Securities And Exchange Commission
Washington, D.C. 20549
Form S-8
Registration Statement
Under The Securities Act Of 1933
PEOPLES TELEPHONE COMPANY, INC.
(Exact name of registrant as specified in its charter)
New York 13-2626435
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2300 N.W. 89th Place, Miami, Florida 33172
(Address of Principal Executive Offices, Zip Code)
Peoples Telephone Company, Inc. 1997 Incentive Plan
(Full title of the plan)
E. Craig Sanders Copies of Communications to:
President, Chief Executive Officer Ira N. Rosner, P.A.
Peoples Telephone Company, Inc. Steel Hector & Davis LLP
2300 Northwest 89th Place 200 South Biscayne Boulevard
Miami, Florida 33172 Suite 4000
(305) 593-9667 Miami, Florida 33131-2398
(Name, address, and telephone number, (305) 577-2919
including area code, of agent for service)
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CALCULATION OF REGISTRATION FEE
- -------------------------------------------------------------------------------
Title of
Securities Proposed Maximum Proposed Maximum Amount of
to be Amount to be Offering Price Aggregate Offering Registration
Registered registered Per Unit (1) Price (1) Fee
- -------------------------------------------------------------------------------
Common Stock,
$. 01 par
value 1,350,000 (2) $3.625 $4,893,750 $1,483
- -------------------------------------------------------------------------------
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(h)(1) under the Securities Act of 1933, based upon the
average of the high and low prices of such Common Stock on November 14,
1997 on the American Stock Exchange.
(2) This Registration Statement also relates to such indeterminate number of
additional Common Stock of the Registrant as may be issuable as a result of
stock splits, stock dividends, recapitalizations, mergers, reorganizations,
combinations or exchanges of shares or other similar events.
This Registration Statement shall become effective upon filing with the
Securities and Exchange Commission in accordance with Section 8(a) of the
Securities Act of 1933, as amended, and Rule 462 promulgated thereunder.
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PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Item 1. Plan Information.
Not required to be filed with the Securities and Exchange Commission
(the "Commission").
Item 2. Registrant Information and Employee Plan Annual Information.
Not required to be filed with the Commission.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents filed or to be filed by Peoples Telephone Company,
Inc. (the "Company") with the Commission are incorporated herein by
reference:
1. The Company's Annual Report on Form 10-K for the year ended December 31,
1996, as amended by Form 10-K/A No. 1 filed on April 11, 1997 (Commission
File No. 1-12443).
2. The Company's Quarterly Report on Form 10-Q for the quarterly period ended
March 31, 1997 filed on May 14, 1997 (Commission File No. 1-12443).
3. The Company's Proxy Statement filed on June 13, 1997 (Commission File No.
1-12443).
4. The Company's Current Report on Form 8-K filed on July 11, 1997 (Commission
File No. 1-12443).
5. The Company's Current Report on Form 8-K filed on July 18, 1997 (Commission
File No. 1-12443).
6. The Company's Quarterly Report on Form 10-Q for the quarterly period ended
June 30, 1997, as amended by Form 10-Q/A No. 1 filed on August 29, 1997
(Commission File No. 1-12443).
7. The Company's Current Report on Form 8-K filed on September 24, 1997
(Commission File No. 1-12443).
8. The Company's Current Report on Form 8-K filed on October 16, 1997
(Commission File No. 1-12443).
9. The Company's Quarterly Report on Form 10-Q for the quarterly period ended
September 30, 1997 filed on November 14, 1997 (Commission File No.
1-12443).
10. All other reports filed by the Company pursuant to Section 13(a) or 15(d)
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
since December 31, 1996.
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11. The description of the Company's Common Stock, par value $.01 per share, to
be offered pursuant to the Company's 1997 Incentive Plan (the "Incentive
Plan"), which description is contained in the Company's Registration
Statement on Form 8-A filed by the Company with the Commission on November
8, 1996 (Commission File No. 0-16479), including all amendments and reports
filed after the date hereof for the purpose of updating such description.
All documents subsequently filed by the Company pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Exchange Act prior to the filing of a post-effective
amendment which indicates that all securities offered hereby have been sold or
which deregisters all securities remaining unsold, 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 this Registration Statement, or in a document
incorporated or deemed to be incorporated by reference herein, shall be deemed
to be modified or superseded for purposes of this Registration Statement to the
extent that a statement contained herein or in any other subsequently filed
document which is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute a part of this
Registration Statement.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
None.
Item 6. Indemnification of Directors and Officers.
Certificate of Incorporation. Paragraph Tenth of the Company's Certificate
of Incorporation provides that the Company will indemnify and reimburse the
officers and directors of the Company to the fullest extent provided by law.
Paragraph Tenth of the Company's Certificate of Incorporation further provides
that the provisions regarding indemnification and advancement of expenses as
provided by law shall not be exclusive of any other right which any officer or
director of the Company may have or acquire thereafter under any provisions of
the Company's Certificate of Incorporation or By-laws or by any agreement, vote
of shareholders or disinterested directors of the Company or otherwise,
provided, that no indemnification may be made to or on behalf of any officer or
director if a judgment or other final adjudication adverse to such officer or
director establishes that his acts were committed in bad faith or were the
result of active and deliberate dishonesty and were material to the cause of
action so adjudicated, or that he personally gained in fact a financial profit
or other advantage to which he was not legally entitled.
Paragraph Tenth of the Company's Certificate of Incorporation also provides
that a director shall not be liable to the Corporation or its shareholders for
damages for any breach of duty in such director's capacity as a director unless
(i) a judgment or other final adjudication adverse to the director establishes
that his acts or omissions were in bad faith or involved intentional misconduct
or a knowing violation of law or that he personally gained in fact a financial
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profit or other advantage to which he was not legally entitled or that his acts
violated section 719 of the Business Corporation Law of New York or (ii) the
liability of any director for any act or omission occurred prior to the adoption
of such indemnification provision by the Company.
Director and Officer Liability Insurance. Effective December 31, 1996, the
Company renewed insurance providing for reimbursement, subject to certain
exclusions and deductions, to (i) the Company for payments it makes to indemnify
directors and officers of the Company and its subsidiaries, and (ii) directors
and officers for losses, costs and expenses incurred by them in connection with
their acts in those capacities for which they are not indemnified by the
Company.
Indemnification under the Incentive Plan. With respect to the Incentive
Plan, the members of the committee of the board of directors of the Company
which administers the Incentive Plan and any officer or employee acting on
behalf of the such committee shall be fully indemnified and protected by the
Company, to the fullest extent permitted by law, with respect to any action,
determination, or interpretation relating to the Incentive Plan taken or made in
good faith and shall not be personally liable for any action, determination or
interpretation taken or made in good faith with respect to the Incentive Plan.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
(a) 4.1 Peoples Telephone Company, Inc. 1997 Incentive Plan.
*4.2 Amended and Restated Certificate of Incorporation of the Company,
as amended to date, incorporated herein by reference to the
Company's Annual Report on Form 10-K for the year ended December
31, 1996. (Commission File No. 1-12443)
*4.3 Restated Bylaws of the Company, incorporated herein by reference
to the Registration Statement on Form 10 filed by the Company
with the Commission on January 20, 1988. (Commission File No.
0-16479)
*4.4 Form of Second Amended and Restated Warrant Agreement dated as of
February 17, 1994 between the Company and Creditanstalt American
Corporation ("CAC"), incorporated herein by reference to the
Company's Annual Report on Form 10-K for the year ended December
31, 1994. (Commission File No. 0-16479)
*4.5 First Amendment to Second Amended and Restated Warrant Agreement
dated October 30, 1995 between the Company and CAC, incorporated
herein by reference to the Company's Quarterly Report on Form
10-Q for the quarter ended September 30, 1995. (Commission File
No. 0-16479)
*4.6 Second Amendment to Second Amended and Restated Warrant Agreement
dated April 4, 1996 between the Company and CAC, incorporated
herein by reference to the Company's Quarterly Report on Form
10-Q for the quarter ended March 31, 1996. (Commission File No.
0-16479)
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*4.7 Form of Stock Purchase Warrant issued on July 19, 1995 to Appian
Capital Partners, L.L.C., incorporated herein by reference to the
Company's Current Report on Form 8-K dated July 19, 1995.
(Commission File No. 0-16479)
*4.8 Form of Contingent Stock Purchase Warrant issued on July 19, 1995
to UBS Partners, Inc., incorporated herein by reference to the
Company's Current Report on Form 8-K dated July 19, 1995.
(Commission File No. 0-16479)
5 Opinion of Steel Hector & Davis LLP.
*10.1Security Purchase Agreement between UBS Capital Corporation;
Appian Capital Partners, L.L.C. and the Company dated July 3,
1995, incorporated herein by reference to the Company's Current
Report on Form 8-K dated July 19, 1995. (Commission File No.
0-16479)
*10.2Letter Agreement, dated July 18, 1995, among the Company, UBS
Capital Corporation, UBS Partners, Inc. and Appian Capital
Partners, L.L.C., amending the Securities Purchase Agreement,
dated as of July 3, 1995 among the Company, UBS Capital
Corporation and Appian Capital Partners, L.L.C., incorporated
herein by reference to the Company's Current Report on Form 8-K
dated July 19, 1995. (Commission File No. 0-16479)
23.1 Consent of Ernst & Young LLP.
23.2 Consent of Price Waterhouse LLP.
23.3 Consent of Steel Hector & Davis LLP is included in Exhibit 5.
24 Power of Attorney (included on signature pages of this
Registration Statement).
* Incorporated by reference as indicated.
Item 9. Undertakings.
(a) The undersigned Company hereby undertakes:
(1) To file, during any period in which it offers or sells securities,
a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, as amended (the "Securities Act");
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in this Registration Statement. Notwithstanding the foregoing, any
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increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in the volume and price represent no more
than a 20% change in the maximum aggregate offering price set forth in
the "Calculation of Registration Fee" table in the effective
Registration Statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement;
provided, however, that paragraphs (i) and (ii) do not apply if the information
required to be included in a post-effective amendment is contained in periodic
reports filed with or furnished to the Commission by the Company pursuant to
Section 13 or Section 15(d) of the Exchange Act that are incorporated by
reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the Securities
Act, each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(b) The undersigned Company hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the Company's
annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act
(and, where applicable, each filing of an employee benefit plan's annual report
pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference
in the Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Company pursuant to any provision or arrangement whereby the Company may
indemnify any such directors, officers or controlling persons against such
liabilities, the Company has been advised that in the opinion of the Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Company of expenses
incurred or paid by a director, officer or controlling person of the Company 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 Company will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Company
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 Miami, State of Florida, on this 20th day of November,
1997.
PEOPLES TELEPHONE COMPANY, INC.
By: /s/ WILLIAM A. BAUM
William A. Baum
Chief Financial Officer, Senior Vice President
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POWER OF ATTORNEY AND SIGNATURES
Each person whose signature appears below constitutes and appoints E. Craig
Sanders and William A. Baum, or either of them, as his or her true and lawful
attorneys-in-fact and agents with full power of substitution and resubstitution
for him or her and in his or her name, place and stead in any and all capacities
to execute in the name of each such person who is then an officer or director of
the Company any and all amendments (including post-effective 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 attorneys-in-fact and agents and each of them full power and
authority to do and perform each and every act and thing required or necessary
to be done in and about the premises as fully as he or she might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, or any of them, or their substitute or substitutes, may lawfully do or
cause to be done by virtue thereof.
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 date indicated:
Signature Title Date
- ---------------------- ----------------------------- -----------------
/s/ E. CRAIG SANDERS President, Chief Executive November 20, 1997
E. Craig Sanders Officer and Director (Chief
Executive Officer)
/s/ WILLIAM A. BAUM Chief Financial Officer, Senior November 20, 1997
William A. Baum Vice President (Principal
Financial and Accounting Officer)
/s/ JODY FRANK Director November 20, 1997
Jody Frank
/s/ CHARLES J. DELANEY Director November 20, 1997
Charles J. Delaney
/s/ ROBERT E. LUND Director November 20, 1997
Robert E. Lund
/s/ JUSTIN S. MACCARONE Director November 20, 1997
Justin S. Maccarone
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EXHIBIT INDEX
Exhibit
No.
- -------
4.1 Peoples Telephone Company, Inc. 1997 Incentive Plan.
5 Opinion of Steel Hector & Davis LLP.
23.1 Consent of Ernst & Young LLP.
23.2 Consent of Price Waterhouse LLP.
23.3 Consent of Steel Hector & Davis LLP is included in Exhibit 5.
24 Power of Attorney (included on signature pages of this Registration
Statement).
EXHIBIT 4.1
PEOPLES TELEPHONE COMPANY, INC.
1997 Incentive Plan
SECTION 1. Purpose. The purpose of this 1997 Incentive Plan (the "Plan") of
Peoples Telephone Company, Inc. (together with any successor thereto, the
"Corporation") is (a) to promote the identity of interests between shareholders,
directors, officers, employees, and consultants of the Corporation by
encouraging and creating significant ownership of Common Stock of the
Corporation by directors, officers and other employees of the Corporation and
its subsidiaries; (b) to enable the Corporation to attract and retain qualified
directors, officers, employees, and consultants who contribute to the
Corporation's success by their ability, ingenuity and industry; and (c) to
provide meaningful long-term incentive opportunities for directors, officers,
employees, and consultants who are responsible for the success of the
Corporation and who are in a position to make significant contributions toward
its objectives.
SECTION 2. Definitions. In addition to the terms defined elsewhere in the
Plan, the following shall be defined terms under the Plan:
2.01. "Award" means any Performance Award, Option, Stock Appreciation
Right, Dividend Equivalent, or Other Stock-Based Award, or any other right or
interest relating to Shares or cash, granted to a Participant under the Plan.
2.02. "Award Agreement" means any written agreement, contract, or other
instrument or document evidencing an Award.
2.03. "Board" means the Board of Directors of the Corporation.
2.04. "Code" means the Internal Revenue Code of 1986, as amended from time
to time. References to any provision of the Code shall be deemed to include
successor provisions thereto and regulations thereunder.
2.05. "Committee" means the Compensation Committee of the Board, or such
other Board committee as may be designated by the Board to administer the Plan,
or any subcommittee of either; provided, however, that the Committee and any
subcommittee thereof, shall consist of two or more directors, each of whom is a
"Non-Employee Director" within the meaning of Rule 16b-3 under the Exchange Act
and is also an "Outside Director" within the meaning of Section 162(m) of the
Code and the regulations thereunder.
2.06. "Corporation" is defined in Section 1.
2.07. "Covered Employee" has the same meaning as set forth in Section
162(m) of the Code, and the regulations thereunder.
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2.08. "Dividend Equivalent" means a right, granted to a Participant under
Section 6.03, to receive cash, Shares, other Awards, or other property equal in
value to dividends paid with respect to a specified number of Shares.
2.09. "Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time. References to any provision of the Exchange Act shall be
deemed to include successor provisions thereto and regulations thereunder.
2.10. "Fair Market Value" means, with respect to Shares, Awards, or other
property, the fair market value of such Shares, Awards, or other property
determined by such methods or procedures as shall be established from time to
time by the Committee. Unless otherwise determined by the Committee, the Fair
Market Value of Shares as of any date shall be the closing sales price on that
date of a Share as reported on the stock exchange or automated stock quotation
system on which Shares may be listed or quoted; provided, that if there were no
sales on the valuation date but there were sales on dates within a reasonable
period both before and after the valuation date, the Fair Market Value shall be
the weighted average of the closing prices on the nearest date before and the
nearest date after the valuation date (the "Average"). The Average is to be
weighted inversely by the respective numbers of trading days between the selling
dates and the valuation date.
2.11. "Incentive Stock Option" means an Option that is intended to meet the
requirements of Section 422 of the Code.
2.12. "Non-Qualified Stock Option" means an Option that is not intended to
be an Incentive Stock Option.
2.13. "Option" means a right, granted to a Participant under Section 6.04,
to purchase Shares, other Awards, or other property at a specified price during
specified time periods. An Option may be either an Incentive Stock Option or a
Non-Qualified Stock Option.
2.14. "Other Stock-Based Award" means a right, granted to a Participant
under Section 6.06, that relates to or is valued by reference to Shares.
2.15. "Participant" means a person who, as a director, officer, employee or
consultant of the Corporation or any Subsidiary, has been granted an Award under
the Plan.
2.16. "Performance Award" means a right, granted to a Participant under
Section 6.02, to receive cash, Shares, other Awards, or other property the
payment of which is contingent upon achievement of certain performance goals
specified by the Committee.
2.17. "Plan" is defined in Section 1.
2.18. "Rule 16b-3" means Rule 16b-3, as from time to time amended and
applicable to Participants, promulgated by the Securities and Exchange
Commission under Section 16 of the Exchange Act.
2.19. "Shares" means the Common Stock, $.01 par value, of the Corporation
and such other securities of the Corporation as may be substituted for Shares or
such other securities pursuant to Section 9.
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2.20. "Stock Appreciation Right" means a right, granted to a Participant
under Section 6.05, to be paid an amount measured by the appreciation in the
Fair Market Value of Shares from the date of grant to the date of exercise of
the right, with payment to be made in cash, Shares, other Awards, or other
property as specified in the Award or determined by the Committee.
2.21. "Subsidiary" means any corporation (other than the Corporation) with
respect to which the Corporation owns, directly or indirectly, more than 50% of
the total combined voting power of all classes of stock. In addition, any other
related entity may be designated by the Board as a Subsidiary, provided such
entity could be considered as a subsidiary according to generally accepted
accounting principles.
2.22. "Year" means a calendar year.
SECTION 3. Administration.
3.01. Authority of the Committee. The Plan shall be administered by the
Committee. The Committee shall have full and final authority to take the
following actions, in each case subject to and consistent with the provisions of
the Plan:
(i) to select and designate Participants;
(ii) to designate Subsidiaries;
(iii) to determine the type or types of Awards to be granted to each
Participant;
(iv) to determine the number of Awards to be granted, the number of Shares
to which an Award will relate, the terms and conditions of any Award
granted under the Plan (including, but not limited to, any exercise price,
grant price, or purchase price, the applicable performance goals, the
certification of achievement of such goals prior to the settlement of an
Award, any restriction or condition, any schedule for lapse of restrictions
or conditions relating to transferability or forfeiture, exercisability, or
settlement of an Award, and waivers or accelerations thereof, and waiver of
performance conditions relating to an Award, based in each case on such
considerations as the Committee shall determine), and all other matters to
be determined in connection with an Award;
(v) to determine whether, to what extent, and under what circumstances an
Award may be settled, or the exercise price of an Award may be paid, in
cash, Shares, other Awards, or other property, or an Award may be canceled,
forfeited, or surrendered;
(vi) to determine whether, to what extent, and under what circumstances
cash, Shares, other Awards, or other property payable with respect to an
Award will be deferred either automatically, at the election of the
Committee, or at the election of the Participant;
(vii) to prescribe the form of each Award Agreement, which need not be
identical for each Participant;
(viii) to adopt, amend, suspend, waive, and rescind such rules and
regulations and appoint such agents as the Committee may deem necessary or
advisable to administer the Plan;
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(ix) to correct any defect or supply any omission or reconcile any
inconsistency in the Plan and to construe and interpret the Plan and any
Award, rules and regulations, Award Agreement, or other instrument
hereunder; and
(x) to make all other decisions and determinations as may be required under
the terms of the Plan or as the Committee may deem necessary or advisable
for the administration of the Plan.
3.02. Manner of Exercise of Committee Authority. Unless authority is
specifically reserved to the Board under the terms of the Plan, the Committee
shall have sole discretion in exercising such authority under the Plan. Any
action of the Committee with respect to the Plan shall be final, conclusive, and
binding on all persons, including the Corporation, Subsidiaries, Participants,
any person claiming any rights under the Plan from or through any Participant,
and shareholders. The express grant of any specific power to the Committee, and
the taking of any action by the Committee, shall not be construed as limiting
any power or authority of the Committee. A memorandum signed by all members of
the Committee shall constitute the act of the Committee without the necessity,
in such event, to hold a meeting, and the Committee shall establish other rules
governing meetings of the Committee. The Committee may delegate to officers or
managers of the Corporation or any Subsidiary the authority, subject to such
terms as the Committee shall determine, to perform administrative functions
under the Plan.
3.03. Limitation of Liability. Each member of the Committee shall be
entitled to rely or act upon, in good faith, any report or other information
furnished to him by any officer or other employee of the Corporation or any
Subsidiary, the Corporation's independent certified public accountants, or any
executive compensation consultant or other professional retained by the
Corporation to assist in the administration of the Plan. No member of the
Committee, nor any officer or employee of the Corporation acting on behalf of
the Committee, shall be personally liable for any action, determination, or
interpretation taken or made in good faith with respect to the Plan, and all
members of the Committee and any officer or employee of the Corporation acting
on their behalf shall, to the extent permitted by law, be fully indemnified and
protected by the Corporation with respect to any such action, determination, or
interpretation.
SECTION 4. Shares Subject to the Plan. Subject to adjustment as provided in
Section 10, the total number of Shares reserved and available for Awards under
the Plan shall be 1,350,000. For purposes of this Section 4, the number of and
time at which Shares shall be deemed to be subject to Awards and therefore
counted against the number of Shares reserved and available under the Plan shall
be the earliest date at which the Committee can reasonably estimate the number
of Shares to be distributed in settlement of an Award or with respect to which
payments will be made; provided, however, that the Committee may adopt
procedures for the counting of Shares relating to any Award for which the number
of Shares to be distributed or with respect to which payment will be made cannot
be fixed at the date of grant to ensure appropriate counting, avoid double
counting (in the case of tandem or substitute awards), and provide for
adjustments in any case in which the number of Shares actually distributed or
with respect to which payments are actually made differs from the number of
Shares previously counted in connection with such Award.
If any Shares to which an Award relates are forfeited or the Award is
settled or terminates without a distribution of Shares (whether or not cash,
other Awards, or other property is distributed with respect to such Award), any
Shares counted against the number of Shares reserved and available under the
Plan with respect to such Award shall, to the extent of any such forfeiture,
settlement or termination, again be available for Awards under the Plan.
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SECTION 5. Eligibility. Awards may be granted only to individuals who are
directors, officers or other employees and consultants of the Corporation or a
Subsidiary; provided, however, that no Award shall be granted to any member of
the Committee.
SECTION 6. Specific Terms of Awards.
6.01 General. Awards may be granted on the terms and conditions set forth
in this Section 6. In addition, subject to the provisions of Section 10.02, the
Committee may impose on any Award or the exercise thereof, at the date of grant
or thereafter, such additional terms and conditions, not inconsistent with the
provisions of the Plan and Section 162(m) of the Code, as the Committee shall
determine, including without limitation the acceleration of vesting of any
Awards or terms requiring forfeiture of Awards in the event of termination of
service as a director or employment by the Participant. Except as provided in
Sections 7.03 and 7.04, only services may be required as consideration for the
grant of any Award.
6.02. Performance Awards. Subject to the provisions of Section 7.01 and
7.02, the Committee is authorized to grant Performance Awards to Participants on
the following terms and conditions:
(i) Award and Conditions. A Performance Award shall confer upon the
Participant rights, valued as determined by the Committee, and payable to,
or exercisable by, the Participant to whom the Performance Award is
granted, in whole or in part, as determined by the Committee, conditioned
upon the achievement of performance criteria determined by the Committee.
(ii) Other Terms. A Performance Award may be denominated in Shares and may
be payable in cash, other Awards, or other property, and have such other
terms as shall be determined by the Committee.
6.03. Dividend Equivalents. The Committee is authorized to grant Dividend
Equivalents to Participants. The Committee may provide that Dividend Equivalents
shall be paid or distributed when accrued or shall be deemed to have been
reinvested in additional Shares or Awards, or otherwise reinvested; provided,
however, that the payment of Dividend Equivalents shall not be made contingent
upon a Participant's exercise of any Option awarded under Section 6.04.
6.04. Options: The Committee is authorized to grant Options to Participants
on the following terms and conditions:
(i) Exercise Price. The exercise price per Share purchasable under an
Option shall be determined by the Committee; provided, however, that,
except as provided in Section 7.03, such exercise price shall be not less
than the Fair Market Value of a Share on the date of grant of such Option.
(ii) Time and Method of Exercise. The Committee shall determine the time or
times at which an Option may be exercised in whole or in part, the methods
by which such exercise price may be paid or deemed to be paid, the form of
such payment, including, without limitation, cash, Shares, other Awards or
awards issued under other Corporation plans, or other property (including
notes or other contractual obligations of Participants to make payment on a
deferred basis, such as through "cashless exercise" arrangements), and the
methods by which Shares will be delivered or deemed to be delivered to
Participants. Options shall expire not later than ten years after the date
of grant.
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(iii) Incentive Stock Options. The terms of any Incentive Stock Option
granted under the Plan shall comply in all respects with the provisions of
Section 422 of the Code, including but not limited to requirements related
to aggregate maximum fair market value of underlying Shares, minimum
exercise prices, Option duration and the requirement that no Incentive
Stock Option shall be granted more than ten years after the effective date
of the Plan. Anything in the Plan to the contrary notwithstanding, no term
of the Plan relating to Incentive Stock Options shall be interpreted,
amended, or altered, nor shall any discretion or authority granted under
the Plan be exercised, so as to disqualify either the Plan or any Incentive
Stock Option under Section 422 of the Code. In the event a Participant
voluntarily disqualifies an Option as an Incentive Stock Option, the
Committee may, but shall not be obligated, to make such additional Awards
or pay bonuses as the Committee shall deem appropriate to reflect the tax
savings to the Corporation which result from such disqualification.
6.05. Stock Appreciation Rights. The Committee is authorized to grant Stock
Appreciation Rights to Participants on the following terms and conditions:
(i) Right to Payment. A Stock Appreciation Right shall confer on the
Participant to whom it is granted a right to receive, upon exercise
thereof, the excess of (A) the Fair Market Value of one Share on the date
of exercise (or, if the Committee shall so determine in the case of any
such right, other than one related to an Incentive Stock Option, the Fair
Market Value of one Share at any time during a specific period before or
after the date of exercise) over (B) the grant price of the Stock
Appreciation Right as determined by the Committee as of the date of grant
of the Stock Appreciation Right, which, except as provided in Section 7.03,
shall be not less than the Fair Market Value of one Share on the date of
grant.
(ii) Other Terms. The Committee shall determine the time or times at which
a Stock Appreciation Right may be exercised in whole or in part, the method
of exercise, method of settlement, form of consideration payable in
settlement, method by which Shares will be delivered or deemed to be
delivered to Participants, and any other terms and conditions of any Stock
Appreciation Right. Stock Appreciation Rights shall expire not later than
ten years after the date of grant.
6.06. Other Stock-Based Awards. The Committee is authorized to grant to
Participants such other Awards that are denominated in, valued in whole or in
part by reference to, or otherwise based on or related to, Shares, as deemed by
the Committee to be consistent with the purposes of the Plan, including without
limitation, convertible or exchangeable debt securities, other rights
convertible or exchangeable into Shares, purchase rights and Awards valued by
reference to the value of Shares or the value of securities of or the
performance of specified Subsidiaries. The Committee shall determine the terms
and conditions of such Awards, which may include performance criteria. Shares
delivered pursuant to an Award in the nature of a purchase right granted under
this Section 6.06 shall be purchased for such consideration, paid for at such
times, by such methods, and in such forms, including, without limitation, cash,
Shares, other Awards, or other property, as the Committee shall determine.
SECTION 7. Certain Provisions Applicable to Awards.
7.01. Performance-Based Awards. Performance Awards, Dividend Equivalents
and certain Other Stock-Based Awards subject to performance criteria are
intended to be "qualified performance-based compensation" within the meaning of
Section 162(m) of the Code and shall be paid solely on account of the attainment
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of one or more preestablished, objective performance goals within the meaning of
Section 162(m) and the regulations thereunder. Until otherwise determined by the
Committee, the performance goal shall be the attainment of preestablished
amounts of annual net income of the Corporation.
The payout of any such Award to a Covered Employee may be reduced, but not
increased, based on the degree of attainment of other performance criteria or
otherwise at the discretion of the Committee.
7.02. Maximum Yearly Awards. A maximum of 500,000 Shares (or the equivalent
Fair Market Value thereof with respect to Awards valued in whole or in part by
reference to, or otherwise based on or related to, Shares) may be made subject
to Performance Awards and Other Stock-Based Awards subject to performance
criteria in any Year. The maximum payout of such Awards in any Year may not
exceed 150% of the amount thereof, or 750,000 Shares in the aggregate and
187,500 Shares in the case of any Participant. A maximum of 750,000 Shares may
be made subject to Options and Stock Appreciation Rights in any Year. No
Participant may receive Awards covering or representing more than 25% of the
maximum number of Shares which may be made subject to such types of Awards in
any Year. Notwithstanding the foregoing, awards of Options granted in connection
with an employee's initial employment with the Corporation or a Subsidiary shall
not count toward or be subject to such limitations. The Share amounts in this
Section 7.02 are subject to adjustment (i) by the Committee and (ii) under
Section 9, and are subject to the Plan maximum under Section 4.
7.03. Stand-Alone, Additional, Tandem, and Substitute Awards. Awards
granted under the Plan may, in the discretion of the Committee, be granted
either alone or in addition to, in tandem with, or in substitution for any other
Award granted under the Plan or any award granted under any other plan of the
Corporation, any Subsidiary, or any business entity to be acquired by the
Corporation or a Subsidiary, or any other right of a Participant to receive
payment from the Corporation or any Subsidiary. If an Award is granted in
substitution for another Award or award, the Committee shall require the
surrender of such other Award or award in consideration for the grant of the new
Award. Awards granted in addition to or in tandem with other Awards or awards
may be granted either as of the same time as, or at a different time from, the
grant of such other Awards or awards. Subject to Section 9 hereof, the per Share
exercise price of any Option, grant price of any Stock Appreciation Right, or
purchase price of any other Award conferring a right to purchase Shares:
(i) Granted in substitution for an outstanding Award or award shall be not
less than the lesser of the Fair Market Value of a Share at the date such
substitute award is granted or such Fair Market Value at that date reduced
to reflect the Fair Market Value at that date of the Award or award
required to be surrendered by the Participant as a condition to receipt of
the substitute Award; or
(ii) Retroactively granted in tandem with an outstanding Award or award
shall be not less than the lesser of the Fair Market Value of a Share at
the date of grant of the later Award or the date of grant of the earlier
Award or award.
7.04. Exchange Provisions. The Committee may at any time offer to exchange
or buy out any previously granted Award for a payment in cash, Shares, other
Awards (subject to Section 7.03), or other property based on such terms and
conditions as the Committee shall determine and communicate to the Participant
at the time that such offer is made.
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7.05. Term of Awards. The term of each Award shall be for such period as
may be determined by the Committee; provided, however, that in no event shall
the term of any Option or a Stock Appreciation Right granted in tandem therewith
exceed a period of ten years from the date of its grant (or such shorter period
as may be applicable under Section 422 of the Code).
7.06. Form of Payment Under Awards. Subject to the terms of the Plan and
any applicable Award Agreement, payments to be made by the Corporation or a
Subsidiary upon the grant or exercise of an Award may be made in such forms as
the Committee shall determine, including without limitation, cash, Shares, other
Awards, or other property, and may be made in a single payment or transfer, in
installments, or on a deferred basis. Such payments may include, without
limitation, provisions for the payment or crediting of reasonable interest on
installment or deferred payments or the grant or crediting of Dividend
Equivalents in respect of installment or deferred payments denominated in
Shares.
SECTION 8. General Restrictions Applicable to Awards.
8.01. Restrictions Under Rule 16b-3.
8.01.1. Six-Month Holding Period. Unless a Participant could otherwise
transfer an equity security, derivative security, or Shares issued upon
exercise of a derivative security granted under the Plan without incurring
liability under Section 16(b) of the Exchange Act, (i) an equity security
issued under the Plan, other than an equity security issued upon exercise
or conversion of a derivative security granted under the Plan, shall be
held for at least six months from the date of acquisition, and (ii), with
respect to a derivative security issued under the Plan, at least six months
shall elapse from the date of acquisition of the derivative security to the
date of disposition of the derivative security (other than upon exercise or
conversion) or its underlying equity security; and (iii) any Award in the
nature of a Stock Appreciation Right must be held for six months from the
date of grant to the date of cash settlement.
8.01.2. Nontransferability. Awards which constitute derivative
securities (including any option, stock appreciation right, or similar
right) shall not be transferable by a Participant except by will or the
laws of descent and distribution (except pursuant to a beneficiary
designation authorized under Section 8.02) or, if then permitted under Rule
16b-3, pursuant to a qualified domestic relations order as defined under
the Code or Title I of the Employee Retirement Income Security Act of 1974,
as amended, or the rules thereunder, and, in the case of an Incentive Stock
Option or, if then required by Rule 16b-3, any other derivative security
granted under the Plan, shall be exercisable during the lifetime of a
Participant only by such Participant or his guardian or legal
representative.
8.01.3. Compliance with Rule 16b-3. It is the intent of the
Corporation that this Plan comply in all respects with Rule 16b-3 in
connection with any Award granted to a person who is subject to Section 16
of the Exchange Act. Accordingly, if any provision of this Plan or any
Award Agreement does not comply with the requirements of Rule 16b-3 as then
applicable to any such person, such provision shall be construed or deemed
amended to the extent necessary to conform to such requirements with
respect to such person.
8.02. Limits on Transfer of Awards; Beneficiaries. No right or interest of
a Participant in any Award shall be pledged, encumbered, or hypothecated to or
in favor of any party (other than the Corporation or a Subsidiary), or shall be
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subject to any lien, obligation, or liability of such Participant to any party
(other than the Corporation or a Subsidiary). Unless otherwise determined by the
Committee (subject to the requirements of Section 8.01.2), no Award subject to
any restriction shall be assignable or transferable by a Participant otherwise
than by will or the laws of descent and distribution (except to the Corporation
under the terms of the Plan); provided, however, that a Participant may, in the
manner established by the Committee, designate a beneficiary or beneficiaries to
exercise the rights of the Participant, and to receive any distribution, with
respect to any Award, upon the death of the Participant. A beneficiary,
guardian, legal representative, or other person claiming any rights under the
Plan from or through any Participant shall be subject to all terms and
conditions of the Plan and any Award Agreement applicable to such Participant or
agreement applicable to such, except to the extent the Plan and such Award
Agreement or agreement otherwise provide with respect to such persons, and to
any additional restrictions deemed necessary or appropriate by the Committee.
8.03. Registration and Listing Compliance. The Corporation shall not be
obligated to deliver any Award or distribute any Shares with respect to any
Award in a transaction subject to any regulatory approval, registration, or any
other applicable requirement of federal or state law, or subject to a listing
requirement under any listing or similar agreement between the Corporation and
any national securities exchange or automatic stock quotation system, until such
approval or registration has been obtained and such laws, regulations, and
contractual obligations of the Corporation have been complied with in full,
although the Corporation shall be obligated to use its best efforts to obtain
any such approval and comply with such requirements as promptly as practicable.
8.04. Share Certificates. All certificates for Shares delivered under the
Plan pursuant to any Award or the exercise thereof shall be subject to such
stop-transfer order and other restrictions as the Committee may deem advisable
under applicable federal or state laws, rules and regulations thereunder, and
the rules of any national securities exchange or automated stock quotation
system on which Shares are listed or quoted. The Committee may cause a legend or
legends to be placed on any such certificates to make appropriate reference to
such restrictions or any other restrictions that may be applicable to Shares,
including under the terms of the Plan or any Award Agreement. In addition,
during any period in which Awards or Shares are subject to restrictions under
the terms of the Plan or any Award Agreement, or during any period during which
delivery or receipt of an Award or Shares has been deferred by the Committee or
a Participant, the Committee may require the Participant to enter into an
agreement providing that certificates representing Shares issuable or issued
pursuant to an Award shall remain in the physical custody of the Corporation or
such other person as the Committee may designate.
SECTION 9. Adjustment Provisions. In the event that the Committee shall
determine that any dividend or other distribution (whether in the form of cash,
Shares, or other property), recapitalization, stock split, reverse stock split,
reorganization, merger, consolidation, spin-off, combination, repurchase, or
share exchange, or other similar corporate transaction or event, affects the
Shares such that an adjustment is determined by the Committee to be appropriate
in order to prevent dilution or enlargement of the rights of Participants under
the Plan, then the Committee shall, in such manner as it may deem equitable,
adjust any or all of (i) the number and kind of Shares which may thereafter be
issued in connection with Awards, (ii) the number and kind of Shares issued or
issuable in respect of outstanding Awards, and (iii) the vesting,
exercisability, exercise price, grant price, or purchase price relating to any
Award or, if deemed appropriate, make provision for a cash payment with respect
to any outstanding Award; provided, however, that in each case, with respect to
Incentive Stock Options, no such adjustment shall be authorized to the extent
that such authorization would cause the Plan to violate Section 422(b)(1) of the
Code. In addition, the Committee is authorized to make adjustments in the terms
and conditions of, and the criteria included in, any Award or Award Agreement in
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recognition of unusual or nonrecurring events (including, without limitation,
events described in the preceding sentence) affecting the Corporation or any
Subsidiary or the financial statements of the Corporation or any Subsidiary, or
in response to changes in applicable laws, regulations, or accounting
principles. Notwithstanding anything to the contrary contained in the Plan, the
Committee shall not, without further approval of the shareholders of the
Company, authorize the amendment of any outstanding Option to reduce the
exercise price of such Option, nor without such shareholder approval may the
Committee authorize the cancellation of an outstanding Option and its
replacement with an Option having a lower exercise price; provided, however,
that the foregoing shall not prohibit appropriate adjustments to Options in the
event of a stock split, reverse stock split, stock dividend or similar change to
the Company's capital structure.
SECTION 10. Changes to the Plan and Awards.
10.01. Changes to the Plan. The Board may amend, alter, suspend,
discontinue or terminate the Plan without the consent of shareholders or
Participants, except that any such amendment, alteration, suspension,
discontinuation, or termination shall be subject to the approval of the
Corporation's shareholders within one year after such Board action if such
shareholder approval is required by any federal or state law or regulation or
the rules of any stock exchange or automatic stock quotation system on which the
Shares may be listed or quoted, or if the Board in its discretion determines
that obtaining such shareholder approval is for any reason advisable; provided,
however, that, without the consent of an affected Participant, no amendment,
alteration, suspension, discontinuation, or termination of the Plan may impair
the rights of such Participant under any Award theretofore granted to him.
10.02. Changes to Awards. The Committee may waive any conditions or rights
under, or amend, alter, suspend, discontinue, or terminate, any Award
theretofore granted and any Award Agreement relating thereto; provided, however,
that, without the consent of an affected Participant, no such amendment,
alteration, suspension, discontinuation, or termination of any Award may impair
the rights of such Participant under such Award.
SECTION 11. General Provisions.
11.01. No Rights to Awards. No Participant or employee shall have any claim
to be granted any Award under the Plan, and there is no obligation for
uniformity of treatment of Participants and employees.
11.02. No Shareholder Rights. No Award shall confer on any Participant any
of the rights of shareholder of the Corporation unless and until Shares are duly
issued or transferred to the Participant in accordance with the terms of the
Award.
11.03. Tax Withholding. The Corporation or any Subsidiary is authorized to
withhold from any Award granted, any payment relating to an Award under the
Plan, including from a distribution of Shares, or any payroll or other payment
to a Participant, amounts of withholding and other taxes due with respect
thereto, its exercise, or any payment thereunder, and to take such other action
as the Committee may deem necessary or advisable to enable the Corporation and
Participants to satisfy obligations for the payment of withholding taxes and
other tax liabilities relating to any Award. This authority shall include
authority to withhold or receive Shares or other property and to make cash
payments in respect thereof in satisfaction of Participant's tax obligations.
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11.04. No Right to Employment. Nothing contained in the Plan or any Award
Agreement shall confer, and no grant of an Award shall be construed as
conferring, upon any employee any right to continue in the employ of the
Corporation or any Subsidiary or to interfere in any way with the right of the
Corporation or any Subsidiary to terminate his or her employment at any time or
increase or decrease his or her compensation from the rate in existence at the
time of granting of an Award.
11.05. Unfunded Status of Awards. The Plan is intended to constitute an
"unfunded" plan for incentive and deferred compensation. With respect to any
payments not yet made to a Participant pursuant to an Award, nothing contained
in the Plan or any Award shall give any such Participant any rights that are
greater than those of a general creditor of the Corporation; provided, however,
that the Committee may authorize the creation of trusts or make other
arrangements to meet the Corporation's obligations under the Plan to deliver
cash, Shares, other Awards, or other property pursuant to any award, which
trusts or other arrangements shall be consistent with the "unfunded" status of
the Plan unless the Committee otherwise determines with the consent of each
affected Participant.
11.06. Other Compensatory Arrangements. The Corporation or any Subsidiary
shall be permitted to adopt other or additional compensation arrangements (which
may include arrangements which relate to Awards), and such arrangements may be
either generally applicable or applicable only in specific cases.
11.07. Fractional Shares. No fractional Shares shall be issued or delivered
pursuant to the Plan or any Award. The Committee shall determine whether cash,
other Awards, or other property shall be issued or paid in lieu of fractional
Shares or whether such fractional Shares or any rights thereto shall be
forfeited or otherwise eliminated.
11.08. Governing Law. The validity, construction, and effect of the Plan,
any rules and regulations relating to the Plan, and any Award Agreement shall be
determined in accordance with the laws of the State of Florida, without giving
effect to principles of conflicts of laws, and applicable federal law.
SECTION 12. Effective Date. The Plan shall be effective upon approval of
the Plan by holders of the Corporation's capital stock entitled to vote thereon.
As adopted by the Board of Directors on June 4, 1997.
11
EXHIBIT 5
November 20, 1997
Peoples Telephone Company, Inc.
2300 Northwest 89th Place
Miami, Florida 33172
Ladies and Gentlemen:
We have acted as special counsel to Peoples Telephone Company, Inc. (the
"Company") in connection with the preparation and filing with the Securities and
Exchange Commission, on or about the date hereof, of a registration statement on
Form S-8 (the "Registration Statement"). The Registration Statement relates to
the offering of up to 1,350,000 shares of Common Stock, par value $.01 per
share, of the Company (the "Shares"), pursuant to the terms of the Company's
1997 Incentive Plan (the "Plan").
In connection therewith, we have examined the Company's Restated
Certificate of Incorporation and the Company's Bylaws, each as amended to the
date hereof; resolutions adopted by the Board of Directors of the Company
providing for, among other things, the issuance of the Shares and the filing of
the Registration Statement, resolutions adopted by the shareholders of the
Company approving the Plan and such other corporate documents and records,
certificates of public officials and questions of law as we deemed necessary or
appropriate for the purposes of this opinion. We have also reviewed the relevant
provisions of the New York Business Corporation Law, and such other legal
authority as we have deemed relevant.
Based upon and subject to the foregoing and the other qualifications,
limitations and assumptions contained herein, we are of the opinion that the
Shares, when issued and delivered pursuant to the terms of the Plan, will be
validly issued, fully paid and non-assessable.
We hereby consent to the filing of this opinion as Exhibit 5 to the
Registration Statement and to the reference to us under the caption "Legal
Matters" in the Prospectus related thereto.
Very truly yours,
STEEL HECTOR & DAVIS LLP
EXHIBIT 23.1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We consent to the incorporation by reference in the Registration Statement (Form
S-8), dated November 21, 1997, pertaining to the 1997 Incentive Plan of Peoples
Telephone Company, Inc., of our report dated March 3, 1997, except the third
paragraph of Note 6, as to which the date is March 26, 1997, with respect to the
consolidated financial statements and schedule of Peoples Telephone Company,
Inc. included in its Annual Report (Form 10-K) for the year ended December 31,
1996, filed with the Securities and Exchange Commission.
ERNST & YOUNG LLP
Miami, Florida
November 17, 1997
EXHIBIT 23.2
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To the Board of Directors and Shareholders'
of Peoples Telephone Company, Inc.
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated March 28, 1995, except as to the
second paragraph of Note 18 (except for the statements related to Messrs. Rubin,
Hanft and Frank resignations), and the matters discussed in the second and third
paragraphs of that report, which are as of May 31, 1995, on our audit of the
financial statements as of December 31, 1994 and for the year ended December 31,
1994 appearing on pages 35 and 36 of Peoples Telephone Company, Inc.'s Annual
Report on Form 10-K for the year ended December 31, 1996.
PRICE WATERHOUSE LLP
Miami, Florida
November 17, 1997
