representative and shall inure to the benefit of
the heirs and personal representative of that person.
Section 8.2(a)(i) of Registrant's Bylaws, as amended (the "Bylaws"),
provides that Registrant will indemnify and hold harmless any director or
officer of the Registrant for all actions taken by him or her and for all
failures to take action to the fullest extent permitted by Pennsylvania law
against all expense, liability and loss (including legal fees), fees, judgments,
fines, taxes, penalties and amounts paid in settlement actually and reasonably
incurred by such person in connection with any threatened, pending or completed
action, suit or proceeding whether civil, criminal, administrative or
investigative, involving such person by reason of the fact that he or she is or
was a director or officer of Registrant or is or was serving at the request, or
for the benefit of, Registrant in any capacity for another corporation or other
enterprise. However, no indemnification will be made in any case where the act
or failure to act is determined by a court to have constituted willful
misconduct or recklessness.
Section 8.2(a)(ii) of Registrant's Bylaws provides that the right to
indemnification includes the right to have the expenses incurred by the
indemnified person in defending any Proceeding paid by Registrant in advance of
the final disposition of the Proceeding upon receipt of an undertaking by the
indemnified person to repay such advances unless it is ultimately determined
that he or she is entitled to be indemnified by Registrant as authorized by law.
<PAGE>
Section 8.2 (a)(iii) of Registrant's Bylaws further provides that
indemnification shall continue as to former directors and officers or others who
ceased to render services for or at the request of the Registrant and shall
inure to the benefit of the heirs, executors and administrators of such persons.
Section 8.2(b) of Registrant's Bylaws provides that the Board of
Directors by resolution may similarly indemnify any person other than a director
or officer to the fullest extent permitted by law for liabilities incurred by
him or her in connection with services rendered by him for or at the request of
Registrant.
Section 8.2(c) of Registrant's Bylaws states that it shall not be
deemed to provide the exclusive rights to which any person may have or hereafter
acquire under any statute, provision of Registrant's Articles of Incorporation
or By-Laws, agreement, vote of shareholders or directors or otherwise.
Section 8.2(d) of Registrant's Bylaws provides that Registrant may
purchase and maintain insurance, at its expense, for the benefit of any person
on behalf of whom insurance is permitted to be purchased by Pennsylvania law
against expense, liability or loss, whether or not Registrant would have the
power to indemnify such person under Pennsylvania or other law. Registrant may
also purchase and maintain insurance to insure its indemnification obligations
whether arising hereunder or otherwise.
In addition, Registrant has purchased directors and officers liability
insurance for its directors and officers.
Item 8. Exhibits.
The following exhibits are filed as part of this registration statement:
Exhibit No. Description
4 1993 Stock Incentive Plan, as amended
5 Opinion of Fox, Rothschild, O'Brien & Frankel, LLP
23.1 Consent of Arthur Andersen LLP, independent public accountants
23.2 Consent of Fox, Rothschild, O'Brien & Frankel, LLP (contained
in Exhibit 5)
24 Power of Attorney (included on signature page of the
registration statement)
Item 9. Undertakings.
Registrant's undertaking in (a)(2) is revised to read in full as
follows:
(a) (2) to reflect in the prospectus any facts or events arising after
the effective date of this 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 this registration
statement. Notwithstanding the foregoing, any increase or decrease in the volume
of securities offered (if the total dollar value of securities offered would not
exceed that which was registered) and any deviation from the low or high end of
<PAGE>
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;
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, 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 Philadelphia, Pennsylvania, on August 3, 1999.
RIGHT MANAGEMENT CONSULTANTS, INC.
By:/s/ G. Lee Bohs
G. Lee Bohs
Chief Financial Officer and Principal
Accounting Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Richard J. Pinola and G. Lee Bohs, 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, and to file the same, with all
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange 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 of 1933, this
registration statement has been signed below by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
<S> <C> <C>
/s/ Richard J. Pinola Chairman of the Board August 3, 1999
Richard J. Pinola and Chief Executive Officer
/s/ G. Lee Bohs Chief Financial Officer and August 3, 1999
G. Lee Bohs Principal Accounting Officer
/s/ Joseph T. Smith Vice Chairman of August 3, 1999
Joseph T. Smith the Board
/s/ John J. Gavin President, Chief Operating August 3, 1999
John J. Gavin Officer and Director
<PAGE>
/s/ Frank P. Louchheim Founding Chairman August 3, 1999
Frank P. Louchheim of the Board
/s/ Larry A. Evans Executive Vice President August 3, 1999
Larry A. Evans and Director
Executive Vice President August 3, 1999
Marti D. Smye and Director
Director August 3, 1999
John R. Bourbeau
/s/ Raymond B. Langton Director August 3, 1999
Raymond B. Langton
/s/ Rebecca J. Maddox Director August 3, 1999
Rebecca J. Maddox
/s/ Catherine Y. Selleck Director August 3, 1999
Catherine Y. Selleck
/s/ Frederick R. Davidson Director August 3, 1999
Frederick R. Davidson
</TABLE>
<PAGE>
RIGHT MANAGEMENT CONSULTANTS, INC.
1993 STOCK INCENTIVE PLAN, AS AMENDED
REGISTRATION STATEMENT ON FORM S-8
EXHIBIT INDEX
Exhibit No. Description
4 1993 Stock Incentive Plan, as amended
5 Opinion of Fox, Rothschild, O'Brien & Frankel, LLP
23.1 Consent of Arthur Andersen LLP, independent public accountants
23.2 Consent of Fox, Rothschild, O'Brien & Frankel, LLP
(contained in Exhibit 5)
24 Power of Attorney (included on signature page of the
registration statement)
EXHIBIT 4
<PAGE>
RIGHT MANAGEMENT CONSULTANTS, INC.
1993 STOCK INCENTIVE PLAN
As Amended March 26, 1999 and
Approved by Shareholders May 6, 1999
(formerly the "1993 Stock Option Plan")
1. Purpose. This 1993 Stock Incentive Plan (the "Plan") is intended to recognize
the contributions made to the Company by key employees (including employees who
are members of the Board of Directors) of the Company or any Affiliate and
independent contractors who are managing principals of one or more of the
Company's franchisees, to provide such persons with additional incentive to
devote themselves to the future success of the Company or an Affiliate, and to
improve the ability of the Company or an Affiliate to attract, retain, and
motivate individuals upon whom the Company's sustained growth and financial
success depend, by providing such persons with an opportunity to acquire or
increase their proprietary interest in the Company through receipt of Restricted
Stock (as defined below) of the Company and/or rights to acquire the Company's
Common Stock, par value $.01 per Share (the "Common Stock") in accordance with
the terms of the Plan. In addition, the Plan is intended as additional incentive
to directors of the Company who are not employees of the Company or an Affiliate
to devote themselves to the future success of the Company by providing them with
an opportunity to acquire or increase their proprietary interest in the Company
through the receipt of Options to acquire Common Stock in accordance with the
terms of the Plan.
2. Definitions. Unless the context clearly indicates otherwise, the following
terms shall have the following meanings:
(a) "Affiliate" means 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.
(b) "Award" means an award of an Option and/or Restricted Stock granted pursuant
to the Plan.
(c) "Award Document" means either an Option Document or a Restricted Stock
Document or both.
(d) "Board of Directors" means the Board of Directors of the Company.
(e) "Change of Control" shall have the meaning as set forth in Section 9 of the
Plan.
(f) "Code" means the Internal Revenue Code of 1986, as amended.
(g) "Committee" means the committee consisting of at least two (2) members of
the Board of Directors who satisfy the requirement of Section 3(a) of the Plan
appointed by the Board of Directors from time to time to administer the Plan
pursuant to Section 3 of the Plan.
(h) "Company" means Right Management Consultants, Inc., a Pennsylvania
corporation.
<PAGE>
(i) "Disability" means a physical or mental impairment sufficient to make the
individual eligible for benefits under the Long-Term Disability Plan of the
Company (whether or not a participant in such plan), provided such impairment
also constitutes a "disability" within the meaning of Section 22(e)(3) of the
Code.
(j) "Fair market Value" shall have the meaning set forth in Subsection 8(a) (ii)
of the Plan.
(k) "ISO" means an Option granted under the Plan which is intended to qualify as
an "incentive stock option" within the meaning of Section 422(b) of the Code.
(l) "Non-employee Director" means a member of the Board of Directors who is not
an employee of the Company or an Affiliate.
(m) "Non-qualified Stock Option" means an Option granted under the Plan which is
not intended to qualify, or otherwise does not qualify, as an "incentive stock
option" within the meaning of Section 422(b) of the Code.
(n) "Option" means either an ISO or a Non-qualified Stock Option granted under
the Plan.
(o) "Optionee" means a person to whom an Option has been granted under the Plan,
which Option has not been exercised and has not expired or terminated.
(p) "Option Document" means the document described in Section 8(a) of the Plan,
as applicable, which sets forth the terms and conditions of each grant of
Options.
(q) "Option Price" means the price at which Shares may be purchased upon
exercise of an option, as calculated pursuant to subsection 8(a)(ii) of the
Plan.
(r) "Participant" means a person who holds an option or Restricted Stock.
(s) "Plan Shares" means the shares of Common Stock of the Company which have
been, or may be, issued pursuant to the Plan.
(t) "Restricted Stock" means Common Stock granted pursuant to Section 8(b) of
the Plan that is subject to a risk of forfeiture in accordance with the terms of
such grant.
(u) "Restricted Stock Document" means the document described in Section 8(b) of
the Plan which sets forth the terms and conditions of each grant of Restricted
Stock.
(v) "Rule 16b-3" means Rule 16b-3 promulgated under the Securities Exchange Act
of 1934, as amended.
(w) "Shares" means the shares of Common Stock of the Company which are the
subject of options.
<PAGE>
3. Administration of the Plan.
(a) General. The Plan shall be administered by the Committee which shall at all
times consist of two (2) or more persons, each of whom shall be members of the
Board of Directors. Each member of the Committee shall be a disinterested person
(as such term is defined in Rule 16b-3) and an "outside director" within the
meaning of Section 162(m) of the Code and applicable interpretive authority
thereunder. The Board of Directors may from time to time remove members from, or
add members to, the Committee. Vacancies on the Committee, howsoever caused,
shall be filled (or eliminated, consistent with the first sentence of this
Section 3(a) by the reduction of the size of the Committee) by the Board of
Directors.
(b) Meetings. 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.
(c) Grants. The Committee shall from time to time at its discretion grant Awards
pursuant to the terms of the Plan. The Committee shall have plenary authority to
(i) determine the individuals to whom, and the times at which, the Awards shall
be granted, (ii) determine the type of Award to be granted and the number of
Shares and/or amount of Restricted Stock subject thereto, (iii) if an option is
granted, determine the Option Price, its terms and the period or periods when
such option is exercisable, and (iv) approve the form and terms and conditions
of the Award Documents; all subject, however, to the express provisions of the
Plan. In making such determinations, the Committee may take into account the
nature of the individual's services and responsibilities, the individual'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 provisions of the Plan or of any Awards granted under it shall
be final, binding and conclusive. Notwithstanding the foregoing, no single
individual shall receive, in any calendar year, Awards entitling such individual
to more than 10% of the Plan Shares.
(d) Exculpation. No member of the Committee shall be personally liable for
monetary damages as such for any action taken or any failure to take any action
in connection with the administration of the Plan or the granting of Awards
thereunder unless (i) the member of the Committee has breached or failed to
perform the duties of his office under Subchapter B of Chapter 17 of the
Pennsylvania Business Corporation Law of 1988, as amended, and (ii) the breach
or failure to perform constitutes self-dealing, willful misconduct or
recklessness; provided, however, that the provisions of this Subsection 3(d)
shall not apply to the responsibility or liability of a member of the Committee
pursuant to any criminal statute or to the liability of a member of the
Committee for the payment of taxes pursuant to local, state or federal law.
(e) Indemnification. Service on the Committee shall constitute service as a
member of the Board of Directors of the Company. Each member of the Committee
shall be entitled without further act on his part to indemnity from the Company
to the fullest extent provided by applicable law and the Company's Articles of
Incorporation and/or By-laws in connection with or arising out of any action,
suit or proceeding with respect to the administration of the Plan or the
granting of Awards thereunder in which he or she may be involved by reason of
his or her being or having been a member of the Committee, whether or not he or
<PAGE>
she continues to be such member of the Committee at the time of the action, suit
or proceeding.
4. Grants under the Plan. The Committee may grant any of the following types of
Awards, either singly, in tandem or in any combination as the Committee may in
its sole discretion determine:
(a) Options, in the form of Non-qualified Stock Options or ISOs or any
combination thereof; and
(b) Restricted Stock.
5. Eligibility. Subject to the limitations set forth in this Section 5, all key
employees and independent contractors who are managing principals of one or more
of the Company's franchisees and members of the Board of Directors who are not
then serving as members of the Committee shall be eligible to receive Awards
hereunder. The Committee, in its sole discretion, shall determine whether an
individual is eligible to be granted Awards hereunder. Only employees or
employee directors may be granted an ISO or Restricted Stock.
6. Shares Subject to Plan. The aggregate maximum number of shares for which
Options may be granted or Restricted Stock issued pursuant to the Plan is
3,225,000 shares of common stock, subject to adjustment or amendment as provided
in Sections 10 and 11 of the Plan. No more than Three Hundred Thousand (300,000)
of the Plan Shares, as such number may be adjusted as provided in Sections 10
and 11 of the Plan, shall become permanently issued (i.e., cease to be subject
to risk of forfeiture) as a result of Awards of Restricted Stock. Plan Shares
not issued in the form of Restricted Stock (including all or any portion of the
Plan Shares available for issuance as Restricted Stock Awards) may be issued
pursuant to Options. The Plan Shares shall be issued from authorized and
unissued Common Stock or Common Stock held in or hereafter acquired for the
treasury of the Company. If an Option terminates, is canceled or expires without
having been fully exercised for any reason or if Restricted Stock is forfeited
for any reason, the Shares underlying the unexercised portion of the Option
and/or the forfeited Restricted Stock as the case may be, may again be the
subject of one or more Awards granted pursuant to the Plan.
7. Term of the Plan. The Plan is effective as of October 28, 1992, the date on
which it was adopted by the Board of Directors. The Plan was approved by the
shareholders of the Company on December 16, 1992. An amendment to the Plan to
increase the number of shares of common stock eligible for issuance under the
Plan to 700,000 was approved by shareholders on May 4, 1994. Amendments to the
Plan to, among other things, implement a restricted stock feature were approved
by shareholders on May 4, 1995. An amendment to the Plan to increase the number
of shares of common stock eligible for issuance under the Plan by 600,000 was
approved by shareholders on May 9, 1996. A further amendment to the Plan to
increase the number of shares of common stock eligible for issuance under the
Plan by 750,000 was approved by shareholders on May 6, 1999. No option may be
granted under the Plan after December 31, 2003.
8. Award Documents and Terms.
(a) Options. Each Option granted under the Plan shall specify whether or
not it is intended to qualify as an incentive stock option ("ISO"). Options
granted pursuant to the Plan shall be evidenced by the option Documents in such
form as the Committee shall from time to time approve, which Option Documents
<PAGE>
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 the terms of the Plan:
(i) Number of Option Shares. Each option Document shall state the number of
Shares to which it pertains. An Optionee may receive more than one Option, which
may include Options which are intended to be ISOs and Options which are not
intended to be ISOs, but only on the terms and subject to the conditions and
restrictions of the Plan.
(ii) Option Price. Each Option Document shall state the Option Price which,
for a Non-qualified Stock Option, may be less than, equal to, or greater than
the Fair Market Value of the Shares on the date the Option is granted, but in no
case less than eighty-five percent (85%) of such Fair Market Value, and, for an
ISO, shall be at least 100% of the Fair Market Value of the Shares on the date
the Option is granted as determined by the Committee in accordance with this
Subsection 8(a)(ii); 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 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 date the Option is granted, 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, 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.
(iii) 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 Shares to be purchased. Each such notice shall
specify the number of Shares to be purchased and shall (unless Shares are
covered by a then current registration statement or a Notification under
Regulation A under the Securities Act of 1933, as amended (the "Act")) contain
the Optionee's acknowledgment in form and substance satisfactory to the Company
that (a) such 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 Shares have not 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 Shares under the Act or to take any action which would make available to the
Optionee any exemption from such registration, (c) such 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 foregoing, if the Company
determines that issuance of Shares should be delayed pending (A) registration
under federal or state securities laws, (B) the receipt of an opinion of counsel
satisfactory to the Company that an appropriate exemption from such registration
is available, (C) the listing or inclusion of the Shares on any securities
exchange or an automated quotation system or (D) the consent or approval of any
<PAGE>
governmental regulatory body whose consent or approval is necessary in
connection with the issuance of such Shares, the Company may defer exercise of
any Option granted hereunder until any of the events described in this sentence
has occurred.
(iv) Medium of Payment. An Optionee shall pay for Shares (i) in cash, or
(ii) 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
Company's Common Stock. If payment is made in whole or in part in shares of the
Company's Common Stock, then the Optionee shall deliver to the Company
certificates registered in the name of such Optionee representing the shares
owned by such Optionee, free of all liens, claims and encumbrances of every kind
and having an aggregate Fair Market Value on the date of delivery that is at
least as great as the Option Price of the Shares (or relevant portion thereof)
with respect to which such option is to be exercised by the payment in shares of
Common Stock, endorsed in blank or accompanied by stock powers duly endorsed in
blank by the Optionee. Notwithstanding the foregoing, Company Common Stock which
is identified as having been obtained through an option under this Plan and
still subject to the holding rules applicable to ISOs under the Code may not be
tendered in payment of the Option Price. 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 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 (i) the Shares in respect of
which payment is made, and (ii) such excess number of shares. Notwithstanding
the foregoing, the Committee may impose from time to time such limitations and
prohibitions on the use of shares of the Common Stock to exercise an Option as
it deems appropriate.
(v) Termination of Options.
(A) No Option shall be exercisable after the first to occur of the following:
(1) Expiration of the Option term specified in the Option Document, which shall
not occur after (i) ten years from the date of grant, or (ii) five years from
the date of grant of an ISO 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 (10%) of the total combined voting power of all classes of stock of
the Company or an Affiliate;
(2) Expiration of three months from the date the Optionee's employment or
service with the Company or its Affiliates terminates for any reason other than
Disability or death or as otherwise specified in Subsection 8(a)(v)(A)(4) or 8
(a) (v) (A) (5) below;
(3) Expiration of one year from the date such employment or service with the
Company or its Affiliates terminates due to the Optionee's Disability or death;
(4) A finding by the Committee that the Optionee (i) has become employed without
the Company's or an Affiliate's consent by a competitor of the Company or an
Affiliate, or has become engaged in competition with the Company or an
Affiliate, (ii) has divulged without the consent of the Company or an Affiliate
any secret or confidential information belonging to the Company or an Affiliate,
<PAGE>
(iii) has been dishonest or fraudulent in any matter affecting the Company, (iv)
committed any act which, in the sole judgment of the Committee, has been
substantially detrimental to the interests of the Company or (v) was terminated
for other reasons which would constitute cause under applicable law. The Company
shall give an Optionee written notice of the occurrence of any such event prior
to making any such determination. The determination of the Committee as to the
occurrence of any of the events specified in this paragraph shall be conclusive
and binding upon all persons for all purposes. In the event the Committee
determines that any such event as specified in this paragraph has occurred, in
addition to immediate termination of the Options held by the Optionee, the
Optionee shall automatically forfeit all Shares for which the Company has not
yet delivered the share certificates upon refund by the Company of the Option
Price. Notwithstanding anything herein to the contrary, the Company may withhold
delivery of share certificates pending the resolution of any inquiry that could
lead to a finding resulting in a forfeiture.
(5) The date, if any, set by the Board of Directors as an accelerated expiration
date in the event of the liquidation or dissolution of the Company.
(B) Notwithstanding the foregoing, the Committee may extend the period during
which all or any portion of an option may be exercised to a date no later than
the Option term specified in the Option Document pursuant to Subsection
8(a)(v)(A)(1), provided that any change pursuant to this Subsection 8(a)(v)(B)
which would cause an ISO to become a Non-qualified Stock Option may be made only
with the consent of the Optionee.
(vi) 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.
(vii) Holding Period. No Option granted under the Plan may be
exercised before the later of (i) the expiration of six months from the
date of grant, (ii) the expiration of six months following the date the
Plan is approved by the Company's shareholders or (iii) the expiration
of such greater period of time as may be specified in the Option
Documents.
(viii) Limitation on Grants. In no event shall the aggregate
fair market value of the shares of Common Stock (determined at the time
the ISO is granted) with respect to which ISOs under all incentive
stock option plans of the Company or its Affiliates are exercisable for
the first time by the optionee during any calendar year exceed
$100,000.
(ix) Other Provisions. Subject to the provisions of the Plan,
the option Documents shall contain such other provisions including,
without limitation, provisions authorizing the Committee to accelerate
the exercisability of all or any portion of an Option granted pursuant
to the Plan, and such additional restrictions upon the exercise of the
option or additional limitations upon the term of the Option, as the
Committee shall deem advisable. Subject to Sections 8(a)(v) and 8(a)(x)
and the general limitations on options contained herein, the Board of
Directors may authorize adjustments of an Option granted under the Plan
<PAGE>
with respect to the Option Price, the number of Shares, the term and
any restrictions. Such adjustments may be accomplished by cancellation
of an outstanding Option and a subsequent regranting of an Option, by
amendment, or by substitution of an outstanding Option and may result
in an Option Price which is higher but not lower than the Option Price
of the prior Option, provide for a greater or lesser number of Shares
subject to the Option, or provide for a longer or shorter term than the
prior option. The prohibition on the reduction of the option Price
contained in the preceding sentence shall not apply to adjustments made
to reflect changes in capitalization as contemplated by Section 10.
(x) 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 pursuant to Subsection
8(a)(v)(A)(5) or Section 10 of the Plan, as applicable.
(b) Restricted Stock. Restricted Stock granted pursuant to the Plan
shall be evidenced by the Restricted Stock Documents (which shall include the
stock certificate(s) evidencing such Restricted Stock and such other documents
as the Committee shall determine with respect to each Award of Restricted Stock)
in such form(s) as the Committee shall from time to time approve, which
Restricted Stock Documents shall, to the extent applicable, 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 the terms of the Plan.
(i) Amount of Restricted Stock. The Restricted Stock Documents
shall state the amount of Restricted Stock to which they pertain.
(ii) Issuance and Restrictions. Restricted Stock shall be
subject to such restrictions on transferability and other restrictions,
if any, as the Committee may impose, which restrictions may lapse
separately or in combination at such time(s), under such circumstances,
in such installments, or otherwise, as the Committee may determine.
Except to the extent restricted under the terms of the Plan and the
applicable Restricted Stock Documents, a Participant granted Restricted
Stock shall have all rights of a shareholder of the Company with
respect to the Restricted Stock issued in the name of such Participant
and then outstanding, including, without limitation, the right to vote
such Restricted Stock and the right to receive dividends thereon.
(iii) Forfeiture. Except as otherwise determined by the
Committee, upon termination of the employment of a Participant during a
period when the Restricted Stock of such Participant is subject to
forfeiture under the Restricted Stock Documents applicable thereto,
such Restricted Stock shall be forfeited and reacquired by the Company;
provided, however, that the Committee may provide, by rule or
regulation or in any Restricted Stock Document, or may determine in any
individual case, that restrictions or forfeiture conditions relating to
Restricted Stock will be waived in whole or in part in the event of
terminations resulting from specified causes, and the Committee may in
other cases waive in whole or in part the forfeiture of Restricted
Stock.
<PAGE>
(iv) Certificates. Restricted Stock granted under the Plan
shall be evidenced by one or more stock certificates as determined by
the Committee. Each such certificate shall be registered in the name of
the Participant and such certificates shall bear an appropriate legend
referring to the terms, conditions, and restrictions applicable to such
Restricted Stock. The Company shall retain physical possession of the
certificate(s) so long as the Plan Shares evidenced thereby are subject
to forfeiture and the Participant shall (as a condition precedent to
the issuance of a Restricted Stock Award) deliver a stock power to the
Company, endorsed in blank, relating to the Restricted Stock to be
issued. At the expiration of the applicable restriction period, the
Company shall release to the Participant (or the Participant's legal
representative or designated beneficiary) the certificate(s)
representing the Restricted Stock with respect to which the applicable
restrictions have been satisfied.
(v) Dividends. The Committee, in its sole discretion, may
permit or require the payment of dividends on the Restricted Stock to
be automatically reinvested in additional Restricted Stock or other
investment vehicles. Unless otherwise determined by the Committee,
Common Stock distributed as a dividend or otherwise distributed in
connection with the Restricted Stock shall be subject to the same
restrictions and risk of forfeiture as the Restricted Stock with
respect to which such Common Stock has been distributed.
(vi) Minimum Holding Period. Restricted Stock granted under
the Plan may not be transferred, sold or otherwise disposed of, by the
Participant before the later of (i) the expiration of six months from
the date of grant, or (ii) the expiration of six months following the
date the amendments to the Plan adopting the Restricted Stock
provisions are approved by the Company's Shareholders.
9. Change of Control. In the event of a Change of Control, the Committee may
take whatever action it deems necessary or desirable with respect to the Options
and Restricted Stock outstanding. Such action includes, 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 given to the Optionees or accelerating the restriction periods in
the respective Restricted Stock Documents. 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 shareholders of the
Company (or the Board of Directors, if shareholder 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 shareholders of the Company (or
the Board of Directors, if shareholder 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 shareholders of the Company (or the
Board of Directors, if shareholder action is not required) and the shareholders
of the other constituent corporation (or its board directors if shareholder
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 Company's Common Stock immediately prior to the merger or consolidation
will have 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
<PAGE>
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 of the Company 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) the chief executive
officer immediately prior to the determination of whether a Change of Control
has occurred or any "group" of which such chief executive officer is a member or
any entity of which such chief executive officer owns 25% or more of the voting
interests, shall have become the beneficial owner of, or shall have obtained
voting control over, more than twenty-five percent (25%) of the outstanding
shares of the Company's 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 two
(2) years, unless the nomination for election of each new director who was not a
director at the beginning of such two (2) year 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.
10. Adjustments on Changes in Capitalization. The aggregate number of Shares and
class of shares as to which options may be granted hereunder, the number and
class or classes of shares covered by each outstanding Option and the Option
Price thereof, the Restricted Stock outstanding and the amount of uncommitted
Plan Shares remaining subject to the Plan shall be appropriately adjusted in the
event of a stock dividend, stock split, recapitalization or other change in the
number or class of issued and outstanding equity securities of the Company
resulting from a subdivision or consolidation of the Common Stock and/or, if
appropriate, other outstanding equity securities or a recapitalization 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)
affecting the Common Stock which is 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. Fractional shares resulting from any adjustment
pursuant to this Section 10 may be settled in cash or otherwise as the Committee
shall determine.
11. 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 of the Company may not amend the Plan to (i) change the class of
individuals eligible to receive an ISO, (ii) permit the Board to reduce the
Option Price of outstanding options other than for adjustments in capitalization
as contemplated by Section 10, (iii) increase the maximum number of Plan Shares,
or (iv) make any other change or amendments to which shareholder approval is
required in order to satisfy the conditions set forth in Rule 16b-3 without
obtaining approval of such amendments, within twelve months before or after such
action, by vote of a majority of the votes cast at a duly called meeting of the
shareholders at which a quorum representing a majority of all outstanding voting
stock of the Company is, either in person or by proxy, present and voting on the
matter. In the future the Plan may be amended by the Board of Directors to
provide for the granting of Options to Non-employee Directors pursuant to a
formula which satisfies the requirements of Rule 16b-3(c)(2)(ii) of the
Securities Exchange Act of 1934. No amendment to the Plan shall adversely affect
any outstanding Option or Restricted Stock, however, without the consent of the
Optionee or the holder of Restricted Stock, as the case may be.
<PAGE>
12. No Commitment to Retain. The grant of an Award pursuant to the Plan shall
not be construed to imply or to constitute evidence of any agreement, express or
implied, on the part of the Company or any Affiliate to retain the Participant
in the employ of the Company or an Affiliate and/or as a member of the Company's
Board of Directors or in any other capacity.
13. Designation of Beneficiary. Each Participant may designate a beneficiary or
beneficiaries (on a form supplied by the Committee) to exercise his Options
and/or receive any payments as may be due under the Plan to such beneficiary or
beneficiaries in the event of the Participant's death, and may change such
designation from time to time and at any time prior to the death of such
Participant.
14. Withholding of Taxes. Whenever the Company proposes or is required to
deliver Restricted Stock certificates or deliver or transfer shares in
connection with the exercise of an Option, or whenever the Company is otherwise
obligated to withhold taxes in connection with an Option or Restricted Stock,
the Company shall have the right to (a) require the recipient to remit or
otherwise make available to the Company an amount sufficient to satisfy any
federal, state and/or local withholding tax requirements prior to delivery or
transfer of any certificate or certificates for such Restricted Stock or Shares
or (b) take whatever other action it deems necessary to protect its interests
with respect to tax liabilities. The Company's obligation to make any delivery
of certificates in connection with Restricted Stock or make any delivery or
transfer of Shares will be conditioned on the recipient's compliance, to the
Company's satisfaction, with any withholding requirement.
15. Interpretation.
(a) 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. To
the extent that any provision of the Plan would cause a conflict with such
conditions or would cause the administration of the Plan as provided in Section
3 to fail to satisfy the conditions of Rule 16b-3, such provision shall be
deemed null and void to the extent permitted by applicable law. This section
shall not be applicable if no class of the Company's equity securities is then
registered pursuant to Section 12 of the Securities Exchange Act of 1934, as
amended.
(b) The Plan is intended to satisfy the applicable requirements of Code Section
162(m) so that the tax deduction for the Company for remuneration in respect of
this Plan for services performed by employees within the purview of Code Section
162(m) is not disallowed in whole or in part by the operation of such Code
Section. If any provision of this Plan or of any Award Document would otherwise
frustrate or conflict with the intent expressed in this Section 15(b), that
provision to the extent possible shall be interpreted and deemed amended so as
to avoid such conflict. To the extent there remains an irreconcilable conflict
with such intent, such provision shall be deemed null and void as applicable to
such employees.
EXHIBIT 5
<PAGE>
FOX, ROTHSCHILD, O'BRIEN & FRANKEL, LLP
2000 Market Street
10th Floor
Philadelphia, Pennsylvania 19103
August 3, 1999
Right Management Consultants, Inc.
1818 Market Street
Philadelphia, PA 19103
Gentlemen:
We have acted as counsel to Right Management Consultants, Inc., a Pennsylvania
corporation (the "Company"), in connection with the proposed issuance by the
Company of up to 750,000 shares of the Company's Common Stock, $.01 par value,
pursuant to the Company's 1993 Stock Incentive Plan, as amended (the "Plan"),
plus such indeterminate number of additional shares as provided for by the
anti-dilution provisions of the Plan (collectively the "Plan Shares"). The Plan
Shares are to be offered and issued pursuant to a registration statement on Form
S-8 being filed with the Securities and Exchange Commission (the "Registration
Statement").
As counsel to the Company, we have examined the Registration Statement and such
corporate records, certificates and other documents, and have considered such
questions of law as we have deemed necessary as the basis for this opinion.
Based upon the foregoing, we advise you that in our opinion the Plan Shares have
been duly and validly authorized and reserved for issuance by all necessary
corporate action of the Company and will, upon issuance as contemplated by the
Registration Statement and the Plan, be duly and validly issued, fully paid and
non-assessable.
We consent to the filing of this opinion as an exhibit to the Registration
Statement. In giving this consent, we do not hereby admit that we come within
the category of persons whose consent is required under Section 7 of the
Securities Act of 1933, as amended, or the rules and regulations thereunder.
We also wish to disclose to you that various attorneys in this firm have
beneficial ownership of small amounts of shares of the Company's Common Stock.
Very truly yours,
/s/ FOX, ROTHSCHILD, O'BRIEN & FRANKEL, LLP
EXHIBIT 23.1
<PAGE>
Letterhead of Arthur Andersen LLP
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Form S-8 registration statement of our report dated February
2, 1999 included in Right Management Consultants, Inc.'s Form 10-K for the year
ended December 31, 1998 and to all references to our Firm included in this
registration statement.
/ s / Arthur Andersen LLP
August 2, 1999
Philadelphia, PA
