<PAGE>
As filed with the Securities and Exchange Commission on October 14, 1998
Registration No. 333-______
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
GETCHELL GOLD CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 64-0748908
(State or other jurisdiction of 5460 South Quebec Street, (I.R.S. Employer
incorporation or organization) Suite 240 Identification Number)
Englewood, Colorado 80111
(Address of principal executive offices)
--------------------
GETCHELL GOLD CORPORATION
1998 STOCK OPTION PLAN
FOR OUTSIDE DIRECTORS
GETCHELL GOLD CORPORATION
1996 LONG TERM EQUITY INCENTIVE PLAN
(Full title of the plan)
--------------------
Donald S. Robson
Vice President and Chief Financial Officer
Getchell Gold Corporation
5460 South Quebec Street, Suite 240
Englewood, Colorado 80111
(303) 771-9000
(Name, address and telephone number, including area code, of agent for service)
Copies to:
Tad J. Freese
Latham & Watkins
505 Montgomery Street, Suite 1900
San Francisco, CA 94111-2586
(415) 391-0600
--------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------
Proposed
Proposed Maximum
Title of Amount Maximum Aggregate Amount of
Securities to to be Offering Price Offering Registration
be Registered Registered Per Share (1) Price (1) Fee (1)
- ------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, 870,000 $21.3869 $18,606,562.50 $5,488.94
$.0001 par value
- ------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------
</TABLE>
(1) Estimated for the purpose of calculating the registration fee (i) pursuant
to Rule 457(h) on the basis of the exercise price per share of outstanding
options for 45,000 shares at $30.00 per share and 67,500 shares at $23.6875
per share and 45,000 shares at $22.375 per share and (ii) pursuant to Rule
457(c) for the remaining 712,500 shares registered hereunder at the average
of the high and low prices ($20.5625) for the Company's Common Stock quoted
on the American Stock Exchange October 8, 1998.
<PAGE>
PART 1
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
ITEM 1. PLAN INFORMATION
In accordance with the General Instructions to the Form S-8 adopted
by the Securities and Exchange Commission (the "Commission"), the contents of
this item have been omitted from the Registration Statement filed with the
Commission.
ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION
In accordance with the General Instructions to the Form S-8 adopted
by the Commission, the contents of this item have been omitted from the
Registration Statement filed with the Commission.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents have been filed with the Commission by
Getchell Gold Corporation (the "Company") and are hereby incorporated by
reference in this Registration Statement:
(a) The Company's Annual Report on Form 10-K, filed with the Commission on
February 24, 1998;
(b) The Company's Quarterly Report on Form 10-Q, filed with the Commission
on May 4, 1998;
(c) The Company's Quarterly Report on Form 10-Q, filed with the Commission
on July 30, 1998;
(d) The Company's Current Report on Form 8-K, filed with the Commission on
March 12, 1998; and
(e) The Description of the Company's Common Stock contained in the
Company's Registration Statement on Form 8-A filed on June 19, 1996
pursuant to Section 12 of the Exchange Act (No. 001-11847), including
any amendment or report filed for the purpose of updating such
description.
1
<PAGE>
All documents filed by the Company pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Exchange Act after the date of this Registration
Statement and prior to the filing of a post-effective amendment which
indicates that all securities offered have been sold or which deregisters all
securities then remaining unsold, shall be deemed to be incorporated by
reference herein and to be a part hereof from the date of filing 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 of this Registration Statement to the extent that a
statement contained herein or in any other subsequently filed document which
also is or 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
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
As permitted by Section 145 of the Delaware General Corporation Law
(the "DGCL"), the Company's Certificate of Incorporation (the "Certificate of
Incorporation") and Bylaws (the "Bylaws") provide for the indemnification of
officers, directors, employees and agents of the Company. The Certificate of
Incorporation and Bylaws specify the standards of conduct required to be met
to qualify for indemnity. The standards require that the person seeking to
be indemnified must have (a) been successful on the merits or otherwise in
defense of the action or proceeding or (b) acted in good faith and in a
manner reasonably believed to be in or not opposed to the best interests of
the Company, and, with respect to any criminal action or proceeding, such
person must have had no reasonable cause to believe his conduct was unlawful;
provided, however, that if the action, suit or proceeding is by or on behalf
of the Company, no indemnification may be made for any matters as to which
such person has been finally adjudged to be liable to the Company or for
amounts paid in settlement to the Company unless and only to the extent that
a court of competent jurisdiction determines that, in view of all of the
circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses as the court deems proper. Whether these
standards are met will be determined by the stockholders or the Board by
majority vote of a quorum consisting of directors not party to the act, suit
or proceeding or by independent legal counsel selected by the Board. The
Certificate of Incorporation and Bylaws also provide that the Company must
pay an indemnitee's expenses as they are incurred upon an undertaking by such
person to repay such amounts if it is ultimately determined by a court of
competent jurisdiction that such person is not entitled to indemnity.
The Certificate of Incorporation includes a provision that
eliminates the personal liability of its directors for monetary damages for
breach of their fiduciary duty as a director,
2
<PAGE>
except for liability (i) for any breach of the director's duty of loyalty;
(ii) for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of the law; (iii) pursuant to Section 174
of the DGCL; or (iv) for any transaction from which the director derived an
improper personal benefit.
The Company maintains officers and directors liability insurance
against certain claims arising out of such persons' services to the Company.
The Company has entered into indemnification agreements with certain of its
officers and directors. These indemnification agreements provide for
indemnification of such officers or directors in the circumstances and
subject to the conditions set forth in the Company's Certificate of
Incorporation and Bylaws. The effect of the indemnification agreements is to
add to the indemnification rights granted by the Certificate of Incorporation
and Bylaws as currently in effect a contractual right to such indemnification
which right cannot be terminated or altered by amendment of the Certificate
of Incorporation or Bylaws.
The indemnification provisions in the Certificate of Incorporation,
the Bylaws and the indemnification agreements entered into between the
Company and the Company's officers and directors, may be sufficiently broad
to permit indemnification of the officers and directors for liabilities
arising under the Securities Act of 1933, as amended.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8. TABLE OF EXHIBITS
4(a) Getchell Gold Corporation 1998 Stock Option Plan for Outside
Directors.
4(b) Getchell Gold Corporation 1996 Long Term Equity Incentive Plan.
5(a) Opinion of Latham & Watkins.
23(a) Consent of KPMG Peat Marwick LLP.
23(b) Consent of Latham & Watkins (Incorporated in Exhibit 5(a)).
24(a) Power of Attorney (Incorporated in the Signature Page to the
Registration Statement, see page II-5).
- ------------------
ITEM 9. UNDERTAKINGS
(a) The undersigned Registrant hereby undertakes:
3
<PAGE>
(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 this Registration Statement (or the most
recent post-effective amendment thereof) which, individually or
in the aggregate, represent a fundamental change in the
information set forth in the Registration Statement.
Notwithstanding the foregoing, any 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 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; 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) shall not apply
to information contained in periodic reports filed by the Registrant pursuant
to Section 13 or Section 15(d) of the Securities and Exchange Act of 1934
that are incorporated by reference in this 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) 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 15(d)
of the Securities Exchange Act of 1934 that is incorporated by reference in
this Registration Statement shall be deemed to be a new registration
statement relating to the securities offered herein, 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 of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to
4
<PAGE>
the foregoing provisions, or otherwise, the Registrant has been advised that
in the opinion of the Securities and Exchange Commission such indemnification
is against public policy as expressed in the Act and is, therefore,
unenforceable. 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 Act and will be governed by the
final adjudication of such issue.
5
<PAGE>
SIGNATURES
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 Englewood, Colorado, on October 14,
1998.
GETCHELL GOLD CORPORATION
/s/ Donald S. Robson
---------------------------------------------
Donald S. Robson
Vice President, Chief Financial Officer
and Secretary
POWER OF ATTORNEY TO SIGN AMENDMENTS
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below does hereby constitute and appoint G. W. Thompson and Donald S.
Robson, and each of them, with full power of substitution and full power to act
without the other, his true and lawful attorney-in-fact and agent to act for him
in his name, place and stead, in any and all capacities, to sign any or all
amendments (including post-effective amendments) to this Registration Statement
on Form S-8, 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 requisite and
necessary to be done in and about the premises in order to effectuate the same
as fully, to all intents and purposes, as they or he might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, or any of them, may lawfully do or cause to be done by virtue hereof.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS REGISTRATION
STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE CAPACITIES AND ON THE
DATES INDICATED.
Signature Title Date
--------- ----- ----
/s/ G.W. Thompson President and Chief October 14, 1998
------------------------------ Executive Officer
(G.W. Thompson) (Principal Executive
Officer) and Director
6
<PAGE>
/s/ Donald S. Robson Vice President and Chief October 14, 1998
------------------------------ Financial Officer
(Donald S. Robson) (Principal Financial and
Accounting Officer)
/s/ J. Kelley Williams Chairman of the Board October 14, 1998
------------------------------ and Director
(J. Kelley Williams)
/s/ Walter A. Drexel Director October 14, 1998
------------------------------
(Walter A. Drexel)
/s/ William E. Nettles Director October 14, 1998
------------------------------
(William E. Nettles)
/s/ Pete Ingersoll Director October 14, 1998
------------------------------
(Pete Ingersoll)
/s/ John Racich Director October 14, 1998
------------------------------
(John Racich)
/s/ Charles E. Stott, Jr. Director October 14, 1998
------------------------------
(Charles E. Stott, Jr.)
/s/ R. Michael Summerford Director October 14, 1998
------------------------------
(R. Michael Summerford)
/s/ Al Winters Director October 14, 1998
------------------------------
(Al Winters)
/s/ Robert L. Zerga Director October 14, 1998
------------------------------
(Robert L. Zerga)
7
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number
- -------
<S> <C>
4(a) Getchell Gold Corporation 1998 Stock Option Plan for Outside
Directors.
4(b) Getchell Gold Corporation 1996 Long Term Equity Incentive Plan.
5(a) Opinion of Latham & Watkins.
23(a) Consent of KPMG Peat Marwick LLP.
23(b) Consent of Latham & Watkins (Incorporated in Exhibit 5(a)).
24(a) Power of Attorney (Incorporated in the Signature Page to the
Registration Statement, see page II-5).
</TABLE>
------------------
8
<PAGE>
Exhibit 4(a)
GETCHELL GOLD CORPORATION
1998 STOCK OPTION PLAN
FOR OUTSIDE DIRECTORS
Getchell Gold Corporation. (the "Company"), hereby adopts this
Getchell Gold Corporation 1998 Stock Option Plan for Outside Directors. The
purpose of this stock option plan is to obtain, motivate and retain
experienced Outside Directors by offering them an opportunity to become
owners of the Common Stock of the Company.
ARTICLE I.
DEFINITIONS
Whenever the following terms are used in this Plan, they shall have
the meaning specified below unless the context clearly indicates to the
contrary. The masculine pronoun shall include the feminine and neuter and
the singular shall include the plural, where the context so indicates.
SECTION 1.1. BOARD
"Board" shall mean the Board of Directors of the Company.
SECTION 1.2. CODE
"Code" shall mean the Internal Revenue Code of 1986, as amended.
SECTION 1.3. COMMON STOCK
"Common Stock" shall mean the Company's common stock, $.0001 par value.
SECTION 1.4. COMPANY
"Company" shall mean Getchell Gold Corporation, a Delaware corporation.
SECTION 1.5. DIRECTOR FEES
"Director Fees" shall mean the annual retainer fee and regular meeting fees,
including committee or Board chairperson fees, if any, provided to be paid by
the Company to an Outside Director.
SECTION 1.6. EXCHANGE ACT
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.
SECTION 1.7. FAIR MARKET VALUE
"Fair Market Value" shall mean as of any given date:
1
<PAGE>
(A) If the Common Stock is listed on any established stock
exchange or a national market system, including without limitation the
American Stock Exchange, the closing sales price for the Common Stock or the
closing bid if no sales were reported, as quoted on such system or exchange
(or the largest such exchange) for the date the value is to be determined (or
if there are no sales for such date, then for the last preceding business day
on which there were sales), as reported in the WALL STREET JOURNAL or similar
publication.
(B) If the Common Stock is regularly quoted by a recognized
securities dealer but selling prices are not reported, the mean between the
high bid and low asked prices for the Common Stock on the date the value is
to be determined (or if there are no quoted prices for the date of grant,
then for the last preceding business day on which there were quoted prices).
(C) In the absence of an established market for the Common Stock,
as determined in good faith by the Board, with reference to the Company's net
worth, prospective earning power, dividend-paying capacity, and other
relevant factors, including the goodwill of the Company, the economic outlook
in the Company's industry, the Company's position in the industry and its
management, and the values of stock of other corporations in the same or a
similar line of business.
SECTION 1.8. OPTION
"Option" shall mean a non-qualified option to purchase Common Stock of the
Company, granted under the Plan.
SECTION 1.9. OPTIONEE
"Optionee" shall mean an Outside Director to whom an Option is granted under
the Plan.
SECTION 1.10. OUTSIDE DIRECTOR
"Outside Director" shall mean a member of the Board who is not an employee of
the Company, a Parent Corporation or a Subsidiary under Section 3401(c) of
the Code and who is not legally or contractually prohibited from receiving
and holding personally an Option.
SECTION 1.11. PARENT CORPORATION
"Parent Corporation" shall mean any corporation in an unbroken chain of
corporations ending with the Company if each of the corporations other than
the Company then owns stock possessing 50% or more of the total combined
voting power of all classes of stock in one of the other corporations in such
chain.
SECTION 1.12. PERMITTED TRANSFEREE
"Permitted Transferee" shall mean (i) one or more of the following family
members of an Optionee: spouse, former spouse, child (whether natural or
adopted), stepchild, and any other lineal descendant of the Optionee, (ii) a
trust, partnership or other entity established and existing for the sole benefit
of, or under the sole control of, one or more of the above family members of
2
<PAGE>
the Optionee, or (iii) any other transferee specifically approved by the
Board after taking into account any state or federal tax or securities laws
applicable to transferable Options.
SECTION 1.13. PLAN
"Plan" shall mean this Getchell Gold Corporation 1998 Stock Option Plan for
Outside Directors.
SECTION 1.14. RULE 16b-3
"Rule 16b-3" shall mean that certain Rule 16b-3 under the Exchange Act, as such
Rule may be amended in the future.
SECTION 1.15. SECRETARY
"Secretary" shall mean the Secretary of the Company.
SECTION 1.16. SECURITIES ACT
"Securities Act" shall mean the Securities Act of 1933, as amended.
SECTION 1.17. SUBSIDIARY
"Subsidiary" shall mean any corporation in an unbroken chain of corporations
beginning with the Company if each of the corporations other than the last
corporation in the unbroken chain then owns stock possessing 50% or more of
the total combined voting power of all classes of stock in one of the other
corporations in such chain. "Subsidiary" shall also mean any partnership or
limited liability company in which the Company and/or any Subsidiary owns
more than 50% of the capital or profits interests.
ARTICLE II.
SHARES SUBJECT TO PLAN
SECTION 2.1. SHARES SUBJECT TO PLAN
The shares of stock subject to Options shall be shares of the Common Stock. The
aggregate number of such shares which may be issued upon exercise of Options
shall not exceed 170,000.
SECTION 2.2. UNEXERCISED OPTIONS
If any Option expires or is canceled without having been fully exercised, the
number of shares subject to such Option but as to which such Option was not
exercised prior to its expiration or cancellation may again be granted
hereunder, subject to the limitations of Section 2.1.
SECTION 2.3. CHANGES IN COMPANY'S SHARES
In the event that the outstanding shares of Common Stock of the Company are
hereafter changed into or exchanged for a different number or kind of shares
or other securities of the Company, or
3
<PAGE>
of another corporation, by reason of reorganization, merger, consolidation,
recapitalization, reclassification, or the number of shares is increased or
decreased by reason of a stock split-up, stock dividend, combination of
shares or any other increase or decrease in the number of such shares of
Common Stock effected without receipt of consideration by the Company
(provided, however, that conversion of any convertible securities of the
Company shall not be deemed to have been effected without receipt of
consideration), the Board acting in good faith shall make appropriate
adjustments in the number and kind of shares for the purchase of which
Options may be granted, including adjustments of the limitations in Section
2.1 on the maximum number and kind of shares which may be issued on exercise
of Options.
ARTICLE III.
GRANTING OF OPTIONS
SECTION 3.1. ELIGIBILITY
Any Outside Director of the Company shall be eligible to be granted Options.
SECTION 3.2. GRANTING OF OPTIONS
3.2.1. INITIAL GRANT
Each person who is an Outside Director at the time the Plan is adopted by the
Board, shall immediately upon such adoption be granted an Option to purchase
5,000 shares of Common Stock. Any person who is not an Outside Director at such
time, but who later becomes an Outside Director within six months following an
Annual Meeting of Stockholders of the Company, shall be granted on the date of
his election or appointment as an Outside Director an Option to purchase 5,000
shares of Common Stock.
3.2.2. SUBSEQUENT GRANTS
Each Outside Director shall be granted on the date of each Annual Meeting of
Stockholders of the Company (so long as he is an Outside Director at the close
of business on the day of such Annual Meeting) an Option to purchase 5,000
shares of Common Stock; PROVIDED, HOWEVER, that no Outside Director may acquire
more than an aggregate of 15,000 shares of Common Stock pursuant to Sections
3.2.1. and 3.2.2. of this Plan.
3.2.3. GRANTS IN LIEU OF CASH COMPENSATION
Each Outside Director may elect to forego cash payment of all or any
mechanically calculable portion of his or her Director Fees for any fiscal year
("Cash Replacement Fees") and receive, on the last day of such fiscal year, an
Option to purchase the number of whole shares equal to the Cash Replacement Fees
divided by one-third of the Fair Market Value of the Common Stock on the last
day of such fiscal year rounded up to reflect fractional shares. An election
pursuant to this Section 3.2.3 shall be made prior to the date that is six
months from the commencement of the fiscal year to which the grant relates.
Such election shall be irrevocable for such fiscal year,
4
<PAGE>
and such election can only be changed with respect to future fiscal years by
written notice at least six months prior to the commencement of the fiscal
year in question.
SECTION 3.3. NO OPTION GRANT WHERE PROHIBITED
No person shall be granted an Option under this Plan if at the time of such
grant, the grant is prohibited by applicable law or by the policies of the
employer of such person or of any other company of which such person is a
member of the board of directors or a general partner.
ARTICLE IV.
TERMS OF OPTIONS
SECTION 4.1. OPTION AGREEMENT
As soon as practicable after an Outside Director becomes entitled to the
grant of an Option under Section 3.2 above, the Secretary shall cause to be
executed a written Stock Option Agreement, which shall be executed by the
Outside Director and an authorized officer of the Company and which shall
contain such terms and conditions as approved by the Board consistent with
the Plan.
SECTION 4.2. OPTION PRICE
The exercise price per share subject to each Option granted pursuant to
Section 3.2 shall be the Fair Market Value on the date such Option is granted.
SECTION 4.3. TERM
The term of each Option shall be eight years from the date such Option first
becomes exercisable, subject to earlier termination in accordance with
Sections 4.5 or 4.6.
SECTION 4.4. EXERCISE SCHEDULE
An Option granted under Section 3.2.1, 3.2.2 or 3.2.3 shall be exercisable at
the later of (i) the date of grant or (ii) November 14, 1999.
Notwithstanding the foregoing, an Option held by an Outside Director shall
become immediately exercisable in full upon the adoption by the Company of a
plan for liquidation, dissolution, merger, consolidation or reorganization as
described in clause (x), (y) or (z) of Section 4.6., unless the exercise of
such Option would preclude the application of pooling of interests accounting
treatment to such transaction.
SECTION 4.5. TERMINATION OF MEMBERSHIP ON THE BOARD
Except in the case of death, disability, serious illness, age or an
unsuccessful attempt to win reelection to the Board after nomination for
election at the recommendation of the Board, if an Outside Director's
membership on the Board terminates for any reason, an Option held at the date
of termination may be exercised in whole or in part for up to 100% of the
shares covered by such Option at any time within one year after the date of
such termination (but in no event after the term of the Option expires) and
shall thereafter terminate. If an Outside Director's membership terminates
because of death, disability, serious illness, age or an unsuccessful
5
<PAGE>
attempt to win reelection to the Board after nomination for election at the
recommendation of the Board, an Option held at the date of such termination
may be exercised for up to 100% of the shares covered by such Options at any
time within three years after the date of such termination (but in no event
after the term of the Option expires) and shall thereafter terminate.
SECTION 4.6. CHANGE OF CONTROL
In the event of (x) a dissolution or liquidation of the Company, (y) a merger
or consolidation in which the Company is not the surviving corporation or (z)
any other capital reorganization in which more than fifty percent (50%) of
the shares of the Company entitled to vote are exchanged, the Outside
Director shall have the right to exercise such Option as to an equivalent
number of shares of stock of any corporation succeeding the Company or
acquiring its business by reason of such liquidation, dissolution, merger,
consolidation or reorganization, unless such exercise would preclude the
application of pooling of interests accounting treatment to such transaction.
SECTION 4.7. ADJUSTMENTS IN OUTSTANDING OPTIONS
In the event that the outstanding shares of Common Stock subject to Options
are changed into or exchanged for a different number or kind of shares of the
Company or other securities of the Company by reason of merger,
consolidation, recapitalization, reclassification, or the number of shares is
increased or decreased by reason of a stock split-up, stock dividend,
combination of shares or any other increase or decrease in the number of such
shares of Common Stock effected without receipt of consideration by the
Company (provided, however, that conversion of any convertible securities of
the Company shall not be deemed to have been effected without receipt of
consideration), the Board acting in good faith shall make appropriate
adjustments in the number and kind of shares as to which all outstanding
Options, or portions thereof then unexercised, shall be exercisable, to the
end that after such event the Optionee's proportionate interest shall be
maintained as before the occurrence of such event. Such adjustment in an
outstanding Option shall be made without change in the total price applicable
to the Option or the unexercised portion of the Option (except for any change
in the aggregate price resulting from rounding-off of share quantities or
prices) and with any necessary corresponding adjustment in Option price per
share. Any such adjustment made by the Board shall be final and binding upon
all Optionees, the Company and all other interested persons. This Section
4.7 shall be subject to Section 4.6.
ARTICLE V.
EXERCISE OF OPTIONS
SECTION 5.1. PERSON ELIGIBLE TO EXERCISE
Except as provided in Section 7.1, during the lifetime of the Optionee, only
the Optionee may exercise an Option (or any portion thereof) granted to the
Optionee. After the death of the Optionee, any exercisable portion of an
Option may, prior to the time when such portion becomes unexercisable under
the Plan or the applicable Stock Option Agreement, be exercised by the
Optionee's personal representative or by any person empowered to do so under
the deceased Optionee's will or under the then applicable laws of descent and
distribution.
6
<PAGE>
SECTION 5.2. PARTIAL EXERCISE
At any time and from time to time prior to the time when any exercisable
Option or exercisable portion thereof becomes unexercisable under the Plan or
the applicable Stock Option Agreement, such Option or portion thereof may be
exercised in whole or in part; provided, however, that the Company shall not
be required to issue fractional shares and any partial exercise of the Option
shall be with respect to no less than 100 shares (or such lesser remaining
number of shares subject to the Option).
SECTION 5.3. MANNER OF EXERCISE
An exercisable Option, or any exercisable portion thereof, may be exercised
solely by delivery to the Secretary of all of the following prior to the time
when such Option or such portion becomes unexercisable under the Plan or the
applicable Stock Option Agreement:
5.3.1. NOTICE
Notice in writing signed by the Optionee or other person then entitled to
exercise such Option or portion, stating that such Option or portion is
exercised, such notice complying with all applicable rules established by the
Board.
5.3.2. PAYMENT
(a) Full payment (in cash or by check) for the shares with respect to which
such Option or portion is thereby exercised; or
(b) With the consent of the Board, shares of the Company's Common Stock
owned by the Optionee duly endorsed for transfer to the Company; or
(c) With the consent of the Board and subject to the timing requirements of
Section 5.4, shares of the Company's Common Stock issuable to the Optionee
upon exercise of the Option, with a Fair Market Value on the date of Option
exercise equal to the aggregate Option price of the shares with respect to
which such Option or portion is thereby exercised; or
(d) With the consent of the Board, a full recourse promissory note bearing
interest (at least such rate as shall then preclude the imputation of
interest under the Code or any successor provision) and payable upon such
terms as may be prescribed by the Board. The Board may also prescribe the
form of such note and the security to be given for such note. No Option may,
however, be exercised by delivery of a promissory note or by a loan from the
Company when or where such loan or other extension of credit is prohibited by
law; or
(e) With the consent of the Board, any combination of the consideration
provided in the foregoing subsections (a), (b), (c) and (d).
7
<PAGE>
5.3.3. TAX WITHHOLDING
The payment to the Company of all amounts, if any, which it is required to
withhold under federal, state or local law in connection with the exercise of
the Option; with the consent of the Board, (i) shares of the Company's Common
Stock owned by the Optionee duly endorsed for transfer or (ii) subject to the
timing requirements of Section 5.4, shares of the Company's Common Stock
issuable to the Optionee upon exercise of the Option, valued at Fair Market
Value as of the date of Option exercise, may be used to make all or part of
such payment.
5.3.4. SECURITIES REPRESENTATIONS
Such representations and documents as the Board deems necessary or advisable
to effect compliance with all applicable provisions of the Securities Act and
any other federal or state securities laws or regulations. The Board may
also take whatever additional actions it deems appropriate to effect such
compliance including, without limitation, placing legends on share
certificates and issuing stop-transfer orders to transfer agents and
registrars; and
5.3.5. PROOF OF THIRD PARTY RIGHT TO EXERCISE
In the event that the Option or portion thereof shall be exercised pursuant
to Section 5.1 by any person or persons other than the Optionee, appropriate
proof of the right of such person or persons to exercise the Option or
portion thereof.
SECTION 5.4. CERTAIN TIMING REQUIREMENTS
Shares of the Company's Common Stock issuable to the Optionee upon exercise
of the Option may be used to satisfy the Option price or the tax withholding
consequences of such exercise only (i) during the period beginning on the
third business day following the date of release of the quarterly or annual
summary statement of sales and earnings of the Company and ending one month
before the end of the quarter or (ii) pursuant to an irrevocable written
election by the Optionee to use shares of the Company's Common Stock issuable
to the Optionee upon exercise of the Option to pay all or part of the Option
price or the withholding taxes (subject to the approval required under
Sections 5.3.2 and 5.3.3) made at least six months prior to the payment of
such Option price or withholding taxes.
SECTION 5.5. CONDITIONS TO ISSUANCE OF STOCK CERTIFICATES
The shares of stock issuable and deliverable upon the exercise of an Option,
or any portion thereof, may be either previously authorized but unissued
shares or issued shares which have then been reacquired by the Company. The
Company shall not be required to issue or deliver any certificate or
certificates for shares of stock purchased upon the exercise of any Option or
portion thereof prior to fulfillment of all of the following conditions:
(a) The admission of such shares to listing on all stock exchanges on which
such class of stock is then listed;
8
<PAGE>
(b) The completion of any registration or other qualification of such shares
under any state or federal law or under the rulings or regulations of the
Securities and Exchange Commission or any other governmental regulatory body,
which the Board shall deem necessary or advisable;
(c) The obtaining of any approval or other clearance from any state or
federal governmental agency which the Board shall determine to be necessary
or advisable;
(d) The payment to the Company (or other employer corporation) of all
amounts which it is required to withhold under federal, state or local law in
connection with the exercise of the Option; and
(e) The lapse of such reasonable period of time following the exercise of
the Option as the Board may establish from time to time for reasons of
administrative convenience.
SECTION 5.6. RIGHTS AS STOCKHOLDERS
The holders of Options shall not be, nor have any of the rights or privileges
of, stockholders of the Company in respect to any shares purchasable upon the
exercise of any part of an Option unless and until certificates representing
such shares have been issued by the Company to such holders.
SECTION 5.7. TRANSFER RESTRICTIONS
Unless otherwise approved in writing by the Board, no shares acquired upon
exercise of any Option by any Outside Director may be sold, assigned,
pledged, encumbered or otherwise transferred until at least six months have
elapsed from (but excluding) the date that such Option was granted.
ARTICLE VI.
ADMINISTRATION
SECTION 6.1. DUTIES AND POWERS OF THE BOARD
It shall be the duty of the Board to conduct the general administration of
the Plan in accordance with its provisions. The Board shall have the power
to interpret the Plan and the Options and to adopt such rules for the
administration, interpretation and application of the Plan as are consistent
therewith and to interpret, amend or revoke any such rules.
SECTION 6.2. COMPENSATION; PROFESSIONAL ASSISTANCE; GOOD FAITH ACTIONS
All expenses and liabilities incurred by the Board in connection with the
administration of the Plan shall be borne by the Company. The Board may
employ attorneys, consultants, accountants, appraisers, brokers or other
persons. The Board, the Company and its officers and directors shall be
entitled to rely upon the advice, opinions or valuations of any such persons.
All actions taken and all interpretations and determinations made by the
Board in good faith shall be final and binding upon all Optionees, the
Company and all other interested persons. The Board shall not be personally
liable for any action, determination or interpretation made in good
9
<PAGE>
faith with respect to the Plan or the Options, and the Board shall be fully
protected by the Company in respect to any such action, determination or
interpretation.
ARTICLE VII.
OTHER PROVISIONS
SECTION 7.1. TRANSFERABILITY
(a) No Option under this Plan may be sold, pledged, assigned or transferred
in any manner other than by domestic relations order or by will or the laws
of descent and distribution unless and until such Option has been exercised,
or the shares underlying such Option have been issued, and all restrictions
applicable to such shares have lapsed; provided, however, that an Optionee
may transfer an Option to a Permitted Transferee subject to the following
terms and conditions:
(i) An Option transferred to a Permitted Transferee shall not be
assignable or transferable by the Permitted Transferee other than by domestic
relations order or by will or the laws of descent and distribution;
(ii) Any Option which is transferred to a Permitted Transferee shall
continue to be subject to all of the terms and conditions of the Option as
applicable to the original holder (other than the ability to further transfer
the Option);
(iii) The Optionee and the Permitted Transferee shall execute any and
all documents reasonably requested by the Board, including without limitation
documents to (i) confirm the status of the transferee as a Permitted
Transferee, (ii) satisfy any requirements for an exemption for the transfer
under applicable federal and state securities laws and (iii) evidence the
transfer; and
(iv) Shares of Common Stock acquired by a Permitted Transferee through
exercise of an Option have not been registered under the Securities Act of
1933, as amended, or any state securities laws and may not be transferred,
nor will any assignee or transferee thereof be recognized as an owner of such
shares of Common Stock for any purpose, unless a registration statement under
the Securities Act of 1933, as amended, and any applicable state securities
laws with respect to such shares shall then be in effect or unless the
availability of an exemption from registration with respect to any proposed
transfer or disposition of such shares shall be established to the
satisfaction of counsel for the Company.
(b) No Option or interest or right therein or part thereof shall be liable
for the debts, contracts or engagements of the Optionee or his successors in
interest or shall be subject to disposition by transfer, alienation,
anticipation, pledge, encumbrance, assignment or any other means whether such
disposition be voluntary or involuntary or by operation of law by judgment,
levy, attachment, garnishment or any other legal or equitable proceedings
(including bankruptcy), and any attempted disposition thereof shall be null
and void and of no effect, except to the extent that such disposition is
permitted by the provisions of Section 7.1(a).
10
<PAGE>
SECTION 7.2. AMENDMENT, SUSPENSION OR TERMINATION OF THE PLAN
The Plan may be wholly or partially amended or otherwise modified (generally
not more frequently than once every six months), suspended or terminated at
any time or from time to time by the Board. However, without approval of the
Company's stockholders given within twelve months before or after the action
by the Board, no action of the Board may: (i) except as provided in Section
2.3, increase any limit imposed in Section 2.1 on the maximum number of
shares which may be issued upon exercise of Options; (ii) materially modify
the eligibility requirements of Section 3.1; (iii) reduce the minimum Option
price requirements of Section 4.2; (iv) extend the limit imposed in this
Section 7.2 on the period during which Options may be granted; or (v) amend
or modify the Plan in a manner requiring stockholder approval under Rule
16b-3. Notwithstanding anything to the contrary contained herein, the Board,
with respect to the Plan or any Option, shall not (y) amend or modify any
provision concerning the amount, price and timing of any Option (including,
without limitation, the provisions of Sections 3.2 and 4.2 of the Plan) more
than once every six months, other than to comport with changes in the Code,
the Employee Retirement Income Security Act of 1974, as amended, or the rules
thereunder, or (z) otherwise amend or modify the Plan or any Option in any
manner inconsistent with the requirements of Rule 16b-3. Neither the
amendment, suspension nor termination of the Plan shall, without the consent
of the holder of the Option, alter or impair any rights or obligations under
any Option theretofore granted. No Option may be granted during any period
of suspension nor after termination of the Plan, and in no event may any
Option be granted under this Plan after the expiration of ten years from the
date the Plan is adopted by the Board.
SECTION 7.3. EFFECTIVE DATE OF PLAN
The Plan shall be effective on the date it is adopted by the Board, but all
Options shall be conditioned upon approval of the Plan at a duly held meeting
of stockholders by the affirmative vote of the holders of a majority of the
voting power of the shares of the Company represented in person or by proxy
and entitled to vote at the meeting.
SECTION 7.4. EFFECT OF PLAN UPON OTHER OPTION AND COMPENSATION PLANS
The adoption of this Plan shall not affect any other compensation or
incentive plans in effect for the Company, any Parent Corporation or any
Subsidiary. Nothing in this Plan shall be construed to limit the right of the
Company, any Parent Corporation or any Subsidiary (a) to establish any other
forms of incentives or compensation for directors of the Company or (b) to
grant or assume options otherwise than under this Plan in connection with any
proper corporate purpose, including, but not by way of limitation, the grant
or assumption of options in connection with the acquisition by purchase,
lease, merger, consolidation or otherwise, of the business, stock or assets
of any corporation, firm or association.
SECTION 7.5. NO RIGHT TO CONTINUED MEMBERSHIP ON THE BOARD
Nothing in this Plan or in any Stock Option Agreement shall confer upon any
Outside Director any right to continue as a director of the Company or shall
interfere with or restrict in any way
11
<PAGE>
the rights of the Company and its stockholders, which are hereby expressly
reserved, to remove any Outside Director at any time for any reason
whatsoever, with or without cause.
SECTION 7.6. TITLES
Titles are provided herein for convenience only and are not to serve as a
basis for interpretation or construction of the Plan.
SECTION 7.7. CONFORMITY TO SECURITIES LAWS
The Plan is intended to conform to the extent necessary with all provisions
of the Securities Act and the Exchange Act and any and all regulations and
rules promulgated by the Securities and Exchange Commission thereunder,
including without limitation Rule 16b-3. Notwithstanding anything herein to
the contrary, the Plan shall be administered, and Options shall be granted
and may be exercised, only in such a manner as to conform to such laws, rules
and regulations. To the extent permitted by applicable law, the Plan and
options granted hereunder shall be deemed amended to the extent necessary to
conform to such laws, rules and regulations.
12
<PAGE>
Exhibit 4(b)
GETCHELL GOLD CORPORATION
1996 LONG TERM EQUITY INCENTIVE PLAN
SECTION 1. PURPOSE; DEFINITIONS.
(a) PURPOSE. The purpose of the Plan is to provide eligible employees
of, and consultants to, Getchell Gold Corporation (the "Company"), and its
subsidiaries and affiliates, an opportunity to participate in the Company's
future by offering them long-term performance-based and other incentives and
equity interests in the Company so as to retain, attract and motivate its
personnel.
(b) DEFINITIONS. For purposes of the Plan, the following terms have
the following meanings:
(i) "AFFILIATE" means a parent or subsidiary corporation, as
defined in the applicable provisions (currently Section 424) of the Code.
(ii) "AWARD" means any award under the Plan, including any
Option, Stock Appreciation Right, Restricted Stock, or Performance Share
Award.
(iii) "AWARD AGREEMENT" means, with respect to each Award, the
signed written agreement between the Company and the Plan participant setting
forth the terms and conditions of the Award.
(iv) "AWARD LIMIT" means 150,000 shares of Stock.
(v) "BOARD" means the Board of Directors of the Company.
(vi) "CHANGE IN CONTROL" has the meaning set forth in Section
9(a).
(vii) "CHANGE IN CONTROL PRICE" has the meaning set forth in
Section 9(c).
(viii) "CODE" means the Internal Revenue Code of 1986, as
amended from time to time, and any successor law.
(ix) "COMMISSION" means the Securities and Exchange Commission
and any successor agency.
(x) "COMMITTEE" means the Committee referred to in Section 2.
(xi) "COMPANY" means Getchell Gold Corporation
1
<PAGE>
(xii) "DISABILITY" means permanent and total disability as
determined by the Committee for purposes of the Plan.
(xiii) "DISINTERESTED PERSON" has the meaning set forth in Rule
16b-3(c)(2)(i) under the Exchange Act and any successor definition adopted by
the Commission.
(xiv) "EXCHANGE ACT" means the Securities and Exchange Act of
1934, as amended from time to time, and any successor law.
(xv) "FAIR MARKET VALUE" means as of any given date:
(c) If the Stock is listed on any established stock exchange or a
national market system, including without limitation the Nasdaq National
Market, the closing sales price for the Stock or the closing bid if no sales
were reported, as quoted on such system or exchange (or the largest such
exchange) for the date the value is to be determined (or if there are no
sales for such date, then for the last preceding business day on which there
were sales), as reported in the WALL STREET JOURNAL or similar publication.
(d) If the Stock is regularly quoted by a recognized securities dealer
but selling prices are not reported, the mean between the high bid and low
asked prices for the Stock on the date the value is to be determined (or if
there are no quoted prices for the date of grant, then for the last preceding
business day on which there were quoted prices).
(e) In the absence of an established market for the Stock, as
determined in good faith by the Committee, with reference to the Company's
net worth, prospective earning power, dividend-paying capacity, and other
relevant factors, including the goodwill of the Company, the economic outlook
in the Company's industry, the Company's position in the industry and its
management, and the values of stock of other corporations in the same or a
similar line of business.
(xvi) "INCENTIVE STOCK OPTION" means any Option intended to be
and designated as an "incentive stock option" within the meaning of Section
422 of the Code.
(xvii) "NON-QUALIFIED STOCK OPTION" means any Option that is not
an Incentive Stock Option.
(xviii) "OPTION" means an option granted under Section 5.
(xix) "PERFORMANCE SHARE" means the equivalent, as of any time
such assessment is made, of the Fair Market Value of one share of Stock.
(xx) "PERFORMANCE SHARE AWARD" means an Award under Section 8.
(xxi) "PLAN" means this Getchell Gold Corporation 1996 Long
Term Equity Incentive Plan, as amended from time to time.
(xxii) "RESTRICTED STOCK" means an Award of Stock subject to
restrictions, as more fully described in Section 7.
2
<PAGE>
(xxiii) "RULE 16b-3" means Rule 16b-3 under Section 16(b) of the
Exchange Act, as amended from time to time, and any successor rule.
(xxiv) "STOCK" means the Common Stock, $.01 par value, of the
Company, and any successor security.
(xxv) "STOCK APPRECIATION RIGHT" means an Award granted under
Section 6.
(xxvi) "SUBSIDIARY" has the meaning set forth in Section 424 of
the Code.
(xxvii) "TERMINATION" means, for purposes of the Plan, with
respect to a participant, that the participant has ceased to be, for any
reason, an employee of, or a consultant to, the Company, a Subsidiary or an
Affiliate.
SECTION 2. ADMINISTRATION.
(a) COMMITTEE. The Plan shall be administered by a committee of the
Board (the "Committee"), composed of not less than two directors of the
Company appointed by and holding office at the pleasure of the Board, each of
whom is both a disinterested person as defined in Rule 16b-3 ("Disinterested
Person") (unless the Committee determines that Rule 16b-3 is not applicable
to the Plan) and an "outside director" for purposes of Section 162(m) of the
Code ("Outside Director"). Appointment of Committee members shall be
effective upon acceptance of appointment. Committee members may resign at
any time by delivering written notice to the Board. Vacancies in the
Committee shall be filled by the Board. The Committee may act only by a
majority of its members, except that the Committee (i) may authorize any one
or more of its members or any officer of the Company to execute and deliver
documents on behalf of the Committee and (ii) so long as not otherwise
required for the Plan to comply with Rule 16b-3 (unless the Committee
determines that Rule 16b-3 is not applicable to the Plan), may delegate to
one or more officers or directors of the Company authority to grant Awards to
persons who are not subject to Section 16 of the Exchange Act with respect to
Stock. The Board shall have no right to exercise any of the rights or duties
of the Committee under the Plan unless (i) each member of the Board is both a
Disinterested Person and an Outside Director or (ii) such right is with
respect to matters which, under Rule 16b-3 or Section 162(m) of the Code, or
any regulations or rules issued thereunder, are not required to be determined
in the sole discretion of the Committee.
(b) AUTHORITY. The Committee shall grant Awards to eligible employees
and consultants. In particular and without limitation, the Committee,
subject to the terms of the Plan, shall:
(i) select the officers, other employees and consultants to
whom Awards may be granted;
(ii) determine whether and to what extent Awards are to be
granted under the Plan;
3
<PAGE>
(iii) subject to the Award Limit, determine the number of
shares to be covered by each Award granted under the Plan;
(iv) determine the terms and conditions of any Award granted
consistent with this Plan and any related loans to be made by the Company,
based upon factors determined by the Committee; PROVIDED, HOWEVER, that the
terms and conditions of any Awards intended to qualify as performance-based
compensation as described in Section 162(m) of the Code shall include, but
not be limited to, such terms and conditions as may be necessary to meet the
applicable provisions of Section 162(m) of the Code; and
(v) determine to what extent and under what circumstances any
Award payments may be deferred by a participant.
(c) COMMITTEE DETERMINATIONS BINDING. The Committee may adopt, alter
and repeal administrative rules, guidelines and practices governing the Plan
as it from time to time shall deem advisable, interpret the terms and
provisions of the Plan, any Award and any Award Agreement, and otherwise
supervise the administration of the Plan. Any determination made by the
Committee pursuant to the provisions of the Plan with respect to any Award
shall be made in its sole discretion at the time of the grant of the Award
or, unless in contravention of any express term of the Plan or Award, at any
later time. All decisions made by the Committee under the Plan shall be
binding on all persons, including the Company and Plan participants.
SECTION 3. SHARES SUBJECT TO PLAN.
(a) NUMBER OF SHARES. The total number of shares of Stock reserved
and available for issuance pursuant to Awards under the Plan shall be
1,600,000 shares. Such shares may consist, in whole or in part, of
authorized and unissued shares or shares reacquired in private transactions
or open market purchases, but all shares issued under the Plan regardless of
source shall be counted against the 1,600,000 share limitation. If any
Option terminates or expires without being exercised in full or if any shares
of Stock subject to an Award are forfeited, or if an Award otherwise
terminates without a payment being made to the participant in the form of
Stock, the shares issuable under such Option or Award shall again be
available for issuance in connection with Awards. If any shares of Stock
subject to an Award are repurchased by the Company, the shares issuable under
such Award shall again be available for issuance in connection with Awards
other than Options and Stock Appreciation Rights. To the extent an Award is
paid in cash, the number of shares of Stock representing, at Fair Market
Value on the date of the payment, the value of the cash payment shall not be
available for later grant under the Plan.
(b) COMPLIANCE WITH THE AWARD LIMIT AND SECTION 162(m) OF THE CODE.
The maximum number of shares which may be subject to options, rights or other
awards granted under the Plan to any individual in any calendar year shall
not exceed the Award Limit. To the extent required by Section 162(m) of the
Code, shares subject to Options which are canceled continue to be counted
against the Award Limit and if, after grant of an Option, the price of shares
subject to such Option is reduced, the transaction is treated as a
cancellation of the Option and a grant of a new Option and both the Option
deemed to be canceled and the Option deemed to be granted are counted against
the Award Limit. Furthermore, to the extent required by
4
<PAGE>
Section 162(m) of the Code, if, after grant of a Stock Appreciation Right,
the base amount on which stock appreciation is calculated is reduced to
reflect a reduction in the Fair Market Value of the Stock, the transaction is
treated as a cancellation of the Stock Appreciation Right and a grant of a
new Stock Appreciation Right and both the Stock Appreciation Right deemed to
be canceled and the Stock Appreciation Right deemed to be granted are counted
against the Award Limit.
(c) ADJUSTMENTS. In the event of any merger, reorganization,
consolidation, recapitalization, stock dividend, stock split, spin-off, sale
of substantial assets, or other change in corporate structure affecting the
Stock, such substitution or adjustments shall be made in the aggregate number
of shares of Stock reserved for issuance under the Plan, in the Award Limit,
in the number and exercise price of shares subject to outstanding Options and
in the number of shares subject to other outstanding Awards, as may be
determined to be appropriate by the Committee, in its sole discretion;
PROVIDED, that the number of shares subject to any Award shall always be
rounded down to the nearest whole number. Such adjusted exercise price shall
also be used to determine the amount payable by the Company upon the exercise
of any Stock Appreciation Right associated with any Option. With respect to
Options and Stock Appreciation Rights intended to qualify as
performance-based compensation under Section 162(m), no adjustments shall be
authorized pursuant to this Section 3(c) or any other provision of the Plan
to the extent that such adjustment would cause the Plan to violate Section
422(b) of the Code or would cause such Option or Stock Appreciation Right to
fail to so qualify under Section 162(m), as the case may be, or any successor
provisions thereto. Furthermore, no such adjustment or action shall be
authorized to the extent such adjustment or action would violate Section 16
of the Exchange Act or Rule 16b-3.
SECTION 4. ELIGIBILITY.
Subject to the Award Limit, awards may be granted to officers and
other employees of, and consultants to, the Company and its Affiliates
(excluding any person who serves only as a director).
SECTION 5. STOCK OPTION.
(a) TYPES. Any Option granted under the Plan shall be in such form as
the Committee may from time to time approve. The Committee shall have the
authority to grant to any participant Incentive Stock Options, Non-Qualified
Stock Options or any type of Option (in each case with or without Stock
Appreciation Rights). Incentive Stock Options may be granted only to
employees of the Company, its parent (within the meaning of Section 424 of
the Code) or Subsidiaries. Any portion of an Option that does not qualify as
an Incentive Stock Option shall constitute a Non-Qualified Stock Option.
(b) TERMS AND CONDITIONS. Options granted under the Plan shall be
subject to the following terms and conditions:
(i) APPLICABLE AWARD AGREEMENTS. Award Agreements evidencing
Options intended to qualify as performance-based compensation as described in
Section 162(m) of the
5
<PAGE>
Code shall contain such terms and conditions as may be necessary to meet the
applicable provisions of Section 162(m) of the Code. Award Agreements
evidencing Incentive Stock Options shall contain such terms and conditions as
may be necessary to meet the applicable provisions of Section 422 of the
Code. The grant shall automatically terminate without any action by the
Company in the event that an Award Agreement is not executed by the
participant within 30 days after delivery of the Option to the participant.
(ii) OPTION TERM. The term of each Option shall be fixed by
the Committee, but no Incentive Stock Option shall be exercisable more than
10 years after the date the Option is granted and no Non-Qualified Stock
Option shall be exercisable more than 11 years after the date the Option is
granted. If, at the time the Company grants an Incentive Stock Option the
optionee owns directly or by, attribution stock possessing more than 10% of
the total combined voting power of all classes of stock of the Company, or
any Affiliate of the Company, the Incentive Stock Option shall not be
exercisable more than five years after the date of grant.
(iii) GRANT DATE. The Company may grant Options under the Plan
at any time and from time to time before the Plan terminates. The Committee
shall specify the date of grant or, if it fails to, the date of grant shall
be the date of action taken by the Committee to grant the Option; provided,
that no Option may be exercised prior to execution of the applicable Award
Agreement. However, if an Option is approved in anticipation of employment,
the date of grant shall be the date the intended optionee is first treated as
an employee for payroll purposes.
(iv) EXERCISE PRICE. The exercise price per share of Stock
purchasable under a Non-Qualified Stock Option shall be equal to the Fair
Market Value on the date of grant. The exercise price per share of Stock
purchasable under an Incentive Stock Option shall be equal to at least the
Fair Market Value on the date of grant; PROVIDED, that if at the time the
Company grants an Incentive Stock Option, the optionee owns directly or by
attribution stock possessing more than 10% of the total combined voting power
of all classes of stock of the Company, or any Affiliate of the Company, the
exercise price shall be not less than 110% of the Fair Market Value on the
date the Incentive Stock Option is granted.
(v) EXERCISABILITY. Subject to the other provisions of the
Plan, an Option shall be exercisable in its entirety at grant or at such
times and in such amounts as are specified in the Award Agreement evidencing
the Option. The Committee, in its absolute discretion, at any time may waive
any limitations respecting the time at which an Option first becomes
exercisable in whole or in part.
(vi) METHOD OF EXERCISE; PAYMENT. To the extent the right to
purchase shares has accrued, Options may be exercised, in whole or in part,
from time to time, by written notice from the optionee to the Company stating
the number of shares being purchased, accompanied by payment of the exercise
price for the shares. The Committee, in its discretion, may elect at the
time of Option exercise that any Non-Qualified Stock Option be settled in
cash rather than Stock.
(vii) NO DISQUALIFICATION. Notwithstanding any other provision in
the Plan, no term of the Plan relating to Incentive Stock Options shall be
interpreted, amended or altered nor
6
<PAGE>
shall any discretion or authority granted under the Plan be exercised so as
to disqualify the Plan under Section 422 of the Code or, without the consent
of the optionee affected, to disqualify any Incentive Stock Option under such
Section 422 of the Code.
SECTION 6. STOCK APPRECIATION RIGHTS.
(a) RELATIONSHIP TO OPTIONS; NO PAYMENT BY PARTICIPANT. A Stock
Appreciation Right may be awarded either (i) with respect to Stock subject to
an Option held by a participant, or (ii) without reference to an Option. The
Committee, in its discretion, may determine whether a Stock Appreciation
Right is to qualify as performance-based compensation as described in Section
162(m) of the Code and the Award Agreements evidencing Stock Appreciation
Rights intended to so qualify shall contain such terms and conditions as may
be necessary to meet the applicable provisions of Section 162(m) of the Code.
If an Option is an Incentive Stock Option, a Stock Appreciation Right
granted with respect to such Option may be granted only at the time of grant
of the related Incentive Stock Option, but if the Option is a Non-Qualified
Stock Option, the Stock Appreciation Right may be granted either
simultaneously with the grant of the related Non-Qualified Stock Option or at
any time during the term of such related Non-Qualified Stock Option. No
consideration shall be paid by a participant with respect to a Stock
Appreciation Right.
(b) WHEN EXERCISABLE. A Stock Appreciation Right shall be exercisable
at such times and in whole or in part, each as determined by the Committee,
subject, with respect to participants subject to Section 16(b) of the
Exchange Act, to Rule 16b-3. Unless the Committee determines that Rule 16b-3
is not applicable to the Plan, any exercise by the participant of a Stock
Appreciation Right for cash shall be made only (i) during the window period
specified in Rule 16b-3(e)(3) and any successor rule (the "Window Period") or
(ii) pursuant to an irrevocable written election by the participant to
receive cash, in whole or in part, upon exercise of his Stock Appreciation
Right (subject to the approval of the Committee) made at least 6 months prior
to the exercise of the Stock Appreciation Right. If a Stock Appreciation
Right is granted with respect to an Option, unless the Award Agreement
otherwise provides, the Stock Appreciation Right may be exercised only to the
extent to which shares covered by the Option are not at the time of exercise
subject to repurchase by the Company.
(c) EFFECT ON RELATED RIGHT; TERMINATION OF STOCK APPRECIATION RIGHT. If
a Stock Appreciation Right granted with respect to an Option is exercised, the
Option shall cease to be exercisable and shall be canceled to the extent of the
number of shares with respect to which the Stock Appreciation Right was
exercised. Upon the exercise or termination of an Option, related Stock
Appreciation Rights shall terminate to the extent of the number of shares as to
which the Option was exercised or terminated, except that, unless otherwise
determined by the Committee at the time of grant, a Stock Appreciation Right
granted with respect to less than the full number of shares covered by a related
Option shall not be reduced until the number of shares covered by exercise or
termination of the related Option exceeds the number of shares not covered by
the Stock Appreciation Right. A Stock Appreciation Right granted independently
from an Option shall terminate and shall be no longer exercisable at the time
determined by the Committee at the time of grant, but not later than 10 years
from the date of grant. Upon the Termination of the
7
<PAGE>
participant, a Stock Appreciation Right granted with respect to an Option
shall be exercisable only to the extent to which the Option is then
exercisable.
(d) FORM OF PAYMENT UPON EXERCISE. Despite any attempt by a
participant to elect payment in a particular form upon exercise of a Stock
Appreciation Right, the Committee, in its discretion, may elect to cause the
Company to pay cash, Stock, or a combination of cash and Stock upon exercise
of the Stock Appreciation Right.
(e) AMOUNT OF PAYMENT UPON EXERCISE. Upon the exercise of a Stock
Appreciation Right, the participant shall be entitled to receive one of the
following payments, as determined by the Committee under Section 6(d):
(i) STOCK. That number of whole shares of Stock equal
to the number computed by dividing (A) an amount (the "Stock Appreciation
Right Spread"), rounded to the nearest whole dollar, equal to the product
computed by multiplying (x) the excess of (1) if the Stock Appreciation Right
may only be exercised during the Window Period, the highest Fair Market Value
on any day during the Window Period, and otherwise, the Fair Market Value on
the date the Stock Appreciation Right is exercised, over (2) the exercise
price per share of Stock of the related Option, or in the case of a Stock
Appreciation Right granted without reference to an Option, such other price
as the Committee establishes at the time the Stock Appreciation Right is
granted, by (y) the number of shares of Stock with respect to which a Stock
Appreciation Right is being exercised by (B) (1) if the Stock Appreciation
Right may only be exercised during the Window Period, the highest Fair Market
Value during the Window Period in which the Stock Appreciation Right was
exercised, and (2) otherwise, the Fair Market Value on the date the Stock
Appreciation Right is exercised; plus, if the foregoing calculation yields a
fractional share, an amount of cash equal to the applicable Fair Market Value
multiplied by such fraction (such payment to be the difference of the
fractional share); or
(ii) CASH. An amount in cash equal to the Stock Appreciation
Right Spread; or
(iii) CASH AND STOCK. A combination of cash and Stock, the
combined value of which shall equal the Stock Appreciation Right Spread.
SECTION 7. RESTRICTED STOCK.
Shares of Restricted Stock shall be subject to the following terms
and conditions:
(a) PRICE. Participants awarded Restricted Stock, within 45 days of
receipt of the applicable Award Agreement, which in no event shall be later
than 10 days after the Award grant date, shall pay to the Company, if
required by applicable law, an amount at least equal to the par value of the
Stock subject to the Award. If such payment is not made and received by the
Company by such date, the Award of Restricted Stock shall lapse.
(b) RESTRICTIONS. Subject to the provisions of the Plan and the Award
Agreement, during a period set by the Committee, commencing one year and not
exceeding 10 years from the
8
<PAGE>
date of such award (the "Restriction Period"), the participant shall not be
permitted to sell, assign, transfer, pledge or otherwise encumber shares of
Restricted Stock. Within these limits, the Committee may in its discretion
provide for the lapse of such restrictions in installments and may accelerate
or waive such restrictions, in whole or in part, based on performance
criteria as the Committee may determine.
(c) DIVIDENDS. Unless otherwise determined by the Committee, cash
dividends with respect to shares of Restricted Stock shall be automatically
reinvested in additional Restricted Stock, and dividends payable in Stock
shall be paid in the form of Restricted Stock.
(d) TERMINATION. Except to the extent otherwise provided in the Award
Agreement and pursuant to Section 7(b), upon termination of a participant's
employment for any reason during the Restriction Period, all shares still
subject to restriction shall be forfeited by the participant.
SECTION 8. PERFORMANCE SHARES.
(a) AWARDS. The Committee shall determine the nature, length (which
shall in no event exceed 10 years) and starting date of the performance
period (the "Performance Period") for each Performance Share Award. The
consideration payable by a participant with respect to a Performance Share
Award shall be an amount determined by the Committee in the exercise of the
Committee's discretion at the time of the Award; provided, that the amount of
consideration may be zero and may in no event exceed 50% of the Fair Market
Value at the time of grant. The Committee shall determine the performance
objectives to be used in awarding Performance Shares and the extent to which
such Performance Shares have been earned. Performance Periods may overlap
and participants may participate simultaneously with respect to Performance
Share Awards that are subject to different Performance Periods and different
performance factors and criteria. At the beginning of each Performance
Period, the Committee shall determine for each Performance Share Award
subject to such Performance Period the number of shares of Stock (which may
constitute Restricted Stock) to be awarded to the participant at the end of
the Performance Period if and to the extent that the relevant measures of
performance for such Performance Share Award are met. Such number of shares
of Stock may be fixed or may vary in accordance with such performance or
other criteria as may be determined by the Committee. The Committee may
provide that amounts equivalent to interest at such rates as the Committee
may determine or amounts equivalent to dividends paid shall be payable with
respect to Performance Share Awards. In addition to the provisions set forth
in Section 10(j), the Committee, in its discretion, may modify the terms of
any Performance Share Award, including the specification and measurement of
performance goals.
(b) TERMINATION OF EMPLOYMENT. Except as otherwise provided in the
Award Agreement or determined by the Committee, in the event of Termination,
then the participant shall not be entitled to any payment with respect to the
Performance Shares subject to the Performance Period.
(c) FORM OF PAYMENT. Payment shall be made in the form of cash or
whole shares of Stock, as the Committee, in its discretion, shall determine.
9
<PAGE>
SECTION 9. CHANGE IN CONTROL.
(a) DEFINITION OF "CHANGE IN CONTROL". For purposes of Section 10(b),
a "Change in Control" means the occurrence of either of the following:
(i) any "person", as such term is used in Sections 13(d) and
14(d) of the Exchange Act (other than the Company, a Subsidiary, an
Affiliate, or a Company employee benefit plan, including any trustee of such
plan acting as trustee), is or becomes the "beneficial owner" (as defined in
Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of
the Company (or a successor to the Company) representing 20% or more of the
combined voting power of the then outstanding securities of the Company or
such successor;
(ii) at any time that the Company has registered shares under
the Exchange Act, at least 40% of the directors of the Company constitute
persons who were not at the time of their first election to the Board,
candidates proposed by a majority of the Board in office prior to the time of
such first election; or
(iii) (A) the dissolution of the Company or liquidation of
more than 50% in value of the Company or a sale of assets involving 50% or
more in value of the assets of the Company, (B) any merger or reorganization
of the Company whether or not another entity is the survivor, (C) a
transaction or related set of transactions (including without limitation a
merger or tender offer together with a related purchase of shares by the
tender offeror in the market) pursuant to which the holders, as a group, of
all of the shares of the Company outstanding prior to the transaction hold,
as a group, less than 50% of the combined voting power of the Company or any
successor company outstanding after the transaction, or (D) any other event
which the Board determines, in its discretion, would materially alter the
structure of the Company or its ownership.
(b) IMPACT OF EVENT. In the event of a "Change in Control" as defined
in Section 10(a), the following provisions shall apply:
(i) any Stock Appreciation Rights and Options outstanding as
of the date such Change in Control is determined to have occurred and not
then exercisable and vested shall become fully exercisable and vested;
provided, that in the case of the holder of Stock Appreciation Rights who is
actually subject to Section 16(b) of the Exchange Act, such Stock
Appreciation Rights shall have been outstanding for at least six months at
the date such Change in Control is determined to have occurred;
(ii) the restrictions and limitations applicable to any
Restricted Stock shall lapse, and such Restricted Stock shall become fully
vested;
(iii) the value (net of any exercise price and required tax
withholdings) of all outstanding Options, Stock Appreciation Rights and
Restricted Stock, unless otherwise determined by the Committee at or after
grant and subject to Rule 16b-3, shall be cashed out on the basis of the
"Change in Control Price," as defined in Section 9(c), as of the date such
Change
10
<PAGE>
in Control is determined to have occurred or such other date as the Board may
determine prior to the Change in Control; and
(iv) any outstanding Performance Share Awards shall be vested
and paid in full as if all performance criteria had been met;
provided, however, that the foregoing provisions shall only apply, with
respect to the events described Section 9(a)(i) when such "person" acquires,
9(a)(iii)(B), and 9(a)(iii)(D), if and to the extent so specifically
determined by the Board in the exercise of the Board's discretion, which
determination may be amended or reversed only by the affirmative vote of a
majority of the persons who were directors at the time such determination was
made.
(c) CHANGE IN CONTROL PRICE. For purposes of this Section 9, "Change
in Control Price" means the highest price per share paid in any transaction
reported on any established stock exchange, national market system or other
established market for the Stock, or paid or offered in any bona fide
transaction related to a potential or actual Change in Control of the Company
at any time during the preceding 60-day period as determined by the Board,
except that, in the case of Incentive Stock Options and Stock Appreciation
Rights relating to Incentive Stock Options, such price shall be based only on
transactions reported for the date on which the Board decides to cash out
such Options.
SECTION 10. GENERAL PROVISIONS.
(a) AWARD GRANTS. Any Award may be granted either alone or in
addition to other Awards granted under the Plan. Subject to the terms and
restrictions set forth elsewhere in the Plan, the Committee shall determine
the consideration, if any, payable by the participant for any Award and, in
addition to those set forth in the Plan, any other terms and conditions of
the Awards. The Committee may condition the grant or payment of any Award
upon the attainment of specified performance goals or such other factors or
criteria, including vesting based on continued employment or consulting, as
the Committee shall determine. Performance objectives may vary from
participant to participant and among groups of participants and shall be
based upon such Company, Subsidiary, group or division factors or criteria as
the Committee may deem appropriate, including, but not limited to, earnings
per share or return on equity. The other provisions of Awards also need not
be the same with respect to each recipient. Unless specified otherwise in
the Plan or by the Committee, the date of grant of an Award shall be the date
of action by the Committee to grant the Award.
(b) TYPES OF SHARES. The Committee, in its discretion, may determine
at the time of an Award that in lieu of Stock there shall be issuable under,
or applicable to the measurement of, any Award any of (i) Restricted Stock,
(ii) shares of any series of common stock of the Company, other than Stock,
and shares of any series of common stock of any Subsidiary or Affiliate of
the Company ("Common Shares"), or (iii) shares of any series of preferred
stock of the Company ("Preferred Shares"); provided, that (A) with respect to
shares issuable upon exercise of Incentive Stock Options, Common Shares and
Preferred Shares shall be limited to shares of any Subsidiary authorized as
of the date the Plan is approved by the Board, and (B) with respect to shares
issuable upon exercise of Non-Qualified Stock Options and Stock
11
<PAGE>
Appreciation Rights, Common Shares and Preferred Shares shall be limited to
shares of any Subsidiary or Affiliate of the Company. In such event the
Committee shall determine the number of shares of Stock equivalent to such
Restricted Stock, Common Shares or Preferred Shares for the purpose of
calculating the shares of Stock issued under the Plan; provided, that a
Common Share or a Preferred Share in no event shall be deemed equal to less
than one share of Stock.
(c) AWARD AGREEMENT. As soon as practicable after the date of an
Award grant, the Company and the participant shall enter into a written Award
Agreement specifying the date of grant, the terms and conditions of the Award.
(d) CERTIFICATES. All certificates for shares of Stock or other
securities delivered under the Plan shall be subject to such stock transfer
orders, legends and other restrictions as the Committee may deem advisable
under the rules, regulations and other requirements of the Commission, any
stock exchange upon which the Stock is then listed and any applicable
federal, state or foreign securities law.
(e) TERMINATION. In the event of Termination for any reason other
than death, Disability or retirement, Awards held at the date of Termination
(and only to the extent then exercisable or payable, as the case may be) may
be exercised in whole or in part at any time within three months after the
date of Termination, or such lesser period specified in the Award Agreement
(but in no event after the expiration date of the Award), but not thereafter.
If Termination is due to death or Disability, or a participant dies or
becomes disabled within the period that the Award remains exercisable or
payable, as the case may be, after Termination, only Awards held at the date
of death or Disability (and only to the extent then exercisable or payable,
as the case may be) may be exercised in whole or in part by the participant
in the case of Disability, by the participant's personal representative or by
the person to whom the Award is transferred by will or the laws of descent
and distribution, at any time within 18 months after the death or one year
after the Disability, as the case may be, of the participant or any lesser
period specified in the Award Agreement (but in no event after the expiration
of the Award). In the event of Termination by reason of the participant's
retirement (as determined in the exercise of the Committee's sole
discretion), Awards may be exercised in whole or in part at any time within
two years after the date of Termination, or such lesser period specified in
the Award Agreement; provided, however, that in no event shall an Award be
exercisable after the expiration date of the Award.
(f) DELIVERY OF PURCHASE PRICE. Participants shall make all or any
portion of any payment due to the Company with respect to the consideration
payable for, upon exercise of, or for federal, state, local or foreign tax
payable in connection with, an Award by delivery of cash; and if and only to
the extent authorized by the Committee, all or any portion of such payment
may be made by delivery of any property (including, without limitation, a
promissory note of the participant or shares of Stock or other securities
and, in the case of an option, surrender of shares issuable upon exercise of
that option) other than cash, so long as, if applicable, such property
constitutes valid consideration for the Stock under applicable law. To the
extent participants may make payments due to the Company upon grant or
exercise of Awards by the delivery of
12
<PAGE>
shares of Stock or other securities, the Committee, in its discretion, may
permit participants constructively to deliver for any such payment (A)
securities of the Company held by the participant for at least 6 months or
(B), subject to the timing requirements of Section 10(z), securities of the
Company issuable to the participant upon exercise of the Award. Constructive
delivery shall be effected by (i) identification by the participant of shares
intended to be delivered constructively, (ii) confirmation by the Company of
participant's ownership of such shares (for example, by reference to the
Company's stock records, or by some other means of verification), and (iii)
if applicable, upon exercise, delivery to the participant of a certificate
for that number of shares equal to the number of shares for which the Award
is exercised less the number of shares constructively delivered.
(g) TAX WITHHOLDING. If and to the extent authorized by the Committee
in its discretion, a person who has received an Award or payment under an
Award may, to pay the amount of tax that the Committee in its discretion
determines to be required to be withheld by the Company, make an election to
deliver to the Company or have withheld either (i) a promissory note of the
participant on the terms set forth in Section 10(f) or (ii) (A) securities of
the Company held by the participant for at least 6 months or (B), subject to
the timing requirements of Section 10(z), securities of the Company issuable
to the participant upon exercise of the Award. Any shares or other
securities so withheld or tendered will be valued by the Committee as of the
date they are withheld or tendered; provided, that Stock shall be valued at
the Fair Market Value on such date. The value of the shares withheld or
tendered may not exceed the required federal, state, local and foreign
withholding tax obligations as computed by the Company. Unless the Committee
permits otherwise, the participant shall pay to the Company in cash, promptly
when the amount of such obligations becomes determinable, all applicable
federal, state, local and foreign withholding taxes that the Committee in its
discretion determines to result from the lapse of restrictions imposed upon
an Award or upon exercise of an Award or from a transfer or other disposition
of shares acquired upon exercise or payment of an Award or otherwise related
to the Award or the shares acquired in connection with an Award.
(h) NO TRANSFERABILITY. No Award shall be assignable or otherwise
transferable by the participant other than by will or by the laws of descent
and distribution, and during the life of a participant, an Award shall be
exercisable, and any elections with respect to an Award may be made, only by
the participant or participant's guardian or legal representative. Unless
otherwise approved in writing by the Committee, no shares acquired upon
exercise of any Award by any officer of the Company, as defined in Rule
16a-l(f) under the Exchange Act, may be sold, assigned, pledged, encumbered
or otherwise transferred until at least 6 months have elapsed from (but
excluding) the date that such Award was granted. The Committee may require
the participant to give the Company prompt notice of any disposition of
shares of Stock, acquired by exercise of an Incentive Stock Option within two
years from the date of granting such option or one year after the transfer of
such shares to such participant. The Committee may direct that the
certificates evidencing shares acquired by exercise of an option refer to
such requirement to give prompt notice of disposition.
(i) RIGHT OF FIRST REFUSAL. At the time of grant, the Committee may
provide in connection with any Award that the shares of Stock received as a
result of such Award shall be
13
<PAGE>
subject to a right of first refusal pursuant to which the participant shall
be required to offer to the Company any shares that the participant wishes to
sell at the then Fair Market Value of the Stock or at such other price as may
be set forth in the applicable Award Agreement, subject to such other terms
and conditions as the Committee may specify at the time of grant.
(j) ADJUSTMENT OF AWARDS; WAIVERS. The Committee may adjust the
performance goals and measurements applicable to Awards (i) to take into
account changes in law and accounting and tax rules, (ii) to make such
adjustments as the Committee deems necessary or appropriate to reflect the
inclusion or exclusion of the impact of extraordinary or unusual items,
events or circumstances in order to avoid windfalls or hardships, (iii) to
make such adjustments as the Committee deems necessary or appropriate to
reflect any material changes in business conditions, and (iv) in any other
manner determined in the Committee's discretion. In the event of hardship or
other special circumstances of a participant and otherwise in its discretion,
the Committee may waive in whole or in part any or all restrictions,
conditions, vesting, or forfeiture with respect to any Award granted to such
participant.
(k) ELECTION TO DEFER PAYMENT. To the extent, if any, permitted by
the Committee, a participant may elect, at such time as the Committee may in
its discretion specify, to defer payment of all or a portion of an Award.
(l) NON-COMPETITION. The Committee may condition the Committee's
discretionary-waiver of a forfeiture or vesting acceleration at the time of
Termination of a participant holding any unexercised or unearned Award or the
waiver of restrictions upon any Award upon a requirement that such
participant agree to and actually (i) not engage in any business or activity
competitive with any business or activity conducted by the Company and (ii)
be available, unless such participant shall have died, for consultations at
the request of the Company's management, all on such terms and conditions
(including conditions in addition to (i) and (ii)) as the Committee may
determine.
(m) DIVIDENDS. The reinvestment of dividends in additional Stock or
Restricted Stock at the time of any dividend payment shall only be
permissible if sufficient shares of Stock are available under Section 3 for
such reinvestment (taking into account then outstanding Awards).
(n) REGULATORY COMPLIANCE. Each Award under the Plan shall be subject
to the condition that, if at any time the Committee shall determine that (i)
the listing, registration or qualification of the shares of Stock, Common
Shares or Preferred Shares upon any securities exchange or under any state or
federal law, (ii) the consent or approval of any government or regulatory
body or (iii) an agreement or representations by the participant with respect
thereto, is necessary or desirable, then such Award shall not be consummated
in whole or in part unless such listing, registration, qualification,
consent, approval, agreement or representations shall have been effected or
obtained free of any conditions not acceptable to the Committee.
(o) RIGHTS AS STOCKHOLDER. Unless the Plan or the Committee expressly
specifies otherwise, a participant shall have no rights as a stockholder with
respect to any shares covered by an Award until the participant is entitled,
under the terms of the Award, to receive such
14
<PAGE>
shares. Subject to Sections 3(c) and 7(c), no adjustment shall be made for
dividends or other rights for which the record date is prior to the date the
certificates are delivered.
(p) BENEFICIARY DESIGNATION. The Committee, in its discretion, may
establish procedures for a participant to designate a beneficiary to whom any
amounts payable in the event of the participant's death are to be paid.
(q) ADDITIONAL PLANS. Nothing contained in the Plan shall prevent the
Company, a Subsidiary or Affiliate from adopting other or additional
compensation arrangements for its employees.
(r) NO EMPLOYMENT RIGHTS. The adoption of the Plan shall not confer
upon any employee any right to continued employment nor shall it interfere in
any way with the right of the Company, a Subsidiary or Affiliate to terminate
the employment of any employee at any time.
(s) RULE 16b-3. Notwithstanding any provision of the Plan, the Plan
shall always be administered, and Awards shall always be granted and
exercised, in such a manner as to conform to the provisions of Rule 16b-3,
unless the Committee determines that Rule 16b-3 is not applicable to the Plan.
(t) LIMITATIONS APPLICABLE TO SECTION 16 PERSONS AND PERFORMANCE-BASED
COMPENSATION. Notwithstanding any other provision of this Plan, and any
Option, Performance Share Award or Stock Appreciation Right granted, or
Restricted Stock awarded, to any individual who is then subject to Section 16
of the Exchange Act, shall be subject to any additional limitations set forth
in any applicable exemptive rule under Section 16 of the Exchange Act
(including any amendment to Rule 16b-3 of the Exchange Act) that are
requirements for the application of such exemptive rule. Any such additional
limitation shall be set forth in an annex to this Plan, such annex to be
incorporated herein by this reference and made part of this Plan. To the
extent permitted by applicable law, the Plan, Options, Performance Share
Awards, Stock Appreciation Rights, and Restricted Stock granted or awarded
hereunder shall be deemed amended to the extent necessary to conform to such
applicable exemptive rule. Furthermore, notwithstanding any other provision
of this Plan, any Option or Stock Appreciation Right intended to qualify as
performance-based compensation as described in Section 162(m) of the Code
shall be subject to any additional limitations set forth in Section 162(m) of
the Code (including any amendment to Section 162(m) of the Code) or any
regulations or rulings issued thereunder that are requirements for
qualification as performance-based compensation as described in Section
162(m) of the Code, and this Plan shall be deemed amended to the extent
necessary to conform to such requirements.
(u) GOVERNING LAW. The Plan and all Awards shall be governed by and
construed in accordance with the laws of the State of Delaware.
(v) USE OF PROCEEDS. All cash proceeds to the Company under the Plan
shall constitute general funds of the Company.
15
<PAGE>
(w) UNFUNDED STATUS OF PLAN. The Plan shall constitute an "unfunded"
plan for incentive and deferred compensation. The Committee may authorize
the creation of trusts or arrangements to meet the obligations created under
the Plan to deliver Stock or make payments; provided, that unless the
Committee otherwise determines, the existence of such trusts or other
arrangements shall be consistent with the "unfunded" status of the Plan.
(x) ASSUMPTION BY SUCCESSOR. The obligations of the Company under the
Plan and under any outstanding Award may be assumed by any successor
corporation, which for purposes of the Plan shall be included within the
meaning of "Company."
(y) PLAN DESIGNATION AND STATUS. Notwithstanding the designation of
this document as a plan for ease of reference and to standardize certain
provisions applicable to all types of Awards, each type of Award shall be
deemed to be a separate "plan" for purposes of Section 16 of the Exchange Act
and any applicable state securities laws.
(z) CERTAIN TIMING REQUIREMENTS. Securities of the Company issuable
to the participant upon exercise of an Award may be used to satisfy the
exercise price or the tax withholding consequences of such exercise only (i)
during the period beginning on the third business day following the date of
release of the quarterly or annual summary statement of sales and earnings of
the Company and ending on the twelfth business day following such date or
(ii) pursuant to an irrevocable written election by the participant to use
securities of the Company issuable to the participant upon exercise of the
Award to pay all or part of the exercise price or the withholding taxes
(subject to the approval of the Committee) made at least 6 months prior to
the payment of such exercise price or withholding taxes.
SECTION 11. AMENDMENTS AND TERMINATION.
The Board may amend, alter, or discontinue the Plan, but no
amendment, alteration or discontinuance shall be made which would impair the
rights of a participant under an outstanding Award without the participant's
consent. In addition, to the extent required for the Plan to comply with
Rule 16b-3 or, with respect to provisions solely as they relate to Incentive
Stock Options, to the extent required for the Plan to comply with Section 422
of the Code, the Board may not amend or alter the Plan without the approval
of a majority of the votes cast at a duly held meeting of stockholders at
which a quorum of the voting power of the Company is represented in person or
by proxy, where such amendment or alteration would:
(a) except as expressly provided in the Plan, increase the total
number of shares reserved for issuance pursuant to Awards under the Plan or
modify the Award Limit;
(b) except as expressly provided in the Plan, change the minimum price
terms of Sections 5(b)(iv) or 7(a);
(c) change the class of employees and consultants eligible to
participate in the Plan;
(d) extend the maximum Option term under Section 5(b); or
16
<PAGE>
(e) materially increase the benefits accruing to participants under
the Plan.
The Board of Directors may, at any time without stockholder
approval, amend the Plan and the terms of any Award outstanding under the
Plan, provided that such amendment is designed to maximize federal income tax
benefits accorded to Awards or, if the Committee determines that Rule 16b-3
is applicable to the Plan, to comply with Rule 16b-3 and provided further,
that with respect to outstanding Awards, the participant consents to such
amendment.
SECTION 12. EFFECTIVE DATE OF PLAN.
The Plan shall be effective on the date it is adopted by the
Board, but all Awards shall be conditioned upon approval of the Plan at a
duly held meeting of stockholders by the affirmative vote of the holders of a
majority of the voting power of the shares of the Company represented in
person or by proxy and entitled to vote at the meeting.
SECTION 13. TERM OF PLAN.
No Award shall be granted on or after November 16, 2005, but
Awards granted prior to November 16, 2005 (including, without limitation,
Performance Share Awards for Performance Periods commencing prior to November
16, 2005) may extend beyond that date.
17
<PAGE>
Exhibit 5(a)
[Latham & Watkins Letterhead]
October 14, 1998
Getchell Gold Corporation
5460 South Quebec Street, Suite 240
Englewood, Colorado 80111
Re: Getchell Gold Corporation
870,000 shares of Common Stock, par value $0.0001 per share
-----------------------------------------------------------
Ladies/Gentlemen:
In connection with the registration under the Securities Act of 1933, as
amended (the "Act"), of an aggregate of 870,000 shares (the "Shares") of
common stock, par value $0.0001 per share, of Getchell Gold Corporation (the
"Company") issuable under the Getchell Gold 1998 Stock Option Plan for
Outside Directors (the "New Director Plan") and the Getchell Gold Corporation
1996 Long Term Equity Incentive Plan (the "Plan," and together with the New
Director Plan, the "Plans"), by the Company on Form S-8 filed with the
Securities and Exchange Commission (the "Commission") on October 14, 1998
(the "Registration Statement"), you have requested our opinion with respect
to the matters set forth below.
In our capacity as your counsel in connection with such registration, we
are familiar with the proceedings taken and proposed to be taken by the
Company in connection with the authorization, issuance and sale of the
Shares. In addition, we have made such legal and factual examinations and
inquiries, including an examination of originals or copies certified or
otherwise identified to our satisfaction of such documents, corporate records
and instruments, as we have deemed necessary or appropriate for purposes of
this opinion.
In our examination, we have assumed the genuineness of all signatures,
the authenticity of all documents submitted to us as originals, and the
conformity to authentic original documents of all documents submitted to us
as copies.
18
<PAGE>
We are opining herein as to the effect on the subject transaction only
of the General Corporation Law of the State of Delaware, and we express no
opinion with respect to the applicability thereto, or the effect thereon, of
any other laws, or as to any matters of municipal law or the laws of any
other local agencies within the State of Delaware.
Subject to the foregoing, it is our opinion that the Shares to be issued
under each of the Plans have been duly authorized, and upon the issuance and
delivery of the Shares, in the manner contemplated by the each of the Plans,
and assuming the Company completes all actions and proceedings required on
its part to be taken prior to the issuance and delivery of the Shares
pursuant to the terms of each of the Plans, including, without limitation,
collection of required payment for the Shares, the Shares will be validly
issued, fully paid and nonassessable.
This opinion is rendered only to you and is solely for your benefit in
connection with the transactions covered hereby. This opinion may not be
relied upon by you for any other purpose, or furnished to, quoted to or
relied upon by any other person, firm or corporation for any purpose, without
our prior written consent. We consent to your filing this opinion as an
exhibit to the Registration Statement.
Very truly yours,
/s/ LATHAM & WATKINS
19
<PAGE>
Exhibit 23(a)
CONSENT OF INDEPENDENT AUDITORS
THE BOARD OF DIRECTORS
GETCHELL GOLD CORPORATION
We consent to incorporation by reference in the registration statement on
Form S-8 of Getchell Gold Corporation, relating to the 1998 Stock Option Plan
for Outside Directors and the 1996 Long Term Equity Incentive Plan, of our
report dated February 12, 1998, relating to the consolidated balance sheets of
Getchell Gold Corporation and subsidiary as of December 31, 1997 and 1996,
and the related consolidated statements of operations, stockholders' equity
and cash flows for the years ended December 31, 1997 and 1996, the six months
ended December 31, 1995 and the year ended June 30, 1995, which report
appears in the December 31, 1997 annual report on Form 10-K of Getchell Gold
Corporation.
/s/ KPMG Peat Marwick LLP
KPMG PEAT MARWICK LLP
Denver, Colorado
October 12, 1998
