<PAGE>
As filed with the Securities and Exchange Commission on August 28, 1998
Registration No. 333-
==========================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
SAFE TECHNOLOGIES INTERNATIONAL, INC.
(name of small business issuer in its charter)
Delaware 22-2824492
(State of jurisdiction (I.R.S. Employer
or incorporation or organization) Identification No.)
249 Peruvian Avenue
Palm Beach, Florida 33480
(Address of Principal Executive Office)
Safe Technologies International, Inc.
1998 Stock Incentive Plan
(Full Title of the Plan)
Barbara L. Tolley
Safe Technologies International, Inc.
249 Peruvian Avenue
Palm Beach, Florida 33480
(561) 832-2700
(Name, address and telephone number of agent for service)
<PAGE>
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed Maximum
------------------------
Title of Each Class Amount Offering Aggregate
of Securities to be to be Price Per Offering Amount of
Registered Registered (1) Share (2) Price (2) Registration Fee
- ------------------- -------------- --------- ---------- ----------------
<S> <C> <C> <C> <C>
Options(3) 30,000,000 $0.0425 $1,275,000 $376.12
Common Stock (4) 45,000,000 $0.0425 $1,912,500 $564.19
Total Registration Fee $940.31
- ---------------------------------------------------------------------------
</TABLE>
(1) This Registration Statement covers, in addition to the number of shares
of Common Stock stated above, options and other rights to purchase or
acquire the shares of Common Stock covered by the Prospectus and, pursuant
to Rule 416 under the Securities Act of 1933, as amended, an additional
indeterminate number of shares which by reason of certain events specified
in the Plan may become subject to the Plan.
(2) Pursuant to Rule 457(h) under the Securities Act of 1933, as amended,
the maximum offering price per share and in the aggregate, and the
registration fee were calculated based upon the average of the high and low
prices of the Common Stock on August 25, 1998, as reported on the OTC
Bulletin Board.
(3) Options granted under the Plan.
(4) Includes 15,000,000 shares of Common Stock granted as Stock Awards and
30,000,000 shares of Common Stock issuable upon exercise of Stock Options
granted under the Plan.
EXPLANATORY NOTE
This Registration Statement has been prepared in accordance with the
requirements of Form S-8 under the Securities Act of 1933, as amended (the
"Securities Act") to register shares of common stock, $.00001 par value
("Common Stock") of Safe Technologies International, Inc. (the "Company")
issuable pursuant to the Company's 1998 Incentive Stock Plan (the "Stock
Plan").
<PAGE>
PART I. INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
Item 1. Plan Information.
Pursuant to Rule 428(b)(1) under the Securities Act of 1933, as amended
(the "Securities Act"), an information statement containing the information
specified in Part I of Form S-8 (an "Information Statement") will be
distributed to participants under the Company's 1998 Incentive Plan. Such
Information Statement, taken together with the documents incorporated by
reference herein pursuant to Item 3 of Part II below, constitutes a
prospectus meeting the requirements of Section 10(a) of the Securities Act,
and such Information Statement is hereby incorporated by reference in this
Registration Statement.
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The Company incorporates the following documents by reference in this
Registration Statement.
(a) Company's Annual Report on Form 10-KSB for the fiscal year ended
November 30, 1997.
(b) Company's Quarterly Reports on Form 10-QSB for the quarters ended March
31, 1998 and June 30, 1998.
(c) Company's Current Reports on Form 8-K filed on February 23, 1998, May
27, 1998, June 23, 1998, July 21, 1998 and July 28, 1998.
(d) The description of the Company's common stock which is contained in the
Company's registration statement on Form 8-A dated May 9, 1989.
All other documents subsequently filed by Company under Section 13(a),
13(c), 14 and 15(d) of the Securities Exchange Act of 1934 (the "Exchange
Act"), and prior to the filing of the post-effective amendment to this
Registration Statement which indicate that all securities offered have been
sold or which de-registers all securities then remaining unsold, shall be
deemed to be incorporated herein by reference and to be a part hereof from
the date of filing such documents.
ITEM 4. DESCRIPTION OF SECURITIES.
The Company's Common Stock is registered pursuant to Section 12 of the
Exchange Act, and therefore, the description of securities is omitted.
<PAGE>
ITEM 5. INTEREST OF NAMED EXPERTS AND COUNSEL.
Not Applicable.
ITEM 6. INDEMNIFICATION OF OFFICERS AND DIRECTORS.
Delaware General Corporation, Law, Section 102(b)(7), enables a corporation
in its certificate of incorporation to eliminate or limit personal
liability of members of its Board of Directors for monetary damages for
breach of a director's fiduciary duty of care. The elimination or
limitation does not apply where there has been a breach of the duty of
loyalty, failure to act in good faith, engaging in intentional misconduct
or knowingly violating a law, paying a dividend or approving a stock
repurchase which was deemed illegal or obtaining an improper personal
benefit. The Company's Certificate of Incorporation contains comparable
provisions.
Delaware General Corporation Law, Section 145, permits a corporation
organized under Delaware law to indemnify directors and officers with
respect to any matter in which the director or officer acted in good faith
and in a manner he reasonably believed to be in or not opposed to the best
interests of the Company, and with respect to any criminal action or
proceeding, he had no reasonable cause to believe his conduct was unlawful.
The Bylaws of the Company include comparable provisions.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not Applicable.
ITEM 8. EXHIBITS.
5.1 Opinion of English, McCaughan & O'Bryan, P.A. as to the legal of
securities being registered.
10.1 Company's 1998 Stock Incentive Plan.
23.1 Consent of Scott & Guilfoyle.
23.2 Consent of English, McCaughan & O'Bryan, P.A. (contained in Exhibit
5.1).
<PAGE>
ITEM 9. UNDERTAKINGS.
A. The undersigned Company, a small business issuer, will:
(1) File, during any period in which it offers or sells securities, a post-
effective amendment to this Registration Statement to include any
additional or changed material information on the plan of distribution.
(2) For determining liability under the Securities Act treat each post-
effective amendment as a new registration statement of the securities
offered, and the offering of the securities at that time to be the initial
bona fide offering.
(3) File a post-effective amendment to remove from registration any of the
Securities that remain unsold at the end of the offering.
B. The undersigned Company hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of
the Company's Annual Report pursuant to Section 13(a) or 15(d) of the
Securities and Exchange Act of 1934 that is incorporated by reference in
the registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of
such securities at that time shall be deemed to be the initial bona fide
offering thereof.
C. Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Company pursuant to the foregoing provisions, or otherwise, the Company has
been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the
Company of expenses incurred or paid by a director, officer or controlling
person of the Company in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Company will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as expressed in
the Securities Act and will be governed by final adjudication of such
issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1993, as amended, the
Company certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Palm Beach, State of Florida, on
this 28th day of August, 1998.
SAFE TECHNOLOGIES INTERNATIONAL, INC.
By:/s/ Barbara L. Tolley
Barbara L. Tolley
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933 as amended, this
Registration Statement on Form S-8 (the "Registration Statement") has been
signed by the following person in the capacities and on the dates
indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Barbara L. Tolley Chief Executive Officer August 28, 1998
Barbara L. Tolley and Director
/s/ Michael A. Bhathena Vice President and August 28, 1998
Michael L. Bhathena Chief Information Officer
/s/ Bradford L. Tolley Treasurer and Secretary August 28, 1998
Bradford L. Tolley
/s/ Jack W. Tolley Director August 28, 1998
Jack W. Tolley
/s/ Charles N. Martin Director August 28, 1998
Charles N. Martin
/s/ Robert L. Alexander Director August 28, 1998
Robert L. Alexander
</TABLE>
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit Description
- ------- -----------
<S> <C>
5.1 Opinion of English, McCaughan & O'Bryan, P.A.
10.1 Company's 1998 Stock Incentive Plan.
23.1 Consent of Scott & Guilfoyle
23.2 Consent of English, McCaughan & O'Bryan, P.A.
(contained in Exhibit 5.1)
</TABLE>
EXHIBIT 5.1
ENGLISH, McCAUGHAN & O'BRYAN P.A.
First Fort Lauderdale Place
100 N. E. Third Avenue, Suite 1100
Fort Lauderdale, Florida 33302-4098
Telephone (954) 462-3300
Telecopier (954) 763-2439
Gerald W. Gritter
August 28, 1998
Safe Technologies International, Inc.
249 Peruvian Avenue
Palm Beach, Florida 33480
Re: Form S-8 Registration Statement
Gentlemen:
We have acted as counsel to Safe Technologies International, Inc., a
Delaware corporation (the "Company") in connection with its Registration
Statement on Form S-8 (the "Registration Statement") filed under the
Securities Act of 1933, as amended (the "Act") relating to the offering of
up to 45,000,000 shares of its Common Stock, $.0001 par value (the
"Shares") pursuant to the Company's 1998 Stock Incentive Plan.
In that connection, we have examined originals, or copies certified or
otherwise identified to our satisfaction, of such documents, corporate
records and other instruments as we have deemed necessary or appropriate
for purposes of this opinion, including the Company's Restated Certificate
of Incorporation, the By-Laws of the Company and the Stock Plan.
Based on the foregoing, we are of the opinion that, the Shares when
purchased or issued in accordance with the terms of the Stock Plan will be
legally and validly issued, fully paid and nonassessable.
We hereby consent to the use of this opinion in connection with the
Company's registration statement and the inclusion hereof as an exhibit
thereto.
Very truly yours,
ENGLISH, MCCAUGHAN & O'BRYAN, P.A.
By:/s/ Gerald W. Gritter
Gerald W. Gritter
For the Firm
EXHIBIT 10.1
SAFE TECHNOLOGIES INTERNATIONAL, INC.
1998 INCENTIVE STOCK PLAN
1. Purpose. This 1998 Incentive Stock Plan (the
"Plan") of Safe Technologies International, Inc. (the
"Company") for selected employees, officers, directors and
key consultants to the Company and its subsidiaries, is
intended to advance the best interests of the Company by
providing personnel who have substantial responsibility for
the management and growth of the Company and its
subsidiaries with additional incentive by increasing their
proprietary interest in the success of the Company, thereby
encouraging them to remain in the employ of the Company or
any of its subsidiaries.
2. Administration. The Plan shall be administered
by a committee (the "Committee") consisting of not less
than two members of the Board of Directors of the Company
(the "Board"). All of the members of the Committee shall
be "Non-Employee Directors" as defined in Rule 16b-3 of the
Rules and Regulations promulgated under the Securities
Exchange Act of 1934 (the "Exchange Act") or any similar or
successor rule. The Board shall have the power to add or
remove members of the Committee from time to time, and to
fill vacancies thereon arising by resignation, death,
removal, or otherwise. The Committee shall designate a
chairman from among its members, who shall preside at all
of its meetings, and shall designate a secretary, without
regard to whether that person is a member of the Committee,
who shall keep the minutes of the proceedings and all
records, documents, and data pertaining to its
administration of the Plan. Meetings shall be held at such
times and places as shall be determined by the Committee.
A majority of the members of the Committee shall constitute
a quorum for the transaction of business, and the vote of a
majority of those members present at any meeting shall
decide any question brought before that meeting. In
addition, the Committee may take any action otherwise
proper under the Plan by the affirmative vote, taken
without a meeting, of a majority of its members. Any
decision or determination reduced to writing and signed by
a majority of the members shall be as effective as if it
<PAGE>
had been made by a majority vote at a meeting properly
called and held. All questions of interpretation and
application of the Plan, including those involving non-
qualified stock options (the "Options"), restricted stock
("Restricted Stock"), or awards of stock ("Stock Awards")
shall be subject to the determination of the Committee.
The actions of the Committee in exercising all of the
rights, powers and authorities set out in this Plan, when
performed in good faith and in its sole judgment, shall be
final, conclusive, and binding on the parties.
3. Shares Available Under the Plan. The stock
subject to Options, Restricted Stock Grants and Stock
Awards shall be shares of the Company's Common Stock,
.00001 par value (the "Common Stock"). The total number of
shares of Common Stock available under the Plan shall not
exceed in the aggregate 60,000,000 shares, consisting of a
maximum of 30,000,000 Options, 15,000,000 Restricted Stock
Grants and 15,000,000 Stock Awards; provided, that the class
and aggregate number of shares which may be subject to grant
hereunder shall be subject to adjustment in accordance with
the provisions of Paragraph 16 hereof. Such shares may be
treasury shares or authorized but unissued shares.
In the event that any outstanding Option, Restricted Stock
Grant or Stock Award shall expire or terminate by reason of
the death or severance of employment of the optionee or
grantee, the shares of Common Stock allocable to the
unexercised portion of that Option or the forfeited
Restricted Stock or Stock Award may again be available under
the Plan. If Common Stock is used by an employee pursuant
to Section 8 of this Plan to pay the exercise price of an
Option, only the net number of shares of Common Stock
issued by the Company shall be considered utilized under
this Plan. If shares of Stock are withheld by the Company
to pay tax withholding due from the optionee or grantee, the
number of such shares withheld shall not be considered
utilized under this Plan.
<PAGE>
4. Authority to Grant Options, Restricted Stock Grants and
Stock Awards. The Committee in its discretion and subject
to the provisions of the Plan, may grant the following from
time to time to eligible individuals of the Company or any
of its subsidiaries:
(a) Options. The Committee may grant to an eligible
individual an Option or Options to buy a stated number of
shares of Common Stock under the terms and conditions of the
Plan, which Option or Options do not constitute "incentive
stock options" within the meaning of Section 422 of the Code
("Non-Qualified Stock Option" or "Option").
(b) Restricted Stock Grant. The Committee may grant
to an eligible individual shares of Common Stock subject to
specified restrictions on transferability and vesting as
provided in the Plan ("Restricted Stock Grant").
(c) Stock Award. The Committee may award and issue
shares of Common Stock under the Plan to an eligible
individual ("Stock Award"). Stock Awards may be made in
lieu of cash compensation or as additional compensation.
Stock Awards may also be made pursuant to performance based
goals established by the Committee.
Subject only to any applicable limitations set forth in the
Plan, the number of shares of Common Stock covered by any
Option, Restricted Stock Grant, and Stock Award, shall be
determined by the Committee.
<PAGE>
5. Eligibility. The individuals who shall be eligible to
participate in the Plan shall be any officer, director,
employee, consultant or other person providing key services
to the Company or any of its subsidiaries, and any person to
whom an offer of employment has been made by the Company or
any of its subsidiaries (hereinafter such persons may
sometimes be referred to as the "Eligible Individuals.").
6. Option Price. The price at which shares may be
purchased pursuant to an Option shall not be less than the
fair market value of the shares of Common Stock on the date
the Option is granted. However, the Committee in its
discretion may provide that the price at which shares may be
purchased shall be more than the fair market value of the
shares of Common Stock on the date the Option is granted.
The Option price determined under this Paragraph 6 shall be
referred to herein as the "Option Price."
For all purposes of this Plan, the "fair market value" of a
share of Common Stock as of any particular date shall mean
the average of the high and low sales price of a share of
Common Stock on that date as reported by the principal
national securities exchange on which the Common Stock is
then listed, if the Common Stock is then listed on a
national securities exchange, or the average of the bid and
asked price of a share of Common Stock on that date as
reported in the NASDAQ listing, if the Common Stock is not
then listed on a national securities exchange, provided that
if no closing price or quotes are reported on that date or,
if in the discretion of the Committee, another means of
determining the fair market value of a share of Common Stock
at that date shall be necessary or advisable, the
Committee may provide for another means of determining fair
market value.
7. Duration of Options. No Option shall be exercisable
after the expiration of ten (10) years from the date the
Option is granted; and the Committee in its discretion may
provide that the Option shall be exercisable throughout the
ten-year period or during any lesser period of time
commencing on or after the date of grant and ending on or
before the expiration of the ten-year period.
<PAGE>
8. Exercise of Options. An optionee may exercise an
Option by delivering to the Company a written notice stating
(i) that the optionee wishes to exercise the Option on the
date notice is delivered, (ii) the number of shares of
Common Stock with respect to which the Option is to be
exercised, (iii) the address to which the certificate
representing the shares of Common Stock should be mailed,
and (iv) the social security number of the optionee. In
order to be effective, the written notice shall be
accompanied by (i) payment of the Option Price of
the shares of Common Stock and (ii) payment of an amount of
money necessary to satisfy the withholding tax liability, if
any, that may result from the exercise of the Option. Each
payment shall be made by cash or by check drawn on a
national banking association and payable to the order of the
Company in United States dollars.
At the time of receipt by the Company of written notice of
exercise, the optionee may deliver to the Company, to the
extent permitted by law, in payment of the Option Price of
the shares of Common Stock with respect to which the Option
is exercised, (x) certificates registered in the name of the
optionee that represent a number of shares of Common Stock
legally and beneficially owned by the optionee (free of all
liens, claims and encumbrances of every kind) and having a
fair market value on the date of receipt by the Company of
written notice that is not greater than the Option Price of
the shares of Common Stock with respect to which the Option
is to be exercised, the certificates to be accompanied by
stock powers duly endorsed in blank by the record holder of
the shares of Common Stock represented by certificates (or
in lieu of such certificates, other arrangements for the
transfer of shares to the Company which are satisfactory
to the Company), and cash or a check for the balance and (y)
if the Option Price of the shares of Common Stock with respect
to which such Option is to be exercised exceeds the fair
market value, a check drawn on a national banking
association and payable to the order of the Company in an
amount, in United States dollars, equal to the amount of the
excess plus (z) the amount of money, in a form acceptable to
the Committee, necessary to satisfy the withholding tax
liability, if any, that may result from the exercise of the
Option.
<PAGE>
Notwithstanding the provisions of the immediately preceding
sentence, the Committee, in its sole discretion, may refuse
to accept shares of Common Stock in payment of the Option
Price of the shares of Common Stock with respect to which
the Option is to be exercised and, in that event, any
certificates representing shares of Common Stock that were
received by the Company with written notice shall be
returned to the optionee, together with notice by the
Company to the optionee of the refusal of the Committee to
accept the shares of Common Stock. The Company, upon
approval of the Committee and in its sole discretion,
following the request of the optionee, may retain shares of
Common Stock which would otherwise be issued upon exercise
of an Option to satisfy the withholding tax liability that
may result from the exercise of an Option. In this case, the
retained shares shall be valued at their then fair market
value. If, at the expiration of seven business days after
the delivery to optionee of written notice from the Company
that it will not accept shares of Common Stock in payment of
the exercise price, the optionee shall not have delivered to
the Company a check or money order drawn on a national
banking association and payable to the order of the Company
in an amount, in United States dollars, equal to the Option
Price of the shares of Common Stock with respect to which
such Option is to be exercised, the written notice from the
optionee to the Company shall be ineffective to exercise the
Option.
The Committee may permit an optionee to elect to pay the
exercise price upon exercise of an Option by authorizing a
third party (broker) to sell all (or a portion) of the
shares of Stock acquired upon exercise of the Option and
remit to the Company a sufficient portion of the sale
proceeds to pay the exercise price and any applicable tax
withholding resulting from such exercise.
As promptly as practicable after the receipt by the Company
of (i) the written notice from the optionee, (ii) payment,
in the form required by the foregoing provisions of this
Paragraph of the Option Price of the shares of Common Stock
with respect to which the Option is to be exercised, and
(iii) payment, in the form required by the foregoing
provisions of this Paragraph of an amount of money necessary
to satisfy any withholding tax liability that may result
from the exercise of the Option, the Company shall deliver
to the optionee a certificate representing
<PAGE>
the number of shares of Common Stock with respect to which the
Option has been exercised, reduced to the extent applicable by
the number of shares retained by the Company as provided above to
pay any required withholding tax liability, the certificate to be
registered in the name of the optionee, provided that delivery
shall be considered to have been made when the certificate shall
have been mailed, postage prepaid, to the optionee at the address
specified for that purpose in written notice from the optionee to
the Company.
9. Restricted Stock Grants. The Committee may issue
shares of Common Stock to an Eligible Individual subject to the
terms of a Restricted Stock Grant. The shares may be issued for
no payment by the individual or for a payment at or below the
fair market value on the date of grant. Restricted Stock shall be
subject to restrictions as to sale or other transfer and
generally will be subject to vesting over a period of time
specified in the Restricted Stock Grant. The Committee shall
determine the number of shares and the price, if any, at which
shares of Restricted Stock will be granted.
Restricted Stock shall be subject to the following terms and
conditions as determined by the Committee, including without
limitation any or all of the following:
(a) a prohibition against the sale, transfer, pledge
or other encumbrance of the shares of Restricted Stock, such
prohibition to lapse (i) at such time or times as the Committee
shall determine (whether in annual or more frequent installments,
at the time of the death, disability or retirement of the holder
of such shares, or otherwise);
(b) a requirement that the holder of shares of
Restricted Stock forfeit, or in the case of shares sold to a
Participant, resell back to the Company at his cost, all or a
part of such shares in the event of termination of the holder's
employment during any period in which the shares remain subject
to restrictions;
(c) a prohibition against employment of the holder of
Restricted Stock by any competitor of the Company or its
affiliates, or against such holder's dissemination of any secret
or confidential information belonging to the Company or a
subsidiary of the Company;
<PAGE>
(d) unless stated otherwise in the Restricted Stock
Grant, if restrictions remain at the time of severance of
employment with the Company or a parent or subsidiary
corporation, the Restricted Stock shall be forfeited; provided
however, if severance of employment is by reason of disability or
death, the restrictions on the shares shall lapse and the grantee
or his heirs or estate shall be 100% vested in the shares subject
to the Restricted Stock Grant.
No holder of Restricted Stock shall exercise the election
authorized by Section 83(b) of the Code without the express
written consent of the Committee to this election. Any grantee
of Restricted Stock making this election without the consent of
the Committee shall forfeit all shares of Restricted Stock
granted to him.
Shares of Restricted Stock shall be registered in the name
of the grantee and deposited, together with a stock power
endorsed in blank, with the Company. Each such certificate shall
bear a legend in substantially the following form:
The transferability of this certificate and the shares
of Common Stock represented by it are subject to the
terms and conditions (including conditions of
forfeiture) contained in Safe Technologies
International, Inc. 1998 Incentive Stock Plan, and an
agreement entered into between the registered owner and
the Company. A copy of the Plan and agreement is on
file in the office of the Secretary of the Company.
At the end of any time period during which the shares of
Restricted Stock are subject to forfeiture and restrictions on
transfer, the shares will be delivered free of all restrictions
to the grantee or to the grantee's legal representative,
beneficiary or heir; provided the certificate shall bear such
legend, if any, as the Committee determines is reasonably
required by applicable law.
Subject to the terms and conditions of the Plan, each
grantee receiving Restricted Stock shall have all the rights of a
stockholder with respect to the shares of Common Stock during any
period in which such shares are subject to forfeiture and
restrictions on transfer, including without limitation, the right
to vote such shares. By accepting a Restricted Stock Grant, the
grantee agrees to remit when due any federal and state income and
employment taxes required to be withheld. Dividends paid in cash
or property other than stock with respect to shares of Restricted
Stock shall be paid to the grantee currently.
<PAGE>
10. Stock Awards.
(a) The Committee may grant Common Stock to an
Eligible Individual under the Plan, without any payment by the
individual, in lieu of certain cash compensation or as additional
compensation. The Stock Award is subject to appropriate tax
withholding. After compliance with the tax withholding
requirements, a stock certificate shall be issued to the
individual recipient of the Stock Award. The certificate shall
bear such legend, if any, as the Committee determines is
reasonably required by applicable law. Prior to receipt of a
Stock Award, the individual must comply with appropriate requests
of the Committee to assure compliance with all relevant laws.
(b) The Committee may award shares of Common Stock,
without any payment for such shares, to designated individuals if
specified performance goals established by the Committee are
satisfied. The terms and provisions herein relating to
performance based Stock Awards are intended to satisfy Section
162(m) of the Code and regulations issued thereunder. The
designation of an employee eligible for a specific performance
based Stock Award shall be made by the Committee in writing prior
to the beginning of the 12-month period for which the performance
is measured. The Committee shall establish the number of shares
to be issued to a designated employee if the performance goal is
met; provided the maximum number of shares which may be issued to
any one employee per year under this Paragraph 10 is
shares. The Committee must certify in writing that a performance
goal has been met prior to issuance of any certificate for a
performance based Stock Award to any employee. If the Committee
certifies the entitlement of an employee to the performance based
Stock Award, the certificate shall be issued to the employee as
soon as administratively practicable, and subject to other
applicable provisions of the Plan, including but not limited to,
all legal requirements and tax withholding.
Performance goals determined by the Committee may be based
on specified increases in net profits, stock price, Company or
segment sales, market share, earnings per share, and/or return on
equity.
The employees eligible for a performance based Stock Award
are the senior officers (i.e., President Vice President,
Secretary, Treasurer, and above) of the Company and its
subsidiaries.
<PAGE>
11. Transferability of Options to Permitted Transferees.
(a) The Committee may, in its discretion, permit an
individual to transfer all or any portion of a Non-Qualified
Stock Option, or authorize all or a portion of any Non-Qualified
Stock Option to be granted to an individual to be on terms which
permit transfer by such individual, to (i) his spouse, children
or grandchildren ("Immediate Family Members"), (ii) a trust or
trusts for the exclusive benefit of such Immediate Family
Members, or (iii) a partnership in which such Immediate Family
Members are the only partners (collectively, "Permitted
Transferees"); provided that (x) there may be no consideration
for any such transfer and (y) subsequent transfers of Options
transferred as provided above shall be prohibited except
subsequent transfers back to the original individual-holder of
the Non-Qualified Stock Option and transfers to other Permitted
Transferees of the original individual-holder. Options evidencing
Non-Qualified Stock Options with respect to which such
transferability is authorized at the time of grant must be
approved by the Committee, and must expressly provide for
transferability in a manner consistent with this Subsection
11(a).
(b) Other Transfers. Except as expressly permitted by
subsection ll(a), Options requiring exercise shall not be
transferable other than by will or the laws of descent and
distribution or pursuant to domestic relations orders.
(c) Effect of Transfer. Following the transfer of any
Non-Qualified Stock Option as contemplated by Subsection ll(a)
and ll(b), (i) such Option shall continue to be subject to the
same terms and conditions as were applicable immediately prior to
transfer, provided that the term "individual" shall be deemed to
refer to the Permitted Transferee or the estate or heirs of a
deceased individual, as applicable, to the extent appropriate to
enable the holder to exercise the transferred Option in
accordance with the terms of the Plan and applicable law and (ii)
the provisions of the Plan shall continue to be applied with
respect to the original individual and, following the occurrence
of any such events described therein the Options shall be
exercisable by the Permitted Transferee or the estate or heirs of
a deceased holder, as applicable, only to the extent and for the
periods specified.
<PAGE>
(d) Procedures and Restrictions. Any individual
desiring to transfer a Non-Qualified Stock Option as permitted
under Subsection 11(a) shall make application therefor to the
Committee and shall comply with such other requirements as the
Committee may require to assure compliance with all applicable
securities laws. The Committee shall not give permission for
such a transfer if (i) it would give rise to short-swing
liability under Section 16(b) of the Exchange Act, or (ii) it may
not be made in compliance with all applicable federal, state and
foreign securities laws.
(e) Registration. To the extent the issuance to any
Permitted Transferee of any shares of Stock issuable pursuant to
Non-Qualified Stock Options transferred as permitted in this
Section is not registered pursuant to the effective registration
statement of the Company generally covering the shares to be
issued pursuant to the Plan to initial holders of Options, the
Company shall not have any obligation to register the issuance of
any such shares of stock to any such transferee.
12. Termination of Employment or Death of Optionee. Except
as may be otherwise expressly provided herein, each Option, to
the extent it shall not previously have been exercised, shall
terminate on the earlier of the date of the expiration of the
Option or one day less than three months after the date of the
severance of the employment relationship between the Company and
the optionee, whether with or without cause, for any reason other
than the death or disability of the optionee, during which period
the optionee shall be entitled to exercise the Option in respect
of the number of shares that the optionee would have been
entitled to purchase had the optionee exercised the Option on the
date of severance of employment. Whether authorized leave of
absence, or absence on military or government service, shall
constitute severance of the employment relationship between the
Company and the optionee shall be determined by the Committee at
the time thereof.
In the event of severance because of the disability of the
holder of any Option while in the employ of the Company and
before the date of expiration of the Option, the Option shall
terminate on the earlier of the date of expiration or one day
less than one year following the date of severance because of
disability, during which period the optionee shall be entitled to
exercise the Option in respect of the number of shares that the
optionee would have been entitled to purchase had the optionee
exercised the Option on the date of severance because of
disability.
<PAGE>
In the event of the death of the holder of any Option while
in the employ of the Company and before the date of expiration of
the Option, the Option shall terminate on the earlier of the date
of expiration or one day less than one year following the date of
death. After the death of the optionee, the executors,
administrators or any person or persons to whom the Option was
transferred by will or by the laws of descent and distribution,
shall have the right, at any time prior to the expiration of an
Option, to exercise the option in whole or in part, without
regard to any limitation the optionee would have been subject to
had he exercised the option on the day of his death while in
employment.
13. Requirements of Law. The Company shall not be required
to sell or issue any shares under any Option, Restricted Stock
Grant or Stock Award if the issuance of those shares would
constitute a violation by the optionee, recipient, or the Company
of any provisions of any law or regulation of any governmental
authority. Each Option, Restricted Stock Grant and Stock Award
granted under the Plan shall be subject to the requirements that,
if at any time the Board or the Committee shall determine that
the listing, registration or qualification of the shares subject
thereto upon any securities exchange or under any state or
federal law of the United States or of any other country or
governmental subdivision thereof, or the consent or approval of
any governmental regulatory body, or investment or other
representations, are necessary or desirable in connection with
the issue or purchase of shares subject thereto, no Option may be
exercised in whole or in part, or Restricted Stock Grant or Stock
Award issued, unless the listing, registration, qualification,
consent, approval or representations shall have been effected or
obtained free of any conditions not acceptable to the Board. If
required at any time by the Board or the Committee, an Option may
not be exercised or a Stock Award issued until the optionee or
recipient has delivered an investment letter to the Company. In
addition, specifically in connection with the Securities Act of
1933 (as now in effect or hereafter amended) (the "1933 Act"),
upon exercise of any Option or entitlement to a Restricted Stock
Grant or Stock Award, the Company shall not be required to issue
the underlying shares unless the Committee has received evidence
satisfactory to it to the effect that the holder of the Option,
Restricted Stock Grant or Stock Award will not transfer the
shares except pursuant to a registration statement in effect
<PAGE>
under the 1933 Act or unless an opinion of counsel satisfactory
to the Committee has been received by the Company to the effect
that registration is not required. Any determination in this
connection by the Committee shall be final, binding and
conclusive. In the event the shares issuable on exercise of an
Option or pursuant to a Restricted Stock Grant or Stock Award are
not registered under the 1933 Act, the Company may imprint on the
certificate for the shares the following legend or any other
legend which counsel for the Company considers necessary or
advisable to comply with the 1933 Act:
The shares of stock represented by this certificate
have not been registered under the Securities Act of
1933 or under the securities laws of any state and may
not be sold or transferred except upon such
registration or upon receipt by the Corporation of an
opinion of counsel satisfactory to the Corporation, in
form and substance satisfactory to the Corporation,
that registration is not required for such sale or
transfer.
The Company may, but shall not be obligated to, register any
securities covered hereby pursuant to the 1933 Act (as now in
effect or as hereafter amended) and, in the event any shares are
registered, the Company may remove any legend on certificates
representing these shares. The Company shall not be obligated to
take any other affirmative action in order to cause the exercise
of an Option or the issuance of shares pursuant thereto or
pursuant to a Restricted Stock Grant or Stock Award to comply
with any law or regulation of any governmental authority.
14. No Rights as Shareholder. No optionee shall have
rights as a shareholder with respect to shares covered by an
Option until the date of issuance of a stock certificate for the
shares; and, except as otherwise provided in Paragraph 16 hereof,
no adjustment for dividends, or otherwise, shall be made if the
record date therefor is prior to the date of issuance of the
certificate.
15. Employment Obligation. The granting of any Option,
Restricted Stock Grant, or Stock Award shall not impose upon the
Company any obligation to employ or continue to employ any
optionee or grantee; and the right of the Company to terminate
the employment of any officer or other employee shall not be
diminished or affected by reason of the fact that an Option,
Restricted Stock Grant or Stock Award, has been granted to him.
<PAGE>
16. Changes in the Company's Capital Structure. The
existence of outstanding Options, Restricted Stock Grants, and
Stock Awards shall not affect in any way the right or power of
the Company or its shareholders to make or authorize any or all
adjustments, recapitalizations, reorganizations or other changes
in the Company's capital structure or its business, or any merger
or consolidation of the Company, or any issue of bonds,
debentures, preferred or prior preference stock ahead of or
affecting the Common Stock or the rights thereof, or the
dissolution or liquidation of the Company, or any sale or
transfer of all or any part of its assets or business, or any
other corporate act or proceeding, whether of a similar character
or otherwise.
If the Company shall effect a subdivision or consolidation
of shares or other capital readjustment, the payment of a
dividend in capital stock or other equity securities of the
Company on, its Common Stock, or other increase or reduction of
the number of shares of the Common Stock outstanding, without
receiving consideration therefor in money, services, or property,
or the reclassification of its Common Stock, in whole or in part,
into other equity securities of the Company, then (a) the number,
class and per share price of shares of Common Stock subject to
outstanding Options, Restricted Stock Grants, and Stock Awards
hereunder shall be appropriately adjusted (or in the case of the
issuance of other equity securities as a dividend on, or in a
reclassification of, the Common Stock, the Options, Restricted
Stock Grants, and Stock Awards shall extend to such other
securities) in a manner so as to entitle an optionee or a grantee
to receive, upon exercise of an Option, for the same aggregate
cash consideration, and for the vesting of Restricted Stock, and
award of pending performance based Stock Awards, the same total
number and class or classes of shares (or in the case of a
dividend of, or reclassification into, other equity securities,
those other securities) he would have held after adjustment if he
had exercised his Option, or the Restricted Stock was vested in
full, or the Stock Award was earned, immediately prior to the
event requiring the adjustment, or, if applicable, the record
date for determining shareholders to be affected by the
adjustment; and (b) the number and class of shares then reserved
for issuance under the Plan (or in the case of a dividend of, or
reclassification into, other equity securities, those other
securities) shall be adjusted by substituting for the total
<PAGE>
number and class of shares of stock then reserved, the number and
class or classes of shares of stock (or in the case of a dividend
of, or reclassification into, other equity securities, those
other securities) that would have been received by the owner of
an equal number of outstanding shares of Common Stock as a result
of the event requiring the adjustment. Comparable rights shall
accrue to each optionee or employee in the event of successive
subdivisions, consolidations, capital adjustments, dividends or
reclassifications of the character described above.
After a merger of one or more corporations into the Company,
after any consolidation of the Company and any one or more
corporations, or after any other corporate transaction described
in Section 424(a) of the Code in which the Company shall be the
surviving corporation, each optionee, at no additional cost,
shall be entitled to receive (subject to any required action by
stockholders), upon any exercise of his Option, in lieu of the
number of shares as to which the Option shall then be
exercisable, the number and class of shares of stock or other
securities to which the holder would have been entitled pursuant
to the terms of the agreement of merger or consolidation, if,
immediately prior to such merger or consolidation such holder had
been the holder of a number of shares of Common Stock equal to
the number of shares as to which the Option shall then be
exercised and, if as a result of the merger, consolidation or
other transaction, the holders of Common Stock are not entitled
to receive any shares of Common Stock pursuant to the terms
thereof, each optionee, at no additional cost, shall be entitled
to receive, upon exercise of his Option, other assets and
property, including cash, to which he would have been entitled if
at the time of such merger, consolidation or other transaction he
had been the holder of the number of shares of Common Stock equal
to the number of shares as to which the Option shall then be
exercised. Comparable rights shall accrue to each optionee in the
event of successive mergers or consolidations of the character
described above. Appropriate adjustments shall also be made to
shares of Restricted Stock and to pending Stock Awards.
<PAGE>
If the Company is merged into or consolidated with another
corporation under circumstances where the Company is not the
surviving corporation, or if the Company is liquidated, or sells
or otherwise disposes of substantially all its assets to another
corporation while unexercised Options remain outstanding under
the Plan, (i) subject to the provisions of clause (iii) below,
after the effective date of such merger, consolidation or sale,
as the case may be, each holder of an outstanding Option shall be
entitled, upon exercise of such Option, to receive in lieu of
shares of Common Stock, shares of such stock or other securities
as the holders of shares of Common Stock received pursuant to the
terms of the merger, consolidation or sale; (ii) the Board may
waive any vesting requirements set forth in any Option so that
all Options from and after a date prior to the effective date of
such merger, consolidation, liquidation or sale, as the case may
be, specified by the Board shall be exercisable in full; or (iii)
all outstanding Options may be canceled by the Board as of the
effective date of any such merger, consolidation, liquidation or
sale provided that (x) notice of such cancellation shall be given
to each holder of an Option and (y) each holder of an Option
shall have the right to exercise such Option in full (subject to
any vesting requirements, unless waived) during a 30-day period
preceding the effective date of such merger, consolidation,
liquidation, sale or acquisition.
Except as hereinbefore expressly provided, the issue by the
Company of shares of stock of any class, or securities
convertible into shares of stock of any class, for cash or
property, or for labor or services either upon direct sale or
upon the exercise of rights or warrants to subscribe therefor, or
upon conversion of shares or obligations of the Company
convertible into such shares or other securities, shall not
affect, and no adjustment by reason thereof shall be made with
respect to, the number or price of shares of Common Stock then
subject to outstanding Options, Restricted Stock Grants, or Stock
Awards.
17. Amendment or Termination of Plan. The Board may at any
time alter, suspend or terminate the Plan, but except in
accordance with the provisions of Paragraph 16 hereof, no change
shall be made which will have a material adverse effect upon any
Option, Restricted Stock Grant or Stock Award previously granted
unless the consent of such grantee is obtained.
<PAGE>
18. Forfeitures. Notwithstanding any other provisions of
this Plan, if the Committee finds by a majority vote after full
consideration of the facts that the employee, before or after
termination of his employment with the Company or its
subsidiaries for any reason (a) committed or engaged in fraud,
embezzlement, theft, commission of a felony, or proven dishonesty
in the course of his employment by the Company or its
subsidiaries, which conduct damaged the Company or its
subsidiaries, or disclosed trade secrets of the Company or its
subsidiaries, or (b) participated, engaged in or had a financial
or other interest, whether as an employee, officer, director,
consultant, contractor, shareholder, owner, or otherwise, in any
commercial endeavor in the United States which is competitive
with the business of the Company or its subsidiaries without the
written consent of the Company or its subsidiaries, the employee
shall forfeit all outstanding Options, Restricted Stock and Stock
Awards which are not fully vested, including all rights related
to such matters, and including all unexercised Options, exercised
Options, and any performance based Stock Awards to which he may
be entitled, and other elections pursuant to which the Company
has not yet delivered a stock certificate. Clause (b) shall not
be deemed to have been violated solely by reason of the
employee's ownership of stock or securities of any publicly owned
corporation, if that ownership does not result in effective
control of the corporation.
The decision of the Committee as to the cause of the
employee's discharge, the damage done to the Company or its
subsidiaries, and the extent of the employee's competitive
activity shall be final. No decision of the Committee, however,
shall affect the finality of the discharge of the employee by the
Company or its subsidiaries in any manner. To provide the
Company with an opportunity to enforce this Section, no
certificate for Stock may be issued under this Plan without the
certification by the Committee that no action forbidden by this
provision has been raised for their determination.
<PAGE>
19. Tax Withholding. The Company or any of its
subsidiaries shall be entitled to deduct from other compensation
payable to each employee any sums required by federal, state, or
local tax law to be withheld with respect to the grant, exercise,
or vesting, as appropriate, of an Option, Restricted Stock Grant,
or Stock Award. In the alternative, the Company may require the
employee (or other person exercising the Option, or receiving the
Restricted Stock or Stock Award) to pay the sum directly to the
employer corporation. If the employee (or other person) is
required to pay the sum directly, payment in cash or by check of
such sums for taxes shall be delivered within five (5) days after
the date of exercise. The Company shall have no obligation upon
exercise of any Option, vesting of Restricted Stock or issuance
of a Stock Award until payment has been received, unless
withholding (or offset against a cash payment) as of or prior to
the date of exercise is sufficient to cover all sums due with
respect to that exercise or vesting. The Company shall not be
obligated to advise an employee of the existence of the tax or
the amount which the employer corporation will be required to
withhold.
20. Written Agreement. Each Option, Restricted Stock
Grant, and Stock Award granted hereunder shall be embodied in a
written agreement, which shall be subject to the terms and
conditions prescribed herein, and shall be signed by the optionee
or grantee and by an appropriate officer of the Company for and
in the name and on behalf of the Company. Each agreement shall
contain other provisions which the Committee in its discretion
shall deem advisable.
21. Governing Law and Interpretation. This Plan shall be
governed by the laws of the state of Florida. Headings contained
in this Plan are for convenience only and shall in no manner be
construed as part of this Plan. It is the intent of the Company
that the Plan comply in all respects with Rule 16b-3 promulgated
under the Exchange Act, any ambiguities or inconsistencies in
construction of the Plan shall be interpreted to give effect to
such intention, and if any provision of the Plan is found not to
be in compliance with Rule 16b-3, such provision shall be deemed
null and void to the extent required to permit the Plan to comply
with Rule 16b-3. The Board and the Committee each may from time
to time adopt rules and regulations under, and amend, the Plan in
furtherance of the intent of the foregoing.
22. Effective Date of Plan. The Plan shall become
effective as of April 1, 1998 (the "Effective Date") and shall
terminate on the 10th anniversary of the Effective Date. No
Option, Restricted Stock Grant, or Stock Award shall be granted
pursuant to the Plan after April 1, 2008.
EXHIBIT 23.1
Scott & Guilfoyle
Certified Public Accountants
5 Dakota Drive - Suite 206
Lake Success, New York 11042
Paul J. Scott. C.P.A. (516) 775-9600
Richard T. Guilfoyle. C.P.A. Fax (516) 328-6638
As independent certified public accountants, we hereby consent to the
incorporation by reference in this Registration Statement of Safe
Technologies International, Inc. on Form S-8 relating to the Safe
Technologies International, Inc. 1998 Stock Incentive Plan use of our
report dated February 9, 1998 appearing in and incorporated by reference in
the Annual Report on Form 10-KSB of Safe Technologies International, Inc.
for the year ended November 30, 1997 to all references to our Firm included
in this Registration Statement.
/s/ SCOTT & GUILFOYLE
SCOTT & GUILFOYLE
Lake Success, New York
August 28, 1998
