As filed with the Securities and Exchange Commission on June 30, 1999
Registration No. 333-___________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------------------------
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
---------------------------------------
RECOVERY ENGINEERING, INC.
(Exact name of registrant as specified in its charter)
MINNESOTA 41-1557115
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
9300 NORTH 75TH AVENUE, MINNEAPOLIS, MINNESOTA 55428
(Address of principal executive offices, including zip code)
RECOVERY ENGINEERING, INC. 1993 DIRECTOR STOCK OPTION PLAN
(Full title of the plan)
Copy to:
Charles F. Karpinske Eric O. Madson, Esq.
Chief Financial Officer Robins, Kaplan, Miller & Ciresi L.L.P.
Recovery Engineering, Inc. 2800 LaSalle Plaza, 800 LaSalle Avenue
9300 North 75th Avenue Minneapolis, Minnesota 55402
Minneapolis, Minnesota 55428 (612) 349-8500
(612) 315-5500
(Telephone number, including area code, of agent for service)
Approximate date of commencement of proposed sale:
FROM TIME TO TIME AFTER THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT.
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
=============================================================================================
TITLE OF PROPOSED PROPOSED
SECURITIES AMOUNT MAXIMUM MAXIMUM
TO BE TO BE OFFERING PRICE AGGREGATE AMOUNT OF
REGISTERED(1) REGISTERED PER SHARE(2) OFFERING PRICE(2) REGISTRATION FEE
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, 30,000 shares $16.09 $482,815.50 $135.00
$.01 par value
- ---------------------------------------------------------------------------------------------
</TABLE>
(1) Includes Common Stock Purchase Rights which currently are not separable
from the common stock and are not exercisable.
(2) Pursuant to Rule 457(h), the per share price is estimated, solely for
the purpose of determining the registration fee, based upon the average
of the high and low prices for such common stock on June 25, 1999, as
reported on The Nasdaq National Market.
================================================================================
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents have been filed by Recovery Engineering, Inc.
(the "Company") (File No. 0-21232) with the Securities and Exchange Commission
(the "Commission") pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 (the "Exchange Act") and are incorporated by reference herein:
a. The Company's Annual Report on Form 10-K for the fiscal year ended
January 3, 1999;
b. The Company's Quarterly Report on Form 10-Q for the quarter ended April
4, 1999;
c. The description of the Company's capital stock contained in the
Company's Registration Statement on Form 8-A (File No. 0-21232), as
amended on June 29, 1999, filed with the Commission; and
d. The description of the Company's Common Stock Purchase Rights contained
in the Company's Registration Statement on Form 8-A (File No. 0-21232),
as amended on June 29, 1999, filed with the Commission.
All documents filed with the Commission by the Company pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of
this Registration Statement and prior to the filing of a post-effective
amendment which indicates that all securities offered hereby have been sold or
which deregisters all such securities then remaining to be sold shall be deemed
to be incorporated by reference herein and to be a part hereof from the date of
filing of such documents.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes hereof to the extent a statement contained herein or in any
subsequently filed document which also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed to constitute a part hereof, except
as so modified or superseded.
ITEM 4. DESCRIPTION OF SECURITIES.
The common stock, par value $.01 per share (the "Common Stock"), of the
Company offered pursuant to this Registration Statement and the related Common
Stock Purchase Rights are registered under Section 12(g) of the Exchange Act.
The description of the Company's capital stock and Common Stock Purchase Rights
are incorporated by reference pursuant to Item 3 above.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The financial statements and financial statement schedule of Recovery
Engineering, Inc. incorporated by reference in Recovery Engineering, Inc.'s
Annual Report (Form 10-K) for the year ended January 3, 1999, have been audited
by Ernst & Young LLP, independent auditors, as set forth in their report thereon
incorporated by reference therein and incorporated by reference herein. Such
financial statements and schedule are incorporated herein by reference in
reliance upon such report given upon the authority of such firm as experts in
accounting and auditing.
2
<PAGE>
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article V of the Company's Bylaws provides that the Company shall
indemnify the directors and officers to the extent permitted by Minnesota
Statutes, Section 302A.521, as now enacted or hereafter amended.
In addition, as allowed by Minnesota Statutes, Section 302A.251,
Article 8 of the Company's Articles of Incorporation provides that a director of
the Company shall not be personally liable to the Company or its stockholders
for monetary damages for certain types of breaches of fiduciary duty as a
director.
Further, the Company has purchased director and officer liability
insurance that insures directors and officers against certain liabilities in
connection with the performance of their duties as directors and officers,
including liabilities under the Securities Act of 1933, as amended, and provides
for payment to the Company of costs incurred by it in indemnifying its directors
and officers.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
The following exhibits are filed as a part of this Registration
Statement on Form S-8:
EXHIBIT
NUMBER DESCRIPTION
- ------ -----------
5.1 Opinion of Robins, Kaplan, Miller & Ciresi L.L.P. (filed
electronically herewith)
23.1 Consent of Ernst & Young LLP (filed electronically herewith)
23.2 Consent of Robins, Kaplan, Miller & Ciresi L.L.P. (included in
Exhibit 5.1)
24.1 Powers of Attorney (filed electronically herewith)
99.1 Recovery Engineering, Inc. 1993 Director Stock Option Plan, as
amended (filed electronically herewith)
ITEM 9. UNDERTAKINGS.
(a) RULE 415 OFFERING.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration
statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration
statement (or the most recent post-effective
amendment thereof) which,
3
<PAGE>
individually or in the aggregate, represent a
fundamental change in the information set forth in
the registration statement; and
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in
the registration statement or any material change to
such information in the registration statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do
not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed by the registrant pursuant to Section
13 or Section 15(d) of the Securities Exchange Act of 1934
that are incorporated by reference in the registration
statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona
fide offering thereof.
(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) FILINGS INCORPORATING SUBSEQUENT EXCHANGE ACT DOCUMENTS BY REFERENCE.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing
of the registrant's annual report pursuant to Section 13(a) or 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.
(h) STATEMENT REQUIRED BY ITEM 512(h) IN CONNECTION WITH FILING OF
REGISTRATION STATEMENT ON FORM S-8.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or
otherwise, the registrant has been advised that in the opinion of the
Commission such indemnification is against public policy as expressed
in the Securities Act of 1933 and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other
than the payment by the registrant of expenses incurred or paid by a
director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the
securities being registered, the registrant will, unless in the opinion
of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication
of such issue.
4
<PAGE>
SIGNATURES
THE REGISTRANT: Pursuant to the requirements of the Securities Act of
1933, the Registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Minneapolis, State of Minnesota on June 30,
1999.
RECOVERY ENGINEERING, INC.
By /s/ BRIAN F. SULLIVAN
------------------------------------------
Brian F. Sullivan
President 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.
SIGNATURE TITLE DATE
/s/ BRIAN F. SULLIVAN President, Chief Executive Officer June 30, 1999
- --------------------------- and Director (Principal Executive
Brian F. Sullivan Officer)
/s/ CHARLES F. KARPINSKE Chief Financial Officer (Principal June 30, 1999
- --------------------------- Financial Officer and Principal
Charles F. Karpinske Accounting Officer)
* Director June 30, 1999
- ---------------------------
Robert R. Gheewalla
* Director June 30, 1999
- ---------------------------
John E. Gherty
* Director June 30, 1999
- ---------------------------
Sanjay H. Patel
* Director June 30, 1999
- ---------------------------
William D. Thompson
* Director June 30, 1999
- ---------------------------
William F. Wanner, Jr.
* Director June 30, 1999
- ---------------------------
Richard J. Zeckhauser
* By /s/ CHARLES F. KARPINSKE
------------------------------------------
Charles F. Karpinske, Attorney-in-Fact
5
<PAGE>
INDEX TO EXHIBITS
EXHIBIT
NO. DESCRIPTION METHOD OF FILING
5.1 Opinion of Robins, Kaplan, Miller & Filed electronically herewith
Ciresi L.L.P.
23.1 Consent of Ernst & Young LLP Filed electronically herewith
23.2 Consent of Robins, Kaplan, Miller & Included in Exhibit 5.1
Ciresi L.L.P.
24.1 Powers of Attorney Filed electronically herewith
99.1 Recovery Engineering, Inc. 1993 Filed electronically herewith
Director Stock Option Plan, as
amended
EXHIBIT 5.1
ROBINS, KAPLAN, MILLER & CIRESI L.L.P.
2800 LaSalle Plaza, 800 LaSalle Avenue
Minneapolis, Minnesota 55402
June 30, 1999
Recovery Engineering, Inc.
9300 North 75th Avenue
Minneapolis, MN 55428
Re: Registration Statement on Form S-8
1993 Director Stock Option Plan, as amended
Registration of 30,000 shares of Common Stock
Ladies and Gentlemen:
We have acted as legal counsel for Recovery Engineering, Inc. (the
"Company") in connection with the preparation of a Registration Statement on
Form S-8 (the "Registration Statement") to be filed with the Securities and
Exchange Commission, and the Prospectus to be used in conjunction with the
Registration Statement (the "Prospectus"), relating to the registration under
the Securities Act of 1933, as amended, of 30,000 shares (the "Shares") of
common stock, $.01 par value (the "Common Stock"), to be issued by the Company
pursuant to the Recovery Engineering, Inc. 1993 Director Stock Option Plan, as
amended (the "Plan"), in the manner set forth in the Registration Statement and
the Prospectus.
In connection therewith, we have examined (a) the Articles of
Incorporation and Bylaws of the Company, both as amended to date; (b) the
corporate proceedings of the Company relative to its organization and to the
authorization and issuance of the Shares; and (c) the Registration Statement and
the Prospectus. In addition to such examination, we have reviewed such other
proceedings, documents and records and have ascertained or verified such
additional facts as we deem necessary or appropriate for purposes of this
opinion.
Based upon the foregoing, we are of the opinion that:
1. The Company has been legally incorporated and is validly existing under
the laws of the State of Minnesota.
2. All necessary corporate action has been taken by the Company to
authorize the issuance of the Shares.
3. The Shares are validly authorized by the Company's Articles of
Incorporation, as amended, and when issued and paid for as contemplated
in the Registration Statement and Prospectus, will be validly issued,
fully paid, and non-assessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to our firm under the caption "Legal
Matters" in the Prospectus.
Very truly yours,
ROBINS, KAPLAN, MILLER & CIRESI L.L.P.
By /s/ Eric O. Madson
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration
Statement (Form S-8) and related Prospectus of Recovery Engineering, Inc. for
the registration of 30,000 shares of its common stock of our reports dated
January 26, 1999 with respect to the financial statements of Recovery
Engineering, Inc. incorporated by reference in its Annual Report (Form 10-K) for
the year ended January 3, 1999 and the related financial statement schedule
included therein, filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
Minneapolis, Minnesota
June 28, 1999
EXHIBIT 24.1
POWER OF ATTORNEY
I am a director or officer of Recovery Engineering, Inc. and do hereby
constitute and appoint Brian F. Sullivan and Charles F. Karpinske, and each of
them singly, my true and lawful attorneys and agents, to do any and all things
and acts in my name in the capacities indicated below and to execute any and all
instruments for me and in my name in the capacities indicated below which said
Brian F. Sullivan or Charles F. Karpinske, or either of them, may deem necessary
or advisable to enable Recovery Engineering, Inc. to comply with the Securities
Act of 1933, as amended, and any rules, regulations and requirements of the
Securities and Exchange Commission, in connection with the Registration
Statement on Form S-8 relating to the offering of Common Stock pursuant to the
Recovery Engineering, Inc. 1993 Director Stock Option Plan, as amended,
including specifically, but not limited to, power and authority to sign for me
in my name in the capacities indicated below the Registration Statement and any
and all amendments (including post-effective amendments) thereto; and I hereby
ratify and confirm all that Brian F. Sullivan and Charles F. Karpinske, or
either of them, shall do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have signed this Power of Attorney on the date
set forth below.
SIGNATURE TITLE DATE
/s/ Brian F. Sullivan President, Chief Executive Officer April 29, 1999
- -------------------------- and Director (Principal Executive
Brian F. Sullivan Officer)
/s/ Charles F. Karpinske Chief Financial Officer (Principal April 29, 1999
- -------------------------- Financial Officer and Principal
Charles F. Karpinske Accounting Officer)
/s/ Robert R. Gheewalla Director April 29, 1999
- --------------------------
Robert R. Gheewalla
/s/ John E. Gherty Director April 29, 1999
- --------------------------
John E. Gherty
/s/ Sanjay H. Patel Director April 29, 1999
- --------------------------
Sanjay H. Patel
/s/ William D. Thompson Director April 29, 1999
- --------------------------
William D. Thompson
/s/ William F. Wanner, Jr. Director May 12, 1999
- --------------------------
William F. Wanner, Jr.
/s/ Richard J. Zeckhauser Director April 29, 1999
- --------------------------
Richard J. Zeckhauser
EXHIBIT 99.1
RECOVERY ENGINEERING, INC.
1993 DIRECTOR STOCK OPTION PLAN
AS AMENDED
<PAGE>
RECOVERY ENGINEERING, INC.
1993 DIRECTOR STOCK OPTION PLAN
The purpose of the Recovery Engineering, Inc. 1993 Director Stock
Option Plan (the "Option Plan") is to attract and retain persons of outstanding
competence to serve on the Board of Directors of Recovery Engineering, Inc. (the
"Company").
1. ADMINISTRATION. The Option Plan will be administered by the Board of
Directors of the Company. Grants of stock options under the Option Plan
("Options") and the amount and nature of the Options so granted will be
automatic, as described below.
2. STOCK SUBJECT TO THE OPTION PLAN. An aggregate of 100,000 shares of
Common Stock, par value $.01 per share ("Common Stock"), of the Company are
reserved for issuance under the Option Plan. The number of shares authorized for
issuance under the Option Plan may be increased from time to time by approval of
the Board of Directors and, if required pursuant to Rule 16b-3 under the
Securities Exchange Act of 1934 or the applicable rules of any securities
exchange or the NASD, the shareholders of the Company. In the event of any
reorganization, merger, recapitalization, stock dividend, stock split, or
similar change in the corporate structure or shares of the Company, appropriate
adjustments will be made to the number and kind of shares reserved for issuance
under the Option Plan and pursuant to outstanding Options and to the exercise
price of outstanding Options.
3. AUTOMATIC OPTION GRANTS. Under the Option Plan, each non-employee
director will automatically be granted Options to purchase shares of Common
Stock as follows:
a. INITIAL OPTION GRANTS. Under the Option Plan, each current
and future non-employee director will be granted an initial Option (the
"Initial Grant") as follows:
i. CURRENT NON-EMPLOYEE DIRECTORS. Each person
serving as a non-employee director on the effective date of
the Option Plan will automatically be granted an Option on the
effective date to purchase the number of shares set forth
below:
Name Number of shares
---------------------- ----------------
Eugene E. Erickson 1,000 shares
John E. Gherty 2,000 shares
William F. Wanner, Jr. 1,000 shares
Ronald W. Weber 1,000 shares
Richard J. Zeckhauser 0 shares
ii. FUTURE NON-EMPLOYEE DIRECTORS. Each person who is
first elected or appointed to serve as a non-employee director
after the effective date of the Option Plan will automatically
be granted an Option on the date of his or her initial
election
1
<PAGE>
or appointment to the Company's Board of Directors to purchase
1,000 shares of Common Stock.
b. ADDITIONAL OPTION GRANTS. Under the Option Plan, each
non-employee director will automatically be granted additional Options
to purchase shares of Common Stock as follows:
i. On the date of the first annual meeting of
shareholders occurring after the Initial Grant to a
non-employee director under the Option Plan, such non-employee
director, if reelected at such meeting, will automatically be
granted an additional Option to purchase 1,000 shares of
Common Stock.
ii. Thereafter, on the date of each subsequent annual
meeting of shareholders at which the non-employee director is
reelected to the Board of Directors, the non-employee director
shall automatically be granted an additional Option to
purchase 1,000 shares of Common Stock.
4. VESTING, EXERCISABILITY AND EXPIRATION. All Options granted under
the Option Plan shall be fully vested when granted, but may not be exercised
until six months following the date of grant. All Options granted under the
Option Plan shall expire five years after the date of grant.
5. TRANSFERABILITY. No Option granted under the Option Plan is
assignable or transferable during the lifetime of the director, either
voluntarily or involuntarily. Options shall be exercisable during a director's
lifetime only by such director. In the event of the death of a non-employee
director, Options granted under the Option Plan may be transferred by will or
the laws of descent and distribution and may only be exercised by the executors
or administrators of such director's estate or by the person or persons to whom
such director's rights under the Option shall pass by the director's will or the
laws of descent and distribution.
6. EXERCISE PRICE. The exercise price of Options granted under the
Option Plan shall be 85% of the fair market value of one share of Common Stock
on the date of grant; provided, however, that the exercise price of 1,000 of the
shares included in the initial option grant to Mr. Gherty shall be $2.50 per
share. For purposes of the Option Plan, "fair market value" is the average of
the high and low sales price of the Common Stock, as reported by the NASDAQ
National Market System on the date of grant. Payment for the exercise of Options
may be made in cash, by personal check payable to the Company, by delivery of
shares of Common Stock having an aggregate fair market value on the date of
exercise which is not less than the option price, or by a combination thereof.
7. PLAN AMENDMENT AND TERMINATION. The Board of Directors may suspend
or terminate the Option Plan or any portion thereof at any time, and may amend
the Option Plan from time to time in any respect, provided that no such
amendment will be effective without approval of the shareholders, if shareholder
approval is required pursuant to Rule 16b-3 under the Securities Exchange Act of
1934 or the applicable rules of any securities exchange or the NASD. To the
extent prohibited under Rule 16b-3 under the Securities Exchange Act of 1934,
the Option Plan may not be amended more than once every six months. No
termination, suspension or amendment of the
2
<PAGE>
Option Plan will alter an outstanding Option without the consent of the holder
of such Option. Unless earlier terminated by action of the Board, the Option
Plan will terminate on September 7, 2003, and no Option shall be granted after
any such termination. Options outstanding upon termination of the Option Plan
may continue to be exercised in accordance with their terms.
8. COMPLIANCE WITH SEC REGULATIONS. It is the Company's intent that the
Option Plan comply in all respects with Rule 16b-3 of the Act and any
regulations promulgated thereunder. If any provision of this plan is later found
not to be in compliance with the Rule, the provision shall be deemed null and
void. All grants and exercises of Options under the Option Plan shall be
executed in accordance with the requirements of Section 16 of the Act, as
amended, and any regulations promulgated thereunder.
9. SHAREHOLDER APPROVAL. The Option Plan shall be subject to approval
by the shareholders holding at least a majority of the voting stock of the
Company represented in person or by proxy at a duly held shareholders' meeting,
and any Option granted under the Option Plan prior to the date of such approval
shall be contingent upon such approval.
10. EFFECTIVE DATE. This Option Plan shall be effective as of September
7, 1993, subject to shareholder approval of the Option Plan as described above
on or before September 7, 1994.
11. MISCELLANEOUS. Except as otherwise provided herein, no non-employee
director shall have any claim or right to be granted an Option under the Option
Plan. Neither the Option Plan nor any action hereunder shall be construed as
giving any director any right to be retained in the service of the Company.
3
<PAGE>
FIRST AMENDMENT TO THE
RECOVERY ENGINEERING, INC.
1993 DIRECTOR STOCK OPTION PLAN
April 24, 1997
RECITALS:
A. The Recovery Engineering, Inc. 1993 Director Stock Option Plan (the
"Plan") was adopted by the Board of Directors of Recovery Engineering,
Inc. (the "Company") on September 7, 1993, and was approved by the
shareholders of the Company on April 12, 1994. The Plan is now in full
force and effect.
B. This First Amendment is adopted in order to increase the number of
shares subject to each option hereafter granted under the Plan.
AMENDMENT:
THEREFORE, the Plan is hereby amended as follows:
1. Amendment No. 1: Section 3.a.ii of the Plan is hereby amended to read
as follows:
"ii. FUTURE NON-EMPLOYEE DIRECTORS. Each person who
is first elected or appointed to serve as a non-employee
director on or after the effective date of the First Amendment
to the Option Plan will automatically be granted an Option on
the date of his or her initial election or appointment to the
Company's Board of Directors to purchase 4,000 shares of
Common Stock."
2. Amendment No. 2: Section 3.b of the Plan is hereby amended to read as
follows:
"b. ADDITIONAL OPTION GRANTS. Under the Option Plan, each
non-employee director will automatically be granted additional Options
to purchase shares of Common Stock as follows:
"i. On the date of the first annual meeting of
shareholders occurring (A) after the Initial Grant to a
non-employee director under the Option Plan and (B) on or
after the effective date of the First Amendment to the Option
Plan, such non-employee director, if reelected at such
meeting, will automatically be granted an additional Option to
purchase 4,000 shares of Common Stock.
"ii. Thereafter, on the date of each subsequent
annual meeting of shareholders at which the non-employee
director is reelected to the Board of Directors, the
non-employee director will automatically be granted an
additional Option to purchase 4,000 shares of Common Stock."
1
<PAGE>
3. Effective Date. This First Amendment shall be effective as of April 24,
1997, and with respect to Options granted under the Plan on or after
such effective date. If shareholder approval of this First Amendment is
required pursuant to Rule 16b-3 under the Securities Act of 1934 or the
applicable rules of any securities exchange or the NASD, then this
First Amendment and any Option granted under the Plan on or after the
date of this First Amendment (but only to the extent of the additional
shares which are subject to such Option as a result of this First
Amendment) shall be subject to and contingent upon such shareholder
approval.
2
<PAGE>
SECOND AMENDMENT TO THE
RECOVERY ENGINEERING, INC.
1993 DIRECTOR STOCK OPTION PLAN
January 28, 1999
RECITALS:
A. The Recovery Engineering, Inc. 1993 Director Stock Option Plan (the
"Option Plan") was adopted by the Board of Directors of Recovery
Engineering, Inc. (the "Company") on September 7, 1993, and was
approved by the shareholders of the Company on April 12, 1994. The
First Amendment to the Option Plan, increasing the number of shares of
Common Stock subject to each option thereafter granted under the Option
Plan, was adopted by the Board of Directors on April 24,1997, and was
approved by the shareholders of the Company on April 23, 1998. The
Option Plan, as amended, is now in full force and effect,
B. This Second Amendment is adopted in order to increase the number of
shares of Common Stock available for issuance under the Option Plan.
AMENDMENT:
THEREFORE, the Option Plan is hereby amended as follows.
1. The first sentence of paragraph 2 of the Option Plan is hereby amended
to read as follows:
"2. STOCK SUBJECT TO THE OPTION PLAN. An aggregate of 130,000
shares of Common Stock, par value $.01 per share, ("Common Stock") of
the Company are reserved for issuance under the Option Plan."
2. The foregoing amendment shall be effective as of January 28, 1999, and
shall be subject to approval by the shareholders of the Company at its
next Annual or Special Meeting of shareholders.
