As filed with the Securities and Exchange Commission on December 16, 1998
Registration No. 333-_____
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
DAY RUNNER, INC.
(Exact name of registrant as specified in its charter)
Delaware 95-3624280
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
15295 Alton Parkway
Irvine, California 92618
(Address of Principal Executive Offices) (Zip Code)
1995 STOCK OPTION PLAN
NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
WARRANTS TO PURCHASE COMMON STOCK
(Full titles of the plans)
JAMES E. FREEMAN, JR.
Chief Executive Officer
Day Runner, Inc.
15295 Alton Parkway
Irvine, California 92618
(714) 680-3500
(Name, address and telephone number of agent for service)
Copy to:
KATHERINE F. ASHTON, ESQ.
Bryan Cave LLP
120 Broadway, Suite 300
Santa Monica, California 90401
<PAGE>
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
Proposed
Title of Amount Proposed Maximum
Securities of Shares Maximum Aggregate Amount of
to be to be Offering Price Offering Registration
Registered Registered per Share Price Fee
---------- ---------- --------- ----- ---
<S> <C> <C> <C> <C>
Common Stock,
$0.001 par value 525,000(1) $19.625(2) $10,303,125(2) $3,039
Common Stock,
$0.001 par value 25,000(3) $20.625 $515,625 $153
TOTAL 550,000 $3,192
======= =====
</TABLE>
(1) Represents 375,000 shares issuable upon the exercise of options granted or
to be granted under the Company's 1995 Stock Option Plan and 150,000 shares
issuable upon the exercise of options granted or to be granted under the
Company's Non-Employee Director Stock Option Plan.
(2) Estimated pursuant to Rule 457(h) solely for the purpose of calculating the
amount of the registration fee on the basis of the average of the high and
low reported sales prices of a share of the Company's Common Stock on
December 11, 1998, as reported by The Nasdaq Stock Market in The Wall
Street Journal.
(3) Represents shares issuable upon the exercise of outstanding warrants to
purchase an aggregate of 25,000 shares of the Company's Common Stock at an
exercise price of $20.625 per share.
<PAGE>
PART I. INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The document(s) containing the information specified in Items 1 and 2
of Part I of Form S-8 will be sent or given to plan participants as specified in
Rule 428(b)(1) and, in accordance with the instructions to Part I, are not filed
with the Commission as part of this Registration Statement.
PART II. INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents and information previously filed with the
Securities and Exchange Commission are hereby incorporated by reference:
Item 3(a)
The Registrant's Annual Report on Form 10-K for the year ended
June 30, 1998.
Item 3(b)
The Registrant's Quarterly Report on Form 10-Q for the quarter
ended September 30, 1998.
The Registrant's Current Report on Form 8-K filed with the
Commission on November 12, 1998.
Item 3(c)
The description of the Registrant's Common Stock contained in the
Registrant's Registration Statement on Form S-1 (Registration No.
33-45391), as amended by the Registrant's Current Report on Form
8-K filed with the Commission on August 5, 1993, including any
amendments or reports filed for the purpose of updating such
description.
All documents subsequently filed by the Registrant pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934,
prior to the filing of a post-effective amendment which indicates that all
securities offered have been sold or which deregisters all securities then
remaining unsold, shall be deemed to be incorporated by reference in this
Registration Statement and to be part hereof from the date of filing 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.
Sections 145(a) and 145(b) of the Delaware General Corporation Law permit a
corporation to indemnify any person against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement or actually and
reasonably incurred by such person in connection with any threatened, pending or
completed nonderivative action and against expenses (including attorneys' fees)
actually and reasonably incurred in connection with any threatened, pending or
completed derivative action if such person was or is a party or was threatened
to be made a party to such action by reason of the fact that such person is or
was a director, officer, employee or agent of the corporation. Any
indemnification shall be made if a determination in each instance is made either
by a majority vote of the Board of Directors (other than directors who are
parties to such action) even though less than a quorum, by the stockholders, or
by independent legal counsel in a written opinion, that such indemnification is
proper because the director, officer, employee or agent acted in good faith and
in a manner that such person reasonably believed to be in or not opposed to the
best interests of the corporation, and, with respect to any criminal action or
proceeding, that such person had no reasonable cause to believe that his conduct
was unlawful. However, no indemnification may be made with respect to a
derivative action if such person is adjudged to be liable to the corporation,
unless and only to the extent that the Delaware Court of Chancery or the court
in which the action was brought determines upon application that, despite the
adjudication of liability but in view of all the circumstances, such person is
fairly and reasonably entitled to indemnity for such expenses as the court deems
proper. To the extent that a person has been successful in defense of any
action, suit or proceeding, Section 145(c) provides that such person shall be
indemnified against expenses actually and reasonably incurred by such person in
connection therewith. A corporation may also advance expenses incurred in
defending proceedings against an officer or a director upon receipt of an
undertaking by or on behalf of such officer or director to repay such expenses
to the corporation if it is ultimately determined that such officer or director
is not entitled to be indemnified for such expenses. The indemnification and
advancement of expenses provided under the Delaware General Corporation Law are
not exclusive of any other rights to indemnification or advancement of expenses
a person may be entitled to under any bylaw, agreement, vote of stockholders or
disinterested directors or otherwise.
Under the terms of Article VIII of the Registrant's Bylaws, the Registrant
is required to indemnify any person who is or was a director or officer of the
Registrant (or is or was serving at the request of the Registrant as a director,
officer, trustee or partner of another corporation, partnership, joint venture,
trust or other enterprise) in the manner and to the fullest extent permitted
under Section 145 of the Delaware General Corporation Law against expenses,
liabilities and other matters covered by or referred to in Section 145.
As permitted by paragraph (7) of subsection (b) of Section 102 of the
Delaware General Corporation Law, Article VIII of the Registrant's Certificate
of Incorporation provides that no director of the Registrant shall be liable to
the Registrant or its stockholders for monetary damages for breach of his or her
fiduciary duty as a director except for liability (a) for breach of the
director's duty of loyalty to the corporation or its stockholders; (b) for acts
or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law; (c) under Section 174 of the Delaware General
Corporation Law (relating to unlawful declarations or payments of dividends or
unlawful stock purchases or redemptions); or (d) for any transaction from which
the director derived an improper personal benefit.
Item 7. Exemption from Registration Claimed.
Not Applicable.
Item 8. Exhibits.
Exhibit
Number
5.1 Opinion of Bryan Cave LLP
10.1 Amendment No. 3 to 1995 Stock Option Plan
10.2 Non-Employee Director Stock Option Plan
10.3 Form of Warrant dated April 20, 1998 to purchase shares of the
Registrant's Common Stock and Schedule of Warrantholders(1)
23.1 Consent of Deloitte & Touche LLP
23.2 Consent of Bryan Cave LLP(included in Exhibit 5.1)
24.1 Power of Attorney (see page 5 of this Registration Statement)
(1) Incorporated by reference to the Registrant's Annual Report on Form 10-K
(File No. 0-19835) as filed with the Commission on September 30, 1998.
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:
(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 recent post-effective
amendment thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high and 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 percent change in the
maximum aggregate offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement; and
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
the information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Registrant pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(4) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the Registrant's annual report pursuant to Section
13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where
applicable, each filing of an employee benefit plan's annual report pursuant to
Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by
reference in the registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(b) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
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 of 1933 and will be governed by the final adjudication of such
issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Irvine, State of California, on December 16, 1998.
DAY RUNNER, INC.
By: /s/ James E. Freeman, Jr.
---------------------------
James E. Freeman, Jr.,
Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints James E. Freeman, Jr. his or her
attorney-in-fact and agent, with full power of substitution for him or her and
in his or her name, place and stead, in any and all capacities, to sign any or
all amendments to this Registration Statement, and to file the same with all
exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorney-in-fact and
agent full power and authority to do so and perform each and every act and thing
requisite and necessary to be done in connection with this Registration
Statement, as fully to all intents and purposes as he or she might or could do
in person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
<S> <C> <C>
Signature Title Date
/s/ Mark A. Vidovich Chairman of the Board December 16, 1998
- -----------------------------------------------
Mark A. Vidovich
/s/ James E. Freeman, Jr. Chief Executive Officer and Director
- ------------------------------------------------ (Principal Executive Officer) December 16, 1998
James E. Freeman, Jr.
/s/ Dennis K. Marquardt Executive Vice President, Finance & December 16, 1998
- ----------------------------------------------- Administration and Chief Financial Officer
Dennis K. Marquardt (Principal Financial and Accounting Officer)
/s/ James P. Higgins Director December 16, 1998
- -----------------------------------------------
James P. Higgins
/s/ Jill Tate Higgins Director December 16, 1998
- -----------------------------------------------
Jill Tate Higgins
/s/ Charles Miller Director December 16, 1998
- -----------------------------------------------
Charles Miller
/s/ Alan R. Rachlin Director December 16, 1998
- -----------------------------------------------
Alan R. Rachlin
/s/ Boyd I. Willat Director December 16, 1998
- -----------------------------------------------
Boyd I. Willat
/s/ Felice Willat Director December 16, 1998
- -----------------------------------------------
Felice Willat
</TABLE>
<TABLE>
<CAPTION>
INDEX TO EXHIBITS
Sequentially
Exhibit Numbered
Number Exhibit Page
<S> <C>
5.1 Opinion of Bryan Cave LLP..............................................................
10.1 Amendment No. 3 to 1995 Stock Option Plan..............................................
10.2 Non-Employee Director Stock Option Plan................................................
23.1 Consent of Deloitte & Touche LLP.......................................................
</TABLE>
Exhibit 5.1
BRYAN CAVE LLP
120 BROADWAY, SUITE 500
SANTA MONICA, CALIFORNIA 90401
(310) 576-2100
FACSIMILE (310) 576-2200...
December 16, 1998
Day Runner, Inc.
15295 Alton Parkway
Irvine, California 92618
Re: Day Runner, Inc. - Registration Statement on Form S-8
Gentlemen:
We have acted as securities counsel for Day Runner, Inc. (the
"Company") in connection with the preparation of a registration statement on
Form S-8 (the "Registration Statement") under the Securities Act of 1933, as
amended, to be filed with the Securities and Exchange Commission (the
"Commission") on December 16, 1998, in connection with the registration of an
aggregate of 550,000 shares of Common Stock, par value $0.001 per share (the
"Shares"), comprising (i) 375,000 shares of Common Stock of the Company issuable
upon the exercise of options granted or to be granted pursuant to the Company's
1995 Stock Option Plan, (ii) 150,000 shares of Common Stock of the Company
issuable under the Company's Non-Employee Director Stock Option Plan and (iii)
25,000 shares of Common Stock of the Company issuable upon the exercise of
warrants granted to the five non-employee directors of the Company on April 20,
1998 (such 1995 Stock Option Plan, Non-Employee Director Stock Option Plan and
warrants are referred to herein as the "Plans").
In connection with the preparation of the Registration
Statement and the proposed issuance and sale of the Shares in accordance with
the Plans and the Form S-8 prospectuses to be delivered to participants in the
Plans, we have made certain legal and factual examinations and inquiries and
examined, among other things, such documents, records, instruments, agreements,
certificates and matters as we have considered appropriate and necessary for the
rendering of this opinion. We have assumed for the purpose of this opinion the
authenticity of all documents submitted to us as originals and the conformity
with the originals of all documents submitted to us as copies, and the
genuineness of the signatures thereon. As to various questions of fact material
to this opinion, we have, when relevant facts were not independently
established, relied, to the extent deemed proper by us, upon certificates and
statements of officers and representatives of the Company.
Based on the foregoing and in reliance thereon, it is our
opinion that the Shares have been duly authorized and, after the Registration
Statement becomes effective and after any post-effective amendment required by
law is duly completed, filed and becomes effective, and when the applicable
provisions of "Blue Sky" and other state securities laws shall have been
complied with, and when the Shares are issued and sold in accordance with the
Plans and the Form S-8 prospectuses to be delivered to the participants in the
Plans, the Shares will be validly issued, fully paid and nonassessable.
We hereby consent to the inclusion of our opinion as Exhibit
5.1 to the Registration Statement and further consent to the reference to this
firm in the Registration Statement. In giving this consent, we do not hereby
admit that we are in the category of persons whose consent is required under
Section 7 of the Securities Act of 1933 or the rules and regulations of the
Commission thereunder.
This opinion is rendered solely for your benefit in connection
with the subject transaction and is not to be otherwise used, circulated, quoted
or referred to without our prior written consent. We are opining herein as to
the effect on the subject transaction only of United States federal law and the
internal laws of the State of Delaware, and we assume no responsibility as to
the applicability thereto, or the effect thereon, of the laws of any other
jurisdiction.
Very truly yours,
BRYAN CAVE LLP
Exhibit 10.1
AMENDMENT NO. 3 TO
DAY RUNNER, INC.
1995 STOCK OPTION PLAN
Section 3 of the Day Runner, Inc. 1995 Stock Option Plan is hereby amended
to read in its entirety as follows:
"3. Shares Reserved. The maximum aggregate number of
Shares reserved for issuance pursuant to the Plan shall be
1,925,000 Shares or the number of shares of stock to which
such Shares shall be adjusted as provided in Section 10 of the
Plan. Such number of Shares may be set aside out of authorized
but unissued Shares not reserved for any other purpose, or out
of issued Shares acquired for and held in the treasury of the
Company from time to time.
Shares subject to, but not sold or issued under, any
Option terminating, expiring or canceled for any reason prior
to its exercise in full, shall again become available for
Options thereafter granted under the Plan, and the same shall
not be deemed an increase in the number of Shares reserved for
issuance under the Plan. Any Shares which may be tendered,
actually or by attestation, by an Optionee as full or partial
payment in connection with the exercise of any Option under
the Plan shall again be available for Options thereafter
granted during the remainder of the term of the Plan."
Dated: September 15, 1998
Exhibit 10.2
DAY RUNNER, INC.
NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
1. Establishment and Purpose of the Plan.
Day Runner, Inc. hereby establishes this Non-Employee Director Stock
Option Plan to promote the interests of the Company and its stockholders by (i)
helping to attract and retain the services of persons of the highest caliber to
serve as non-employee directors of the Company, (ii) motivating such persons, by
means of performance-related incentives, to achieve the Company's business goals
and (iii) enabling such persons to participate in the long-term growth and
financial success of the Company by providing them with an opportunity to
purchase stock of the Company.
2. Definitions.
The following definitions apply throughout the Plan:
(a) "Board" shall mean the Board of Directors of the Company.
(b) "Code" shall mean the Internal Revenue Code of 1986, as amended. References
in the Plan to any section of the Code shall be deemed to include any amendment
or successor provisions to such section and any regulations issued under such
section.
(c) "Committee" shall mean the committee of the Board of Directors appointed in
accordance with Section 4(a) of the Plan, if one is appointed.
(d) "Company" shall mean Day Runner, Inc., a Delaware corporation (or any
successor corporation), and any "subsidiary" corporation, whether now or
hereafter existing, as deemed in Sections 424(f) and (g) of the Code.
(e) "Director" shall mean a person who serves on the Board as of the date the
Plan is adopted by the Board or who is thereafter duly elected or appointed to
serve as a member of the Board.
(f) "Eligible Director" shall mean a Director who is not an employee (within the
meaning of Section 3401 of the Code and the regulations thereunder) of the
Company. The payment of directors' fees or consulting fees to a Director shall
not be sufficient to constitute "employment" by the Company.
(g) "Fair Market Value" shall mean, with respect to Shares on a particular date,
the fair market value per Share on such date, which value shall be the average
of the closing bid and asked prices of the Common Stock on such date, as
reported in The Wall Street Journal (or, if not so reported, as otherwise
reported by the National Association of Securities Dealers Automated Quotations
("Nasdaq") System) or, if there are no such prices on such date, on the most
recent preceding day on which there were reported closing bid and asked prices,
or, if the Shares are listed on a stock exchange or on The Nasdaq Stock Market
as a National Market System security, shall be the closing price on the exchange
or on The Nasdaq Stock Market as of such date, as reported in The Wall Street
Journal or, if there are no sales on such date, on the most recent preceding day
on which there were reported sales.
(h) "First Grant Date" shall mean the date of the Company's first Annual Meeting
of Stockholders following the Board's adoption of this Plan.
(i) "Grant Date" shall mean each of (i) the First Grant Date and (ii) the dates
of the Company's Annual Meetings of Stockholders held during the term of this
Plan but after the First Grant Date.
(j) "Option" shall mean the grant of the right to an Eligible Director pursuant
to the Plan to purchase a specified number of Shares at a specified exercise
price.
(k) "Option Agreement" shall mean a written certificate substantially in the
form attached hereto as Exhibit A, or such other form or forms as the Board or
its Committee (subject to the terms and conditions of the Plan) may from time to
time approve, evidencing and reflecting the terms of an Option.
(l) "Optionee" shall mean an Eligible Director who is granted an Option under
the Plan or any permitted transferee of such Eligible Director.
(m) "Plan" shall mean this Day Runner, Inc. Non-Employee Director Stock Option
Plan as the same may be amended from time to time.
(n) "Shares" shall mean shares of the Common Stock of the Company, par value per
share of $0.001, or any shares into which such Shares may be converted in
accordance with Section 9 of the Plan.
3. Shares Reserved
The maximum aggregate number of Shares reserved for issuance pursuant
to the Plan shall be 250,000 Shares or the number of shares of stock to which
such Shares shall be adjusted as provided in Section 10 of the Plan. Such number
of Shares may be set aside out of authorized but unissued Shares not reserved
for any other purpose, or out of issued Shares acquired for and held in the
treasury of the Company from time to time.
Shares subject to, but not sold or issued under, any Option
terminating, expiring or canceled for any reason prior to its exercise in full,
shall again become available for Options thereafter granted under the Plan, and
the same shall not be deemed an increase in the number of Shares reserved for
issuance under the Plan.
4. Administration of the Plan.
(a) The Plan shall be administered by the Board. The Board may at any time
appoint a Committee comprised of not less than two directors to administer the
Plan on behalf of the Board. Members of the Committee shall serve for such
period of time as the Board of Directors may determine or until their
resignation, retirement, removal or death, if sooner. From time to time the
Board of Directors may increase the size of the Committee and appoint additional
members thereto, remove members (with or without cause) and appoint new members
in substitution therefor or fill vacancies however caused.
(b) Subject to the provisions of the Plan, the Board or its Committee shall have
the sole and complete discretionary authority: (i) to prescribe, amend and
rescind rules and regulations relating to the Plan subject to the limitations
set forth in Section 11 of the Plan; (ii) to interpret the Plan or any Option
Agreement or document executed or entered into with respect to the grant or
exercise of Options; (iii) to authorize any person to execute on behalf of the
Company any instrument required to effectuate the grant of an Option previously
granted or to take such other actions as may be necessary or appropriate with
respect to the Company's rights pursuant to Options or agreements relating to
the grant or exercise thereof; and (iv) to make such other determinations and
establish such other procedures as it deems necessary or advisable for the
administration of the Plan; provided, however, that the Board or its Committee
shall have no discretion to determine the selection of persons to whom Options
will be granted, the frequency of Option grants, the number of Shares subject to
Option grants (except in accordance with Sections 5 and 6 hereof) the exercise
prices of Options or any other material terms of Options (except in accordance
with Section 9(b) hereof).
(c) All decisions, determinations and interpretations of the Board or its
Committee shall be final and binding on all Optionees under the Plan.
(d) The Board or its Committee shall keep minutes of its meetings and of the
actions taken by it without a meeting. A majority of the Board or its Committee
shall constitute a quorum, and the actions of a majority at a meeting, including
a telephone meeting, at which a quorum is present, or acts approved in writing
by a majority of the members of the Board or its Committee without a meeting,
shall constitute acts of the Board or its Committee.
(e) The Company shall pay all original issue and transfer taxes with respect to
the grant of Options and/or the issue and transfer of Shares pursuant to the
exercise thereof, and all other fees and expenses necessarily incurred by the
Company in connection therewith; provided, however, that the person exercising
an Option shall be responsible for all payroll, withholding, income and other
taxes incurred by such person on the date of exercise of an Option or transfer
of an Option or Shares.
5. Eligibility.
Options may be granted under the Plan only to Eligible Directors. An
Eligible Director who has been granted an Option may be granted, if he or she is
otherwise eligible, additional Options.
6. Terms and Conditions of Options.
Each person who (i) is an Eligible Director at the close of business on
a Grant Date shall, on such Grant Date, automatically be granted an Option to
purchase the number of shares specified in Section 6(a)(i) hereof and (ii) is
not an Eligible Director on a Grant Date but who is elected or appointed to the
Board subsequent to such Grant Date and prior to the next Grant Date, if any,
shall automatically be granted, as of the date of his or her election or
appointment to the Board, an Option to purchase the number of Shares specified
in Section 6(a)(ii) hereof. Notwithstanding anything to the contrary herein, no
Options shall be granted under this Plan prior to the First Grant Date. Options
granted pursuant to the Plan shall be evidenced by an Option Agreement providing
the following terms and conditions:
(a) Number of Shares.
(i) Grants on a Grant Date. The number of Shares subject to an Option granted to
an Eligible Director on the First Grant Date shall be 10,000, and the number of
shares subject to an Option granted to an Eligible Director on subsequent Grant
Dates shall be 5,000.
(ii) Grants Other Than on a Grant Date. The number of Shares subject to an
Option granted to an Eligible Director on a date other than a Grant Date shall
be equal to 5,000 minus the product of 1,250 and the number of installments that
would have vested under an Option granted to an Eligible Director on the most
recent Grant Date preceding the date of such grant.
(iii) Pro Rata Adjustment. If the total number of Shares to be granted pursuant
to Options on a specific grant date in accordance with this Section 6 would
exceed the number of Shares then available for grant under the Plan, then the
Shares remaining available for grant pursuant to Options shall be allocated pro
rata among those Eligible Directors who are entitled on such grant date to be
granted Options under the Plan.
(b) Vesting.
(i) Grants on a Grant Date. Subject to Section 7(e) of the Plan, each Option
granted to an Eligible Director on a Grant Date shall vest and become
exercisable in four equal quarterly installments with the first of such
installments vesting on the first day of the calendar quarter following the
quarter in which the grant is made and one additional installment vesting on the
first day of each calendar quarter thereafter. If an Eligible Director receives
an Option covering a reduced number of Shares due to an adjustment pursuant to
Section 6(a)(iii) hereof, the Option shall vest in quarterly installments of
1,250 shares (provided that the last installment to vest may be less than 1,250
shares), with the first such installment vesting on the first day following the
calendar quarter in which the grant is made and one additional installment
vesting, subject to Section 7(e) of the Plan, on the first day of each calendar
quarter thereafter until such Option is fully vested.
(ii) Grants Other Than on a Grant Date. Subject to Section 7(e) of the Plan, if
an Eligible Director is granted an Option covering fewer than 5,000 shares (the
"Prorated Shares") pursuant to Section 6(a)(ii) hereof, such Option shall vest
and become exercisable in equal quarterly installments of 1,250 shares with the
first of such installments vesting on the first day of the calendar quarter
following the quarter in which the grant is made and one additional installment
vesting on the first day of each calendar quarter thereafter. If such Eligible
Director receives an Option covering less than the Prorated Shares due to an
adjustment pursuant to Section 6(a)(iii) hereof, the Option shall vest in
quarterly installments of 1,250 shares (provided that the last installment to
vest may be less than 1,250 shares), with the first such installment vesting on
the first day following the calendar quarter in which the grant is made and one
additional installment vesting, subject to Section 7(e) of the Plan, on the
first day of each calendar quarter thereafter until such Option is fully vested.
(c) Exercise Price. The exercise price per Share for the Shares to be issued
pursuant to the exercise of an Option shall be 100% of the Fair Market Value per
Share on the date of grant.
(d) Medium and Time of Payment. The consideration to be paid for the Shares to
be issued upon exercise of an Option may consist of cash or check; provided,
however, that the Optionee shall be required to pay in cash an amount necessary
to satisfy any tax withholding obligations of the Company.
(e) Term of Options. The term of each Option shall be ten years from the date of
grant thereof.
7. Exercise of Option.
(a) In General. Any Option granted hereunder to an Eligible Director shall be
exercisable at such times and under such conditions as shall be permissible
under the terms of the Plan. An Option may be exercised in accordance with the
provisions of the Plan as to all or any portion of the Shares then exercisable
under the Option from time to time during the term of the Option. However, an
Option may not be exercised for a fraction of a Share.
(b) Procedure. An Option shall be deemed to be exercised when written notice of
such exercise has been given to the Company at its principal business office in
accordance with the terms of the Option Agreement by the person entitled to
exercise the Option and full payment for the Shares with respect to which the
Option is exercised has been received by the Company, accompanied by payment by
the Optionee of all payroll, withholding or income taxes incurred in connection
with such Option exercise (or arrangements for the collection or payment of such
tax satisfactory to the Board or its Committee are made). Full payment may
consist of such consideration and method of payment as are allowable under
Section 6(d) of the Plan.
(c) Decrease in Available Shares. Exercise of an Option in any manner shall
result in a decrease in the number of Shares which thereafter may be available,
both for purposes of the Plan and for sale under the Option, by the number of
Shares as to which the Option is exercised.
(d) Exercise of Stockholder Rights. Until an Option is properly exercised in
accordance with the terms of this Section, no right to vote or receive dividends
or any other rights as a stockholder shall exist with respect to the Shares
issuable upon exercise of the Option. No adjustment shall be made for a dividend
or other right for which the record date is prior to the date the Option is
exercised, except as provided in Section 9 of the Plan.
(e) Termination of Status as a Director. If any person ceases to be a Director
of the Company for any reason or no reason ("Termination"), whether such
Termination is permanent or temporary, then after the effective date of such
Termination and through the end of the term of any Option granted to such
Director under the Plan, the Optionee may exercise the Option to purchase only
such number of Shares that the Optionee would have been entitled to purchase on
the effective date of such Termination. To the extent that the Optionee shall
not have been entitled to exercise any portion of the Option on the effective
date of such Termination, such portion shall be deemed to have expired
unexercised on such effective date.
Notwithstanding the foregoing, an Option shall not be exercisable after
the expiration of the term of such Option, as set forth in the Option Agreement.
To the extent the Optionee does not exercise his or her Option, to the extent
exercisable, within the time specified herein, the Option shall terminate.
(f) Expiration of Option. Notwithstanding any provision in the Plan, including
but not limited to the provisions set forth in Section 7(e), an Option may not
be exercised, under any circumstances, after the expiration of its term.
(g) Conditions on Exercise and Issuance. As soon as practicable after any proper
exercise of an Option in accordance with the provisions of the Plan, the Company
shall deliver to the Optionee at the principal executive office of the Company,
or such other place as shall be mutually agreed upon between the Company and the
Optionee, a certificate or certificates representing the Shares for which the
Option shall have been exercised. The time of issuance and delivery of the
certificate or certificates representing the Shares for which the Option shall
have been exercised may be postponed by the Company for such period as may be
required by the Company, with reasonable diligence, to comply with any law or
regulation applicable to the issuance or delivery of such Shares.
Options granted under the Plan are conditioned upon the Company
obtaining any required permit or order from appropriate governmental agencies
authorizing the Company to issue such Options and Shares issuable upon exercise
thereof. Shares shall not be issued pursuant to the exercise of an Option unless
the exercise of such Option and the issuance and delivery of Shares pursuant
thereto shall comply with all relevant provisions of law, including, without
limitation, the Securities Act of 1933, as amended (the "Securities Act"), the
Securities Exchange Act of 1934, as amended, applicable state law, the rules and
regulations promulgated thereunder, and the requirements of any stock exchange
upon which the Shares may then be listed, and may be further subject to the
approval of counsel for the Company with respect to such compliance.
(h) Withholding or Deduction for Taxes. The grant of Options hereunder and the
issuance of Shares pursuant to the exercise thereof is conditioned upon the
Company's reservation of the right to withhold, in accordance with any
applicable law, from any compensation or other amounts payable to the Optionee
any taxes required to be withheld under Federal, state or local law as a result
of the grant or exercise of such Option. To the extent that compensation and
other amounts, if any, payable to the Optionee are insufficient to pay any taxes
required to be so withheld, the Company may, in its sole discretion, require the
Optionee, as a condition of the exercise of an Option, to pay in cash to the
Company an amount sufficient to cover such tax liability or otherwise to make
adequate provision for the delivery to the Company of cash necessary to satisfy
the Company's withholding obligations under Federal, state and local law.
8. Transferability of Options.
(a) Subject to the terms hereof, including, without limitation, Section 8(b),
each Option granted under the Plan and all rights thereunder are transferable,
in whole or in part, on the books of the Company maintained for such purpose at
the principal business office of the Company by the registered holder thereof in
person or by such holder's duly authorized attorneys, upon surrender of the
Option Agreement properly endorsed and upon payment of any necessary transfer
tax or other governmental charge imposed upon such transfer. Upon any partial
transfer, the Company will issue and deliver to such Optionee a new Option
Agreement with respect to the rights not so transferred. Each taker and holder
of an Option, by taking or holding the same, consents and agrees that the Option
Agreement when endorsed in blank shall be deemed negotiable and that when the
Option shall have been so endorsed, the holder thereof may be treated by the
Company and all other persons dealing with the Option as the absolute owner
thereof for any purpose and as the person entitled to exercise the rights
represented thereby, and to the transfer thereof on the books of the Company,
any notice to the contrary notwithstanding; but until such transfer on such
books, the Company may treat the registered holder thereof as the owner for all
purposes.
(b) An Optionee, by acceptance of an Option, agrees that, absent an effective
notification under Regulation A or a registration statement, in either case
under the Securities Act, covering the disposition of the Option or Shares
issued or issuable upon exercise thereof, he or she will not sell, transfer,
pledge or hypothecate any or all of such Option or Shares, as the case may be,
unless such sale or transfer will be exempt from the registration and prospectus
delivery requirements of the Securities Act and applicable state securities
laws, and such Optionee consents to the Company making a notification on its
records or giving instructions to any transfer agent of the Option or such
Shares in order to implement such restriction on transferability.
9. Adjustment upon Change in Corporate Structure.
(a) Subject to any required action by the stockholders of the Company, the
number of Shares covered by each outstanding Option, and the number of Shares
which have been authorized for issuance under the Plan but as to which no
Options have yet been granted or which have been returned to the Plan upon
cancellation or expiration of an Option, as well as the exercise or purchase
price per Share covered by each such outstanding Option, shall be
proportionately adjusted as may be necessary to prevent dilution or enlargement
of rights which would result from a stock split or combination, the payment of a
stock dividend, recapitalization, merger, consolidation, exchange, spin-off or
any other increase or decrease in the number of issued Shares effected without
receipt of consideration by the Company. Any such adjustment with respect to
Shares authorized for issuance under the Plan but as to which no Options have
yet been granted or which have been returned to the Plan upon cancellation or
expiration of an Option, shall be made by the Board or its Committee, in its
sole discretion, whose determination in that respect shall be final, binding and
conclusive. The existence of the Plan and outstanding Options shall not limit or
affect in any way the right or power of the Company to engage in any such
transactions.
(b) In the event of the proposed dissolution or liquidation of the Company, or
in the event of a proposed sale of all or substantially all of the assets or
stock of the Company (other than in the ordinary course of business), the merger
or consolidation of the Company with or into another corporation (any of which
shall constitute a "Reorganization"), as a result of which the Company is not
the surviving and controlling corporation, the Board of Directors of the Company
shall (i) make provision for the assumption of the Options by the successor
corporation whereby this Certificate shall thereafter evidence the right to
purchase such number and kind of securities and other property as would have
been issuable or distributable on account of such Reorganization upon or with
respect to the securities which were purchasable or would have become
purchasable under the Options immediately prior to such Reorganization or (ii)
declare that the Options shall terminate as of a date fixed by the Board of
Directors which is at least 30 days after the notice thereof to the Optionee and
shall give the Optionee the right to exercise the Option as to all or any part
of the Shares covered by the Option, including Shares covered by the Option as
to which the Option would not otherwise be exercisable, provided such exercise
does not violate Section 7(f) hereof.
(c) No fractional Shares shall be issuable on account of any action aforesaid or
any exercise of any Option; rather, in lieu of fractional Shares, the Company
shall make a cash payment therefor upon the basis of the Fair Market Value of
the Shares at the time of such exercise.
10. Stockholder Approval.
Effectiveness of the Plan shall be subject to approval by the
stockholders of the Company within 12 months after the date the Plan is adopted
by the Board. Stockholder approval shall be obtained by the affirmative votes of
the holders of a majority of voting Shares present or represented and entitled
to vote at a meeting of stockholders duly held in accordance with the laws of
the State of Delaware.
11. Amendment and Termination of the Plan.
(a) Amendment and Termination. The Board or its Committee may amend or terminate
the Plan from time to time in such respects as the Board or its Committee may
deem advisable; provided, however, that the Plan shall not be amended more than
once every six months other than changes to comport with changes in the Code,
the Employee Retirement Security Act, or the rules under either such statute;
and that without approval of the holders of a majority of the voting Shares
represented or present and entitled to vote at a valid meeting of stockholders,
no such revision or amendment shall: (i) materially increase the benefits
accruing to participants under the Plan; (ii) materially increase the number of
Shares which may be issued under the Plan, other than in connection with an
adjustment under Section 9 of the Plan; (iii) materially modify the requirements
as to eligibility for participation in the Plan; (iv) materially change the
designation of the class of persons eligible to be granted Options; (v) remove
the administration of the Plan from the Board of Directors or its Committee; or
(vi) extend the term of the Plan beyond the maximum term set forth in Section 14
hereof.
(b) Effect of Amendment or Termination. Except as otherwise provided in Section
9 of the Plan, any amendment or termination of the Plan shall not affect Options
already granted, and such Options shall remain in full force and effect as if
the Plan had not been amended or terminated unless mutually agreed otherwise
between the Optionee and the Company, which agreement must be in writing and
signed by the Optionee and the Company.
12. Indemnification.
No member of the Board or its Committee shall be liable for any act or
action taken, whether of commission or omission, except in circumstances
involving actual bad faith, or for any act or action taken, whether of
commission or omission, by any other member or by any officer, agent or employee
of the Company. In addition to such other rights of indemnification they may
have as members of the Board of Directors, or as members of the Committee, the
Board or its Committee shall be indemnified by the Company against reasonable
expenses, including attorneys' fees, actually and necessarily incurred in
connection with the defense of any action, suit or proceeding, or in connection
with any appeal therein, to which they or any of them may be a party by reason
of any action taken, by commission or omission, in connection with the Plan or
any Option granted under the Plan, and against all amounts paid by them in
settlement thereof (provided such settlement is approved by independent legal
counsel selected by the Company) or paid by them in satisfaction of a judgment
in any action, suit or proceeding, except in relation to matters as to which it
shall be adjudged in such action, suit or proceeding that such Board or
Committee member is liable for actual bad faith in the performance of his or her
duties; provided that within 60 days after institution of any such action, suit
or proceeding, a Board or Committee member shall in writing offer the Company
the opportunity, at its own expense, to handle and defend the same.
13. General Provisions.
(a) Other Plans. Nothing contained in the Plan shall prohibit the Company
from establishing additional incentive compensation arrangements.
(b) No Enlargement of Rights. Neither the Plan, nor the granting of Options
hereunder, nor any other action taken pursuant to the Plan shall confer upon any
person any right to continue as a director of the Company or interfere in any
way with the right of the Company's stockholders to remove a director at any
time.
No Eligible Director shall have any right to or interest in Options
authorized hereunder prior to the grant thereof to such eligible person, and
upon such grant he or she shall have only such rights and interests as are
expressly provided herein and in the related Option Agreement, subject, however,
to all applicable provisions of the Company's Certificate of Incorporation, as
the same may be amended from time to time.
(c) Notice. Any notice to be given to the Company pursuant to the provisions of
the Plan shall be addressed to the Company in care of its Secretary (or such
other person as the Company may designate from time to time) at its principal
business office, and any notice to be given to an Optionee to whom an Option is
granted hereunder shall be delivered personally or addressed to him or her at
the address given beneath his or her signature on his or her Option Agreement,
or at such other address as such Optionee or his or her transferee may hereafter
designate in writing to the Company. Any such notice shall be deemed duly given
when enclosed in a properly sealed envelope or wrapper addressed as aforesaid,
registered or certified, and deposited, postage and registry or certification
fee prepaid, in a post office or branch post office regularly maintained by the
United States Postal Service. It shall be the obligation of each Optionee
holding Shares purchased upon exercise of an Option to provide the Secretary of
the Company, by letter mailed as provided hereinabove, with written notice of
his or her direct mailing address.
(d) Applicable Law. To the extent that Federal laws do not otherwise control,
the Plan shall be governed by and construed in accordance with the laws of the
State of Delaware, without regard to the conflict of laws rules thereof.
(e) Information to Optionees. The Company shall provide, upon request, without
charge to each Optionee copies of such annual and periodic reports as are
provided by the Company to its stockholders generally.
(f) Availability of Plan. A copy of the Plan shall be delivered to the Secretary
of the Company and shall be shown by him or her to any eligible person making
reasonable inquiry concerning it.
(g) Severability. In the event that any provision of the Plan is found to be
invalid or otherwise unenforceable under any applicable law, such invalidity or
unenforceability shall not be construed as rendering any other provisions
contained herein as invalid or unenforceable, and all such other provisions
shall be given full force and effect to the same extent as though the invalid or
unenforceable provision was not contained herein.
14. Effective Date and Term of Plan.
The Plan shall become effective upon stockholder approval as provided
in Section 10 of the Plan. The Plan shall continue in effect for a term of ten
years unless sooner terminated under Section 11 of the Plan. Except as provided
in Section 9, the termination of the Plan upon the expiration of its term shall
not affect any outstanding Options which shall remain outstanding in accordance
with their respective terms; provided, however, that no Options shall be granted
after such termination.
<PAGE>
Exhibit A
DAY RUNNER, INC.
NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
Stock Option Agreement
DAY RUNNER, INC., a Delaware corporation (the "Company"), hereby grants
to ______________________ (the "Optionee") an option (the "Option") to purchase
a total of __________ ( ) shares of Common Stock of the Company (the "Shares"),
at the price and on the terms set forth herein, and in all respects subject to
the terms and provisions of the Company's Non-Employee Director Stock Option
Plan (the "Plan"), which terms and provisions are hereby incorporated by
reference herein. Unless the context herein otherwise requires, capitalized
terms used in this Agreement shall have the same meanings ascribed to them in
the Plan.
1. Nature of the Option.
The Option is intended to be a Non-Statutory Stock Option and is not
intended to be an Incentive Stock Option within the meaning of Section 422 of
the Internal Revenue Code of 1986, as amended (the "Code").
2. Date of Grant; Term of Option.
The Option is granted as of ______________, and it may not be exercised
later than _______________.
3. Option Exercise Price.
The exercise price of the Option is $________ per Share, which price is
not less than the Fair Market Value per Share on the date the Option was
granted.
4. Exercise of Option.
The Option shall be exercisable during its term only in accordance with
the terms and provisions of the Plan and the Option as follows:
(a) Right to Exercise. The Option shall vest and be exercisable, cumulatively,
in four equal quarterly installments, commencing on _________________, and
continuing to vest as to one additional installment on the first day of each
calendar quarter thereafter so long as ________________ remains a member of the
Company's Board of Directors.
Notwithstanding the foregoing, if ___________ shall cease to be a
director of the Company for any reason or no reason ("Termination"), whether
such Termination is permanent or temporary, then after the effective date of
such Termination and through the end of the term of the Option the Optionee may
exercise the Option to purchase only such number of Shares that the Optionee
would have been entitled to purchase on the effective date of such Termination
as determined in accordance with the immediately preceding sentence. To the
extent that the Optionee shall not have been entitled to exercise any portion of
the Option on the effective date of such Termination, such portion shall be
deemed to have expired unexercised on such effective date.
(b) Method of Exercise. The Option shall be exercisable by written notice in the
form of the Notice of Exercise of Non-Statutory Stock Option utilized by the
Company from time to time, which notice shall state the election to exercise the
Option and the number of Shares in respect to which the Option is being
exercised. Such written notice shall be signed by the Optionee and shall be
delivered in person or by certified mail to the Secretary of the Company or such
other person as may be designated by the Company. The written notice shall be
accompanied by payment of the exercise price. Payment of the exercise price
shall be by cash or by check or by such other method of payment as is authorized
by the Committee pursuant to the Plan. The certificate or certificates for the
Shares as to which the Option shall be exercised shall be registered in the name
of the Optionee and may bear a legend as required under the Plan and/or under
applicable law.
(c) Restrictions on Exercise. The Option may not be exercised if the issuance of
the Shares upon such exercise would constitute a violation of any applicable
federal or state securities laws or other laws or regulations. As a condition to
the exercise of the Option, the Company may require the Optionee to make any
representation and warranty to the Company as may be required by any applicable
law or regulation.
(d) No Stockholder Rights before Exercise and Issuance. No rights as a
stockholder shall exist with respect to the Shares as a result of the grant of
the Option. Such rights shall exist only after issuance of a stock certificate
in accordance with Section 7 of the Plan following the exercise of the Option as
provided in this Agreement and the Plan.
5. Transfer and Exchange of Warrant.
Subject to the terms hereof, including, without limitation, Section 6,
the Option and all rights hereunder are transferable, in whole or in part, on
the books of the Company maintained for such purpose at its principal office
referred to above by the registered holder hereof in person or by its duly
authorized attorney, upon surrender of the Option Agreement properly endorsed
and upon payment of any necessary transfer tax or other governmental charge
imposed upon such transfer. Upon any partial transfer, the Company will issue
and deliver to the Optionee a new Option Agreement with respect to the shares of
Common Stock not so transferred. Each taker and holder of the Option, by taking
or holding the same, consents and agrees that the Option Agreement when endorsed
in blank shall be deemed negotiable and that when the Option shall have been so
endorsed, the holder hereof may be treated by the Company and all other persons
dealing with the Option as the absolute owner hereof for any purpose and as the
person entitled to exercise the rights represented hereby, and to the transfer
hereof on the books of the Company, any notice to the contrary notwithstanding;
but until such transfer on such books, the Company may treat the registered
holder hereof as the owner for all purposes.
6. Restrictions on Transfer of Option.
The Optionee, by acceptance hereof, agrees that, absent an effective
notification under Regulation A or a registration statement, in either case
under the Securities Act of 1933, covering the disposition of the Option or
Common Stock issued or issuable upon exercise hereof, he or she will not sell,
transfer, pledge or hypothecate any or all of such Option or Common Stock, as
the case may be, unless such sale or transfer will be exempt from the
registration and prospectus delivery requirements of the Securities Act of 1933
and applicable state securities laws, and such Optionee consents to the Company
making a notification on its records or giving instructions to any transfer
agent of the Option or such Common Stock in order to implement such restriction
on transferability.
7. No Enlargement of Rights.
Neither the Plan nor the Option shall confer upon the Optionee any
right to continue as a director of the Company or limit in any respect the right
of the Company to remove the Optionee as a director of the Company at any time.
The Optionee shall have only such rights and interests as are expressly provided
in this Agreement and the Plan.
8. Withholding Tax Liability.
The Company reserves the right to withhold, in accordance with any
applicable laws, from any consideration payable to the Optionee any taxes
required to be withheld by federal, state or local law as a result of the grant
or exercise of this Option or the sale or other disposition of the Shares issued
upon exercise of this Option. If the amount of any consideration payable to the
Optionee is insufficient to pay such taxes or if no consideration is payable to
the Optionee, upon the request of the Company, the Optionee shall pay to the
Company an amount sufficient for the Company to satisfy any federal, state or
local tax withholding requirements it may incur as a result of the grant,
exercise or transfer of this Option or the sale or other disposition of the
Shares issued upon the exercise of this Option.
9. Effect of the Plan on Option.
The Option is subject to, and the Company and the Optionee agree to be
bound by, all of the terms and conditions of the Plan, as such may be amended
from time to time in accordance with the terms thereof, provided that no such
amendment shall deprive the Optionee, without his or her consent, of the Option
or any rights hereunder. Pursuant to the Plan, the Committee appointed by the
Board of Directors of the Company is authorized to adopt rules and regulations,
consistent with the Plan and as it shall deem appropriate and proper, with
regard to the Plan. A copy of the Plan in its present form is available for
inspection at the Company's principal office during the Company's business hours
by the Optionee or the persons entitled to exercise the Option.
10. Entire Agreement.
The terms of this Agreement and the Plan constitute the entire
agreement between the Company and the Optionee with respect to the subject
matter hereof and supersede any and all previous agreements between the Company
and the Optionee.
11. Severability.
If any provision of this Agreement, or the application of such
provision to any person or circumstances, is held invalid or unenforceable, the
remainder of this Agreement, or the application of such provision to persons or
circumstances other than those as to which it is held invalid or unenforceable,
shall not be affected thereby.
Date: _____________________ DAY RUNNER, INC.
By:
Title:
<PAGE>
The Optionee acknowledges receipt of a copy of the Plan, a copy of
which is attached hereto, and represents that he or she has read and is familiar
with the terms and provisions thereof, and hereby accepts the Option subject to
all of the terms and provisions thereof. The Optionee hereby agrees to accept as
binding, conclusive and final all decisions or interpretations of the Board of
Directors or the Committee with respect to any questions arising with respect to
the Option and the Plan.
------------------------
Date: ________________ Signature of Optionee
------------------------
Address
------------------------
City State Zip Code
Exhibit 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement
of Day Runner, Inc., on Form S-8 of our reports dated August 17, 1998 (September
25, 1998 as to Note 20) appearing in the Annual Report on Form 10-K of Day
Runner, Inc. for the year ended June 30, 1998.
Deloitte & Touche LLP
Los Angeles, California
December 16, 1998
