As filed with the Securities and Exchange Commission on November 25, 1998.
Registration No. 333-_________
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------
LIFE USA HOLDING, INC.
(Exact name of issuer as specified in its charter)
MINNESOTA 41-1578384
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
--------------------
Suite 95, Interchange North Building
300 South Highway 169
Minneapolis, Minnesota 55426
(612) 546-7386
(Address, including zip code,
of issuer's principal executive offices)
--------------------
LIFE USA HOLDING, INC.
1990 STOCK OPTION PLAN
(Full title of the plan)
--------------------
Robert W. MacDonald, Chief Executive Officer
Life USA Holding, Inc.
Suite 95, Interchange North Building
300 South Highway 169
Minneapolis, Minnesota 55426
(612) 546-7386
(Name and address, including zip code and telephone number,
including area code, of agent for service)
--------------------
COPIES TO:
Catherine A. Bartlett
Kaplan, Strangis and Kaplan, P.A.
5500 Norwest Center, 90 South Seventh Street
Minneapolis, Minnesota 55402
(612) 375-1138
<PAGE>
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
===========================================================================================================
Title of Securities to Amount to be Proposed Maximum Offering Proposed Amount of
be Registered Registered(1) Price per Share(2) Maximum Registration Fee
Aggregate
Offering Price
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock Par 1,000,000 $12.5 $12,500,000 $3,475
Value $.01
===========================================================================================================
</TABLE>
(1) Represents an additional 1,000,000 shares of Common Stock hereby
reserved for issuance under the 1990 Stock Option Plan (the "Plan"). The number
of shares of Common Stock stated above may be adjusted in accordance with the
provisions of the Plan in the event that, during the period the Plan is in
effect there is effected any increase or decrease in the number of issued shares
of Common Stock resulting from a subdivision or consolidation of shares or the
payment of a stock dividend or any other increase or decrease in the number of
shares effected without receipt of consideration by the Company. Accordingly,
this Registration Statement covers, in addition to the number of shares of
Common Stock stated above, an indeterminate number of shares which by reason of
any such events may be issued in accordance with the provisions of the Plan.
(2) Estimated by the registrant solely for the purpose of calculating
the amount of registration fee for the additional shares registered hereby,
based on the average of the high and low prices of the Company's Common Stock as
reported on the Nasdaq National Market tier of the Nasdaq Stock Market on
November 19, 1998.
2
<PAGE>
INCORPORATION OF PRIOR REGISTRATION STATEMENT BY REFERENCE
In connection with the registration of additional shares of the Common
Stock of Life USA Holding, Inc. issuable under its 1990 Stock Option Plan, and
in accordance with Instruction E to Form S-8, the contents of Registration
Statement No. 33-81444 filed with the Securities and Exchange Commission on July
11, 1994, Registration Statement No. 33-85768 filed with the Securities and
Exchange Commission on October 31, 1994, Registration Statement No. 333-4482
filed with the Securities and Exchange Commission on May 2, 1996 and
Registration Statement No. 333-26841 filed May 9, 1997, as amended, are hereby
incorporated by reference herein.
EXPLANATORY NOTE
As permitted by the rules of the Securities and
Exchange Commission (the "Commission"), this
Registration Statement omits the information
specified in Part I of Form S-8.
3
<PAGE>
Part II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3: INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents filed with the Commission by Life USA Holding,
Inc. (the "Company") are incorporated in this Registration Statement on Form S-8
(the "Registration Statement") by reference:
1. The Company's Annual Report on Form 10-K/A for the fiscal year
ended December 31, 1997;
2. Quarterly Report on Form 10-Q for the quarters ended March 31,
1998, June 30, 1998 and September 30, 1998;
3. The description of the Company's Common Stock set forth in the
Company's Registration Statement on Form S-3, No. 33-71068;
and
All documents subsequently filed by the Company pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), prior to the filing of a post-effective amendment which
indicates that all securities offered hereunder have been sold or which
deregisters all of the securities offered then remaining unsold, shall be deemed
to be incorporated herein by reference and to be a part hereof from the date of
filing of such documents.
ITEM 4: DESCRIPTION OF SECURITIES
Not applicable.
ITEM 5: INTERESTS OF NAMED EXPERTS AND COUNSEL
Not applicable.
ITEM 6: INDEMNIFICATION OF DIRECTORS AND OFFICERS
Article V, Section 5.01 of the Bylaws of the Company provides that the
Company shall indemnify persons to the extent required by Minnesota Statutes,
Section 302A.521. Section 302A.521 provides that a corporation shall indemnify
any person who was or is made or is threatened to be made a party to any
proceeding by reason of the former or present official capacity of such person
against judgments, penalties and fines, including, without limitation, excise
taxes assessed against such person with respect to an employee benefit plan,
settlements and reasonable expenses, including attorneys' fees and
disbursements, incurred by such person in connection with the proceeding, if,
with respect to the acts or omissions of such person complained of in the
proceeding, such person has not been indemnified by another organization or
employee benefit plan
4
<PAGE>
for the same penalties, fines, taxes and expenses with respect to the same acts
or omissions; acted in good faith; received no improper personal benefit and
Section 302A.255 (regarding conflicts of interest), if applicable, has been
satisfied; in the case of a criminal proceeding, had no reasonable cause to
believe the conduct was unlawful; and in the case of acts or omissions by
persons who are or were serving other organizations at the request of the
corporation or whose duties involve or involved service for other organizations,
reasonably believed that the conduct was not opposed to the best interests of
the corporation.
ITEM 7: EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8: EXHIBITS
4.1 Restated Articles of Incorporation of the Company
(incorporated by reference to Exhibit 3.1 filed as part of the
Company's Registration Statement No. 33-52624)
4.2 Amended and Restated By-laws of the Company
4.3 Life USA Holding, Inc. 1990 Stock Option Plan
5.1 Opinion of Kaplan, Strangis and Kaplan, P.A.
23.1 Consent of Kaplan, Strangis and Kaplan, P.A. (included in
Exhibit 5.1)
23.2 Consent of Ernst & Young LLP
24.1 Power of Attorney
ITEM 9: UNDERTAKINGS
Rule 415 Offering.
The Company hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or the most
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
5
<PAGE>
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;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement;
provided, however, that paragraphs (i) and (ii) do not apply if the information
required to be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed with or furnished to the Commission by the
Company pursuant to Section 13 or Section 15(d) of the Exchange Act that are
incorporated by reference in 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 herein, 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.
Incorporation of Subsequent Exchange Act Documents by Reference.
The 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 Section 15(d) of the Exchange Act that is
incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
Form S-8 Registration Statement.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 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 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 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 Act and
will be governed by the final adjudication of such issue.
6
<PAGE>
SIGNATURES
The Registrant. Pursuant to the requirements of the Securities Act of
1933, the Company certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Minneapolis, State of Minnesota, on November 24,
1998.
LIFE USA HOLDING, INC.
By: /s/ Robert W. MacDonald
---------------------------------
Robert W. MacDonald
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ Robert W. MacDonald Chief Executive Officer, Chairman
- ------------------------ of the Board and President November 24, 1998
Robert W. MacDonald
/s/ Mark A. Zesbaugh Executive Vice President, Chief
- ------------------------ Financial Officer, Treasurer and November 24, 1998
Mark A. Zesbaugh Secretary (Principal Accounting
Officer and Director)
* Director
- ------------------------
Hugh Alexander
* Director
- ------------------------
Jack H. Blaine
* Director
- ------------------------
Margery G. Hughes
7
<PAGE>
* Director
- ------------------------
Barbara J. Lautzenheiser
* Director
- ------------------------
Daniel J. Rourke
* Director
- ------------------------
Ralph Strangis
* Director
- ------------------------
Donald J. Urban
* Director
- ------------------------
Edward J. Bonach
* Director
- ------------------------
Robert S. James
Robert W. MacDonald, pursuant to Powers of Attorney executed by each of
the directors above whose name is marked with a "*," by signing his name hereto
does hereby sign and execute this Registration Statement of Life USA Holding,
Inc. on behalf of each such director.
8
<PAGE>
EXHIBIT INDEX
Exhibit Sequentially
Number Description of Exhibit Numbered Page
- ------ ---------------------- -------------
4.1 * Restated Articles of Incorporation
of the Company (incorporated by reference to
Exhibit 3.1 filed as part of the Company's
Registration Statement No. 33-52624)
4.2 Amended and Restated By-laws of the Company
4.3 Life USA Holding, Inc. 1990 Stock Option Plan
5.1 Opinion of Kaplan, Strangis and Kaplan, P.A.
23.1 Consent of Kaplan, Strangis and Kaplan, P.A.
(included in Exhibit 5.1)
23.2 Consent of Ernst & Young LLP
24.1 Power of Attorney
* Previously filed
9
EXHIBIT 4.2
AMENDED AND RESTATED
BYLAWS
OF
LIFE USA HOLDING, INC.
Life USA Holding, Inc., a corporation organized under Minnesota Statutes
Chapter 302A.
ARTICLE I
MEETINGS OF SHAREHOLDERS
Section 1.01. Regular Meetings. Regular meetings of shareholders may
be called by the Chief Executive Officer, the Secretary, the Board of Directors,
or by shareholder demand in accordance with Minnesota Statutes Section 302A.431,
subdivision 2. No meeting shall be designated a regular meeting unless
specifically described as such in the notice of meeting or unless all the
shareholders are present in person or by proxy and none of them objects to this
designation.
Section 1.02. Special Meetings. Special meetings of the shareholders
may be called for any purpose or purposes at any time by the Chief Executive
officer, Chief Financial Officer, two or more directors or by shareholder demand
in accordance with Minnesota Statutes Section 302A.433, subdivision 2.
Section 1.03. Time and Place of Shareholder Meetings. Except as
otherwise provided by statute, any meeting of shareholders shall be held on the
date and at the time and place fixed by the Chief Executive Officer or the Board
of Directors of the corporation.
Section 1.04. Notice of Shareholder Meeting. Except as otherwise
provided by statute, written notice of the date, time, and place of any meeting
of shareholders shall be given to every holder of voting shares at such address
as appears on the stock book of the corporation at least ten days prior to the
meeting if by mail, or two days prior to the meeting if by telex, telegram, or
in person.
Section 1.05. Voting. Except where a greater percentage is required by
statute, the shareholders shall take action by the affirmative vote of the
holders of a majority of the voting power of the shares present.
Section 1.06. Notice of Business to be Considered. No business shall be
considered at an annual meeting of the shareholders except business identified
(a) pursuant to the Company's Notice of Meeting, (b) by or at the direction of
the Board of Directors, or (c) by any shareholder of the Company who (i) was a
shareholder of record at the time of giving of the notice specified
<PAGE>
in clause (iii) below, (ii) is entitled to vote at the meeting, and (iii) gives
notice of the matter, which otherwise must be a proper matter for shareholder
action, in a writing received by the Secretary of the Company not less than 120
calendar days in advance of the date the Company's proxy statement and notice
was released to shareholders in connection with the Company's previous year's
annual shareholder meeting.
ARTICLE II
DIRECTORS
Section 2.01. Number, Term of Office. The Board of Directors shall
consist of not less than three or more than fifteen directors. The Board of
Directors shall be elected annually by ballot of the holders of the shares of
the corporation entitled to vote thereon for the term of one year, and shall
serve until the election and qualifications of their successors, unless they
sooner resign. The number of directors may be increased or decreased at any time
by a majority vote of the Board of Directors, except that no decrease in the
number of directors shall have the effect of shortening the term of any
incumbent director. The Board of Directors shall be empowered to fill any
vacancies on the Board of Directors.
Section 2.02. Removal. The Board of Directors or shareholders may
remove any director of the corporation at any time, for cause or without cause.
New directors may be elected at a meeting at which directors are removed.
Section 2.03. Board Meetings, Notice. The Chief Executive Officer (if a
director), the Chairman of the Board (if one is elected) or Directors comprising
at least one-third of the number of directors then in office may call a Board
meeting by giving ten days notice if by mail, or two days notice if by
telephone, telex, telegram, or in person, to all directors of the day or date
and time of the meeting. Meetings of the Board of Directors may be held at the
day or date, time, and place, as shall be determined by the Board. If the day or
date, time, and place have been announced at a previous meeting of the Board, or
if a meeting schedule is adopted by the Board, no notice is required. In the
absence of a designation by the Board of Directors, Board meetings shall be held
at the principal executive offices of the corporation.
Section 2.04. (a) Advance Written Consent or Opposition. Any member of
the Board or a committee thereof, as the case may be, may give advance written
consent or opposition to a proposal to be acted on at a Board or committee
meeting. If a director or committee member is not present at the meeting,
advance written consent or opposition to a proposal does not constitute presence
for the purpose of determining whether a quorum exists, but such advance written
consent or opposition shall be a vote in favor of or against the proposal or
resolution if the proposal or resolution acted upon at the meeting is
substantially the same or has substantially the same effect as the proposal or
resolution to which the member of the Board or committee has consented or
objected.
<PAGE>
(b) Action Without Meeting. Any action, other than an action requiring
shareholder approval, may be taken by written action signed by the number of
directors that would be required to take the same action at a meeting of the
board at which all directors were present. An action requiring shareholder
approval required or permitted to be taken at a board meeting may be taken by
written action signed by all of the directors. Any such written action is
effective when signed by the required number of directors, unless a different
effective time is provided in the written action. When written action is taken
by less than all directors, all directors shall be notified immediately of its
text and effective date. Failure to provide the notice does not invalidate the
written action. A director who does not sign or consent to the written action
has no liability for the action or actions taken thereby.
Section 2.05 (a) Electronic Conferences. A conference among directors
by any means or communication through which the directors may simultaneously
hear each other during the conference constitutes a regular or special meeting
of directors, if the same notice is given of the conference to every holder of
shares entitled to vote as would be required for a meeting, and if the number of
shares held by the directors participating in the conference would be sufficient
to constitute a quorum at a meeting. Participation in a conference by that means
constitutes presence at the meeting in person or by proxy if all the other
requirements of Section 302A.449 of the Minnesota Business Corporation Act are
met.
(b) Participation by Electronic Means. A director may participate in a
regular or special meeting of directors by any means of communication through
which the director, other directors so participating, and all directors
physically present at the meeting may simultaneously hear each other during the
meeting. Participation in a meeting by that means constitutes presence at the
meeting in person or by proxy if all the other requirements of section 302A.449
of the Minnesota Business Corporation Act are met.
ARTICLE III
OFFICERS
Section 3.01. Election; Term of Office; Removal. The Board of Directors
shall elect a Chief Executive Officer and Chief Financial officer or one or more
officers exercising the functions of such offices, and may elect such other
officers as it may deem necessary for the operation and management of the
corporation, each of whom shall have the duties and responsibilities incident to
the offices which they hold or as determined by the Board. Officers need not be
directors or shareholders. Without limiting the foregoing, the Board may elect a
Chairman of the Board, President, a Chief Operating Officer, one or more Vice
Presidents, a Treasurer, a Secretary and such assistant officers as it may
designate with titles to describe their duties, functions or special
responsibilities. Officers shall hold office at the will of the Board for an
indefinite term until their successors are elected and qualified. Any officer
elected or appointed by the Board of Directors may be removed by the Board at
any time with or without cause.
<PAGE>
ARTICLE IV
AMENDMENTS
Section 4.01. Subject to the power of shareholders to adopt, amend, or
repeal these Bylaws as provided in Minnesota Statutes Section 302A.181,
subdivision 3, any Bylaw may be amended or repealed by the Board of Directors at
any meeting, provided that, after adoption of the initial Bylaws, the Board
shall not adopt, amend, or repeal a Bylaw fixing a quorum for meetings of
shareholders, prescribing procedures for removing directors or filling vacancies
in the Board, or fixing the number of directors or their classifications,
qualifications, or terms of office. The Board may adopt or amend a Bylaw to
increase the number of directors.
ARTICLE V
INDEMNIFICATION
Section 5.01. The corporation shall indemnify persons for such expenses
and liabilities in such manner, under such circumstances, and to the extent
required by Minnesota Statutes Section 302A.521.
EXHIBIT 4.3
LIFE USA HOLDING, INC.
1990 STOCK OPTION PLAN
(RESTATED)
------------------------------
PART I
PURPOSES; DEFINITIONS; SHAREHOLDER APPROVAL;
RESERVATION OF SHARES; AND PARTICIPATION IN PLAN
ARTICLE I
Purposes
1.1 Purposes of Plan. The purpose of this Life USA Holding, Inc. 1990
Stock Option Plan (the "Plan") is to provide incentives to employees and
consultants of the Company and/or its Subsidiaries who contribute, and are
expected to contribute, to the success of the Company and its Subsidiaries, to
provide a means of rewarding outstanding performance, and to enhance the
interest of such employees and consultants in the Company's continued success
and progress by providing them a proprietary interest in the Company. Further,
this Plan is designed to enhance the Company's ability to maintain a competitive
position in attracting and retaining qualified personnel and consultants
necessary for the continued success and progress of the Company.
ARTICLE II
Definitions
2.1 Certain terms used herein shall have the meaning below stated,
subject to the provisions of Section 7.1.
"Board" or "Board of Directors" means the Board of Directors of the
Company.
"Code" means the Internal Revenue Code of 1986, as amended.
"Committee" means the committee appointed by the Board to administer
this Plan pursuant to Article VII or, if no Committee is appointed by the Board,
means the Board.
"Common Stock" means, subject to the provisions of Section 9.3, the
presently authorized common stock of the Company, par value $.01 per share.
<PAGE>
"Company" means Life USA Holding, Inc., a Minnesota corporation.
"Consultant" means any person providing services to the Company or any
Subsidiary who is not an Employee.
"Disability" means (subject to Section 6.2) a physical or mental
impairment of sufficient severity such that an Employee is permanently unable to
continue his employment with the Company as determined by the Committee.
"Employee" means an employee (including an officer) of the Company or
of any Subsidiary of the Company.
"Fair Market Value" means the fair market value of the Company's Common
Stock as determined by the Committee on the basis of available prices for such
Common Stock or in such manner as may be authorized by applicable regulations
under the Code.
"Incentive Stock Option" means an option to purchase Common Stock,
granted by the Company to an Employee pursuant to Section 5.1, which is intended
to meet the requirements of Section 422A of the Code and which is designated at
the time of the award of an Incentive Stock Option.
"Non-Statutory Option" means an option to purchase Common Stock,
granted by the Company to an Optionee or a Consultant pursuant to Section 5.1,
which is not an Incentive Stock Option.
"Option" means an Incentive Stock Option or a Non-Statutory Option.
"Optionee" means the holder of an Option granted under the Plan.
"Plan" means the Life USA Holding, Inc. 1990 Stock Option Plan, as set
forth herein and as from time to time amended.
"Subsidiary" means a subsidiary or parent corporation, as defined in
Section 425(e) and (f) of the Code, with respect to the Company.
ARTICLE III
Shareholder Approval; Reservations of Shares
3.1 Shareholder Approval. This Plan shall be subject to approval by the
affirmative vote of the holders of a majority of the Company's Common Stock
present or represented and entitled to vote thereon at a meeting of
shareholders, which approval must be obtained no later than September 17, 1991.
<PAGE>
3.2 Shares Reserved Under Plan. Subject to adjustment under the
provisions of Section 9.3 hereof, the maximum number of shares of Common Stock
which may be issued and sold under this Plan is 5,000,000 shares. Such shares
may be either authorized and unissued shares or shares issued and thereafter
acquired by the Company. Shares issued pursuant to this Plan shall be subject to
all applicable provisions of the Articles of Incorporation and Bylaws of the
Company in existence at the time of issuance of such shares and at all times
thereafter. If Options granted under this Plan shall terminate or cease to be
exercisable by reason of expiration, surrender for cancellation or otherwise
without having been wholly exercised, new Options may be granted under this Plan
covering the number of shares to which such termination or cessation relates. At
no time may the sum of the maximum number of shares issuable under outstanding
Options granted under this Plan and the number of shares previously issued under
Options granted under this Plan exceed the maximum number of shares that may be
issued and sold under this Plan, as above stated.
ARTICLE IV
Participation in Plan
4.1 Eligibility to Receive Options. Options under this Plan may be
granted only to (a) Employees who are employed by the Company or a Subsidiary on
the date the Option is granted and who the Committee believes are in a position
to make an important contribution to the success of the Company, and (b)
Consultants of the Company or a Subsidiary who the Committee believes are in a
position to make important contributions to the success of the Company, all as
determined by the Committee.
4.2 Participation Not Guarantee of Employment. Nothing in this Plan or
in the instrument evidencing the grant of an Option shall in any manner be
construed to limit in any way the right of the Company or a Subsidiary to
terminate an Employee's employment at any time without regard to the effect of
such termination on any rights such Employee would otherwise have under this
Plan, or give any right to such an Employee to remain employed by the Company or
a Subsidiary thereof in any particular position or at any particular rate of
compensation.
<PAGE>
PART II
OPTIONS;
TERMINATION OF EMPLOYMENT AND DEATH
ARTICLE V
Options
5.1 Grants of Options.
(a) Grant. The Committee may grant Incentive Stock Options and/or
Non-Statutory Options to Employees and Non-Statutory Options to Consultants,
subject to the limitations provided in Section 7.1. All Options under this Plan
shall be granted within ten years of September 18, 1990, the date on which this
Plan was adopted by the Board of Directors subject to approval of the Plan by
shareholders.
(b) Option Price. The purchase price per share of Common Stock under
each Incentive Stock Option and Non-Statutory Option shall be determined by the
Committee but shall be not less than 100% of the Fair Market Value per share of
such Common Stock on the date the Option is granted for Incentive Stock Options
and 85% of the Fair Market Value per share of such Common Stock on the date the
Option is granted for Non-Statutory Options; provided that no more than ten
percent (10%) of the Non-Statutory Options granted under the Plan (determined at
the time of grant) shall be granted at an exercise price below Fair Market Value
per share. The purchase price per share may be subject to adjustment in
accordance with the provisions of Section 9.3 hereof.
(c) Options Agreements. Options shall be evidenced by option agreements
in such form and containing such terms and conditions as the Committee shall
approve, which terms and conditions need not be the same for all Options.
(d) Options Nontransferable. An Option granted under this Plan shall by
its terms be nontransferable by the Optionee otherwise than by will or the laws
of descent and distribution, and, during the lifetime of the Optionee, shall be
exercisable only by such Optionee. No transfer of an Option by an Optionee by
will or by the laws of descent and distribution shall be effective to bind the
Company unless the Company shall have been furnished with written notice thereof
and a copy of the will and/or such other evidence as the Committee may determine
necessary to establish the validity of the transfer.
(e) Substitution and Cancellation. The Committee, in its sole
discretion, may grant to an Optionee who has been granted an Option under this
Plan, in exchange for the surrender and cancellation of such Option, a new
Option having a purchase price lower (or higher) than the purchase price
provided in the Option so surrendered and cancelled and containing such other
terms as the Committee may deem appropriate, subject to Section 5.1(b) and such
other limitations or
<PAGE>
restrictions with respect to an Incentive Stock Option as may be imposed by the
Code; provided that the number of outstanding Options under the Plan which have
been issued in the exchange referred to in this sentence shall not exceed ten
percent (10%) of the outstanding Options under the Plan (determined at the time
of such exchange).
5.2 Exercise.
(a) Term of Options; Vesting; and Exercise. The term of each Option
granted under this Plan shall not exceed ten (10) years from the date of grant.
An Option granted under this Plan shall become vested at such rate and on such
conditions as the Committee shall determine at the time such Option is granted.
(b) Exercise; Payment on Exercise. Options shall be exercised by
delivering to the Company an exercise notice in the form prescribed by the
Committee. No shares of Common Stock shall be issued on the exercise of an
Option unless paid for in full at the time of purchase as provided in the next
sentence and until the provisions of 9.4 shall have been satisfied. Payment for
shares of Common Stock purchased upon the exercise of an Option shall be made
(i) in cash, or (ii) in whole or in part in shares of Common Stock held by the
Optionee for at least six months and valued at the then Fair Market Value
thereof, or (iii) by delivery to the Company of irrevocable instructions to the
Optionee's broker, which instructions and broker shall be satisfactory to the
Company, to promptly deliver to the Company the total purchase price for the
shares of the Option being exercised from the sale proceeds for such shares or
the loan proceeds for such shares or any other securities which the Optionee may
have in his account with such broker, and the Company will deliver such shares
directly to such broker in accordance with such procedures as the Committee may
establish, which alternative forms of payment may be permitted by the Committee
at the time the Option is granted or at any time thereafter during the term of
the Option. Stock certificates for the shares of Common Stock so paid for will
be issued and delivered to the person entitled thereto only at the Company's
office in Minneapolis, Minnesota. No Optionee shall have any rights as a
shareholder with respect to any share of Common Stock covered by an Option
unless and until such Optionee shall have become the holder of record of such
share and, except as otherwise permitted in Section 9.3 hereof, no adjustment
shall be made for dividends (ordinary or extraordinary, whether in cash,
securities or other property or distributions or other rights) in respect of
such share for which the record date is prior to the date on which such Optionee
shall have become the holder of record thereof.
(c) Dissolution, Liquidation, Etc. If at any time after an Option has
become exercisable and prior to its exercise and expiration, a voluntary
dissolution, liquidation (other than a liquidation into another corporation
which agrees to continue this Plan) or winding up of the affairs of the Company
shall be proposed, the Company shall cause notice in writing to be mailed to
each person holding an Option under this Plan, which notice shall be mailed not
less than twenty days prior to the closing of the transfer books of the Company
or the record date for determination of the holders of Common Stock of the
Company entitled to participate in such dissolution, liquidation or winding up,
as the case may be, to the end that during such notice period the holder of any
Option, to the extent that the same is then exercisable by such holder, subject
to the terms of Article V
<PAGE>
hereof, may purchase Common Stock in accordance with the terms of the Option and
be entitled, in respect of the number of shares so purchased, to all the rights
of the other holders of Common Stock of the Company with respect to such
proposed dissolution, liquidation or winding up of the affairs of the Company.
Each Option at the time outstanding and all rights thereunder shall terminate at
the close of business on the twentieth day after mailing of such notice to the
holder of such Option or on the record date for determination of holders of
Common Stock entitled to participate in such dissolution, liquidation or winding
up, whichever date is later.
(d) Exercise of Options. In the event that an Optionee exercises
Options, such Optionee shall comply with all requirements set forth in the
option agreement for such Options in connection with the purchase of shares of
Common Stock under this Plan.
5.3 Incentive Stock Options.
(a) Annual Limitation. In no event shall any Optionee be granted an
Incentive Stock Option under this Plan or any other plan of the Company or any
Subsidiary if such option would, during the calendar year in which the option
first becomes exercisable when combined with other Incentive Stock Options which
first become exercisable in such calendar year, entitle such Optionee, to
purchase shares of Common Stock or shares of any Subsidiary having an aggregate
fair market value (determined as of the time such option or options were
granted) in excess of $100,000. In the event an option granted hereunder is
designated an Incentive Stock Option and exceeds the limitations set forth in
this Section 5.4(a), whether at the time of grant or thereafter, such option
shall be an Incentive Stock Option only to the extent permitted hereby and the
balance thereof shall be a Non-Statutory Option for the purposes of this Plan.
(b) Incentive Stock Options Granted to Ten Percent Shareholders. No
Incentive Stock Option shall be granted to any Employee who owns, directly or
indirectly pursuant to Section 425(d) of the Code, stock possessing more than
ten percent (10%) of the total combined voting power of all classes of stock of
the Company or any Subsidiary, unless at the time such Incentive Stock Option is
granted, the price of the Incentive Stock Option is at least 110% of the Fair
Market Value of the Common Stock subject to the Incentive Stock Option and such
Incentive Stock Option, by its terms, is not exercisable after the expiration of
five (5) years from the date such Incentive Stock Option is granted.
(c) Notice. Each Optionee shall give prompt notice to the Company of
any disposition of shares acquired upon exercise of an Incentive Stock Option if
such disposition occurs within either two years after the date of grant or one
year after the date of transfer of such shares to the Optionee upon the exercise
of such Incentive Stock Option.
(d) Consent. To the extent appropriate to avoid a "modification" or
other event described in Section 425(h) of the Code, a Optionee's rights under
an Incentive Stock Option (including the rights to pay the exercise price in
Common Stock) shall be set forth in the option agreement for such Option entered
into at the date of grant, so as to preclude any requirement that further
Committee consent be given after the date of grant.
<PAGE>
ARTICLE VI
Termination of Employment
6.1 Termination of Employment. Unless earlier terminated in accordance
with its terms, an Option shall terminate 30 days after any termination of the
Optionee's employment with the Company or any Subsidiary if the Optionee is an
Employee or, in the case of death or disability of any Optionee, 90 days after
the death or disability of such Optionee.
6.2 Employment. For all purposes of this Plan, and any Option granted
hereunder, "employment" shall be defined in accordance with the provisions of
Section 1.421-7(h) of the Income Tax Regulations (or any successor regulations).
PART III
ADMINISTRATION, AMENDMENT AND TERMINATION
OF PLAN; MISCELLANEOUS
ARTICLE VII
Administration of Plan
7.1 The Committee. This Plan shall be administered by a Committee
(which shall be the Board unless the Board appoints a committee pursuant hereto)
of three or more persons, all of whom shall be members of the Board and shall be
appointed by, and serve at the pleasure of, the Board. No person shall serve as
a member of the Committee if such person is eligible, or at any time within one
year prior to appointment as a member was granted any Options under this Plan or
granted or awarded equity securities under any other plan of the Company or any
of its affiliates. A majority of the Committee shall constitute a quorum thereof
and the actions of a majority of the Committee at a meeting at which a quorum is
present, or actions unanimously approved in writing by all members of the
Committee, shall be the actions of the Committee. Vacancies occurring on the
Committee shall be filled by the Board. The Committee shall have full and final
authority to interpret this Plan and the agreements evidencing Options granted
hereunder (which agreements need not be identical), to prescribe, amend and
rescind rules and regulations, if any, relating to this Plan and to make all
determinations necessary or advisable for the administration of this Plan. The
Committee's determination in all matters referred to herein shall be conclusive
and binding for all purposes and upon all persons including, but without
limitation, the Company, the shareholders of the Company, the Committee and each
of the members thereof, and the Employees and Consultants of the Company or a
Subsidiary, and their respective successors in interest.
<PAGE>
7.2 Liability of Committee. No member of the Committee shall be liable
for anything done or omitted to be done by such member or by any other member of
the Committee in connection with this Plan, except for the willful misconduct or
gross negligence of such member. The Committee shall have power to engage
outside consultants, auditors or other professional help to assist in the
fulfillment of the Committee's duties under this Plan at the Company's expense.
7.3 Determinations of the Committee. In making its determinations
concerning the Employees and Consultants, who shall receive Options as well as
the number of shares to be covered thereby and time or times at which they shall
be granted, the Committee shall take into account the nature of the services
rendered by the respective Employees and Consultants, their past, present, and
potential contribution to the Company's success and such other factors as the
Committee may deem relevant. The Committee shall also determine the form of
option agreements to be issued under this Plan and the terms and conditions to
be included therein, provided such terms and conditions are not inconsistent
with the terms of this Plan. In its discretion or in accordance with a direction
from the Board, the Committee may waive any provisions of any option agreement,
provided such waiver is not inconsistent with the terms of this Plan as then in
effect.
ARTICLE VIII
Amendment and Termination of Plan
8.1 Amendment of Plan.
(a) Generally. The Plan may be amended at any time and from time to
time by the Board of Directors of the Company but no amendment which (i)
increases the aggregate number of shares of Common Stock which may be issued and
sold under this Plan other than adjustments pursuant to Section 9.3, (ii)
decreases the minimum option price provided in this Plan, (iii) extends the
period during which Options may be granted under this Plan, or (vi) changes the
class of Employees eligible to receive Options, shall be effective unless and
until the same is approved by the affirmative vote, in person or by proxy, of
the holders of a majority of the shares of Common Stock of the Company present
and entitled to vote at a meeting held to take such action at which a quorum is
present. No termination or amendment of this Plan, without the consent of the
holder of any Option then existing, may terminate such holder's Option or
materially and adversely affect such holder's rights thereunder.
(b) Amendments Relating to Incentive Stock Options. To the extent
applicable, this Plan is intended to permit the issuance of Incentive Stock
Options in accordance with the provisions of Section 422A of the Code. The Plan
may be modified or amended at any time, both prospectively and retroactively,
and in such manner as to affect Incentive Stock Options previously granted
(after taking into account Section 425(h) of the Code, relating to
"modifications," etc.), if such amendment or modification is necessary for this
Plan and the Incentive Stock Options granted hereunder to qualify under said
provisions of the Code.
<PAGE>
8.2 Termination. The Board of Directors of the Company may at any time
terminate this Plan as of any date specified in a resolution adopted by the
Board. If not earlier terminated, this Plan shall terminate on the tenth
anniversary of the effective date of the Plan. No Options may be granted after
this Plan has terminated. After this Plan shall terminate, the function of the
Committee will be limited to supervising the administration of Options
previously granted.
ARTICLE IX
Miscellaneous Provisions
9.1 Restrictions Upon Grant of Options. The registration or
qualification under any Federal or state law of any shares of Common Stock to be
granted pursuant to this Plan (whether to permit the grant of Options or the
resale or other disposition of any such shares of Common Stock by or on behalf
of the Optionees receiving such shares) may be necessary or desirable and, in
any such event, delivery of the certificates for such shares of Common Stock
shall, if the Board of Directors, in its sole discretion, shall determine, not
be made until such listing, registration or qualification shall have been
completed.
9.2 Restrictions upon Resale of Unregistered Stock. If the shares of
Common Stock that have been transferred to a Optionee pursuant to the terms of
this Plan are not registered under the 1933 Act, pursuant to an effective
registration statement, such Optionee, if the Committee shall deem it advisable,
may be required to represent and agree in writing (i) that any shares of Common
Stock acquired by such Optionee pursuant to this Plan will not be sold except
pursuant to an effective registration statement under the 1933 Act, or pursuant
to an exemption from registration under the 1933 Act and (ii) that such Optionee
is acquiring such shares of Common Stock for such Optionee's own account and not
with a view to the distribution thereof.
9.3 Adjustments. In the event of any change (through recapitalization,
merger, consolidation, stock dividend, split-up, or amount of the Company's
capital stock (or any other transaction described in Section 425(a) of the Code)
after any Option is granted hereunder and prior to the exercise thereof, the
Option, to the extent that it has not been exercised, shall entitle the holder
to such number and kind of securities as such holder would have been entitled to
had such holder actually owned the stock subject to the Option at the time of
the occurrence of such change. If any such event should occur, the number of
shares subject to Options which are authorized to be issued hereunder, but which
have not been issued, shall be similarly adjusted. If any other event shall
occur, prior to the exercise of an Option granted to an Optionee hereunder,
which shall increase or decrease the amount of capital stock outstanding and
which the Committee, in its sole discretion, shall determine equitably requires
an adjustment in the number of shares which the holder should be permitted to
acquire, such adjustment as the Committee shall determine may be made, and when
so made shall be effective and binding for all purposes of this Plan.
9.4 Withholding of Taxes. Each Optionee who exercises an Option to
purchase Common Stock shall, prior to the issuance of any shares or payment of
any amounts to the Optionee, pay to the Company, or make arrangements (including
withholding of shares of Common
<PAGE>
Stock purchased upon exercise of the Option at the Fair Market Value thereof)
satisfactory to the Committee regarding payment of, any taxes of any kind
required by law to be withheld with respect to the transfer to such Optionee of
such shares of Common Stock and/or amounts upon exercise of such Option.
9.5 Use of Proceeds. The proceeds from the sale of Common Stock
pursuant to Options granted under this Plan shall constitute general funds of
the Company and may be used for such corporate purposes as the Company may
determine.
9.6 Other Grants. Options may be granted under this Plan from time to
time in substitution for stock options held by employees of other corporations
who are or are about to become employees of the Company or a Subsidiary as the
result of a merger or consolidation of the employing corporation with the
Company or a Subsidiary, or the acquisition by the Company or a Subsidiary of
the assets of the employing corporation, or the acquisition by the Company or a
Subsidiary of stock of the employing corporation as the result of which it
becomes a Subsidiary of the Company. The terms and conditions of the substituted
Options so granted may vary from the terms and conditions set forth in Part II
to such extent as the Committee may deem appropriate to conform, in whole or in
part, to the provisions of the substituted stock incentives.
9.7 Other Benefits. Nothing contained herein shall prevent the Company
from establishing other incentive plans in which Employees and Consultants under
the Plan may also participate. No award under this Plan shall be considered as
compensation in calculating any insurance, pension or other benefit for which
the recipient is eligible unless any such insurance, pension or other benefit is
granted under a plan which expressly provides that compensation under this Plan
(and specifying the type of such compensation) shall be considered as
compensation under such plan.
<PAGE>
OPTION EXERCISE FORM
Life USA Holding, Inc.
Suite 600, Interchange North Building
300 South Highway 169
Minneapolis, Minnesota 55426
Attention: Corporate Secretary
Dear Sir:
I hereby exercise the following Stock Options granted under Life USA
Holding, Inc.'s (the "Company") 1990 Stock Option Plan (the "Plan"):
Date of Options Exercise Number of
Grant Awarded Price Shares Exercised
----- ------- ----- ----------------
As payment for the exercise of the above listed stock options and for
the amount of federal, state and local tax which the Company is required by law
or believes appropriate to withhold and the cost of any applicable state or
federal documentary tax stamps, I am enclosing and elect the following method of
payment (check appropriate box):
Cashier's or certified check in the amount of $_________.
Shares of the Company's Common Stock which have been held by
me for at least six months and which are valued at Fair Market
Value (as defined in the Plan) listed below.
Certificate Acquisition Fair Market
Number Date Number of Shares Value
------ ---- ---------------- -----
NOTE: All shares of Common Stock must be transferred to Life USA
Holding, Inc. on the reverse side of each certificate.
<PAGE>
Irrevocable instructions, a copy of which is attached hereto and is
subject to the Company's approval, to my broker who must be acceptable
to you to promptly deliver to the Company an amount sufficient to pay
such amounts from either (i) the proceeds of sale through the broker of
a sufficient number of shares purchased by me upon exercise of the
Option as set forth above or (ii) the loan proceeds from borrowings by
me from the broker, and the Company is hereby instructed to issue and
deliver the shares purchased by me upon exercise of the option as set
forth above directly to and in the name of the broker.
Unless the third payment option above is selected, in which case the
shares will be issued and delivered as described therein, please have _____
certificates issued in blocks of ________ shares per certificate and the
certificates should be registered as follows:
Name ______________________________________________
Mailing Address ___________________________________
___________________________________
Social Security Number ____________________________
Very truly yours,
-----------------------------------
Signature
EXHIBIT 5.1
[Letterhead of Kaplan, Strangis and Kaplan, P.A.]
November 16, 1998
Securities and Exchange Commission
Judiciary Plaza
450 Fifth Street N.W.
Washington, D.C. 20549
RE: LIFE USA HOLDING, INC.
Ladies and Gentlemen:
This opinion is furnished in connection with the Registration Statement
on Form S-8 (the "Registration Statement") filed with the Securities and
Exchange Commission by Life USA Holding, Inc. (the "Company") covering up to
1,000,000 additional shares of common stock, par value $.01, (the "Common
Stock"), reserved for issuance under the Company's 1990 Stock Option Plan (the
"Plan").
We have acted as counsel to the Company and, as such, have examined the
Company's Articles of Incorporation, Bylaws and such other corporate records and
documents as we have considered relevant and necessary for the purposes of this
opinion. We have participated in the preparation and filing of the Registration
Statement. We are familiar with the proceedings taken by the Company with
respect to the authorization and proposed issuance of shares of Common Stock
pursuant to the offering contemplated by the Registration Statement.
Based on the foregoing, we are of the opinion that:
1. The Company has been duly incorporated and is validly existing and
in good standing under the laws of the State of Minnesota.
2. The Company has corporate authority to issue the shares of Common
Stock by the Registration Statement.
3. The additional 1,000,000 shares of Common Stock proposed to be
issued under the Plan described in the Registration Statement will, when sold
and paid for, be duly and validly issued, fully paid and non-assessable.
We hereby consent to the reference of our firm in the Registration
Statement.
<PAGE>
Very truly yours,
KAPLAN, STRANGIS AND KAPLAN, P.A.
By: /s/ Catherine A. Bartlett
------------------------------------
Catherine A. Bartlett
EXHIBIT 23.1
Consent of Kaplan, Strangis and Kaplan, P.A.
(included in Exhibit 5.1)
EXHIBIT 23.2
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement (Form
S-8) pertaining to the Life USA Holding, Inc. 1990 Stock Option Plan for the
registration of an additional 1,000,000 shares of common stock of Life USA
Holding, Inc. of our report dated January 30, 1998, except for Note 10 as to
which the date is February 6, 1998 with respect to the consolidated financial
statements of Life USA Holding, Inc. included in its Annual Report and Form
10-K/A for the year ended December 31, 1997, filed with the Securities and
Exchange Commission.
/s/ Ernst & Young LLP
Minneapolis, Minnesota
November 23, 1998
EXHIBIT 24.1
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that LIFE USA HOLDING, INC., a Minnesota
corporation (the "Company"), and each of the undersigned directors of the
Company, hereby constitutes and appoints Robert W. MacDonald and Mark A.
Zesbaugh and each of them (with full power to each of them to act alone) its/his
true and lawful attorney-in-fact and agent, for it/him and on its/his behalf and
its/his name, place and stead, in any and all capacities to sign, execute, affix
its/his seal thereto and file one or more Registration Statements on Form S-8 or
any other applicable form under the Securities Act of 1933, as amended, and
amendments thereto, including pre-effective and post-effective amendments, with
all exhibits and any and all documents required to be filed with respect thereto
with any regulatory authority, relating to an additional 1,000,000 shares of the
Company's common stock, par value $.01, (the "Common Stock"), reserved for
issuance with respect to the Company's 1990 Stock Option Plan, as amended.
There is hereby granted to said attorneys, 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 respect of the foregoing as fully as it/he or
itself/himself might or could do if personally present, 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.
This Power of Attorney may be executed in any number of counterparts,
each of which shall be an original, but all of which taken together shall
constitute one and the same instrument and any of the undersigned directors may
execute this Power of Attorney by signing any such counterpart.
IN WITNESS WHEREOF, LIFE USA HOLDING, INC. has caused this Power of
Attorney to be executed in its name by its Executive Vice President, Chief
Financial Officer, Secretary and Treasurer on the 14th day of April, 1998.
LIFE USA HOLDING, INC.
By /s/ Mark A. Zesbaugh
-------------------------------------
Mark A. Zesbaugh, Executive Vice
President, Chief Financial Officer,
Secretary and Treasurer
<PAGE>
The undersigned, directors of LIFE USA HOLDING, INC., have hereunto
set their hands as of the 14th day of April, 1998.
/s/ Hugh Alexander /s/ Daniel J. Rourke
- ------------------------------------- -------------------------------------
Hugh Alexander Daniel J. Rourke
/s/ Jack H. Blaine /s/ Ralph Strangis
- ------------------------------------- -------------------------------------
Jack H. Blaine Ralph Strangis
/s/ Margery G. Hughes /s/ Donald J. Urban
- ------------------------------------- -------------------------------------
Margery G. Hughes Donald J. Urban
/s/ Barbara J. Lautzenheiser /s/ Mark A. Zesbaugh
- ------------------------------------- -------------------------------------
Barbara J. Lautzenheiser Mark A. Zesbaugh
/s/ Robert W. MacDonald /s/ Edward J. Bonach
- ------------------------------------- -------------------------------------
Robert W. MacDonald Edward J. Bonach
/s/ Robert S. James
-------------------------------------
Robert S. James
