As filed with the Securities and Exchange Commission on September 18, 1998
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
Registration Statement
Under
The Securities Act of 1933
______________________________
VALLEY FORGE SCIENTIFIC CORP.
(Exact Name of Registrant as Specified in its Charter)
PENNSYLVANIA 23-2131580
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) Identification no.)
136 Green Tree Road, Suite 100, Oaks, Pennsylvania 19456
(Address of principal executive offices and zip code)
___________________________________
Non-Qualified Employee Stock Option Plan
(full title of the plan)
______________________________
JERRY L. MALIS, PRESIDENT
VALLEY FORGE SCIENTIFIC CORP.
136 Green Tree Road, Suite 100, Oaks, PA 19456
(610) 666-7500
(Name, address, including zip code, and telephone number, including
area code, of agent for service)
______________________________
COPIES TO:
Russell U. Schenkman, Esq.
Hale & Schenkman
13 Roszel Road, Suite C-225
Princeton, New Jersey 08540
(609) 452-0110
____________________________________
<PAGE 1>
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
Proposed Maximum Proposed Maximum
Title of Securities Amount to be Offering Price Per Aggregate Offering Amount of
to be Registered Registered (1) Share Registration (2) Registration (2)
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Non-Qualified 500,000 $4.00 $1,424,095 $421.85
Stock Option Plan
Common Stock (no
par value
</TABLE>
(1) Represents the number of shares which may be issued upon the issuance and
exercise of all options issued and authorized to be issued under the
Non-Qualified Employee Stock Option Plan ("Plan"). This Registration Statement
shall also cover additional shares of Common Stock which may become issuable
under the Plan by reason of a stock dividend, stock split, recapitalization or
other similar transaction effected without the receipt of consideration which
results in an increase in the number of Registrant's outstanding shares
of Common Stock.
(2) Computation based in part on the weighted average of the exercise price per
share of $2.55 as to the 396,900 outstanding but unexercised options to
purchase Common Stock under the Plan. Balance of registration fee estimated
in accordance with Rule 457(c) under the Securities Act of 1933 as to 103,100
shares of Common Stock, solely for purposes of calculating the registration fee.
The computation is based upon the closing price of the Common Stock as reported
on the Nasdaq Small Cap Market on September 14, 1998 because the price at which
options to be granted in the future may be exercised is not currently
determinable.
_______________________________
<PAGE 2>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
Valley Forge Scientific Corp. (the "Registrant") hereby incorporates
into reference into this Registration Statement the following documents
previously filed with the Securities and Exchange Commission (the
"Commission").
(a) The Registrant's Annual Report on Form 10-K for the fiscal
year ended September 30, 1997 as filed with the Commission
on December 29, 1997, and as amended on January 26, 1998
pursuant to Section 13 of the Securities and Exchange Act of
1934, as amended (the "Exchange Act");
(b) The Registrant's Quarterly Report on Form 10-Q for the fiscal
quarter ended December 31, 1997 filed with the Commission on
February 17, 1998 pursuant to Section 13 of the Exchange Act;
(c) The Registrant's Quarterly Report on Form 10-Q for the fiscal
quarter ended March 31, 1998 filed with the Commission on
May 14, 1998 pursuant to Section 13 of the Exchange Act;
(d) The Registrant's Quarterly Report on Form 10-Q for the fiscal
quarter ended June 30, 1998 filed with the Commission on
August 14, 1998, pursuant to Section 13 of the Exchange Act;
and
(e) The Registrant's Registration Statement No. 1-10382 on Form
8-A filed with the Commission on October 30, 1989 and
declared effective on November 15, 1989, in which there is
described the terms, rights and provisions applicable to the
Registrant's outstanding Common Stock.
All reports and definitive proxy or information statements filed pursuant
to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this
Registration Statement and prior to the filing of a post-effective amendment
which indicates that all securities offered hereby have been sold or which
deregisters all securities then remaining unsold shall be deemed to be
incorporated by reference into this Registration Statement and to be a part
hereof from the date of filing of such documents. Any statement contained in
a document incorporated or deemed to be incorporated by reference herein shall
be deemed to be modified or superseded for purposes of this Registration
Statement to the extent that a statement contained herein or in any subsequently
filed document which is also deemed to be incorporated by reference herein
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Registration Statement.
Item 4. Description of Securities
Not Applicable.
Item 5. Interests of Named Experts and Counsel
Not Applicable.
Item 6. Indemnification of Officers and Directors
The Registrant's Bylaws provide that the Registrant shall indemnify its
officers and directors to the fullest extent permitted by the Business
Corporation Law of Pennsylvania, including circumstances in which
indemnification is otherwise discretionary under Pennsylvania law.
Sections 1741 and 1746 of the Business Corporation Law of Pennsylvania provide
for indemnification of
II-1
<PAGE 3>
officers, directors and other corporate agents in terms sufficiently broad to
indemnify such persons, under certain circumstances, for certain liabilities
(including reimbursement of expenses incurred) arising under the Securities Act
of 1933 ("Securities Act"). The registrant has entered into indemnification
agreements to such effect with its officers and directors containing provisions
which are in some respects broader than the specific indemnification provisions
contained in the Business Corporation Law of Pennsylvania. The
indemnification agreements may require the Company, among other things, to
indemnify such officers and directors against certain liabilities that may
arise by reason of their status or services as directors or officers (other
than liabilities determined by a court to arise from willful misconduct or
recklessness) and to advance their expenses incurred as a result of any
proceeding against them as to which they could be indemnified.
Item 7. Exemption from Registration Claimed.
Not Applicable.
Item 8. Exhibits
4.1 Certificate of Incorporation of Registrant*
4.2 Bylaws of the Registrant*
5.1 Opinion of Hale & Schenkman as to the legality of the
securities being registered
10.1 Non -Qualified Stock Option Plan
10.2 Form of Non-Qualified Stock Option Agreement
23.1 Consent of Samuel Klein & Company, Independent Auditors
23.2 Consent of Hale & Schenkman (contained in its opinion
filed as Exhibit 5.1)
24.1 Power of Attorney (contained on the page II-5 of this
Registration Statement)
* Incorporated by reference to the Company's Registration Statement
on Form S-18 (File No. 33-31008-NY), effective November 8, 1989.
Item 9. Undertakings
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement 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;
(2) That for the purpose of determining any liability under the
Securities Act of 1993, as amended ("Securities Act") each such post-effective
amendment shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof;
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering;
II-2
<PAGE 4>
(4) That for purposes of determining any liability under the
Securities Act, each filing of the Registrant's annual report pursuant to
Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 that is
incorporated by reference in this Registration Statement shall be deemed to be
a new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof; and
(5) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Registrant pursuant to the provisions summarized in Item 6, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Securities Act of 1933 and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director, officer
or controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
II-3
<PAGE 5>
SIGNATURES
Pursuant to the requirements of the Securities Act, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized in the City of Oaks, State of Pennsylvania, on the 16th day of
September 1998.
VALLEY FORGE SCIENTIFIC CORP.
By: /s/ Jerry L. Malis
--------------------------------------
Jerry L. Malis, President, and
Chairman of the Board
(Principal Executive Officer and Financial and
Principal Accounting Officer)
II-4
<PAGE 6>
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each of the person
whose signature appears below constitutes and appoints Jerry L. Malis, his
attorney-in-fact, with full power of substitution, for him in any and all
capacities, to sign any amendment to this Registration Statement on Form S-8,
and to file same, with exhibits thereto and other documents in connection
therewith, with the Securities and Exchange Commission, hereby ratifying and
confirming all that each of said attorney-in-fact, or his substitute or
substitutes, may do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the date indicated.
Signature Title
Date
/s/ Jerry L. Malis Chairman of the Board, September 16, 1998
- -----------------------
Jerry L. Malis President
/s/Thomas J. Gilloway Executive Vice President, September 16, 1998
- -----------------------
Thomas J. Gilloway Secretary, Treasurer, Director
/s/ Leonard I. Malis Director September 16, 1998
- ----------------------
Leonard I. Malis
/s/ Bruce A. Murray Director September 16, 1998
- ----------------------
Bruce A. Murray
/s/Bernard H. Shuman Director, Vice President, September 16, 1998
- --------------------- Technology
Bernard H. Shuman
Robert H. Dick Director September 16, 1998
- ---------------------
Robert H. Dick
II-5
<PAGE 7>
VALLEY FORGE SCIENTIFIC CORP.
EXHIBIT INDEX
FORM S-8
Exhibit No. Description
5.1 Opinion and consent of Hale & Schenkman
10.1 Non-Qualified Stock Option Plan
10.2 Form of Non-Qualified Stock Option Agreement
23.1 Consent of Samuel Klein & Company, Independent Auditors
23.2 Consent of Hale & Schenkman (contained in its opinion
filed as Exhibit 5.1)
24.1 Power of Attorney (contained on page II-5 of this
Registration Statement)
Exhibit 5.1
September 17, 1998
Valley Forge Scientific Corp.
136 Green Tree Road, Suite 100
Oaks, PA 19456
Re: SEC Registration Statement on Form S-8
Non-Qualified Employee Stock Option Plan
Ladies and Gentlemen:
We have examined the Registration Statement on Form S-
8 to be filed by Valley Forge Scientific Corp. (the "Company") with
the Securities and Exchange Commission on or about September
17, 1998 (the "Registration Statement") in connection with the
registration under the Securities Act of 1933, as amended, of
500,000 shares ("Shares") of the Company's common stock
issuable under the Company's Non-Qualified Employee Stock
Option Plan ("Plan"). As legal counsel for the Company, we have
examined the proceedings taken and are familiar with the
proceedings proposed to be taken by the Company in connection
with the issuance and sale of Shares pursuant to the Plan.
It is our opinion that the Shares, when issued and sold in
the manner described in the Plan and pursuant to the agreement
that accompanies each grant under the plan, will be legally and
validly issued, fully-paid and non-assessable.
We note that insofar as this opinion may involve the laws
of the Commonwealth of Pennsylvania, our opinion is based
solely upon the Business Corporation Law of Pennsylvania.
We consent to the use of this opinion as an exhibit to the
Registration Statement and further consent to the use of our
name wherever appearing in the Registration Statement and any
amendment thereto.
Very truly yours,
/s/ Hale & Schenkman
Hale & Schenkman
Exhibit 10.1
VALLEY FORGE SCIENTIFIC CORP.
NON-QUALIFIED EMPLOYEE STOCK OPTION PLAN
DATED: JULY 6, 1988, AS AMENDED
<PAGE 1>
ARTICLE I
DEFINITIONS
1.1. In this Non-Qualified Employee Stock Option Plan (hereinafter
referred to as the "Plan") unless the context otherwise requires, references
to the following words shall have the following meanings:
"APPLICATION" shall mean the Letter of Invitation substantially in the
form set out in Appendix "A", attached hereto and made a part hereof, as may be
amended by the Board from time to time.
"BOARD" shall mean the Board of Directors of the Company or a duly
constituted committee thereof.
"COMPANY" shall mean Valley Forge Scientific Corp.
"DATE OF GRANT" shall mean the date on which an Option is granted to a
Qualified Person by the Company pursuant to Article V hereof.
"FAIR MARKET VALUE" shall mean the fair market value of the Shares of the
Company on the Date of Grant.
"OPTION" shall mean a right to subscribe for Shares granted to a
Qualified Person pursuant to the Plan.
"OPTION HOLDER" shall mean a Qualified Person who holds an Option in
accordance with the terms and provisions of the Plan.
"OPTION SHARES" shall mean unissued Shares in respect of which Options
are granted.
"PARTICIPANT" shall mean any Qualified Person to whom an Option is
granted.
"PLAN" shall mean Valley Forge Scientific Corp. Non-Qualified Employee
Stock Option Plan.
"QUALIFIED PERSON" shall mean any employee, officer or director of or
consultant to the Company.
"SHARES" shall mean the authorized shares of common stock of the Company,
without par value.
"STOCK OPTION AGREEMENT" shall mean the agreement between the Company
and the Qualified Person, under which the Qualified Person is granted an option.
<PAGE 2>
"SUBSCRIPTION PRICE" shall mean the price payable for a Share on the
exercise of an Option, as determined in accordance with Article VI herein.
"SUBSIDIARIES" shall mean any corporation which at the time qualifies as
a subsidiary of the Company under the definition of "subsidiary corporation" in
Section 425(f) of the Internal Revenue of Code of 1986, as amended.
ARTICLE II
GENERAL
2.1. The purpose of the Plan is to advance the interests of Valley
Forge Scientific Corp. and its stockholders by affording to Qualified
Persons of the Company an opportunity to acquire or increase their proprietary
interest in the Company by the grant to such Qualified Persons of Options. By
thus encouraging such Qualified Persons to become owners of the common stock of
the Company, the Company seeks to motivate, retain, and attract those
highly competent individuals upon whose judgment,initiative, leadership, and
continued efforts the success of the Company in large measure depends.
2.2. The company shall pay any and all fees and expenses incurred in
connection with the exercise of any Options hereunder.
ARTICLE III
INVITATIONS TO APPLY FOR OPTIONS
3.1. The Plan shall be administered by the Board. The Board may at
its discretion invite any Qualified Person to apply for an Option on the terms
set forth herein and in the Application, in respect of the number of Option
Shares that the Board shall therein specify.
3.2. Subject to the limitations contained in Article IV hereof,
the total number of Option Shares for which any Applications for Options will be
invited shall be such number as determined by the Board.
3.3. Subject to the express provisions of the Plan, the Board shall
also have complete authority to interpret the Plan, to prescribe, amend, and
rescind rules and regulations relating to it, to determine the details and
provisions of each Application and the Stock Option Agreement issued to
a Qualified Person, and to make all other determinations necessary or
advisable in the administration of the Plan.
ARTICLE IV
LIMITATIONS
4.1. Subject to the adjustment pursuant to the provisions of Section
4.2 hereof, the total
<PAGE 3>
number of Shares which may be issued and sold hereunder shall not exceed five
hundred thousand (500,000) Shares.
4.2. If and to the extent that the Shares shall be increased or
reduced by reason of a capitalization, a rights issue, sub-division,
consolidation of shares or a reduction of capital, then the number of Shares
subject to Options, the Subscription Price per Share and the number of Shares
subject to the Plan, shall be proportionately adjusted. If the Company is
reorganized or consolidated or merged with another entity, an Option Holder
shall be entitled to receive an Option, to the extent not theretofore
exercised, covering Shares or such other ownership interest of such
reorganized, consolidated, or merged entity in the same proportion, at an
equivalent price and subject to the same terms and conditions; provided,
however, that the issuance of securities by the Company as consideration
for the acquisition by the Company of securities of another corporation or any
other asset will not be regarded as a circumstance requiring adjustment.
4.3. All Shares acquired by the Option Holder pursuant to the Plan
shall be subject to the restrictions contained in the By-Laws of the Company,
or as same may be amended or restated from time to time, and (subject thereto)
shall be effective on the date of issue thereof and rank pari passu with the
Shares of the Company then in issue (including the right to receive all
dividends or other distributions thereafter declared, paid or made by reference
to a record date falling on or after the date of issue thereof).
ARTICLE V
GRANT OF OPTIONS
5.1. Each Option granted hereunder shall be recorded in the minutes
of a meeting of or the written consent of the Board and evidenced by a written
Application and Option Agreement dated as of the Date of the Grant and executed
by the Company and the Option Holder, which Application shall set forth
such terms and conditions as may be determined by the Board in its sole
discretion consistent with the Plan.
5.2. Subject to the rules of the Plan, the form, manner, and timing
of Options, and the number of Shares comprised in an Option offered on any date
shall be at the absolute discretion of the Board.
5.3. Neither an Option Holder nor his successor shall have any of the
rights of a stockholder of the Company until the receipt by the Secretary of
the Company of written notice of the exercise of the Option by the Option Holder
in accordance with the terms of the Stock Option Agreement.
5.4. The terms of any Option granted under the Plan shall include a
provision making such Option nontransferable by the Option Holder, except upon
death, and exercisable during the lifetime of the Option Holder only by the
Option Holder.
<PAGE 4>
ARTICLE VI
SUBSCRIPTION PRICE
6.1. The Subscription Price for a Share subject to an Option granted
hereunder shall not be less than the Fair Market Value of the Share on the
Date of Grant of the Option and at the time of exercise of the Option by the
Option Holder, the Subscription Price for such Shares shall be paid in full.
ARTICLE VII
RIGHT TO EXERCISE AN OPTION
7.1. Each Option granted pursuant to the Plan shall contain
provisions, established by the Board, setting forth the manner of exercise
of such Option.
ARTICLE VIII
TERMINATION OF OPTION
8.1. Except as otherwise stated herein, the Option to the extent not
heretofore exercised shall terminate upon the occurrence of any of the
following dates, whichever shall occur first:
(a) The expiration of (3) months after the date on which the
employment of the Option Holder by the Company, or any of its Subsidiaries is
terminated (except if such termination be by reason of death or permanent or
total disability). The granting of an Option to a Qualified Person does not
alter in any way the existing rights of the Company or any of its Subsidiaries
to terminate the employment of such Qualified Person, except as specifically
provided for in the Plan.
(b) The expiration of six (6) months following the date of death of
the Participant, subject to the Participant being in the employ of the company,
or any of its Subsidiaries on the date of his death. Under such circumstances
the executors and administrators of the Option Holder, in accordance with the
terms of the Plan, may exercise the Option within six (6) months following the
date of the death, as to any shares of stock not theretofore exercised during
his lifetime.
(c) The expiration of twelve (12) months after the date on which the
employment of the Option Holder by the Company, or any of its Subsidiaries is
terminated, if such termination be by reason of the permanent and total
disability of the Option Holder as defined in Section 105(d)(4) of the Internal
Revenue Code of 1986, as amended.
(d) The expiration of ten (10) years from the Date of Grant by the
Company to the Option Holder of the Option.
<PAGE 5>
ARTICLE IX
STOCK CERTIFICATES
9.1. The Company shall not be required to issue or deliver any
certificate evidencing Shares purchased upon the exercise of any Option granted
hereunder, prior to fulfillment of all of the following conditions:
(a) The completion of any registration or other qualification
of such Shares under any federal or state law or under the rulings or
regulations of the Securities and Exchange Commission or any other governmental
regulatory body, which the Board shall in its sole discretion deem necessary or
advisable;
(b) The obtaining of any approval or other clearance from any
federal, state or foreign governmental agency which the Board shall in its sole
discretion determine to be necessary or advisable;
(c) The lapse of such reasonable period of time following the
exercise of an Option as the Board from time to time may establish for reasons
of administrative convenience; and
(d) The execution by the Option Holder of an investment letter,
satisfactory to the Board.
ARTICLE X
TERMINATION, AMENDMENT, AND MODIFICATION OF PLAN
10.1. The Board may at any time, terminate, and may at any time and
from time to time and in any respect amend or modify, the Plan; provided
further, that no termination, amendment, or modification of the Plan shall in
any manner affect any Option theretofore granted under the Plan without the
consent of the Option Holder or (in the event of his death) his executors
and administrators.
10.2. Notwithstanding anything herein to the contrary, no variation
to the number of Shares comprised in an Option or the Subscription Price
thereof shall be made pursuant to any of the provisions contained in the
Plan until the auditors of the Company shall have notified the Board in writing
that such variation is, in their opinion, fair and reasonable.
ARTICLE XI
MISCELLANEOUS
11.1. The adoption of the Plan shall not affect any other stock option
or incentive stock option or other compensation plans in effect for the Company
or any of its Subsidiaries, nor shall the Plan preclude the Company from
establishing any other forms of incentive or other compensation
<PAGE 6>
for employees of the Company or any of its Subsidiaries.
11.2. The Plan shall be binding upon the successors and assigns of the
Company.
11.3. The place of administration of the Plan shall conclusively
deemed to be within the Commonwealth of Pennsylvania and the validity,
construction, interpretation, administration, and effect of the Plan and of
its rules and regulations and the rights of any an all personnel having or
claiming to have an interest therein or thereunder shall be governed by and
determined exclusively and solely in accordance with the laws of the
Commonwealth of Pennsylvania.
11.4. The granting of options to any employee shall not give such
employee any right to be retained in the employ of the Company, its subsidiary
or affiliated companies; and the rights and power of the Company, its
subsidiary and affiliated companies, to dismiss or discharge any employee is
specifically reserved.
11.5. No member of the Board shall be liable, in respect to this Plan,
for any act whether of commission or omission taken by any other member or by
any officer, agent, or employee of the Company, its subsidiary or affiliated
companies, nor, except in circumstances involving his own bad faith, for
anything done or omitted to be done by himself.
ATTEST: VALLEY FORGE SCIENTIFIC CORP.
/s/ Thomas J. Gilloway By: /s/ Jerry L. Malis
- ------------------------ ------------------------------
Thomas J. Gilloway, Secretary Jerry L. Malis, President
(SEAL)
<PAGE 7>
APPENDIX A
LETTER OF INVITATION
_____________, 198_
To:
Dear Mr. ______________:
Re: VALLEY FORGE SCIENTIFIC CORP. NON-QUALIFIED EMPLOYEE
STOCK OPTION GRANT
The Board of Directors believes that key members of the Company should
have stake in the growth of the Company's prosperity which their joint efforts
help to promote. The Board of Directors wishes, therefore, that you should be
given the opportunity to acquire shares of common stock in the Company under
the Valley Forge Scientific Corp. Non-Qualified Employee Stock Option Plan
dated June ___, 1988 ("Plan"). The enclosed Stock Option Agreement specifies
that you have been granted a Stock Option and sets forth the terms of the
option granted.
If the agreement prepared meets with your approval, kindly execute and
return both originals to me. These originals will then be executed by both
me and the Secretary of Valley Forge Scientific Corp. and one original fully
executed will be returned to you. Please feel free to contact me should any
questions arise.
Very truly yours,
Jerry L. Malis, President
<PAGE 8>
APPENDIX B
FORM OF EXERCISE OF STOCK OPTIONS
TO: Secretary of the Corporation
Valley Forge Scientific Corp.
136 Green Tree Road
Oaks, PA 19456
Dear Sir/Madam:
I wish to exercise Options for ___________ shares of common stock of
Valley Forge Scientific Corp., without par value, now available to me
under the grant of _____ shares made to me effective of as ___________ at
$______ per share pursuant to the Valley Forge Scientific Corp. Non-Qualified
Stock Option Plan and the Stock Option Agreement, copy of said Agreement being
attached hereto. My certified check drawn to the order of Valley Forge
Scientific Corp. in the amount of $_____ is attached.
NAME: _____________________
SS NO.: _____________________
Address of Record:
___________________________________________________________________
(Street) (City) (State) (Zip)
Please forward my certificate to the following address:
_____________________________________________________________________
(Street) (City) (State) (Zip)
____________________________ _________________________
Employee Signature Date
[To be completed by Personnel Manager:
The above individual is a current employee: Yes _________ No __________
Termination Date _______________________.]
_____________________________ _________________________
Authorized Corporate Officer Date
<PAGE 1>
Exhibit 10. 2
VALLEY FORGE SCIENTIFIC CORP.
STOCK OPTION AGREEMENT
PURSUANT TO
NON-QUALIFIED STOCK OPTION PLAN
This STOCK OPTION AGREEMENT is dated as of the ____ day of __________,
199__ by and between Valley Forge Scientific Corp. (the "Company") and
______________ (the "Option Holder"), governing the grant by the Company to the
Option Holder of a Non-Qualified Stock Option to purchase an aggregate of
_______ shares ("Option Shares") of the no par value common stock ("Common
Stock") of the Company under the Valley Forge Scientific Corp. Non-Qualified
Stock Option Plan ("Plan").
ARTICLE I
DEFINITIONS
1.1 In this Non-Qualified Stock Option Agreement (hereinafter
referred to as the "Agreement") unless the context otherwise requires,
references to the following words shall bear the following meanings:
"Adoption Date" shall mean the date upon which the Plan
was adopted by the Board of Directors of the Company.
"Board" shall mean the Board of Directors of the Company or
a duly constituted committee thereof.
"Company" shall mean Valley Forge Scientific Corp.
"Date of Grant" shall mean the date upon which an Option is
granted by the Company pursuant to Article V of the Plan.
"Market Value" shall mean the fair market value of a share of
Common Stock on the Date of Grant.
"Option" shall mean a right to subscribe for Shares granted to
a Qualified Person pursuant to the Plan.
"Option Holder" shall mean a Qualified Person or a former
Qualified Person who holds an Option in accordance with the terms and
provisions of the Plan.
"Option Period" shall mean the period commencing on the
Date of Grant and expiring on the day preceding the tenth anniversary of the
Date of Grant.
"Option Shares" shall mean unissued Shares in respect of which
Options are granted.
<PAGE 2>
"Participant" shall mean any Qualified Person to whom an Option is
granted.
"Plan" shall mean Valley Forge Scientific Corp. Non-Qualified Stock
Option Plan adopted on July 6, 1988.
"Qualified Person" shall mean any officer, employee, director
or consultant of the Company.
"Shares" shall mean the authorized no par value shares of Common
Stock of the Company.
"Subscription Price" shall mean the price payable for a Share
on the exercise of an Option, as determined in accordance with Article VI of
the Plan.
ARTICLE II
CONFIRMATION OF GRANT AND SUBSCRIPTION PRICE.
2.1. Subject to the terms and conditions of the Plan, the provisions of
which are hereby made a part of this Agreement, and the return of this
Agreement signed by the Option Holder, the Company hereby confirms it
grant to the Option Holder of an Option to purchase ________ Shares at the
Subscription Price of $______ per Share.
ARTICLE III
3.1. The schedule for the exercise of Options granted pursuant to this
Agreement shall be as follows:
No. of Date First Available Expiration Date of
Shares For Exercise Right of Exercise
_______ ______________ ______________
(a) The number of Shares as to which the Option becomes available
for exercise may be purchased after the date first available for exercise
indicated above, subject to the provisions hereof, and at any time prior to the
expiration date of the Option indicated above.
<PAGE 3>
ARTICLE IV
RESTRICTION OF EXERCISE
4.1. The Option may be exercised only with respect to full Shares.
No fractional Shares shall be issued. The Option may not be exercised in
whole or in part and no Shares subject to the Option shall be issued, if any
requisite approval or consent of any governmental authority of any kind
having jurisdiction over the exercise of the Options shall not have been
secured.
4.2. In addition, the Company may (but need not) require as a
condition to the exercise of the Option in whole or in part, that the Option
Holder (or any person exercising the Option after the death of the Option
Holder in accordance with the provisions os Section 6.1(b) hereof) represent
to the Company in writing that the Shares to be acquired upon such exercise
are to be acquired for the account of the Option Holder (or for the account of
any person exercising the Option after the death of the Option Holder in
accordance with the provisions of Section 6.1(b) hereof) for investment only
and not with a view to distribution of any such Shares.
4.3. All Shares acquired by the Option Holder pursuant to this
Agreement shall be subject to the restrictions contained in the By-Laws of the
Company, as may be amended or restated from time to time.
4.4. No Option may be exercised later than ten (10) years after the
Date of Grant.
4.5. An Option shall only be exercised during the Option Period,
except as provided in Article VI herein.
ARTICLE V
MANNER OF EXERCISE
5.1. To the extent the Option shall have become and remains
exercisable and subject to such administrative regulations established by the
Board pursuant to the Plan, the Option may be exercised in whole or in part,
by the service of written notice, in the form attached hereto as Appendix A,
by the Option Holder upon the Secretary of the Company specifying the
number of shares with respect to which the Option is being exercised,
together with full payment in United States Dollars for the Subscription Price
for such Shares as herein provided. The date of exercise of the Option shall
be the date on which said written notice and full payment are received by the
Secretary pursuant to this Section 5.1.
5.2. In the event that the Option shall be exercised by a person other
than the Option holder in accordance with the provisions of Section 6.1(b) of
Article VI, such person shall furnish the Company either evidence
satisfactory to the Company of his or her right to exercise the Option.
5.3. The Company may require the Option Holder or other person
exercising the Option
<PAGE 4>
in accordance with the provisions of Section 6.1(b) of
Article VI, to furnish or execute such documents as the Company shall deem
necessary to evidence such exercise, to determine whether registration is then
require under the Securities Act of 1933, or any other applicable law.
5.4. The obligation of the Company to deliver stock certificates evidencing
Shares upon the exercise of any Option shall be subject to applicable federal,
state, local and foreign securities and tax laws.
5.5. If an offer shall be made to the holders of Shares to acquire such
shares or a plan shall be proposed whereunder the Company may, or shall
have become a subsidiary of another company, on such an offer becoming
unconditional or such plan being sanctioned by the Court, the Board shall
forthwith give notice thereof in writing to each participant (or as the case
may be his personal representative) who shall be entitled:
(a) Within the period of six (6) months after the date on
which such an offer becomes unconditional to exercise his Option up to the
full extent to which it remains unexercised; provided that if during such
period of six (6) months such other company exercises its rights of
compulsory acquisition of Shares (including any Shares issued upon the
exercise of Options) and gives notice to the Participant that it intends to
exercise such right as regards all Shares issued upon the exercise of Options
prior to a specified date (not being earlier than one (1) month after the date
of such notice) the Option shall only remain exercisable until the specified
date; and
(b) Within a period of one (1) month after the date on which
such a plan is approved by the stockholders, to exercise his Option up to the
fullest extent on which such a plan is approved by the stockholders, provided
that any right to exercise an Option contained in this Section 5.6 shall not be
exercisable later than the expiration of the Option Period.
5.6. If notice is duly given of a resolution for the voluntary winding
up of the Company, a Participant may forthwith and before the
commencement of the winding-up exercise his Option up to the full extent to
which it remains unexercised (but so that such exercise shall be conditional
upon such resolution being passed) provided that any right to exercise an
Option contained in this Section 5.6. shall not be exercisable later than the
expiration of the Option Period.
ARTICLE VI
TERMINATION OF OPTIONS
6.1. Except as otherwise stated herein, the Option to the extent not
heretofore exercised shall terminate upon either of the following dates,
whichever shall occur first:
(a) The expiration of three (3) months after the date which
employment of the Option Holder by the Company or any of its subsidiaries
is terminated (except if such termination be by reason of death or permanent
or total disability). The granting of an Option
<PAGE 5>
to a Qualified Person does not alter in any way the existing rights of the
Company or any of its subsidiaries to terminate the employment of such person
at any time for any reason, nor does it confer upon such person any rights or
privileges, except as specifically provided for in this Agreement.
(b) The expiration of six (6) months following the date of
death of the Participant, subject to the Participant being in the employ of the
Company or any of its subsidiaries on the date of death. Under such
circumstances the executors and administrators of the Option Holder may
exercise the Option within six (6) months following the date of the death of
the Option Holder, as to any Shares not theretofore exercised during the
lifetime of the Option Holder.
(c) The expiration of ten (10) years from the Date of Grant by
the Company to the Option Holder of the Option.
ARTICLE VII
NON-ASSIGNABILITY
7.1. This Option is non-assignable by the Option Holder, except in
the event of his or her death, as provided in section 6.1(b) of Article VI, as
set forth above.
ARTICLE VIII
RIGHTS AS A STOCKHOLDER
8.1. The Option Holder shall have no rights as a stockholder with
respect to any Shares covered by the Option until the date of exercise of the
Option as provided in Article V herein. No adjustments shall be made for
dividends or to other rights which may accrue to stockholders of the
Company prior to such date.
ARTICLE IX
CAPITAL ADJUSTMENTS
9.1. If and to the extent that the number of Shares shall be increased
or reduced either by change in par value, stock split, reverse stock split,
reclassification, distribution of a dividend payable in stock, or the like, the
number of Shares subject to this Option and the Subscription Price per Share
shall be proportionately adjusted. If the Company is reorganized or
consolidated or merged with another entity, the Option Holder shall be
entitled to receive Options theretofore not exercised covering Shares or such
other ownership interests of such reorganized, consolidated, or merged entity
in the same proportion at an equivalent price, and subject to the same terms
and conditions.
ARTICLE X
NOTICE
10.1. All notices to the Secretary of the Company hereunder shall
<PAGE 6>
be in writing and shall be made by personal delivery or by certified mail,
return receipt requested, to the Secretary at the then principal office of
the Company.
ARTICLE XI
INTERPRETATION OF AGREEMENT: GOVERNING LAW
11.1. This Agreement shall be construed and enforced in accordance
with and governed by the laws of the Commonwealth of Pennsylvania.
IN WITNESS WHEREOF, the Company and the Option Holder
have duly executed this Agreement.
VALLEY FORGE SCIENTIFIC CORP.
ATTEST:
___________________ By: ____________________________
WITNESS: OPTION HOLDER
____________________ _____________________________
<PAGE 7>
APPENDIX A
FORM OF EXERCISE OF NON-QUALIFIED STOCK OPTIONS
Secretary
Valley Forge Scientific Corp.
136 Green Tree Road
Oaks, PA 19456
Dear Mr. Gilloway:
I wish to exercise Options for ___________ shares of common stock
of Valley Forge Scientific Corp. now available to me under the grant of
________________ shares made to me effective as of __________________ at
$_______ per share pursuant to the Valley Forge Scientific Corp. Non-Qualified
Stock Option Plan and the Non-Qualified Stock Option Agreement, a copy of said
Agreement being attached hereto. My certified check drawn to the order of
Valley Forge Scientific Corp. in the amount of $_____ is attached.
NAME: ________________________________
SS No. : _____________________________
Address of Record:
______________________________________________________________.
Please forward my Certificate to the following address:
______________________________________________________________.
_________________________ Date:_____________
Employee Signature
TO BE COMPLETED BY PERSONNEL MANAGER:
The above named Employee is a current Employee? Yes ___ No____
Termination Date:________________
______________________________ Date:_____________
Authorized Corporate Officer
EXHIBIT 23.1
We consent to the incorporation by reference in the Registration
Statement of Valley Forge Scientific Corp. (the "Company") on Form
S-8 pertaining to the registration of 500,000 shares of common stock
to be issued pursuant to the Company's Non-Qualified Employee
Stock Option Plan of our report dated December 1, 1997, on our
audits of the consolidated financial statements as of September 30,
1997 and for each of the three years in the period ended September
30, 1997, which report is included in the Company's Annual Report on
Form 10-K for the year ended September 30, 1997.
SAMUEL KLEIN & COMPANY
Newark, New Jersey
September 16, 1998
