SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended March 31, 1995
or
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
for the transition period from ________ to ________
Commission file number 0-3062
GUY F. ATKINSON COMPANY OF CALIFORNIA
(Exact name of registrant as specified in its charter)
STATE OF DELAWARE
(State or other jurisdiction of 94-1649018
incorporation or organization) (IRS Employer Identification No.)
1001 Bayhill Drive, San Bruno, California 94066
(Address of principal executive offices) (zip code)
Registrants' telephone number, including area code - (415) 876-1000
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15 (d) of the Securities
Exchange Act of 1934 during the preceding 12 months, and (2) has been
subject to such filing requirements for the past 90 days.
Yes X No
Common stock as of May 11, 1995
Issued and outstanding - 8,917,224 shares
<PAGE>
GUY F. ATKINSON COMPANY OF CALIFORNIA
AND SUBSIDIARY COMPANIES
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets March 31, December 31,
(thousands of dollars) 1995 1994
(unaudited)
ASSETS
Current Assets:
Cash and short-term investments $ 72,288 $ 78,441
Accounts receivable 44,239 33,150
Costs and estimated earnings in excess
of billings 5,615 4,338
Inventories and unamortized costs on
contracts in progress 24,021 20,062
Investments in joint ventures 36,659 40,503
Deferred income taxes 12 23
Other current assets 3,015 3,163
Total current assets 185,849 179,680
Property, plant and equipment, at cost 49,778 51,896
Less accumulated depreciation 32,668 34,345
17,110 17,551
Deferred income taxes 89 88
Other assets 2,526 2,395
$ 205,574 $199,714
LIABILITIES
Current Liabilities:
Notes payable, including current
portion of long-term obligations $ 633 $ 662
Accounts payable 54,934 43,998
Billings in excess of costs and
estimated earnings 33,437 16,920
Accrued expenses 22,899 24,240
Accrued federal & foreign income taxes 5,396 6,953
Due to joint ventures 289 103
Total current liabilities 117,588 92,876
Long-term obligations, less current portion 2,087 2,199
Postretirement benefit obligations and
postretirement health care obligations 7,651 7,651
Total liabilities 127,326 102,726
STOCKHOLDERS' EQUITY
Capital stock 1,894 1,894
Paid-in capital 12,754 13,185
Accumulated translation adjustment (5,168) (5,249)
Unearned compensation (305) (736)
Retained earnings 69,073 87,894
78,248 96,988
$ 205,574 $199,714
See accompanying notes
<PAGE>
GUY F. ATKINSON COMPANY OF CALIFORNIA
AND SUBSIDIARY COMPANIES
<TABLE>
<CAPTION>
Consolidated Statements of Operations (unaudited)
(thousands of dollars except Quarter Ended
per share amounts) March 31, 1995 and 1994
1995 1994
<S> <C> <C>
Revenue $ 89,738 $127,171
Cost of revenue 82,800 121,322
Gross margin 6,938 5,849
General and administrative expense 8,805 8,509
(Loss) from operations (1,867) (2,660)
Other income (expense), net:
Interest expense (201) (867)
Miscellaneous, net 1,130 941
Total other income (expense), net 929 74
(Loss) from continuing operations before
taxes and the cumulative effect of changes
in accounting (938) (2,586)
Provision (benefit) for income taxes (based on
estimated annual effective tax rates) 49 (457)
(Loss) from continuing operations before
the cumulative effect of changes in accounting (987) (2,129)
Discontinued operations, net of income taxes - 1,371
(Loss) before the cumulative effect of changes
in accounting (987) (758)
Cumulative effect of changes in accounting:
Postemployment benefit costs - (739)
Net (loss) $ (987) $ (1,497)
</TABLE>
See accompanying notes
<PAGE>
GUY F. ATKINSON COMPANY OF CALIFORNIA
AND SUBSIDIARY COMPANIES
<TABLE>
<CAPTION>
Consolidated Statements of Operations (unaudited), continued
(thousands of dollars except Quarter Ended
per share amounts) March 31, 1995 and 1994
1995 1994
<S> <S> <S>
(Loss) per share of common stock from continuing
operations before the cumulative effect of
changes in accounting $ (0.11) $ (0.24)
Income per share of common stock from
discontinued operations - 0.15
(Loss) per share of common stock before
the cumulative effect of changes in accounting $ (0.11) $ (.09)
Cumulative effect of changes in accounting
per share - (.08)
Net (loss) per share $ (0.11) $ (.17)
Average number of shares and common stock
equivalents utilized in net income per
share calculations 8,917 8,780
</TABLE>
See accompanying notes
<PAGE>
GUY F. ATKINSON COMPANY OF CALIFORNIA
AND SUBSIDIARY COMPANIES
<TABLE>
<CAPTION>
Consolidated Statements of Cash Flows (unaudited) Quarter Ended
(thousands of dollars) March 31, 1995 and 1994
1995 1994
<S> <C> <C>
Operating activities:
Net income $ (987) $ (1,497)
Adjustments to reconcile net income to
net cash provided by (used for) operating
activities:
Income from discontinued operations - (1,371)
Depreciation, depletion and amortization 491 543
Deferred income taxes 11 13
Net (gain) on dispositions of property,
plant and equipment (765) (505)
Cumulative effect of changes in accounting - 739
Changes in operating assets and liabilities:
Accounts receivable (11,092) 12,082
Inventories and unamortized costs (3,962) 1,034
Investments in joint ventures 4,029 (1,226)
Other current assets 147 (1,610)
Accounts payable and accrued expenses 9,605 5,294
Accrued income taxes (1,552) 485
Billings in excess of costs and estimated
earnings, net 15,240 (5,962)
Other, net 6 (297)
Net cash provided by operating activities
from continuing operations 11,171 7,722
Net cash (used in) operating activities
from discontinued operations - (9,076)
Net cash provided by (used in) operating
activities 11,171 (1,354)
Investing activities:
Property, plant and equipment expenditures (767) (273)
Proceeds from dispositions of property,
plant and equipment 725 369
Decrease (increase) in other assets, net 634 (547)
Net investing activities of discontinued
operations - (795)
Net cash provided by (used in) investing
activities 592 (1,246)
Financing activities:
Cash dividends paid (17,835) -
Short-term borrowing repayments, net - 3,193
Long-term debt repayments (141) (155)
Net cash provided by (used in) financing
activities (17,976) 3,038
Effect of exchange rate changes on cash 60 (778)
Net (decrease) in cash and short-term
investments $ (6,153) $ (340)
Supplementary information:
Cash paid during the period for:
Interest $ 273 $ 1,244
Federal, foreign and state income taxes 2,547 970
</TABLE>
<PAGE>
GUY F. ATKINSON COMPANY OF CALIFORNIA
AND CONSOLIDATED SUBSIDIARIES
Notes to Condensed Financial Statements
(all dollar amounts are in thousands)
1. The information furnished reflects all adjustments which
are, in the opinion of management, necessary to a fair
statement of results for the interim periods.
2. During 1994, the company sold its principal manufacturing
subsidiary, Lake Center Industries, Inc., its pipe
distribution business, Comco Pipe & Supply Company, and its
oil and gas investments. The results of operations of these
divested businesses are shown separately in the income
statement for 1994 as "Discontinued operations, net of
income taxes".
The summarized results of discontinued operations were as
follows:
Quarter Ended
March 31, 1995 and 1994
1995 1994
Revenue $ - $ 42,707
Income from discontinued
operations before taxes - 2,154
Provision for income taxes - 783
Income from discontinued
operations $ - $ 1,371
Income per share of common stock
from discontinued operations $ - $ 0.15
<PAGE>
GUY F. ATKINSON COMPANY OF CALIFORNIA
AND CONSOLIDATED SUBSIDIARIES
Notes to Condensed Financial Statements
(all dollar amounts are in thousands)
3. The major classifications of inventory are as follows:
March 31, December 31,
1995 1994
Construction materials, parts
and supplies $ 3,109 $ 3,724
Unamortized costs on contracts
in progress 20,912 16,338
$ 24,021 $20,062
4. In 1994, the company recorded an accounting charge of $739
for postemployment benefits upon the adoption of Statement
of Financial Accounting Standards No. 112.
5. On March 31, 1995, the company paid a special cash dividend
of $2.00 per share to shareholders of record on March 15,
1995.
6. The company has 40,000 shares of restricted stock
outstanding pursuant to the provisions of the Guy F.
Atkinson Company of California Executive Stock Plan.
Restrictions on the shares are progressively removed based
on achievement of earnings per share performance goals.
<PAGE>
GUY F. ATKINSON COMPANY OF CALIFORNIA
AND CONSOLIDATED SUBSIDIARIES
Notes to Condensed Financial Statements
(all dollar amounts are in thousands)
6. (continued)
In the event that performance goals are not achieved, the
restricted shares are progressively subject to forfeiture.
The market value of the outstanding restricted shares has
been recorded as unearned stock grant compensation, a
separate component of stockholders' equity. The unearned
compensation will be charged to general and administrative
expense as the performance goals are met. At March 31, 1995
no such amounts have been charged.
The company has options outstanding with respect to 741,604
shares of common stock at exercise prices ranging from $6.55
to $11.95 per share. The right to exercise these options
vests progressively over a four year period commencing with
the date of issue and expiring ten years from the date of
issue. In addition, there are stock warrants outstanding
for 387,500 shares of common stock with an exercise price of
$7.00 expiring in 1998.
<PAGE>
GUY F. ATKINSON COMPANY OF CALIFORNIA
AND CONSOLIDATED SUBSIDIARIES
Notes to Condensed Financial Statements
(all dollar amounts are in thousands)
7. Net primary earnings per share of common and common stock
equivalents are calculated using the weighted average number
of common shares outstanding, excluding restricted shares
for which performance goals have not been met, plus the net
additional number of shares which would be issuable upon the
exercise of stock options and warrants, assuming that the
company used the proceeds received to repurchase outstanding
shares at market prices.
<PAGE>
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Results of Operations (all dollar amounts are in thousands
unless otherwise stated)
Revenue: The company's revenue of $90 million decreased by
30% in the first quarter of 1995 compared with $127 million in
the first quarter of 1994. The reduction in revenue was
attributable to the completion of certain industrial construction
projects in 1994, while new contract awards in the fourth quarter
of 1994 and first quarter of 1995 (which together amount to $270
million), are not yet making a significant contribution to
revenue. The backlog of uncompleted contracts amounted to
$424,883 at March 31, 1995, compared to $656,827 at March 31,
1994. March 31, 1994 backlog included $293,000 relating to an
awarded but long-delayed industrial construction contract which
was subsequently removed from backlog at December 31, 1994.
Excluding the aforementioned contract, backlog at March 31, 1995
was 17% higher than in the comparable period of 1994.
Gross margin: The company's gross margin of $6,938
increased by 19% in the first quarter of 1995 over 1994's $5,849.
The percentage of gross margin to revenue in all of the company's
business units improved to a consolidated 7.7% versus 4.4% for
1994, which more than compensated for the reduced level of
revenue compared with the comparable period in 1994.
<PAGE>
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations, continued
General and administrative expense: General and
administrative expense of $8,805 increased by 3% in 1995 compared
to $8,509 in 1994. Reductions in corporate overhead expense
implemented in the fourth quarter of 1994 were offset by
increased marketing efforts for Asia and the Middle East as well
as the ongoing costs of implementation of the company's new
accounting and information system.
Other income (expense): Interest expense decreased to $201
in the first quarter of 1995, from $867 in the first quarter of
1994 primarily due to the company retiring all of its short-term
debt in the fourth quarter of 1994. Miscellaneous income
amounted to $1,130 in the first quarter of 1995, compared with
$941 in the corresponding 1994 period. Miscellaneous income was
principally from interest on short-term investments in 1995, and
in 1994 from foreign exchange gains and gains from asset
dispositions.
Income taxes and net income: The loss from continuing
operations before taxes and the cumulative effect of changes in
accounting was reduced to $938 in 1995, from $2,586 in 1994.
Income taxes gave rise to an expense of $49 in 1995 compared to a
benefit of $457 in 1994. The 1995 income tax expense was
attributable to state and foreign income taxes and U.S. tax
<PAGE>
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations, continued
losses for which no net tax benefit was available. The 1994
income tax benefit was attributable to the allocation of taxes to
discontinued operations.
In 1994 discontinued operations, net of income taxes,
provided income of $1,371, and the company's adoption of
Statement of Financial Accounting Standards No. 112 resulted in
an accounting charge of $739.
Net loss for the first quarter of 1995 was reduced to $987
from $1,497 in the corresponding period of 1994.
Liquidity and Capital Resources
The company generated cash from operating activities in the
first quarter of 1995 totalling $11,171, versus $7,722 from
continuing operating activities in the comparable period in 1994.
In 1994, $9,076 of cash was used to fund the operating activities
of discontinued operations, while in 1995, there was a special
dividend payment to common stockholders of $2.00 per share,
amounting to $17,835. Including the effect of the dividend
payment, net cash flow was a negative $6,153 in 1995 compared
with a negative $340 in 1994.
<PAGE>
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations, continued
As of March 31, 1995, the company's short-term lines of
credit amounted to approximately $33,574. The availability of
these lines of credit is reduced by any letters of credit
outstanding under the lines. At March 31, 1995, the company had
no outstanding borrowings and $8,753 in outstanding letters of
credit.
The company believes that its cash and short-term
investments, together with lines of credit and funds generated
from operations will be adequate to cover foreseeable future
requirements.
<PAGE>
PART II - OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
The Annual Meeting of Shareholders of the company (the
"Annual Meeting") was held on April 19, 1995. In addition to the
election of directors, shareholders were asked to vote on a
proposal to approve the Amendment and Restatement of the 1990
Executive Stock Plan.
The first table below sets forth the total number of votes
for and withheld as to each of the eight candidates for director,
all of whom were elected at the Annual Meeting.
The second table below sets forth the total number of votes
for and against and the abstentions and broker non-votes as to
the approval of the Amendment and Restatement of the 1990
Executive Stock Plan. An affirmative vote of a majority of the
shares represented and entitled to vote was required for passage.
Abstentions, or shares represented by proxies marked "abstain,"
had the same effect as a vote against the proposal. The failure
of a broker or other nominee to vote shares for a beneficial
owner had no effect on the proposal. The proposal received an
affirmative vote of approximately 52% of the shares represented
and entitled to vote.
<PAGE>
Item 4. Submission of Matters to a Vote of Security Holders,
continued
Table 1
Broker
Nominee For Withheld Against Abstain Non-Votes
Jack J. Agresti 7,652,757 554,865 N/A N/A N/A
Duane E. Atkinson 7,858,460 349,162 N/A N/A N/A
Ray N. Atkinson 7,873,538 334,084 N/A N/A N/A
William E. Burch 7,783,585 424,037 N/A N/A N/A
J. Phillip Frazier 7,879,199 328,423 N/A N/A N/A
Donald R. Kayser 7,774,069 433,553 N/A N/A N/A
Ross J. Turner 7,782,317 425,305 N/A N/A N/A
John F. Whitsett 7,936,036 271,586 N/A N/A N/A
Table 2
Broker
For Against Abstain Non-Votes
Approval of Amendment
and Restatement of the
1990 Executive Stock
Plan 3,925,423 2,410,530 1,193,316 876,353
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit No. Description
10.1 1990 Executive Stock Plan as Amended and
Restated
27.1 Financial Data Schedule
(b) No reports on Form 8-K were filed during the period.
<PAGE>
GUY F. ATKINSON COMPANY OF CALIFORNIA
AND CONSOLIDATED SUBSIDIARIES
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant had duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
GUY F. ATKINSON COMPANY
OF CALIFORNIA
s/ Herbert D. Montgomery
Senior Vice President,
Chief Financial Officer
and Treasurer
May 11, 1995
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> MAR-31-1995
<CASH> 2784
<SECURITIES> 69504
<RECEIVABLES> 44239
<ALLOWANCES> 0
<INVENTORY> 24021
<CURRENT-ASSETS> 185849
<PP&E> 49778
<DEPRECIATION> 32668
<TOTAL-ASSETS> 205574
<CURRENT-LIABILITIES> 117588
<BONDS> 2087
<COMMON> 1894
0
0
<OTHER-SE> 76354
<TOTAL-LIABILITY-AND-EQUITY> 205574
<SALES> 0
<TOTAL-REVENUES> 89738
<CGS> 0
<TOTAL-COSTS> 82800
<OTHER-EXPENSES> 8805
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 201
<INCOME-PRETAX> (938)
<INCOME-TAX> 49
<INCOME-CONTINUING> (987)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (987)
<EPS-PRIMARY> (0.11)
<EPS-DILUTED> 0
</TABLE>
EXHIBIT 10.1
1990 EXECUTIVE STOCK PLAN
AS AMENDED AND RESTATED
Effective: February 16, 1995
<PAGE>
1990 EXECUTIVE STOCK PLAN
AS AMENDED AND RESTATED
1. Establishment and Purpose.
(a) Guy F. Atkinson Company of California (the "Company")
previously adopted the Guy F. Atkinson Company of
California 1990 Executive Stock Plan (the "Plan"). The
Company hereby amends, restates and renames the Plan to
read as set forth herein, effective as of February 16,
1995 (the "Effective Date"), but contingent upon approval
by the shareholders of the Company within 12 months after
the Effective Date. The Plan provides a means whereby:
(1) key employees of the Company and its Subsidiaries
may be given an opportunity to purchase shares of
the common stock of the Company (the "Stock")
pursuant to options which may qualify as incentive
stock options under Section 422 of the Internal
Revenue Code of 1986, as amended (the "Code")
(referred to as "incentive stock options");
(2) key employees of the Company and its Subsidiaries
may be given an opportunity to purchase shares of
Stock pursuant to options which do not qualify as
incentive stock options (referred to as
"nonqualified stock options");
(3) key employees of the Company and its Subsidiaries
may acquire Stock for such consideration (if any)
and subject to such restrictions (if any) as the
Committee determines appropriate; and
(4) key employees of the Company and its Subsidiaries
may be granted rights or units the value of which
is based on the value of the Stock.
(b) The purpose of the Plan is to promote the long-term
success of the Company by encouraging key employees to
focus on long-range objectives, by attracting and
retaining key employees and by aligning the financial
interests of key employees with the interests of
shareholders.
2. Definitions.
(a) "Awards" refers collectively to Stock grants, Stock
sales, options to purchase Stock, stock appreciation
rights, and units issued pursuant to this Plan.
(b) "Participant" refers to a recipient of an Award.
(c) "Subsidiaries" refers to subsidiary corporations, as
defined in Section 424(f) of the Code (but substituting
"the Company" for "employer corporation"), including
entities which become Subsidiaries after adoption of the
Plan.
3. Administration of the Plan.
(a) The Plan shall be administered by the Compensation
Committee (the "Committee") of the Board of Directors of
the Company (the "Board").
(b) The Committee shall consist of not less than two members,
who shall be members of the Board and who, during the
one-year period preceding service on the Committee, did
not receive Awards under the Plan and did not receive
equity securities under any other plan of the Company or
any of its affiliates. Committee members shall not be
eligible for Awards while serving on the Committee.
(c) The Committee shall meet at such times and places and
upon such notice as the chairperson determines. A
majority of the Committee, but not less than two persons,
shall constitute a quorum. Any acts of the Committee may
be taken at any meeting at which a quorum is present and
shall be by majority vote of those members entitled to
vote. Additionally, any acts reduced to writing or
approved in writing by all the members of the Committee
shall be valid acts of the Committee.
(d) The Committee shall determine which key employees of the
Company or its Subsidiaries shall be granted Awards under
the Plan, the timing of such Awards, the terms thereof,
and the number of shares of Stock subject to each Award.
(e) The Committee shall have the sole authority, in its
absolute discretion, to adopt, amend, and rescind such
rules and regulations as, in its opinion, may be
advisable in the administration of the Plan, to construe
and interpret the Plan, the rules and regulations, and
the instruments evidencing Awards granted under the Plan
and to make all other determinations deemed necessary or
advisable for the administration of the Plan. All
decisions, determinations, and interpretations of the
Committee shall be binding on all Participants.
(f) The Plan is intended to meet the requirements of Rule
16b-3 promulgated by the Securities and Exchange
Commission under Section 16(b) of the Securities Exchange
Act of 1934 and the requirements of Section 162(m)(4)(C)
of the Code and shall be administered and construed
accordingly.
4. Stock Subject to the Plan; Limitations on Award.
(a) Awards may be granted under the Plan to eligible persons
for an aggregate of not more than one million three
hundred thousand (1,300,000) shares of Stock. If an
option is surrendered for cash or other consideration or
for any other reason ceases to be exercisable in whole or
in part, the shares which were subject to such option but
as to which the option had not been exercised shall
continue to be available under the Plan. If Stock is
granted or sold subject to restrictions and is
subsequently forfeited, the forfeited shares shall again
be available for Awards under this Plan. If stock
appreciation rights are granted and subsequently lapse or
are forfeited, the shares to which the rights relate
shall again be available for Awards under the Plan.
(b) If there is any change in the Stock subject to the Plan
or the Stock subject to any Award granted under the Plan,
through merger, consolidation, reorganization, spin-off,
recapitalization, reincorporation, stock split, stock
dividend (in excess of two percent), extraordinary cash
dividend or other change in the corporate structure of
the Company, appropriate adjustments may be made by the
Committee in order to preserve but not to increase the
benefits to the Participants, including adjustments in
the aggregate number of shares subject to the Plan, the
number of shares and the price per share subject to
outstanding Awards and the limitations in subparagraph
(c) below.
(c) The Company shall not grant, issue or sell to any
employee in any calendar year:
(1) options pursuant to paragraph 6 to purchase more
than two hundred thousand (200,000) shares of
Stock, or
(2) stock appreciation rights with respect to more than
two hundred thousand (200,000) shares of Stock,
pursuant to paragraph 7.
5. Eligibility.
Persons who shall be eligible to have Awards granted to them
shall be such key employees of the Company or its Subsidiaries
as the Committee, in its discretion, shall designate from time
to time. Members of the Board who are not full time employees
of the Company may not participate in the Plan.
6. Terms and Conditions of options.
(a) The exercise price of the Stock covered by each incentive
stock option shall not be less than the per share fair
market value of such Stock on the date the option is
granted. Notwithstanding the foregoing, in the case of
an incentive stock option granted to a person possessing
more than ten percent (l0%) of the combined voting power
of the Company or any Subsidiary, the exercise price
shall not be less than one hundred ten percent (ll0%) of
the fair market value of the Stock on the date the option
is granted. Nonqualified stock options may be granted
with an exercise price less than fair market value. The
exercise price of an outstanding stock option shall be
subject to adjustment to the extent provided in paragraph
4, above.
(b) Each option granted pursuant to the Plan shall be
evidenced by a written stock option agreement executed by
the Company and the person to whom such option is
granted.
(c) The Committee shall determine the term of each option
granted under the Plan, but the term of each option shall
be for no more than ten (l0) years; provided, however,
that in the case of an incentive stock option granted to
a person possessing more than ten percent (l0%) of the
combined voting power of the Company or any Subsidiary,
the term shall be for no more than five (5) years.
(d) The stock option agreement may contain such other terms,
provisions, and conditions as may be determined by the
Committee (not inconsistent with this Plan) including,
without limitation, stock appreciation rights with
respect to options granted under this Plan. If an
option, or any part thereof, is intended to qualify as an
incentive stock option, the stock option agreement shall
contain those terms and conditions which are necessary to
so qualify it.
7. Stock Appreciation Rights.
The Committee may, under such terms and conditions as it deems
appropriate, authorize the surrender by an optionee of all or
part of an unexercised option and authorize a payment in
consideration therefor in an amount equal to the difference
obtained by subtracting the option price of the shares then
subject to exercise under such option from the fair market
value of the Stock represented by such shares on the date of
surrender, provided that the Committee determines that such
settlement is consistent with the purpose of the Plan. Such
payment may be made in shares of Stock valued at their fair
market value on the date of surrender of such option or in
cash, or partly in shares and partly in cash. Acceptance of
surrender and the manner of payment shall be in the discretion
of the Committee. Any payments of cash under this paragraph
shall be from the general assets of the Company.
8. Stock Awards
The Comrnittee may, in its discretion, issue Stock to eligible
persons as compensation for services rendered to the Company
or its Subsidiaries, on whatever basis and subject to such
performance requirements, terms and conditions as the
Committee determines. The terms and conditions of such an
Award shall be evidenced by a written agreement executed by
the Company and the Participant.
9. Unit Awards
The Committee may, in its discretion, issue units to eligible
persons as compensation for services rendered to the Company
or its Subsidiaries, the value of such units to be based on
the value of the Stock. Unit Awards shall be subject to
whatever performance requirements, terms and conditions the
Committee determines appropriate. The terms of a Unit Award
shall be evidenced by a written agreement executed by the
Company and the Participant.
lO. Restrictions on Transfer of Stock.
Stock acquired under the Plan shall be subject to such
restrictions and agreements regarding performance, vesting,
sale, assignment, encumbrance, or other transfer as the
Committee deems appropriate at the time of making an Award.
<PAGE>
11. Use of Proceeds.
Any cash proceeds realized from the sale of Stock pursuant to
the Plan or from the exercise of options granted under the
Plan shall constitute general funds of the Company.
12. Amendment, Suspension or Termination of the Plan.
(a) The Board may at any time amend, suspend or terminate the
Plan as it deems advisable; provided, however, except as
provided in paragraph 4, above, the Board shall not amend
the Plan in the following respects without the consent of
stockholders then sufficient to approve the Plan in the
first instance:
(1) to increase the maximum number of shares subject to
the Plan; or
(2) to change the designation or class of persons
eligible to receive Awards under the Plan.
(b) No Award may be granted during any suspension or after
the termination of the Plan, and no amendment, suspension
or termination of the Plan shall, without the
Participant's consent, alter or impair any rights or
obligations under any Award previously made under the
Plan.
(c) This Plan shall terminate l0 years from the date of
adoption of the Plan, unless previously terminated by the
Board pursuant to this paragraph.
(d) Upon a termination of the Plan, the Committee may
authorize the surrender by an optionee of all or part of
an unexercised option and authorize a payment in
consideration therefor in the same manner as if the
Participant had surrendered an option under paragraph 7
regarding stock appreciation rights.
13. Consideration.
Payment of the exercise price of an option or payment of any
consideration required for a Stock Award granted under this
Plan shall be made in cash; provided, however, that the
Comrnittee, in its sole discretion, may establish procedures
which permit a Participant to pay the exercise or purchase
price in whole or in part by delivery (on a form prescribed by
the Committee) of an irrevocable direction to a securities
broker approved by the Committee to sell shares and deliver
all or a portion of the proceeds to the Company in payment for
the Stock. The Committee may also establish procedures for
the sale of shares of Stock to cover withholding taxes or the
withholding of shares of Stock issuable upon exercise of an
option to satisfy applicable withholding taxes to the extent
permitted by applicable law.
Date Amended, Restated and Renamed By Company: February 16, 1995
Date Approved By Shareholders: April 19, 1995
